Money laundering prosecution can proceed without predicate-offence ; mens rea and selective-prosecution pleas are matters for trial.

A person need not be an accused in the predicate offence to face prosecution under the Prevention of Money Laundering Act, 2002 if the scheduled offence exists and the person is alleged to have assisted in concealment, possession, acquisition or use of proceeds of crime. At the pre-charge quashing stage, the Court treated the challenge as premature and declined to test disputed material as if in trial. Allegations of absence of knowledge or mens rea, and claims of discriminatory or pick-and-choose prosecution, were held to raise evidentiary questions for the Special Court, especially in light of the statutory presumption under Section 24 once foundational facts are shown.

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Issues: (i) Whether the ECIR and supplementary complaint could be quashed at the pre-charge stage on the ground that the petitioner was not an accused in the predicate offence and was shown as a witness there; (ii) Whether the alleged absence of knowledge or mens rea regarding the proceeds of crime, and the contention of discriminatory or pick-and-choose prosecution, justified quashing.

Issue (i): Whether the ECIR and supplementary complaint could be quashed at the pre-charge stage on the ground that the petitioner was not an accused in the predicate offence and was shown as a witness there.

Analysis: The offences under the Prevention of Money Laundering Act, 2002 and the predicate offence were treated as independent. A person need not be an accused in the scheduled offence to face prosecution under Section 3 of the Prevention of Money Laundering Act, 2002 if the scheduled offence exists and the person is alleged to have assisted in the concealment, possession, acquisition or use of proceeds of crime. The Court also treated the challenge as premature because charges had not yet been framed and the material could not be tested in quashing jurisdiction as if it were a trial.

Conclusion: The contention was rejected and the petitioner could not secure quashing on this ground.

Issue (ii): Whether the alleged absence of knowledge or mens rea regarding the proceeds of crime, and the contention of discriminatory or pick-and-choose prosecution, justified quashing.

Analysis: Knowledge, concealment, continuing activity, and the effect of the petitioner's statements and disclosures were held to be matters for trial, particularly in view of the statutory presumption under Section 24 of the Prevention of Money Laundering Act, 2002 once the foundational facts are shown. The Court held that it could not conclusively accept the defence version at the quashing stage, nor determine disputed questions about whether the petitioner was truly misled or whether the prosecution had selectively proceeded against her, because those matters required evidentiary assessment.

Conclusion: The plea based on absence of knowledge, mens rea, or selective prosecution was rejected.

Final Conclusion: The proceedings were allowed to continue and the quashing petition failed in limine, leaving all merits to be examined by the Special Court at the appropriate stage.

Ratio Decidendi: In a prosecution under the Prevention of Money Laundering Act, 2002, a person need not be an accused in the predicate offence, and questions of knowledge, mens rea, concealment, possession, and rebuttal of the statutory presumption are ordinarily matters for trial rather than for quashing at the pre-charge stage.

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