Prosecution under PMLA not tenable, if no sufficient case made out: SC

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Prosecution under PMLA not tenable, if no sufficient case made out: SC

 

J.Sekar @Sekar Reddy (Appeal No. 738 of 2022)

Facts:

  1. The appellant, who was the Managing Partner of M/s SRS Mining had deposited Rs 312.64 Crores in three bank accounts of the firm.
  1. The IT department conducted a search in the premises of the appellant and others and seized currency amounting to Rs.106,98,89,800/ and 128.495 kg of gold.
  1. CBI also conducted investigation and after investigation submitted the closure report before the Additional Sessions Judge, CBI Court, Chennai with an observation that for lack of sufficient evidence, nothing incriminating was found which may surface on the part of accused persons.
  1. Meanwhile, the CBI felt that in addition to the scheduled offenses, the provisions of under Sections 2(1)(x) and 2(1)(y) of the PMLA attracted and thus registered the offense against the appellant and others.
  1. The appellant approached the High Court seeking quashing of the proceedings related to the PMLA case, which refused to do so.

The Hon SC held as below:

  1. The material for the commission of offense recorded by the authorities in proceedings may be a relevant factor, when for lack of evidence, the authority itself is satisfied that the attachment of the proceedings in PMLA case cannot be continued.
  1. On account of lack of identity of the source of collected money, it could not be reasonably believed by the Deputy Director (ED) that the unaccounted money is connected with the commission of offence under PMLA.
  1. The chance to prove the allegations even for the purpose of provisions of PMLA in the Court are bleak. It is trite to say, till the allegations are proved, the appellant would be innocent.

 

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