Allowed

Smt. R P Umadevi v. Directorate of Enforcement

Karnataka HC17 Nov 2020CRL.P/2559/2020

Case brief

AI extract

What is this about?

The High Court of Karnataka quashed Special Case No.1347/2019 filed under the Prevention of Money Laundering Act. The court held that although the PML Act does not prescribe a statutory limitation for offences punishable by more than three years, a delay of seven years by the investigating agency was unreasonable, liable to cause miscarriage of justice, and thus violated Article 21 principles requ

What did the court decide?

Further proceedings in Spl. Case No.1347/2019 pending before the Special Court for Prevention of Money Laundering Act were quashed.

Smt. R P Umadevi Vs Directorate of Enforcement — Money Laundering | Karnataka HC (2020)

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CRL.P. No.2559 OF 2020

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 17^TH DAY OF NOVEMBER, 2020

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BEFORE

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THE HON’BLE MR. JUSTICE SURAJ GOVINDARAJ

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CRIMINAL PETITION NO.2559 OF 2020

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BETWEEN:

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SMT. R.P. UMADEVI W/O LATE BALARAM DATE OF BIRTH: 01.01.1975 (45 YEARS) R/AT NO.22, 2^ND CROSS SHARADHA LADIES PG HOSA ROAD, ELECTRONIC CITY BENGALURU-560100 ... PETITIONER

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(BY SRI.ADHI NARAYAN, ADVOCATE FOR M/S ANN ASSOCIATES- THROUGH VC)

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AND:

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DIRECTORATE OF ENFORCEMENT REPRESENTED BY ITS ASSISTANT DIRECTOR 3^RD FLOOR, ‘B’ BLOCK, BMTC SHANTINAGAR, K.H.ROAD BENGALURU-560027 ... RESPONDENT

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(BY SRI. P. PRASANNA KUMAR, ADVOCATE)

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THIS CRIMINAL PETITION IS FILED U/S 482 OF CR.P.C, PRAYING TO QUASH THE ENTIRE PROCEEDINGS IN SPECIAL CASE NO.1347/2019 WHICH IS FILED BY RESPONDENT WHICH IS PENDING FOR CONSIDERATION BEFORE THE XLVII ADDITIONAL CITY CIVIL AND SESSIONS JUDGE AND SPECIAL JUDGE FOR CBI CASES, BANGALORE UNDER THE PREVENTION OF MONEY LAUNDERING ACT IN SO FAR AS THE PETITIONER IS CONCERNED.

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THIS CRIMINAL PETITION COMING ON FOR ADMISSION, THIS DAY, THE COURT MADE THE FOLLOWING:

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CRL.P. No.2559 OF 2020

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ORDER

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The petitioner is before this Court seeking for quashing of the proceedings in Special Case No.1347/2019 pending before the Special Court for Prevention of Money Laundering Act, 2002.

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The Special Court for prevention of money laundering had taken cognizance against the petitioner for the offences punishable under Section 3 and 4 of Prevention of Money Laundering Act, 2002 [‘PML Act’ for short] in Special Case No.1347/2019 on 9.12.2019 and issued summons to the petitioner. The said cognizance has been taken on the basis of the FIR No.58/2011 dated 23.02.2011 filed by the F&M Squad and another charge sheet filed by MICO layout police station in C.C.No.34737/2011 dated 14.10.2011 for offences punishable under Section 420 and 120-B of IPC.

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The facts relating to the offences under those complaints are not relevant for this particular matter except to state that on 14.10.2011 a complaint was filed alleging that the petitioner and certain others had committed offences which are punishable under Section 420 and 120-B of the IPC. and received about Rs.30.65 crores from various persons which amount has to be treated as proceeds of crime. On the basis of the said FIR which had been registered on 14.10.2011, ECIR No.7/BGZO/12 was registered in the year 201, an investigation was conducted and contending that there is a violation of Section 3 of PML Act, a complaint came to be filed eight years later on 27.11.2019 by the respondent as regards which cognizance was taken by the Special Court as aforesaid.

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Sri.Adi Narayan, learned counsel for the petitioner would submit that even if the allegations in the

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complaint filed in 2011 were to be true, the proceedings could not be taken up against the petitioner in the year 2019 since in terms of Section 468 of Cr.P.C, there is a bar on taking cognizance after a lapse of the period of limitation. Learned counsel contends that in terms of Section 3 of PML Act, the offences alleged are punishable by three years imprisonment and therefore, cognizance ought to have been taken within a period of three years from the date of the alleged offence.

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Per contra Sri.P.Prasanna Kumar, learned counsel for the respondent would submit that Section 468 of Cr.P.C is not applicable to the present proceedings since any offence punishable under Section 3 of the PML Act is punishable under Section 4 where minimum punishment is three years extendable for up to seven years. Section 468 speaks of punishment only upto three years and not above three years and therefore, the

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cognizance taken in the year 2019 is proper and valid since there is no limitation period prescribed for the same.

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Heard Sri.Adi Narayan, learned counsel for the petitioner and Sri.P.Prasanna Kumar, learned counsel for the respondent.

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A very short question that arises in this proceedings is: Whether a complaint could be lodged and proceedings taken at any length of time just because Section 468 of Cr.P.C. does not specifically state the upward period of limitation in respect of taking cognizance as regards of such offence?

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What has been argues in the above matter is that there is a limitation in respect of only offences which are punishable upto three years and the statutory limitation does not apply to any crime punishable for three years or more.

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Though at first blush the said argument is very appealing, the same has to be looked into the context of each matter. In the present proceedings the criminal complaint had been filed in the year 2011 as regards the offences committed under the IPC. It is alleging that out of the said offences committed under the IPC, there are proceeds of crime which accrued that the respondent initiated ECIR proceedings in the year 2012, but, however, it is only in the year 2019 that the complaint came to be filed for the purpose of taking cognizance before the Court. Though it is contended that from the year 2012 to 2019 i.e. seven years the respondent had been conducting investigation and there is no delay on the part of the respondent, I am of the considered opinion that in criminal proceedings, the accused who is likely to suffer loss of personal liberty as also loss of reputation, cannot be left to hang like a sword of Damocles t o fall on the accused at any point of time the investigating

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agency chooses to do so at its sweet whims and fancies.

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It is not expected of respondent-Enforcement Director, which is one of the premier investigating agency to be investigating the matter for over seven years after registration of ECIR. The ignominy that any accused has to undergo during the said period of seven years cannot be countenanced in law. It is but required for the investigating agencies to carry out the investigation as expeditiously as possible at any rate within a reasonable time after commencement of the investigation. The period of seven years taken by the respondent cannot be said to be reasonable by any stretch of the imagination. Though Section 468 of Cr.P.C. may not strictly apply since the punishment for offences under Section 3 of PML Act, is three years extendable up to seven years, it is required that the authorities concerned have to

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act with utmost alacrity so as to prevent miscarriage of justice, abuse of the process of law and the unnecessary sufferings by an accused of a protracted criminal proceedings, which has got protracted on account of the inaction or delayed or painfully slow action on the part of the Investigating agency.

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In the present case, I am of the considered opinion that the respondent has failed to discharge its duties within a reasonable period of time as expected of it. The period of seven years cannot be considered to be reasonable though no period of limitation is prescribed for offences punishable with imprisonment of more than three years but it is still expected of the respondent- Investigating agency to complete investigation at the earliest and place the matter before the concerned Court for taking cognizance. The delay accrued on account of the respondent, cognizance could not be taken within

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the reasonable time, and as such, I am of the considered opinion that the further proceedings in the matter cannot be allowed to continue in the light of these facts.

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For the aforesaid reasons the further proceedings in Spl. Case No.1347/2019 pending before the Special Court for Prevention of Money Laundering Act is hereby quashed.

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The petition is allowed.

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Sd/JUDGE

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Smt. R P Umadevi v. Directorate of Enforcement

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Smt. R P Umadevi v. Directorate of Enforcement

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