TaxTMI 
TaxTMI 
2019 (11) TMI 1499
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....) of the Prevention of Money Laundering Act, 2002 (hereinafter referred to as 'Money Laundering Act'). 4. It was claimed that the offence involved in the present case was a scheduled offence under the Money Laundering Act, and that the Directorate of Enforcement had registered crime ECIR/l/KCZO/15 for offences punishable under Sections 3 and 4 of the Money Laundering Act. After completion of investigation, complaint was laid before the designated Court under the Money Laundering Act, which is the Principal Sessions Court, Ernakulam. Cognizance was taken. The matter is now pending as S.C. No. 329 of 2017. 5. It was stated in the above application that, as per the scheme of the Money Laundering Act, the Special Court has to try the scheduled offences and connected matters under the Money Laundering Act. Hence, it was requested that, C.C. No. 3 of 2014 pending before the CBI Court may be committed under Section 44(1)(c) of the Act to the designated Court under the Money Laundering Act. Detailed objection and additional objection were filed by the CBI. After hearing both sides, court below, by the impugned order allowed the application, which is under challenge in the proce....
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....court under Section 43 of the Money Laundering Act, is not competent to try the offences under the PC Act, as the trial of a case involving an offence under the PC Act can be conducted only by a Special Judge appointed under Section 3 of the PC Act. Learned Counsel contended that the present case cannot be clubbed with the complaint under the Money Laundering Act. The trial of the scheduled offence under the PC Act has to be completed before the Special Judge and that under the Money Laundering Act before the principal sessions court, simultaneously. It was contended by the Learned Counsel that, Section 44(1)(c) of the Money Laundering Act does not oblige the authority under the Money Laundering Act, to seek for committal of the scheduled offence pending before the other court, if that was likely to embarrass the trial of either of the proceedings or if the Special court constituted under the Money Laundering Act was incompetent to try the offences pending before the other Court. It was contended by the Learned Prosecutor that, incongruous situations may arise wherein, committal of scheduled offence investigated by the CBI or other agencies are sought to be committed for the trial ....
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....sp; a Special Court while trying the scheduled offence or the offence of money laundering shall hold trial in accordance with the provisions of the Code of Criminal Procedure, 1973 (2 of 1974), as it applies to a trial before a Court of Session. 9. An argument advanced by the Special Prosecutor for the CBI was that, both courts involved being sessions courts, no committal proceeding from one sessions court to another was not legally possible. That was negatived by the court below itself, by the impugned order in the light of Section 44(1) which gives an overriding effect over other provisions of Cr.P.C. Further, Section 44(1)(c) specifically provides for an order of committal by one Court to another. Yet another contention of the CBI was that, to attract Section 44(1)(c) of the Money Laundering Act, special court under the PC Act, has to take cognizance of the complaint of the offence under the Money Laundering Act and since the court below has not taken cognizance of complaint of the offence of Money Laundering, the question of committal under Section 44(1)(c) does not arise. This was also rejected by the court below holding that, since the court below has ....
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....nishable. The offences under the Money Laundering Act, are to be investigated by the competent authorities under the concerned statute and tried by the Court competent under that Act. Since the sine quo non for a prosecution of an offence under the Money Laundering Act is the existence of proceeds of a predicate offence, it can be said that, conviction of an offence under the Money Laundering Act depends on the establishment of predicate offence and the generation of proceeds of that crime. 13. Evidently, Money Laundering Act does not contemplate that offence under the Money Laundering Act and the predicate offence shall both be tried by the same Special Court under the Money Laundering Act. There is no specific provision in the Money Laundering Act, which prescribes so. In fact, existence of Section 44(1)(c) visualizes the existence of two separate proceedings before two courts, one being the Special Court under the Money Laundering Act. In such a situation, Section 44(1)(c) confers an authority on the authorized officer under the Money Laundering Act to make an application requesting the Court to commit the case relating to predicate offence to the Special Court. It clearly....
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....s Act shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force." Section 71 itself clarifies that the provisions of the Act shall have effect notwithstanding anything inconsistent therewith contained in any other law. Evidently, the Money Laundering Act has primacy in the field of operation to which the Act extends and within that domain, it will have overriding effect over any other inconsistent provisions in other Statutes. This is the natural and the limited extent of the scope of Section 71 and not an omnibus overriding effect over all other Statutes, as argued by the respondent. This has been consistently laid down by various authorities. The Company Law Appellate Tribunal, in Anil Goel v. Ramanjit, Deputy Director in CP(IB) 70/ALD/2017, resolving the dispute as to whether Money Laundering Act has supremacy over Insolvency and Bankruptcy Code held that both statutes provide two different hierarchies of functionaries to decide the controversies that arise under respective authorities. When such is the case, one authority cannot interfere with the function of the other authority under a different enactment. In Varr....
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....ney Laundering Act can never precede the trial of scheduled offences as the prosecution needs to establish that, one having committed scheduled offences has acquired property through proceeds of crime and unless that is established, any trial which proceeds under the Money Laundering Act would be pre-mature and that, if it proceeds, the Court will have to assume that the accused is guilty for the scheduled offences, which would be against the spirit of the Act, and therefore, that option never lies with the Court. 21. The other option available to the special court was to proceed with the trial under the scheduled offences as well as under the Money Laundering Act simoltaneously. As mentioned earlier, the scheme of the Money Laundering Act beyond doubt indicates that, it does not contemplate a trial of predicate offences and the offence under the Money Laundering Act by the special court simultaneously, in every case. Though under Section 43(2) of Money Laundering Act, it is clarified that, while trying an offence under the Act, special court shall also try an offence, other than an offence under sub-section (1), with which the accused may be charged under the Cr.P.C., the Pa....
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....ramanian v. CBI (Crl. O.P. No. 6703 of 2019). In that case, crime was registered against the officials of bank and a company for offences punishable under Section 120B r/w 420 of IPC and Section 13(2) r/w 13(l)(d) of the Prevention of Corruption Act. After investigation, final report was laid and cognizance was taken by the Additional Metropolitan Magistrate as C.C. No. 9635 of 2014. In the meanwhile, complaint was laid by Enforcement Directorate under Section 43(1) of the Money Laundering Act, against the accused as C.C. No. 4 of 2018, before the special court. One of the accused approached the Madras High Court under Section 482 of Cr.P.C with a prayer to adjourn the proceedings in C.C. No. 9655 of 2014 of ACJM, till it was transferred to the Special Court constituted under Money Laundering Act. 25. The contention of the petitioner therein was that, proceedings in C.C. No. 9635 of 2014 related to a predicate offence of C.C. No. 4 of 2019, pending before the special court under Money Laundering Act. It was contended that, in the light of Section 44(1)(a) of the Act, the offence under Section 4 of the Act, and any scheduled offence connected to the said offence shall be triab....
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.... gives an overriding effect over all other law in force, may at first blush, give an impression that, there is substance in the contention that the offences under Money Laundering Act and their scheduled offences shall be tried by the special court constituted under the said Act. As indicated earlier, Section 71 of the Act does not create an absolute overriding effect of Money Laundering Act over all other statutes. It applies only in a limited sense that the Act will override to the extent of inconsistency of other statutes over Money Laundering Act. The interpretation given to Section 44(1)(a) that, by virtue of it, all the predicate offences and the offences under Money Laundering Act shall be tried by the special court constituted under the Money Laundering Act does neither stand to reason, nor does it get its support from the scheme of that Act. If such an interpretation is given, Section 44(1)(c) which enables the authorized officer under Act to seek a committal of predicate offence pending in another court to the special court under the said Act, will be rendered meaningless and redundant. 28. Section 44(1)(a) of Money Laundering Act has to be read in conjunction with ....
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....be exercised by the special court under the Money Laundering Act. If such a case is committed to a special court under the PMLA, invoking Section 44(1)(c), the special court will be without jurisdiction to try that case. Necessarily the trial has to fail. Consequently, the prosecution under Money Laundering Act should also fail. Statute cannot be interpreted to lead to such incongruous situation. As referred in Anosh Ekka's case, in such situation, the interpretative tool of "reductioad absurdness" which means that, whichever procedure under the scheme of Act would appear as absurd is to be discarded and only that procedure which would fulfill the aim and object of the Act is to be adopted. Section 44(1)(c) cannot be interpreted to authorize the Court to commit a case relating to scheduled offence to an incompetent court and thereby defeat the purpose of Act. Section 44(1)(c) also cannot be interpreted to authorize a court to commit a case pending before it to a court which lacks jurisdiction and to confer jurisdiction on a Court which inherently lacks it. 30. Hence, Section 44(1)(c) should receive a reasonable interpretation which will augment the purpose of Act. Necessarily....