TaxTMI 
TaxTMI 
2024 (3) TMI 1137
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....to custody of the respondent. In this regard, the petitioner has invoked the jurisdiction of this Court under Article 226 of the Constitution of India read with section 482 of the Code of Criminal Procedure (Cr.P.C.). By way of interim relief, the petitioner has sought his release from the custody of the respondent. 2. It appears that on 11.02.2020, the State Bank of India, the Consortium Leader of the Banks from which M/s Bharat Paper Limited (hereinafter to be referred as the BPL), of which the petitioner was one of the directors, had obtained loan, filed a complaint before the Central Bureau of Investigation(CBI) against the BPL and its four directors including the petitioner herein. On the basis of this complaint, the Anti-Corruption Bureau (ACB) CBI, Jammu registered an FIR bearing No. RC0042020A0001 dated 12.02.2020 for offences under Sections 5(1)(d) read with 5(2) of the J&K Prevention of Corruption Act, 2006 and Sections 120-B, 409 and 420 of J&K RPC. 3. It was alleged in the FIR that the accused persons have perpetrated bank loan fraud for an amount running into approximately Rs. 200 crores with the Consortium of Banks with lead bank as State Bank of India, the othe....
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....enged summons issued to them by the respondent in exercise of their powers under Section 50 of the Prevention of Money Laundering Act, 2002. The said petition is stated to be pending before the High Court of Punjab and Haryana. 7. While all this was going on, the petitioner pursuant to the summons issued by the respondent, put in his appearance before the respondent on 06.02.2024 but he was arrested on the same day at about 9.40 PM. The petitioner was produced before the Special Judge (designated under PMLA), Jammu on 07.02.2024 and vide impugned Remand Order dated 07.02.2024 passed by the said court on the same date, he was remanded to custody by the said respondent. This has led the petitioner to filing of the present petition challenging the action of the respondent with regard to his arrest and subsequent remand to custody. 8. Heard the learned counsel for the parties on the question of grant of interim relief and perused the record of the case including the Case Diary produced by the learned Deputy Solicitor General of India appearing for the Enforcement Directorate (ED). 9. Learned Senior Counsel appearing for the petitioner has urged a number of grounds to challenge....
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....ds of arrest have been furnished to him. He has further contended the impugned order passed by the learned Special Judge, PMLA is also in accordance with law. 11. Before coming to the merits of the case, it would be apt to deal with the preliminary objection raised by the learned DSGI about the maintainability of the present writ petition. 12. It is an admitted fact that the petitioner has invoked the jurisdiction of the High Court of Punjab and Haryana for challenging the proceedings initiated against him under PMLA and he has also challenged the summons issued by the respondent against him. In the instant case, the petitioner has challenged the action of the respondent leading to his arrest as also the order of learned Special Judge designated PMLA, Jammu, whereby he has been remanded to custody of the respondent. Both these events viz., arrest of petitioner and his remand to custody of the respondent have taken place within the territorial jurisdiction of this Court, therefore, the petitioner has rightly approached this Court by invoking the jurisdiction of this Court under Section 226 of the Constitution read with Section 482 of the Cr.P.C. for challenging the aforesaid a....
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....caused to the reputation or the goodwill of the parties, the same cannot be compensated. Whereas if the Department waits for the final outcome of the proceedings, no prejudice would be caused to them. In all these cases, the admitted case of the respondent Department is that the ECIR has been initiated based on the three First Information Reports in Crime Nos. 441 of 2015, 298 of 2017, 344 of 2018, which culminated in the proceedings in C.C. No. 24 of 2021, C.C. No. 19 of 2020 and C.C. No. 25 of 2021 respectively and the proceedings in C.C. No. 25 of 2021 culminating from Crime No. 344 of 2018 have been quashed. The calendar cases arising out of the other two First Information Reports have been stayed. As stated supra, since the ECIR itself was only on the basis of the said three First Information Reports, when the proceedings pursuant to the said First Information Reports have been stayed by the High Court, whether the ECIR, which is also pursuant to the First Information Reports, can be proceeded with, is a question that stares at open. Our considered answer is in the negative. 18. Because, it is not the case of the respondent that apart from the above three Fir....
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.... the above facts in Arun Kumar and others v. Union of India and others, (2007) 1 SCC 732, has held as follows:- "74. A "jurisdictional fact" is a fact which must exist before a court, tribunal or an authority assumes jurisdiction over a particular matter. A jurisdictional fact is one on existence or non-existence of which depends jurisdiction of a court, a tribunal or an authority. It is the fact upon which an administrative agency's power to act depends. If the jurisdictional fact does not exist, the court, authority or officer cannot act. If a court or authority wrongly assumes the existence of such fact, the order can be questioned by a writ of certiorari. The underlying principle is that by erroneously assuming existence of such jurisdictional fact, no authority can confer upon itself jurisdiction which it otherwise does not possess. 75. In Halsbury's Laws of England, it has been stated: "Where the jurisdiction of a tribunal is dependent on the existence of a particular state of affairs, that state of affairs may be described as preliminary to, or collateral to the merits of, the issue. If, at the inception of an inquiry by an inferior tribuna....
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.... Court in State of Haryana and others v. Bhajan Lal and others, 1992 Supp (1) SCC 335, in paragraph-5 stated thus: "Everyone whether individually or collectively is unquestionably under the supremacy of law. Whoever he may be, however high he is, he is under the law. No matter how powerful he is and how rich he may be." 30. Therefore, the Apex Court has given the guidelines to be followed by the Courts while exercising the extraordinary power under Article 226 or the inherent powers under Section 482 of the Code that where the allegations made in the first information report or the complaint, even if they are taken at their face value and accepted in their entirety do not constitute any offence or make out a case against the accused, based on which, when the orders of stay are granted, the parties to the proceedings bound by the rule of law, should abide by the orders of stay. In this background, when the learned Additional Solicitor General appearing for the respondent fairly conceded that in view of the order of quash passed in Criminal Original Petition No. 13374 of 2021 dated 30.07.2021, the respondent Department would not proceed against the accused therein, ....
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....SLP (Crl) Diary No. 9957 of 2022 (SLP (Crl) No. 3841 of 2022)." 15. The aforesaid ratio laid down by the High Court of Madras has been relied upon by a Single Judge of High Court of Karnataka in the case of Mantri Developers Pvt. Ltd. and others vs Directorate of Enforcement and another, (Writ petition No. 20713/2022 decided on 14.12.2022). In the said case, a crime case relating to offences punishable under Sections 406, 415, 417, 420 read with Section 34 of IPC was challenged before the High Court in a writ petition and the investigation was stayed by the High Court. Thereafter, Enforcement Directorate registered an Enforcement Case Information Report (ECIR) pursuant whereto a show cause notice was issued to the petitioner therein calling upon him to appear before the Investigating Officer. The petitioner therein challenged the proceedings relating to ECIR as also the provisional attachment order by way of a writ petition before the High Court of Karnataka. The learned Single Judge of the High Court of Karnataka took note of the conclusions arrived at by the Supreme Court in the case of Vijay Mandanlal Choudhary and others v. Union of India, 2022 SCC Online SC 929, as containe....
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....lesh, the offences under the PMLA is the blood. Therefore, if the predicate offence is not permitted to move forward, the impugned proceedings cannot. It would have been altogether different circumstance, if the petitioners were all acquitted of the offences under the IPC or any other predicate offence to which the offence under the PMLA is linked. The situation in the case at hand is not with regard to acquittal, however, the proceedings are stayed. Therefore, they are eclipsed and not extinguished. The Apex Court does not deal with a circumstance as to what should happen in a case, where it is eclipsed. The Apex Court only dealt with a situation where there is extinguishment of predicate offences. Therefore, it is necessary to consider taking cue from the findings of the Apex Court as to whether attachment order should be permitted to be confirmed or otherwise. 15. It cannot be disputed, that at a later point in time if the petitioners are acquitted, no proceeding under ECIR can continue. In the event they are convicted, it is always open to the Enforcement Directorate to pass any order of attachment or conviction as the case would be. If that be the right of the Enforce....
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....udge Bench judgment of the Supreme Court in Vijay Mandanlal Choudhary's case(supra), wherein, as already stated, it has been clearly laid down that if a person is finally discharged/acquitted of the scheduled offence or the proceedings against him are quashed, there can be no offence of money laundering against him. The effect of this conclusion of the Supreme Court was obviously not under discussion and debate before either the High Court of Madras or before the High Court of Telangana in the aforesaid two cases as these cases were decided prior to the judgment(supra) of the Supreme Court. On the other hand, the aforesaid ratio laid down by the Supreme Court in Vijay Mandanlal Choudhary's case(supra) has been taken note of by the Division Bench of the High Court of Madras in the case of B. Shanmugam's case (supra) and by the Karnataka High Court in Mantri Developers Pvt. Ltd.'s case (supra). 20. For the reason that in the judgments relied upon by the learned DSGI, the position of law enunciated by the Supreme Court in Vijay Mandanlal Choudhary's case(supra) was not available before the High Courts of Madras and Telangan, this Court is prima facie, of the opinion that the view t....