India: Provisions Of PMLA Can Be Invoked Against The Abettor Of A Scheduled

Last Updated: 10 October 2019
Article by Vijay Pal Dalmia, Partner

Article by Vijay Pal Dalmia, Advocate, Supreme Court of India and Delhi High Court, Partner & Head of Intellectual Property Laws Division, Vaish Associates Advocates, India

The petitioner in this case titled Anand Chauhan vs. Directorate of Enforcement  http://lobis.nic.in/ddir/dhc/VSA/judgement/10-04-2017/VSA10042017BA22412016.pdf / MANU/DE/0928/2017, before the High Court of Delhi (Court), had preferred the bail application  during the pendency of writ petition of Habeas Corpus before this court and sought regular bail under section 439 of the Code of Criminal Procedure (CrPC) read with Section 45 of The Prevention of Money Laundering Act, 2002 (PMLA).

CBI had registered FIR under Sections 13(2) r/w 13(1) (e) [Scheduled offence under PMLA] of the Prevention of Corruption Act, 1988 (PC Act) and Section 109 IPC against Virbhadra Singh, the petitioner, and other persons. The FIR/RC alleged that Virbhadra Singh, the principal accused, while serving as Union Minister had invested huge amounts of money in purchasing LIC policies in his own name and in the name of his family members through the petitioner, who was then an LIC agent. As per prosecution this was done by principal accused by claiming to enter into a Memorandum of Understanding (MoU) with the petitioner for management of his apple orchard. In the terms of the said MoU, the petitioner claimed to have sold the apple produce to one of the co-accused and on that pretext he deposited huge amounts in cash in his bank accounts, which were used for purchasing LIC policies. It was further alleged that the petitioner brought the unaccounted money of principal accused back into regular books. On the basis these facts the CBI had claimed that the sale of apples was a sham.

On the basis of FIR, respondent had registered the case vide ECIR against principal accused, the petitioner herein and others under Sections 3 and 4 of the PMLA.

The counsel for petitioner had contended that the arrest of the petitioner is premature, as the commissions of the scheduled offence u/s 13(1) (e) r/w 13(2) of PC Act, 1988 was yet to be, prima facie, established and charge sheet in the regular case had not been filed by the CBI, and the principal accused in aforesaid regular case has also not been arrested.

It was further argued on behalf of petitioner that custody of applicant is in violation of Article 21 of the Constitution of India, since no trial under section 3 and 4 of PMLA Act can be proceeded without the charge sheet being filed.

The invocation of section 45 of PMLA was also challenged on the grounds that it applies only if a person is accused of an offence punishable for a term of imprisonment of more than 3 years under part A of the schedule. Sections 13(2) and 13(1) (e) of PC Act are only applicable to public servants and not to others, and the abettor of the said offence can only be prosecuted under section 109 IPC, which is punishable only in the context of other offences.

On behalf of the respondent it was submitted that section 109 of IPC could not be read in isolation as it is not a standalone offence. In the present matter Section 109 was invoked along with section 13(1) (e), 13(2) of PC Act. Therefore, it was argued that there cannot be any conviction of an accused under section 109 of IPC for abatement alone. Reliance was placed upon the judgments of the Supreme Court in Gautam Kundu v. Directorate of Enforcement ((2015) 16 SCC 1)   [https://www.supremecourtofindia.nic.in/jonew/judis/43201.pdf] and Union of India v. Hassan Ali ((2011) 10 SCC 235) [http://lobis.nic.in/ddir/dhc/VSA/judgement/10-04-2017/VSA10042017BA22412016.pdf].

The Court had rejected the submission of the petitioner that since he had been charged with abatement of the scheduled offence, the PMLA cannot be invoked against him, or that the rigours of Section 45(1) (ii) would not apply to him.

The Court held that the offence of "criminal misconduct" is defined in Section 13 of the PC Act to mean, inter alia, the possession of the public servant "or any person on his behalf at any time during the period of his office of pecuniary resources or property disproportionate" to the known sources of income of the public servant, which the public servant cannot specifically account for. Therefore, it was concluded that even a person who was not a public servant had been noticed in the said definition of "criminal misconduct" as defined in Section 13(1) (e) of the PC Act. Additionally, it was held that an offence under Section 13(1) (e) of the PC Act can rope-in as an abettor any person who is in possession of such unexplained pecuniary resources and property disproportionate to the known sources of income of the public servant, i.e. who holds the said pecuniary resources or property on behalf of the public servant.

The Court had also observed that while dealing with the bail application under Section 439 CrPC it cannot take into consideration aspects which fall within the realm of writ jurisdiction, and in respect of which the petitioner's writ petition is pending.

Petition was dismissed.

© 2019, Vaish Associates Advocates,
All rights reserved
Advocates, 1st & 11th Floors, Mohan Dev Building 13, Tolstoy Marg New Delhi-110001 (India).

The content of this article is intended to provide a general guide to the subject matter. Specialist professional advice should be sought about your specific circumstances. The views expressed in this article are solely of the authors of this article.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
Vaish Associates Advocates
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Vaish Associates Advocates
Related Articles
 
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions