Continuing offence doctrine under PMLA sustains proceedings for post-notification laundering of proceeds of crime.

Money-laundering under the PMLA is a continuing offence, and liability turns on the handling, concealment, use, or projection of proceeds of crime after the relevant offence is notified or the amendment comes into force. The existence of a scheduled offence remains necessary as the foundation of the case, but Section 3 is distinct and can apply where post-notification laundering activity is alleged. The discharge order was based on an incorrect reading of the statutory scheme and Article 20(1), so the accused were not entitled to discharge and the PMLA proceedings were allowed to continue.

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Issues: Whether the accused could be discharged in the PMLA proceeding on the ground that the alleged predicate offence under Section 467 of the Indian Penal Code was not a scheduled offence when the criminal activity was committed, and whether the PMLA could apply only prospectively.

Analysis: The complaint before the Enforcement Directorate alleged fabrication of documents, opening of bank accounts, diversion of funds, and later projection of the tainted property as untainted. The governing principle applied was that the existence of a scheduled offence is necessary for the foundation of a money-laundering case, but the offence under Section 3 of the PMLA is distinct and is attracted by any process or activity connected with proceeds of crime. The Court relied on the continuing-offence character of money laundering and held that the relevant consideration is the continued possession, use, concealment, or projection of proceeds of crime after the scheduled offence has been notified or after the relevant statutory amendment came into force. The Court further held that the discharge order proceeded on an incorrect understanding of the statutory scheme and of Article 20(1) of the Constitution of India.

Conclusion: The discharge was not sustainable and the accused were not entitled to be discharged on the stated ground.

Final Conclusion: The revisional challenge succeeded, the discharge order was set aside, and the PMLA proceedings were directed to continue in accordance with law.

Ratio Decidendi: Money-laundering is a continuing offence based on the handling of proceeds of crime, and PMLA proceedings are maintainable where post-notification laundering activity is alleged even if the predicate offence predated the scheduled-offence amendment.

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