TaxTMI 
TaxTMI 
TaxTMI 
2015 (10) TMI 2679
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..... 1 is promoter and Group Chief Executive of Zoom Group of Companies, petitioner No. 2. Petitioner No. 2 had availed non-fund based bank guarantee facilities from Punjab National Bank and other banks and when number of lending banks increased, a consortium was formed under the leadership of Punjab National Bank as PNB consortium and credit limits were sanctioned to respondent No. 2. Due to the global economic meltdown of 2008, the bank guarantees were invoked by the bankers which brought the business activities of petitioner at a halt in November, 2009. When the CDR process was going on at that stage complaints were filed by PNB and other banks, as a result of which five cases were registered under section 120-B read with section 420 of Indian Penal Code against the petitioners being (1) RC BD1/2011/E/0005 at the instance of PNB; (2) RC BD1/2011/E/0009 by Syndicate Bank Mumbai; (3) RC BD1/2011/E/0010 at the instance of Canara Bank Mumbai; (4) RC BD1/2012/E/0007 at the instance of United Bank of India Mumbai and (5) RC BD1/2013/E/0001 by Union Bank of India Mumbai. In these cases, the investigation has been done by CBI and the charge sheets have been filed before the competent Court....
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....ng the additional ground that the Special Court of Additional Sessions Judge is not the designated Court under sections 43 and 44 of the PMLA and that the proceedings before the said Special Court are not competent. 7. Learned counsel for petitioner submits that in the Bill as well as the Act which was originally enacted on 17-1-2003 under section 45 the offences were cognizable offences but subsequently on 21-5-2005 section 45 was amended and the offences were made non-cognizable. He further submits that in respect of non cognizable offences under section 2(1), Criminal Procedure Code the police officer has no authority to arrest a person without warrant and under section 155 of Criminal Procedure Code the procedure has been prescribed for information as to non-cognizable cases and investigation of such cases and without following the said procedure the respondents cannot be allowed to proceed with the investigation. He further submits that even assuming the offence in question is a cognizable offence then also in terms of section 154 of Criminal Procedure Code the FIR is required to be registered and under section 157 the report is required to be sent to the Magistrate and under....
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....s learned counsel for the respondent opposing the writ petition has submitted that the Sessions Court is the designated Court, hence the Additional Sessions Judge is competent to consider the matter. 11. I have heard the learned counsel for the parties and perused the record. 12. The first issue is if the offence under PMLA is cognizable offence or it is non-cognizable offence? In terms of section 2(1) of the Criminal Procedure Code, non-cognizable offence is one in which a police officer has no authority to arrest without warrant, whereas in terms of section 2(c) of the Criminal Procedure Code cognizable offence is one in which a police officer may, in accordance with the First Schedule or under any other law for the time being in force, arrest without warrant. In terms of section 4 of PMLA offence of money laundering is punishable with rigorous imprisonment for a term not less than 3 years extending to 7 years and with fine. The Second Schedule to the Criminal Procedure Code relates to classification of offences under other laws and in terms of the Second Schedule of the Criminal Procedure Code an offence which is punishable with imprisonment for 3 years and upward but not more....
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....erwise the said judgment only has persuasive value and considering the provisions of section 4 of PMLA read with Part-II of First Schedule to Criminal Procedure Code, I am of the opinion that the offence under PMLA is cognizable. 15. Having held so the next question arises whether the procedure prescribed in Criminal Procedure Code for investigation of cognizable offence i.e. section 154 of the Criminal Procedure Code relating to registering the FIR, sections 157 and 167 relating to investigation, section 172 of the Criminal Procedure Code relating to maintaining the case diary is required to be followed while investigating the offence under the PMLA? 16. Section 71 of PMLA gives overriding effect to the Act and provides as under:-- "71. Act to have overriding effect.--The provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force." 17. Section 65 of the PMLA relates to applicability of the Criminal Procedure Code and provides as under:-- "65. Code of Criminal Procedure, 1973 to apply.--The provisions of the Code of Criminal Procedure, 1973 (2 of 1974) shall apply, insofar as they are not inco....
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.... the investigation of the offence is the field exclusively reserved for the police officers, but the said observation has been made in respect of offence registered under the Indian Penal Code whereas in the present case the offence is registered under PMLA. Under the provisions of PMLA, the investigating officers are not the police officers but since for investigation of offence Provisions of Criminal Procedure Code are held to be applicable, therefore, they are required to follow the same. Keeping in view the provisions of section 65 of PMLA and also the fact that there is no procedure prescribed in PMLA for investigation of the offence, I am of the opinion that the procedure which has been prescribed under the Criminal Procedure Code is required to be followed while investigating the offence under PMLA. 21. So far as the present case is concerned, in the case of Vijay Madanlal Choudhary in W.P. Nos. 4336/15, 4341/15, 4344/15, 4347/15, 4350/15, 5089/15 and 5091/15, the matter is at the investigation stage, therefore, the investigating authorities are directed to carry out the investigation in accordance with the provisions contained in the Criminal Procedure Code. 22. So far as....
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....rial in his possession reason to believe (the reason for such belief to be recorded in writing) that any person has been guilty of an offence punishable under this Act, he may arrest such person and shall, as soon as may be, inform him of the grounds for such arrest. (2) The Director, Deputy Director, Assistant Director or any other officer shall, immediately after arrest of such person under sub-section (1), forward a copy of the order, along with the material in his possession, referred to in that sub-section, to the Adjudicating Authority, in a sealed envelope, in the matter, as may be prescribed and such Adjudicating Authority shall keep such order and material for such period, as may be prescribed. (3) Every person arrested under sub-section (1) shall within twenty-four hours, be taken to a Judicial Magistrate or a Metropolitan Magistrate, as the case may be, having jurisdiction: Provided that the period of twenty-four hours shall exclude the time necessary for the journey from the place of arrest to the Magistrate's Court." 26. Under sub-section (1) of section 19 the specified officers on the basis of the material in possession, having reason to believe which is to ....