TaxTMI 
TaxTMI 
2024 (7) TMI 1523
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....ture Marketing Board, Bangalore (for short, 'the KSAMB') and officials of Syndicate Bank, Uttarahalli Branch, misappropriated the funds of the KSAMB by opening bank accounts by forging the documents and thereafter transferring to different accounts in various other banks and finally withdrawing and syphoning of the amounts related to the amounts related to the KSAMB. 4. On reference from the Jurisdictional Police, the Enforcement Directorate conducted the investigation and the said investigation reveals that during the course of investigation, statements of several accused persons were recorded including the petitioner-accused No.17, and in the said statement, petitioner-accused No.17 is stated to have allegedly admitted that the proceeds of the crime in the scheduled offence was received without his knowledge, and after receipt of the amount, one Krishna Kumar-accused No.5 called upon him stating that the said amounts have been credited to him from the source known to him, and on instructions, he withdrew the said amount and handed over to his father Gunashekar, and as per the instruction of Krishna Kumar-accused No5, transferred the amount of Rs.46,62,500/- to various ba....
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....) Vijay Madanlal Choudhary -vs- Union of India & ors. - 2022 SCC OnLine SC 929: 2) Pavana Dibbur -vs- Directorate of Enforcement - 2023 SCC OnLine Sc 1586: 3) Anoop Bartaria & etc. -vs- Dy.Director Enforcement Directorate and another - 2023 SCC OnLine SC 477: 10. After carefully considering the arguments presented by the learned counsel for the parties, the key points for deliberation are as follows: (i) Whether there is prima facie sufficient evidence to indicate that petitioner- accused no. 17 had knowledge that the funds transferred into his account had been derived from criminal activity related to a scheduled offence, or that the petitioner -accused no. 17 knowingly assisted the prime accused i.e., the accused no. 5, in concealment or transfer of the illicit proceeds as untainted property? (ii) Whether the petitioner who is not an accused in the scheduled offence can be prosecuted for the offence under Section 3 punishable under Section 4 of PMLA in the absence of knowledge that the money transferred to his account and utilised were from the proceeds of the crime? 11. Before deliberating on the points for consideration, it is pertinent to cite the governing provision....
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....upreme Court with reference to the essential elements to constitute an offence under Section 3 punishable under Section 4 of PMLA has ruled as follows: 1) In the case of Pavana Dibbur (supra), it has ruled that an offence under Section 3 of the Act, 2002 can occur subsequent to the commission of a scheduled offence. It was elucidated that an individual, regardless of his connection to the scheduled offence, is deemed guilty under Section 3, if he has knowingly assisted in concealing the proceeds of the crime or facilitated the use of such proceeds to project such illicit proceeds as untainted property. 2) Furthermore, in the case of Anoop Bartaria (supra) where the petitioner-accused was the chairman and managing director of a company involved in the selling and leasing of commercial spaces, and upon reconsideration of the initial agreement, had received as part of consideration more than INR 160 crores of the defrauded funds from the accounts of fictitious firms and companies operated by the purchaser-accused in the case of a bank fraud, against the reregistration of certain commercial units in the names of accused entities, the Court had held that the petitioner was prima fac....
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.... 48,62,500/- in his account bearing no. 42710126472 with the Standard Chartered Bank was without his knowledge and that upon receipt thereof, on the instruction of one Mr. Krishna Kumar (accused no. 5) he had transferred the amount of INR 46,62,500/- to various bank accounts belonging to accused no.5, and withdrew the remainder of the amount and handed over the same to the father of accused No.5, Mr. Gunasekhar. 16. The accused no. 5 along with the accused no. 1 (Mr. Vijay Akkash) is said to have allegedly arranged the bank accounts of different persons for receipt of the proceeds of crime and for final utilisation of the same. The complaint made under Section 44 of the Act also contains a flowchart depicting transfers of various amounts made into the account of accused no. 5 and amounts handed over to the latter in cash. 17. Flowchart eliciting the role attributed to the accused no. 5 in the commission of the scheduled offence - 18. However, in the complaint furnished before the Special Judge, which is the basis for prosecuting the petitioner - accused no. 17, the ED has alleged that the petitioner has indirectly indulged and is actually involved in the process connected with t....
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....ding a trial only for the purpose of formally completing the procedure to the pronounce the conclusion on a future date." It further held that if a "Judge is almost certain that the trial would be an exercise in futility or a sheer waste of time it is advisable to truncate" the proceedings the stage of discharge under Section 227 of Cr.P.C. 22. In the case of Avinash J Mahale v. State of M.H. 2006 4 AIR Bom R 181 (Bom) : 2006 CrLJ 3123, the High Court of Bombay referred to the ratio laid down by the Apex Court in the case of State of M.P. v. S.B. Johari AIR 2000 SC 665 and held that a charge can be quashed where the evidence adduced by the prosecution fails to prove that the accused committed the alleged offence. 23. It has been held by the coordinate bench of this Court in the case of Vipul Prakash Patil v. The State of Karnataka (Crl P. No.104152/2022 KHC-D) where the petitioner sought to quash the FIR and complaint against the offence punishable under Section 420 of IPC and Section 9 of the Karnataka Protection of Interest of Deposits in Financial Establishment Act, 2004 that, "In order to proceed against a person with criminal action, the complaint or the prosecuting agency....