TaxTMI 
TaxTMI 
2021 (1) TMI 569
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....application filed by the respondents (hereinafter referred to as "accused Nos.2 and 3") under section 227 of the Code of Criminal Procedure, discharging accused Nos.2 and 3 from the alleged offence under section 3, punishable under section 4 of the Prevention of Money-Laundering Act, 2002 (hereinafter referred to as "PML Act"). 2. The brief facts of the case are as follows: The Karnataka Lokayukta Police, registered a case against accused No.1 (now deceased) in Crime No.20/2009 on 22.09.2009 under section 13(1)(e) read with section 13(2) of the Prevention of Corruption Act, 1988 (hereinafter referred to as "PC Act"), on the allegation that during his tenure as Deputy Revenue Officer in Kalaburagi City Corporation, between 02.01.1976 a....
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....e coming into force of PML Act. Considering the submissions of the accused and placing reliance on the decisions of the Delhi High Court in RAJIV CHANANA vs. DEPUTY DIRECTOR, DIRECTORATE OF ENFORCEMENT (Manu/DE/2403/2014) and the judgment of High Court of Jharkhand at Ranchi in ANOSH EKKA vs. ENFORCEMENT DIRECTORATE (W.P.(Cr.) No.257/2012 dd.19.2.2013) and MAHANIVESH OILS & FOODS PVT. LTD. vs. DIRECTORATE OF ENFORCEMENT (W.P.(C) No.1925/2014 & CM.No.4017/2014 dd.25.01.2016) rendered by the High Court of Delhi, learned Trial Judge was of the view that the occurrence of a scheduled offence is a substratal condition for giving rise to 'proceeds of crime' and commission of 'scheduled offence' is a pre-condition for proceeding un....
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....condition for any proceedings. Thus he argued that the learned Trial Judge having discharged the accused solely based on the dictum laid down in the above decisions, the impugned order is liable to be set-aside. 5. Sri.Chidananda Urs, learned counsel for the respondents however argued in defence of the impugned order reiterating that in view of the acquittal of accused No.1 there was no cause of action for the petitioner to invoke the provisions of PML Act as the existence of predicate offence is a sine qua non to sustain the charge under section 3 of the PML Act. Considered the submissions and perused the records. 6. Insofar as the averments made in the complaint lodged by the Directorate of Enforcement is concerned, it is seen th....
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.... offender under section 3 of the PML Act is not a party to the predicate offence, still the prosecution could be launched against the offender, if he is found involved in any process or activity connected with the 'proceeds of crime'. Considering the purport of section 3 of the PML Act and the intendment of the Legislature in enacting the said provision in the light of the dictum laid down by this Court as well as various other High Courts, in Criminal Petition No.5698/2019 and other connected matters, decided on 14.12.2020, this Court has held that that even without the existence of predicate offence and without there being any conviction of the offenders for the predicate offence, their prosecution for the offence of money-launder....
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....or discharge. For doing so, the Sessions Judge can only 'hear' the submission of the prosecution and the accused. But under Section 239, the requirement is different. It envisages 'If upon consideration the police report and the documents sent with it under section 173 and making such examination, if any, of the accused as the Magistrate thinks necessary and after giving the prosecution and the accused an opportunity of being heard, the Magistrate considers the charge against the accused to be groundless, he shall discharge the accused, and record his reasons for so doing.' 22. Therefore, examination of the accused is permissible under Section 239, undoubtedly, for ascertainment about the truth or otherwise....