Case Note & Summary
The petitioner, an accused in multiple criminal cases and presently in judicial custody, challenged an order passed by the I Additional Chief Metropolitan Magistrate, Bengaluru, permitting the Directorate of Enforcement (ED) to record his statement under Section 50(3) of the Prevention of Money Laundering Act, 2002 (PMLA). The dispute arose in the backdrop of two crimes registered against the petitioner (Crime No.48/2022 and Crime No.60/2022) and an Enforcement Case Information Report (ECIR) filed by the ED. While the petitioner was in judicial custody in connection with the scheduled offences, the ED sought permission from the Magistrate to record his written statement using laptop and printer, and to secure the cooperation of jail authorities. The petitioner objected on the ground that once an ECIR is registered, the competent court to pass any order under PMLA is the Special Court (Court of Session), not the Magistrate. The ED countered that since the petitioner was in custody, the application had to be made to the court that ordered such custody. The High Court, after examining the statutory framework of the PMLA, noted that Section 43 designates Courts of Session as Special Courts for trial of money laundering offences, and Section 44 mandates that cognizance be taken by such Special Court. The Magistrate, not being a designated court under the PMLA, lacked jurisdiction to pass the impugned order. The fact that the accused was in judicial custody did not alter this jurisdictional bar. Relying on a coordinate Bench decision in Dr. Madhukar G. Angur v. Directorate of Enforcement and principles laid down by the Supreme Court, the Court held that all proceedings under the PMLA, including recording of statements, must be conducted before the Special Court. Accordingly, the writ petition was allowed, the Magistrate's order dated 14-09-2022 was quashed, and the ED was granted liberty to approach the competent Special Court for necessary orders.
Headnote
A) Criminal Law - Prevention of Money Laundering Act, 2002 - Jurisdiction - Prevention of Money Laundering Act, 2002, Sections 43, 44, 50 - Once an Enforcement Case Information Report (ECIR) is registered under the PMLA, all proceedings, including recording of statements under Section 50(3), must be conducted before the Special Court designated under Section 43, which is a Court of Session. The Magistrate who ordered judicial custody of the accused had no jurisdiction to permit the Enforcement Directorate to record statements; the power to do so lies exclusively with the Special Court. Held, the impugned order of the Magistrate dated 14-09-2022 permitting recording of statements is without jurisdiction and is quashed; the Enforcement Directorate is at liberty to approach the competent Special Court for appropriate orders. (Paras 8-16)
Issue of Consideration
Whether the Metropolitan Magistrate had jurisdiction to permit the Enforcement Directorate to record the statement of an accused under Section 50(3) of the Prevention of Money Laundering Act, 2002, when an ECIR was already registered and the accused was in judicial custody.
Final Decision
The High Court allowed the writ petition, quashed the order dated 14-09-2022 passed by the I Additional Chief Metropolitan Magistrate, Bengaluru, and held that the Magistrate had no jurisdiction to permit recording of statements under the PMLA once an ECIR is registered. The Enforcement Directorate was given liberty to approach the competent Special Court (Sessions Court) for appropriate orders.
Law Points
- Once ECIR is registered under PMLA
- all proceedings including recording of statements under Section 50(3) must be before Special Court (Sessions Court) designated under Section 43
- Magistrate lacks jurisdiction to pass such order
- Special Court has exclusive jurisdiction under PMLA post ECIR registration
Case Details
2022 LawText (KAR) (10) 17
Writ Petition No.19042 of 2022 (GM-RES)
Sandesh J. Chouta, Arun G., K.S. Abhijith, Madhukar Deshpande
State by High Ground Police Station and others
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Nature of Litigation
Petition under Article 226 of the Constitution of India read with Section 482 Cr.P.C. seeking quashing of an order passed by the I Additional Chief Metropolitan Magistrate, Bengaluru, permitting the Directorate of Enforcement to record the statement of the petitioner under Section 50(3) of the Prevention of Money Laundering Act, 2002, while the petitioner was in judicial custody.
Remedy Sought
The petitioner sought quashing of the Magistrate's order dated 14-09-2022 in C.C.No.25035/2022, which allowed the ED's application to record his statement and that of other accused.
Filing Reason
The petitioner contended that the Magistrate lacked jurisdiction to pass such an order because an Enforcement Case Information Report (ECIR) had already been registered, and under the PMLA, only the Special Court (Court of Session) designated under Section 43 has the authority to deal with any proceedings, including recording of statements.
Previous Decisions
The learned Magistrate had allowed the ED's application on 14-09-2022, overruling the objections filed by the petitioner on 05-09-2022.
Issues
Whether the Metropolitan Magistrate had jurisdiction to pass an order under Section 50(3) of the Prevention of Money Laundering Act, 2002, permitting the Enforcement Directorate to record statements of an accused in judicial custody, when an ECIR had already been registered and the Special Court (Court of Session) is the designated court for such matters.
Submissions/Arguments
The petitioner argued that once an ECIR is registered, all actions including any permission to record statements must be sought before the Sessions Court, which is the competent Special Court under Sections 43 and 44 of the PMLA; the Magistrate's order was without jurisdiction. Reliance was placed on Dr. Madhukar G. Angur v. Directorate of Enforcement, Harshad S. Mehta v. State of Maharashtra, and A.R. Antulay v. R.S. Nayak.
The respondent ED argued that while trial must be conducted by the designated court, the petitioner was in judicial custody in C.C.No.25035/2022, and therefore, the application had to be moved before the court that ordered such custody. It relied on Niranjan Singh v. Prabhakar Rajaram Kharote regarding the meaning of custody.
Ratio Decidendi
Once an Enforcement Case Information Report (ECIR) is registered under the Prevention of Money Laundering Act, 2002, all proceedings, including recording of statements under Section 50(3), must be conducted before the Special Court constituted under Section 43 of the PMLA. A Magistrate's order permitting such recording is without jurisdiction.
Judgment Excerpts
The learned Magistrate permits recording of statements by the officers of the ED. The ECIR is already registered against the petitioner. ... Once an ECIR is registered, all proceedings including recording of statements will have to be conducted only by the Special Court. ... The Magistrate is not the designated Court to try offences under the PMLA. Therefore, the order passed by the learned Magistrate permitting recording of statements is without jurisdiction.
The impugned order dated 14-09-2022 is quashed. The respondent/ED is at liberty to approach the competent designated Court for appropriate orders.
Procedural History
The petitioner was an accused in Crime No.48/2022 registered at Chowk Police Station, Kalaburagi, which was later transferred to the CID. Another crime, Crime No.60/2022, was registered at High Grounds Police Station, Bengaluru, against 34 persons, in which the petitioner was accused No.29. On 26-07-2022, the police filed a charge sheet in Crime No.60/2022. The petitioner remained in judicial custody in connection with these crimes. Meanwhile, the Directorate of Enforcement registered an ECIR (ECIR/BGZO/68/2022) against the petitioner. On 30-08-2022, the ED moved an application under Section 50(3) of the PMLA before the I Additional Chief Metropolitan Magistrate, Bengaluru, in C.C.No.25035/2022, seeking permission to record written statements of five accused, including the petitioner, and to allow two officers with a laptop and printer for this purpose, along with a direction to jail authorities for cooperation. The petitioner filed objections on 05-09-2022. The learned Magistrate, after considering both, allowed the application by order dated 14-09-2022. Aggrieved, the petitioner filed the present writ petition before the High Court. The petition was heard on 23-09-2022 and reserved for orders, and the final order was pronounced on 17-10-2022, allowing the petition.
Acts & Sections
- Constitution of India: Article 226
- Code of Criminal Procedure, 1973: Section 482
- Indian Penal Code: Sections 34, 120B, 420, 465, 468, 471
- Prevention of Money Laundering Act, 2002: Sections 2(1)(z), 3, 4, 13, 43, 44, 50
- Code of Civil Procedure, 1908:
