| Headnote |
Prevention of Money Laundering Act, 2002 – ss.3, 2(1)(u) –Offence of Money Laundering – Prevention of Corruption Act, 1988– Jobs-for-cash scam in the State of Tamil Nadu – Whether withoutidentifying the proceeds of crime/a property representing theproceeds of crime and any process or activity connected to proceedsof crime as required by s.3, which constitute the foundational/jurisdictional fact, can ED initiate an investigation and issuesummons – Held: All the three FIRs alleged that the accused hadcommitted offences included in the schedule by taking illegalgratification for providing appointment to several persons in thePublic Transport Corporation – It is the bribe money that constitutesthe proceeds of crime u/s.2(1)(u) – A public servant receiving illegalgratification is in possession of proceeds of crime – Mere generationof proceeds of crime is sufficient to constitute the offence of moneylaundering– In s.3 there are 6 activities or process and one of themis “acquisition” – If a person takes a bribe, he acquires proceedsof crime, hence, activity of “acquisition” takes place – Even if hedoes not retain it but “uses” it, he will be guilty of offence of moneylaundering,since “use” is one of the activities mentioned in s.3 –The FIRs for the predicate offences identify all the three componentsof s.3, persons; process; and product – Corruption money representsthe proceeds of crime – In the case of an offence of corruption, thecriminal activity and the generation of the proceeds of crime arelike Siamese twins – The contention that the investigation by EDwas triggered without any foundational/jurisdictional facts are aimedat hoodwinking the Court – Wherever there are allegations ofcorruption, there is acquisition of proceeds of crime which itselftantamount to money-laundering – Once an information relating tothe acquisition of huge amount of illegal gratification in the matterof public employment has come in the public domain, it is the dutyof the ED to register an Information Report – This is because “acquisition” is an activity amounting to money-laundering andthe illegal gratification acquired by a public servant represents“proceeds of crime”, generated through a criminal activity in respectof a scheduled offence – Receipt of bribe money is an act of moneylaundering– All the arguments on facts and all the legal contentionsemanating from some portions of the judgment in Vijay MadanlalChoudhary, to challenge the validity of the proceedings initiated byED are completely unsustainable.Criminal Law – Matters pertaining to Jobs-for-cash scam inthe State of Tamil Nadu – Impugned order allowed de novoinvestigation on a ground not raised in the petition – Held: ‘D’,whose original complaint led to the registration of FIR in CrimeNo.441 of 2015 seems to have had a genuine grievance against theculprits at the bottom of the layer, but he later turned out to be aTrojan horse, willing to sabotage the investigation against influentialpersons – Order directing de novo investigation in all the three cases,actually inured to the benefit of the accused, but the High Courtput it on the ground that the credibility of the investigation shouldnot be eroded – In fact, the accused did not seek de novo investigationon the ground of slackness on the part of the Investigating Officer,but it was ‘D’ who sought it, with the able assistance of theInvestigating Officer – What is shocking is that the High Courtdirected reinvestigation to be started ab initio, wiping out the earlierinvestigation altogether – By issuing the said direction, the HighCourt not only directed the wiping out of the investigation carriedout so far, but virtually wiped out even the judgment of SupremeCourt dtd.08.09.2022 passed in the previous round of litigation –The problem with the impugned order is not merely one of improperusage of language, as sought to be diluted by the accused and thecomplainant, but something more – Prevention of Money LaunderingAct, 2002 –Prevention of Corruption Act, 1988.Doctrines/Principles – Doctrine of stare decisis – Whether inthe light of the fact that notice has been ordered in the review petitionand a few interim orders have been passed in some proceedings, itis necessary for this Court to tag these appeals along with a reviewpetition or defer the hearing of these matters until a decision isrendered in the review petition and other petitions – Held: A noticeordered in the review petition will not destroy or diminish theprecedential value of Vijay Madanlal Choudhary – The argument ofthe counsel for the accused, if accepted, will not only destroy theprinciples of judicial discipline and the doctrine of stare decisis, butalso bring to a grinding halt, all pending investigation in the country– Accused is not entitled at all either to seek a reference to a largerBench or to seek to defer the matter till a decision is rendered in thematters involving larger issues – Appeals arising out of the order ofthe Division Bench of the High Court are allowed – Order of theDivision Bench of the High Court dtd. 01.09.2022 is set aside – EDentitled to proceed further from the stage at which their hands weretied by the impugned order – Prevention of Money Laundering Act,2002 –Prevention of Corruption Act, 1988 – Criminal Law.Prevention of Money Laundering Act, 2002 – History of –Discussed.Criminal Rules of Practice, 2019 – rr.231(3), 237 – Appellantcontended that the High Court overlooked the provisions of r.231(3)and also s.65B, Evidence Act – Held: Both the contentions are withoutsubstance – r.231 primarily deals with the grant of certified copiesof certain other documents to the accused, before filing of the FinalReport – It states that certified copies of unmarked documents shallnot be given – High Court has not passed any order directing thegrant of certified copies of unmarked documents – It has onlypermitted the ED to have an inspection of the documents u/r.237and thereafter to file a proper copy application – This is not contraryto r.231(3) – Further, it is not known how an argument revolvingaround s.65B, Evidence Act is raised – s.65B concerns theadmissibility of electronic records – Without certification, ED maynot be able to use those electronic records in evidence, in theprosecution under PMLA – But it does not mean that they cannoteven have a look at the electronic record – Evidence Act, 1872 –s.65B – Prevention of Money Laundering Act, 2002 –Prevention ofCorruption Act, 1988 – Criminal Law.Criminal Law – Matters pertaining to Jobs-for-cash scam inthe State of Tamil Nadu – Objection to the maintainability of theappeals by appellants, against the order of de novo investigation –Held: Criminal jurisprudence recognizes a limited role of victimsand it is the state which is entrusted with the onerous responsibilityof prosecuting the accused and getting them punished – These theories of law were developed when process of administration ofcriminal justice system was largely unpolluted – However, wheresome of the complainants and the accused have come together toform an unholy alliance, victims cannot be left at the mercy of suchpartnerships – What was compromised between the complainantand accused is not just their disputes, but justice, fair play, goodconscience and the fundamental principles of criminal jurisprudence– Investigation trail of a criminal case cannot be converted by thecomplainant and accused into a friendly match – Further,submissions made on the question of locus in the previous round oflitigation in were rejected by Supreme Court in the very sameproceedings in the first round – Therefore, the accused cannot raisethe question of locus again and again.Criminal Rules of Practice, 2019 – rr.207(12), 210 – Some ofthe appellants filed copies of the confession statements u/s.164,CrPC, as part of the paper book in the appeals – It was contendedthat the confession statements recorded before the Magistrate aresacrosanct and that the copies of the same cannot be made availableto third parties – Held: It is clear from r.207(12) that a confessionstatement is a confidential document till the time investigation iscomplete and Final Report filed – r. 210 enables “third parties toapply to the Court for the grant of copies of Judgment or order orany proceeding or document in the custody of a Court” – Therefore,it is not as though the appellants have filed something to which theycould have never had any access – Further, many of the documentshad started appearing in the public domain at the instance of severalpersons – Hence, it is futile to contend that the appeals are liable tobe thrown out on the ground that the appellants came up withdocuments to which they could not have had any access – Code ofCriminal Procedure, 1973 – s.164.Criminal Law – Matters pertaining to Jobs-for-cash scam inthe State of Tamil Nadu – Political vendetta alleged – On the basisof the timeline of events, it was alleged the Minister was implicatedin the case on 08.03.2021, for offences under the PC Act immediatelyafter the announcement of the elections to the Legislative Assembly,as he had switched over from the party in power to another – Held:That the Investigation Officer did not choose to include the offencesunder the PC Act from the year 2015 till 08.03.2021, cannot be taken to the credit of the Minister, but should be taken as a discreditof the prosecution – If the shield of office protected him from 2015till he formed part of the splinter group and the shield stoodtemporarily removed for a brief period of time until he again becamea Minister in the next regime, the same cannot be said to be a caseof political vendetta – Prevention of Corruption Act, 1988.Practice and Procedure – For all the accused in the PMLAcase, arguments were advanced for the grant of larger reliefs thanwhat they got under the impugned order, without even filing anyappeal against the same – Held: It is possible in law for a successfulparty (though in civil proceedings) to support the decree withoutsupporting the judgment – But what the accused sought to do beforeSupreme Court was to support the judgment and seek an enlargementof the decree, without independently filing appeals – Since theytook a chance by adopting such a course, they may not even beable to challenge the impugned order hereafter, once the seal ofapproval on the same is affixed by this Court and the doctrine ofmerger comes into play – Prevention of Money Laundering Act,2002 – Doctrines/Principles – Doctrine of merger. |
