PMLA discharge and charge standards: prima facie material on proceeds of crime can sustain prosecution without a complete money trail.

In a PMLA prosecution, revisional interference with orders refusing discharge and framing charge is confined to patent illegality or jurisdictional error, and the court does not conduct a mini trial at that stage. The material relied on by the prosecution, including search recoveries, diaries, notes and Section 50 statements, was treated as sufficient to disclose a prima facie case of concealment and handling of proceeds of crime. The court also stated that money-laundering is an independent and continuing offence, so a complete money trail, naming in the predicate offence, or prior sanction under Section 197 CrPC did not justify discharge on the facts presented.

---

---

Issues: (i) Whether the orders rejecting discharge and framing charge in a money-laundering prosecution suffered from legal error warranting interference in revision. (ii) Whether the material collected in investigation disclosed a prima facie case against the accused for offences under the Prevention of Money Laundering Act, 2002. (iii) Whether the objections based on absence of money trail, non-naming in the predicate offence, and want of prior sanction justified discharge.

Issue (i): Whether the orders rejecting discharge and framing charge in a money-laundering prosecution suffered from legal error warranting interference in revision.

Analysis: The revisional court reiterated that interference with an order refusing discharge or framing charge is confined to cases of patent illegality or jurisdictional error. At the stage of discharge, the court is only required to see whether sufficient ground exists for proceeding and is not expected to conduct a mini trial or weigh the evidence as if deciding guilt. Revisional scrutiny is therefore narrow, and the trial court's satisfaction based on the prosecution material is not to be disturbed unless it is perverse or unsupported by record.

Conclusion: No legal error warranting revisional interference was found in the impugned orders.

Issue (ii): Whether the material collected in investigation disclosed a prima facie case against the accused for offences under the Prevention of Money Laundering Act, 2002.

Analysis: The court held that the prosecution material, including search recoveries, diaries and notes, statements recorded under Section 50 of the Act, and the disclosed commission-sharing modus operandi, showed an organised collection and concealment of proceeds of crime. It held that Section 3 of the Act is an independent and continuing offence and that involvement in concealment, possession, acquisition or use of proceeds of crime is sufficient. The court also held that the prosecution need not establish the entire downstream money trail once foundational material shows generation and handling of proceeds of crime.

Conclusion: A prima facie case for proceeding against the accused was made out.

Issue (iii): Whether the objections based on absence of money trail, non-naming in the predicate offence, and want of prior sanction justified discharge.

Analysis: The court rejected the contention that absence of a complete money trail or absence of the accused's name in the original predicate FIR defeated the prosecution, holding that PMLA liability is not confined to persons named in the scheduled offence and may extend to those knowingly involved in laundering proceeds of crime. It further held that the alleged acts of collecting and concealing commission could not be treated as acts done in discharge of official duty, so the plea of sanction under Section 197 CrPC did not assist the accused at this stage. The court also treated the Section 50 statements as admissible material for the limited purpose of discharge and charge.

Conclusion: The objections did not entitle the accused to discharge.

Final Conclusion: The impugned discharge and charge orders were sustained, and the revision petitions failed, leaving the prosecution to proceed to trial on the money-laundering allegations.

Ratio Decidendi: At the stage of discharge or framing of charge in a PMLA case, the court must proceed on the prosecution material as true, and if that material discloses a prima facie nexus with proceeds of crime and involvement in concealment, possession, acquisition or use, discharge is unwarranted even without proof of the entire money trail or inclusion of the accused in the predicate offence FIR.

---