An accused facing parallel trials for a predicate offence and money laundering sought a court direction for simultaneous trial under Section 482 Cr.P.C. The Court held PMLA proceedings are stand-alone and independent of the predicate offence; no simultaneous or joint trial is required, and dismissed the petition.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
Crl.OP.No.7578 of 2023
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 25.11.2024
CORAM
THE HONOURABLE MR. JUSTICE S.M.SUBRAMANIAM AND THE HONOURABLE MR. JUSTICE M.JOTHIRAMAN
Crl.OP.No.7578 of 2023 in Crl.MP.Nos.4863 of 2023
M.Venkatesan
...Petitioner
Versus
1.The Directorate of Enforcement Chennai Zonal Office-II Government Of India 3rd Floor III Block B Wing Shastri Bhavan, Haddows Road, Chennai – 600006. represented by its Deputy Director (ECIR No.CEZO/14/2016)
2.The Central Bureau of Investigation Anti Corruption Branch, Chennai III Floor, Shastri Bhavan Haddows Road, Nungambakkam Chennai – 600 006. rep by its Additional Superintendent of Police.
.. Respondents
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Prayer:-Criminal Original Petition filed under Section 482 of Cr.P.C., to
Prayer:-Criminal Original Petition filed under Section 482 of Cr.P.C., to direct the learned Principal Sessions Judge / Special Court for PMLA and CBI cases, Puducherry to conduct simultaneous trial of cases in Spl.CC.No.1 of 2016 pending on the file of the learned Principal Sessions Judge, Special Court for CBI Cases, Puducherry and Spl.CC.No.1 of 2019 pending on the file of the learned Principal Sessions Judge for PMLA cases, Puducherry (both are pending in the same Court).
For Petitioner : Mr.K.Thilageswaran
For Respondents : Mr.Ranjish Pathiyil Spl.P.P. for enforcement – R1. Mr.K.Srinivasan, Spl.PP for CBI cases – R2.
ORDER [Order of the Court was made by S.M.SUBRAMANIAM, J]
The case on hand has been instituted under Section 482 of Cr.PC to
direct the Principal Sessions Judge / Special Court for PMLA and CBI cases, Puducherry to conduct simultaneous trial of cases in Spl.CC.No.1 of 2016 pending on the file of the Principal Sessions Judge, Special Court for
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CBI Cases, Puducherry and Spl.CC.No.1 of 2019 pending on the file of the same Court.
petitioner would rely on the following judgments.
Ministry of Finance V. G.Varadharajan reported in Manu/TN1222/2024 this Court made an observation as follows :
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“ 16. We also find that the appellant / complainant
had not made any attempt to invoke Section 44(1) of the PMLA as explained under the Statute. Since the predicate
offence has also been pending in the same Court, the appellant / complainant ought to have asked for simultaneous trial in both the cases to avoid conflicting verdict and to avoid omission in marshalling evidence. For the reasons best known, they had allowed the PMLA case to proceed first and while doing so, also failed to place all the material documents though available to substantiate the fundamental requirement to proceed under the PMLA. ”
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trial, thus, simultaneous trial must be conducted.
6993 wherein the Court made the following observation :-
“23. No doubt, the offence of money laundering is
inextricably linked with the scheduled offence and thereby, it would be the ultimate interest of the Prosecution to see
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that charges for the predicate offence/scheduled offence are proved so as to bring the amounts involved in the cases for the predicate offence, within the ambit of the definition of ‘proceeds crime”. That is the reason the wisdom of the legislature have given the option to the Department to seek for a joint trial rather than to give the option to the accused, so that the delay may not be caused in the trial of the offence for the predicate offence.
24. Further, this Court is also of the view that allowing the trial to be continued in the CBI Court will not cause any prejudice to the Petitioner/A1. In fact, if the relief as sought for by the Petitioner/A1 is granted, serious prejudice would not only cause to the Prosecution, but also to the Petitioner/A1. That apart, even in the case of CBI and the complaint filed by the Enforcement Directorate, there cannot be any common evidence and the evidence of each case, has to be assessed independently for deciding the same. Therefore, the
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contention of the learned counsel for the Petitioner/A1 that the evidence would be common in the CBI charge sheeted case as well as the case pending on the file of the Special Court for Prevention of Money Laundering is not sustainable in law. Hence, this Court is of the view that the cases, which are pending on the file of the CBI Court in connection with various offences, which were investigated in the year 2013, cannot be transferred to the Special Court for Prevention of Money Laundering as sought for by the Petitioner/A1. Consequently, this Court is not inclined to entertain the present Criminal Original Petition. However, this Court took note of the submissions
made by the learned counsel for the 2nd Respondent that steps are being taken to file necessary application as per Section 44(1)(c) of the PMLA, seeking to transfer the case.”
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follows :
reported in MANU/TL/1155/2021 the High Court of Telangana held as follows :
“21. Further, it is needless to state that oral and
documentary evidence is the backbone to prove the guilt or innocence of the accused in a criminal trial. The trial in all criminal cases including money laundering offences is required to be conducted expeditiously. If the trial is delayed, it would result in impairment of the complainant to prove the case and also impairment of ability of the accused himself to defend his case. The factors like death, disappearance and non-availability of witnesses would also hamper the criminal administration of justice. Therefore, invariably, oral and documentary evidence is required to be placed on record expeditiously, to arrive at a just conclusion. Therefore, it is too early to say that the accused persons are likely to get acquittal in the scheduled offences. There are instances where conviction was recorded by the trial Court and the appellate Court
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had set aside the said conviction. In the instant case,
mere apprehension that the Court below lis going to record conviction against the accused persons under PML Act and they are likely to get acquittal in the predicate/scheduled offences would not be a ground to stall the proceedings. In the given facts and circumstances of the case, it is difficult to state the result of the case of predicate/scheduled offence and its bearing over the proceedings or decision rendered in the subject offence under PML Act. Therefore, the contention raised
that without proving the guilt of the accused in predicate/scheduled offences, trial of offences under PML Act cannot be proceeded with, is unsustainable. In view of the above observations, it cannot be held that unless proceeds of crime are established by putting the accused on trial, any prosecution of the person under PML Act would be premature and would be futile exercise. Since the offence under PML Act is a stand-alone offence and
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not dependent on predicate/scheduled offences, it can be proceeded with independently without awaiting the outcome of result of scheduled offences or commencement of trial in the predicate/scheduled offences. Further, there is no requirement under law to conduct trials of both category of cases simultaneously. Therefore, the contention that Money Laundering offence starts at the end of predicate offence and commencement of trial in offence under PML Act shall not precede trial of predicate/scheduled offence, is unsustainable. ”
“ 6. The answer to the above submission of
Mr.Mohan lies in explanation (i) to Section 44 of the
PML Act, which clearly states that the jurisdiction of
the Special Court to try a person under the PML Act,
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shall not be dependent upon any orders passed in
respect of the predicate offence. Though this explanation has been included in the statute only subsequently, i.e., by Act 23 of 2019, its effect dates back to the coming into the force of the statute itself. It is true that the predicate offence and the PML offence should be tried by the Special Court, but, that stage has not reached at all in the instant case, because, the
trial in C.C.No.3982 of 2015 has not begun. Even according to Mr.Mohan, summons have not been served on some of the accused even.
7. In Section 44(1)(a) of the PML Act, the
legislature has not used the expression “cognizance by
the Special Court”, but, “triable by the Special Court”. In the case at hand, the Magistrate has taken only cognizance of the offence inC.C.No.3982 of 2015,
he may even discharge the accused or the superior Court may even quash the proceedings. Trial is said to
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begin in a criminal case, only after the charges are framed. When C.C.No.3982 of 2015 ripes to the stage
of trial, then, by invoking Section 44(1)(a) and 44(1)(c) of the PML Act, C.C.No.3982 of 2015 can be transferred to the Special Court and not any time before that. To say that until the disposal of C.C.No.3982 of 2015, the Special Court cannot proceed with the trial in C.C.No.11 of 2017, is tantamount to nullifying explanation (i) to Section 44 of the PML Act.”
“454. This Schedule has been amended by Act 21
of 2009, Act 2 of 2013, Act 22 of 2015, Act 13 of 2018
and Act 16 of 2018, thereby inserting new offences to be regarded as scheduled offence. The challenge is not on
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the basis of legislative competence in respect of enactment of Schedule and the amendments thereto from time to time. However, it had been urged before us that there is no consistency in the approach as it includes even minor offences as scheduled offence for the purposes of offence of money-laundering, more so even offences which have no trans-border implications and are compoundable between the parties. The classification or grouping of offences for treating the same as relevant for constituting offence of money-
laundering is a matter of legislative policy. The Parliament in its wisdom has regarded the property derived or obtained as a result of specified criminal activity, being an offence under the concerned legislation mentioned in the Schedule. The fact that some of the offences may be non-cognizable offences under the concerned legislation or regarded as minor and compoundable offences, yet, the Parliament in its
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wisdom having perceived the cumulative effect of the process or activity concerning the proceeds of crime generated from such criminal activities as being likely to pose threat to the economic stability, sovereignty and integrity of the country and thus, grouped them together for reckoning it as an offence of money-laundering, is a matter of legislative policy. It is not open to the Court to have a second guess at such a policy.
455. Needless to underscore that the 2002 Act is
intended to initiate action in respect of moneylaundering activity which necessarily is associated with the property derived or obtained by any person, directly or indirectly, as a result of specified criminal activity. The prosecution under this Act is not in relation to the criminal activity per se but limited to property derived or obtained from specified criminal activity. Resultantly, the inclusion of criminal activity which has been regarded as non-cognizable, compoundable or minor
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offence under the concerned legislation, should have no bearing to answer the matter in issue. In that, the offence of money-laundering is an independent offence
and the persons involved in the commission of such offence are grouped together as offenders under this Act. There is no reason to make distinction between them insofar as the offence of money-laundering is concerned. In our opinion, therefore, there is no merit in the argument under consideration.”
“18. Unconcluded predicate offence trial is not a bar
for proceeding under the PMLA. The said grounds raised by A6 and A7 is not sustainable in view of the Supreme Court judgment in Vijay Madanlal Choudhary and others
vs. Union of India and others
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(MANU/SC/0924/2022MANU/SC/0924/2022 :
2022:INSC:757 : 2022 LiveLaw (SC) 633). The Hon'ble Supreme Court after considering the object of the PMLA and the expression 'proceeds of crime' and 'money laundering' used by the legislators had held that, PMLA is a stand alone Act. The pre-requisite is a commission of a predicate offence. It is not even necessary that the person accused in the PMLA case must be an accused in the predicate offence. Law even permits joint trial of both the cases and it is not appropriate to canvass that only after the trial in predicate offence end in conviction, the proceeding in PMLA should commence. There is no bar for simultaneous investigation or prosecution and it could be easily understood from the frame of PMLA, which explicitly provides for joint trial of both the predicate offence and the money laundering offence by the same Court designated to try PMLA offences. If, in case, the predicate offence finally end in acquittal or discharge or quashed by the Court,
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there can be no offence of money laundering.
19. For further clarity, it is sufficient to refer one paragraph in Vijay Madanlal Choudhary's case as paginated in MANU/SC/0924/2022MANU/SC/0924/2022 : 2022 Livelaw (SC) 633, which gives quietus to the said
argument:-
''175A. Needless to underscore that the 2002 Act is intended to initiate action in respect of moneylaundering activity which necessarily is associated with the property derived or obtained by any person, directly or indirectly, as a result of specified criminal activity. The prosecution under this Act is not in relation to the criminal activity per se but limited to property derived or obtained from specified criminal activity. Resultantly, the inclusion of criminal activity which has been regarded as non-cognizable, compoundable or minor offence under the concerned legislation, should have no bearing to answer the
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matter in issue. In that, the offence of moneylaundering is an independent offence and the persons involved in the commission of such offence are grouped together as offenders under this Act. ...''
Section 44 of PMLA deals with offences triable by Special Courts. Section 44(i)(a)(b)(c) enumerates as follows :-
(a)“an offence punishable under Section 4 and any scheduled offence connected to the offence under that Section shall be triable by the Special Court constituted for the area in which the offence has been committed :
Provided that the Special Court, trying a scheduled offence before the commencement of this Act, shall continue to try such scheduled offence.
(b)a Special Court may, upon a complaint made by an authority authorised in this behalf under this Act
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take cognizance of offence under section 3, without the accused being committed to it for trial.
Provided that after conclusion of investigation, if no offence of money laundering is made out requiring filing of such complaint, the said authority shall submit a closure report before the Special Court; or
(c) if the court which has taken cognizance of the scheduled offence is other than the Special Court which has taken cognizance of the complaint of the offence of money-laundering under sub-clause (b), it shall, on an
application by the authority authorised to file a complaint under this Act, commit the case relating to the scheduled offence to the Special Court and the Special Court shall, on receipt of such case proceed to deal with
it from the stage at which it is committed.
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Laundering Act, 2002 reads as under :-
(i) the jurisdiction of the Special Court while dealing with the offence under this Act, during investigation, enquiry or trial under this Act, shall not be dependent upon any orders passed in respect of the scheduled offence, and the trial of both sets of offences by the same court shall not be construed as joint trial;
(ii) the complaint shall be deemed to include any subsequent complaint in respect of further investigation that may be conducted to bring any further evidence, oral
or documentary, against any accused person involved in respect of the offence, for which complaint has already been filed, whether named in the original complaint or not.
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Court shall not be construed as joint trial.
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[S.M.S., J.] [M.J.R., J.] 25.11.2024
tsh Internet : Yes/No Index : Yes/No
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Neutral Citation : Yes/No
To
1.The Directorate of Enforcement Chennai Zonal Office-II Government Of India 3rd Floor III Block B Wing Shastri Bhavan, Haddows Road, Chennai – 600006. represented by its Deputy Director (ECIR No.CEZO/14/2016)
2.The Central Bureau of Investigation Anti Corruption Branch, Chennai III Floor, Shastri Bhavan Haddows Road, Nungambakkam Chennai – 600 006. rep by its Additional Superintendent of Police.
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S.M.SUBRAMANIAM, J. AND M.JOTHIRAMAN, J.
tsh
Crl.OP.No.7578 of 2023
25.11.2024
24
2 issues framed by the court
Whether a Special Court must conduct simultaneous trial of the predicate offence and the PMLA case when both pendency before it.
Whether pendency of trial in the predicate offence bars continuation of trial under the PMLA.
Colour shows how this judgement treated each authority
Deputy Director, Directorate of Enforcement, Ministry of Finance v. G.VaradharajanReferred¶5
Manu/TN1222/2024
R.Subramanian v. CBI and anotherReferred¶8
2019 SCC Online Mad 6993 · Who else cites this
V.Vijay Sai Reddy v. Enforcement DirectorateReferred¶9
MANU/TL/1155/2021
M.Rajkumar v. The Assistant Director, Directorate of Enforcement, ChennaiRelied on¶10
Crl.OP.No.5927 of 2018 dated 21.03.2022
Vijay Madanlal Choudhary v. Union of India & othersFollowed¶11
2022 SCC Online 929 · Who else cites this
Sithick Raja v. Directorate of EnforcementRelied on¶12
MANU/TN/1366/2024
5 provisions across 2 enactments
M.Venkatesan
The Directorate of Enforcement Chennai Zonal Office-II
The Central Bureau of Investigation Anti Corruption Branch, Chennai
S.M.Subramaniam
M.Jothiraman
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
