Facing rap from the courts, the Enforcement Directorate (ED) warned officials not to register money laundering cases solely on the basis of ‘criminal conspiracy’ but rely on scheduled offenses under the Prevention of Money Laundering Act (PMLA) to to initiate the investigation.
Several judgments, including that of the Supreme Court, have made it clear that Section 120-B of the erstwhile Indian Penal Code, now 61(2) of the Bharatiya Nyaya Sanhita, 2023, cannot be a standalone “predicate offence” for registration of a criminal. case under the PMLA.
A “scheduled violation” under the PMLA should be grounds for initiating an investigation, the courts have ruled.
Bridge gaps
To bridge anomalies in the investigation, the ED headquarters has also asked its investigators to judiciously use the provisions of Section 66(2) of the PMLA, which allows the agency to share information about an offense with a main agency such as the police or customs. to file a fresh FIR or complaint, sources said.
Based on this, the agency can file its PMLA case, sources said.
The courts have held that Section 120-B of the IPC alone is not sufficient to register a money laundering case and initiate the investigation.
In some cases, some ED FIRs or cases have been quashed, sources said.
Therefore, they said it has been directed that in order to build a watertight case, other sections of the law contained in the schedule of the PMLA should be applied in the ED ECIR (FIR).
ED’s PMLA cases against Karnataka Deputy Chief Minister DK Shivakumar and retired Chhattisgarh IAS officer Anil Tuteja and some others are among the cases quashed by the courts on this ground.
In the Chhattisgarh case, the ED exercised its under Section 66(2) of the PMLA and shared “new evidence” with the Economic Offenses Wing (EOW) of the state police, which lodged a fresh FIR against Tuteja and others.
Based on this EOW complaint, the ED subsequently filed a new money laundering case.
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Published on December 24, 2024
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