Absence of Connection Between Property Acquisitions and Proceeds of Crime Leads to Dismissal of Charges
In a significant judgment, the Bombay High Court has quashed the proceedings against Shri. Kishore in a money laundering case under the Prevention of Money Laundering Act, 2002 (PMLA). The court observed that the property purchased by Kishore's company between 2005 and 2007 could not be connected to the alleged proceeds of crime generated during 2020-2021, thereby leading to the dismissal of charges.
Justice Ashwin D. Bhobe, presiding over the case, highlighted the necessity of a direct link between the property and the proceeds of crime, a fundamental requirement under Sections 3 and 4 of the PMLA. The court emphasized that mere assumptions without prima facie evidence do not suffice to initiate legal action.
The Directorate of Enforcement had initiated proceedings against Shri. Kishore, accusing him of being involved in money laundering activities linked to the former Home Minister, Anil Deshmukh. However, the High Court found that the allegations did not establish a prima facie case against Kishore, as the property transactions occurred well before the alleged generation of tainted funds.
The court also criticized the Designated Court's earlier order for lacking judicial application of mind, emphasizing that taking cognizance of a case requires careful consideration of material evidence. The absence of such consideration led to the quashing of the complaint and proceedings.
This judgment underscores the High Court's role in exercising its inherent powers under Section 482 of the Criminal Procedure Code to prevent abuse of the legal process. It reiterates the legal principle that an offence of money laundering must be clearly connected to proceeds derived from a scheduled offence, ensuring that justice is not compromised by speculative claims.
Bottom Line:
Prevention of Money Laundering Act, 2002 - Quashing of proceedings - Property purchased before the generation of proceeds of crime cannot be connected to the proceeds of crime - Application of judicial mind necessary for taking cognizance - Absence of prima facie material to connect the accused with the offence under Sections 3 and 4 of PMLA.
Statutory provision(s): Prevention of Money Laundering Act, 2002 - Sections 3 and 4, Criminal Procedure Code, 1973 - Section 482
Shri. Kishore v. Directorate of Enforcement, (Bombay) : Law Finder Doc id # 2857211
