TaxTMI 
TaxTMI 
2023 (8) TMI 1240
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.... Ltd., Trichy and its Directors had committed the offences by inducing M/s.Indian Bank and other member banks to grant various credit facilities, by suppression of facts and subsequently misappropriated the funds, thereby causing loss to the extent of Rs. 1,344.96 Crores to the consortium banks. It is alleged that there was huge fund diversion from the Company, which is managed by the Directors, to its subsidiaries and related entities and made investments. Since the offences under Section 120-B, 420 and 471 IPC are scheduled offences, under paragraph 1 Part A of the Prevention of Money Laundering Act, 2002, (PMLA) an ECIR bearing No.ECIR/04/CEZO-II-2019, dated 07.08.2009 was registered by the Enforcement Directorate, Chennai against the company and its Directors, including the petitioners herein, for commission of an offence under Section 3 of PMLA. Statements of the petitioners and others were recorded under Section 50 of PMLA and after investigation, the Directorate of Enforcement / first respondent had filed the Enforcement Case Information Report (ECIR). The complaint filed under Sections 44 and 45 of the PMLA for the alleged offence under Section 3 of the PMLA was taken on fi....
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.... crime and having projected it as untainted property is a guilty of the offence of money laundering. 5. Section 50 of PMLA, confers power on the authorities under the Act to summon any person for production of documents and to give evidence in connection with the complaint. Accordingly, the statement sof all these petitioners herein were recorded. 6. As per the statement of the first petitioner /4th accused, she was the Director of the company and drawing a salary of Rs. 1 lakh from the year 2014-15 onwards. She had also stated that from 2006 to 2012, she had worked in M/s.Cethar Vessels and after that she worked in M/s.Pipelines Ltd., upto 2013-14. According to her, the funds for incorporation of M/s.Cethar Healthcare was provided by the second and third accused. 7. The second petitioner / 5th accused had stated that she had given an unsecured loan of Rs. 25 lakhs to M/s.Cethar Healthcare Services Private Limited between 2006-2013. 8. The third petitioner/6th accused has stated that she is a shareholder of M/s.Cethar Healthcare Services. 9. According to the fourth petitioner /7th accused, the jewels seized by the first respondent belonged to her. 10. The fifth petitioner / 8....
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....were not proceeds of crime, the complaint itself is liable to be quashed. The facts involved in Sivaramakrishnan's case (supra) is distinguishable from the petitioners' case. In the case before the coordinate bench, the Enforcement Director, in their complaint, had not mentioned that the accused had acquired any proceeds of crime and the cause of action for the offence of money laundering arose before loans were sanctioned therein and not after that. This apart, in the predicate offence registered by the CBI, investigation was completed and charge sheet was already filed, as per which the said Sivaramakrishnan was not found to have benefited financially from the criminal activities. Thus, having found so, the coordinate bench disagreed with the Enforcement Director that the salary of the accused therein would not amount to proceeds of crime and the consequent properties purchased will not stand tainted. It is in this background, the coordinate Bench had proceeded to quash the complaint. 16. However, in the instant case, the statements made by the petitioners under Section 50 of PMLA indicate the possible commission of offence under Section 3 of PMLA. The charge sheet has a....
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....nd make out a case against the accused. (4) Where, the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as contemplated under Section 155(2) of the Code. (5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the accused. (6) Where there is an express legal bar engrafted in any of the provisions of the Code or the concerned Act (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and/or where there is a specific provision in the Code or the concerned Act, providing efficacious redress for the grievance of the aggrieved party. (7) Where a criminal proceeding is manifestly attended with mala fide and/or where the proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on the accused and with a view to spite him due to private and personal grudge." 18. In a recent decision of the Hon'ble Su....