TaxTMI 
TaxTMI 
2023 (9) TMI 1462
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....Section 3 of the Prevention of Money-Laundering Act, 2002 (for short 'PML Act'), not being a stand-alone offence, would automatically fall to the ground. Therefore, pending adjudication of the petitioner's prayer for discharge from the scheduled offence by the Supreme Court, continuance of investigation against him for the offence under the PML Act would be an abuse of the process of the Court. 3. A preliminary objection was raised by learned counsel for the Enforcement Directorate regarding maintainability of the application under Section 482 of Cr.P.C. mainly on the ground that an ECIR not being akin to an FIR within the meaning of Section 154 of Cr.P.C., cannot be deemed to have given rise to a criminal action against the petitioner so as to give him a cause of action to invoke the inherent power of this Court under Section 482 of Cr.P.C.. Since the question of maintainability goes to the root of the matter, this Court deems it proper to deal with it at the outset more so, as the main relief claimed by the petitioner can be considered only if the present proceeding is held to be maintainable in the eye of law. 4. Heard Mr. Nikhil Nayyar, learned Senior Counsel with Mr. ....
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....icating authority for retention of movable properties in the form of Currency Digital Devices Records and documents seized during the search operations. The petitioner sought clarification from the Director of Mines Odisha on 21.06.2022 regarding operation of Kalaparbat Iron Ore mines, in response to which the Director of Mines, clarified that the lease was operated by the mines under the different provisions of the MC Rules, 1960. The adjudicating authority however, in its order dated 01.11.2022 observed that the materials shown in the O.A. are sufficient to arrive at the conclusion that retention of records, cash and documents under seizure memo dated 11.05.2022 is required for the purpose of adjudication under Section 8 of the PML Act. Challenging such order of the adjudicating authority, the petitioner has preferred an appeal before the PML Appellate Authority, Delhi being Appeal No. 5255/2022, which is pending adjudication. RIVAL CONTENTIONS ON MAINTAINABILITY 6. Mr. Gopal Agarwal, learned counsel for the E.D. would contend that implication in a schedule offence is sufficient for E.D. to cause investigation under the provisions of PML Act which is a separate and independ....
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....in the case of Emta Coal Ltd. and others. Vs. The Deputy Director, Directorate of Enforcement and others (W.P.(C) No. 3821 of 2022) has also been relied upon. As regards maintainability of the application under Section 482 of Cr.P.C., Mr. Nayyar has relied upon the judgment of the Telengana High Court in the case of Sukesh Gupta vs. Directorate of Enforcement, Hyderabad and another, reported in 2023 SCC OnLine TS 987 and of Sikkim High Court in the case of Smt. Usha Agarwal vs. Union of India and others, (2017) SCC OnLine, Sikk 146. On the above basis, Mr. Nayyar would sum up his arguments by contending that the ECIR is the genesis of the criminal proceedings contemplated under the PML Act and since in the instant case the ECIR has been registered in spite of the fact that the Supreme Court is in seisin over the matter relating to maintainability and continuance of the predicate offence, allowing the investigation/enquiry on the basis of the ECIR would amount to an abuse of the process of Court and therefore, the inherent power of this Court under Section 482 of Cr.P.C. can be exercised to prevent the same. ANALYSIS AND FINDINGS 8. Having regard to the rival contentions noted....
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....pected to inquire into relevant aspects in relation to such property and take measures as may be necessary and specified in the 2002 Act including to attach the property for being dealt with as per the provisions of the 2002 Act. We have elaborately adverted to the procedure to be followed by the authorities for such attachment of the property being proceeds of crime and the follow-up steps of confiscation upon confirmation of the provisional attachment order by the Adjudicating Authority. For facilitating the Adjudicating Authority to confirm the provisional attachment order and direct confiscation, the authorities under the 2002 Act (i.e., Section 48) are expected to make an inquiry and investigate. Incidentally, when sufficient credible information is gathered by the authorities during such inquiry/investigation indicative of involvement of any person in any process or activity connected with the proceeds of crime, it is open to such authorities to file a formal complaint before the Special Court naming the concerned person for offence of money-laundering under Section 3 of this Act. Considering the scheme of the 2002 Act, though the offence of money-laundering is otherwise rega....
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....rocedure prescribed under the 2002 Act. Further, the authorities referred to in Section 48 of the 2002 Act alone are competent to file such complaint. It is a different matter that the materials/evidence collected by the same authorities for the purpose of civil action of attachment of proceeds of crime and confiscation thereof may be used to prosecute the person involved in the process or activity connected with the proceeds of crime for offence of money- laundering. Considering the mechanism of inquiry/investigation for proceeding against the property (being proceeds of crime) under this Act by way of civil action (attachment and confiscation), there is no need to formally register an ECIR, unlike registration of an FIR by the jurisdictional police in respect of cognizable offence under the ordinary law. There is force in the stand taken by the ED that ECIR is an internal document created by the department before initiating penal action or prosecution against the person involved with process or activity connected with proceeds of crime. Thus, ECIR is not a statutory document, nor there is any provision in 2002 Act requiring Authority referred to in Section 48 to record ECIR or to....
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....t an act undertaken under the Code. Significantly, the aforequoted observation of the Supreme Court in Sujit Kumar Rana (supra) was also referred to therein. On such reasoning, it was held that the registration of an ECIR by the officers of the E.D. cannot be the subject matter of judicial review under Section 482 of Cr.P.C. 10. In so far as the case laws cited at the bar, particularly by learned Senior Counsel appearing for the petitioner, this Court finds that in the case of Sukesh Gupta (supra), the Telengana High Court held on the facts of the case before it that since there is no evidence of criminal activity nor any property being derived as a consequence of such criminal activity, the proceedings in the concerned ECIR cannot be permitted to continue. In arriving at such finding, learned Single Judge of Telengana High Court relied upon the observations of the Supreme Court in the case of State of Harayana v. Bhajanlal reported in 1992 Supp (1) SCC 335, State of Karnataka v. M. Devendrappa reported in (2002) 3 SCC 89 and Anil Khadkiwala v. State (NCT of Delhi), reported in (2019) 17 SCC 294 were relied upon. This Court is however, unable to agree with the reasoning of the l....