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The Delhi High Court on Friday issued notice to the Enforcement Directorate (ED) and Central Bureau of Investigation (CBI) on the petition challenging Section 44(1) (c) (Offences triable by Special Courts) of the Prevention of Money Laundering Act as the same has been alleged being manifestly arbitrary, unreasonable and violative of the Petitioner’s rights under Articles 14,19 & 21 of the Constitution of India.

A Division Bench comprising Justice Siddharth Mridul and Justice Anup Jairam Bhambhani passed the directions on a petition filed by NGO Advantage India and posted the matter for further hearing on September 29.

The petition before the court highlights the complexity of the provision stating that the Explanation (i) to Section 44(1) added vide amendment dated 01.08.2019 vide the Finance Act, mandates the committal of a case of the scheduled offence from the court of Magistrate to the Special Court trying the Money Laundering Offence upon an application, even when the same is not expedient in the interest of justice or deemed appropriate in the fact and circumstances of the case.

It further contends that in a matter where certain offences have been exclusively held to be triable by a court of Magistrate, any transfer or committal of a trial of such an offence to a higher court would deprive the right of a forum or appeal entitled to the aggrieved under the law and consequently seriously prejudice and hamper the right to life and liberty guaranteed under Articles 14, 19 and 21 of the Constitution of India.

The petition reads,

“The court of a Magistrate has no jurisdiction to even entertain and decide an Application u/s 44, PMLA, 2002, when the designated court under Section 43 of the PMLA, 2002 can only be a court of Sessions. This is further fortified from the observation of the Ld. Trial court in the impugned order dated 18.02.2021, wherein it goes on to hold that it has no jurisdiction to hear an Application pertaining to the PMLA, 2002 however most erroneously still hears, decides and allows an Application u/s 44 of the same statute i.e. PMLA, 2002.”

“Such transfer/committal leading to the same court trying the offence of money laundering as well as the scheduled offence would seriously prejudice the accused, in as much as the special court if goes on to convict the accused in one such trial, would rather sit with a premeditated mind while adjudicating and trying the other offence,” it adds.

Along with the challenge to the said section, the petitioner has sought stay on pending proceedings in this regard before the court of Ms. Anuradha Shukla Bharadwaj, Ld. ASJ, Rouse Avenue Courts under the Title "CBI vs Deepak Talwar & Ors.”

The petitioner has also challenged the order dated February 18, 2021, by a magistrate Court allowing the application of ED u/s 44(1)(c) of the Prevention of Money Laundering Act, 2002 and committed the prosecution case of the CBI against the petitioner, (being the scheduled offence) to the Session Court.

The Backdrop of the Case

The Petitioner, NGO Advantage India is one of the accused firms facing the probe regarding misappropriation of funds under various sections of the Foreign Contribution Regulation Act (FCRA), 2010, Indian Penal Code (IPC) and PMLA by CBI and ED.

CBI registered an FIR regarding the same in 2017 and later ED registered an Enforcement Case Information Report (ECIR) despite being very well aware that primarily the FIR registered by CBI was based on alleged violation of receipt of foreign contributions, the covenants of the FCRA, which is not even in the schedule of PMLA, 2002.

Counsel - Tanveer Ahmed Mir & Prabhav Ralli for the Petitioner.

Case Title- M/S Advantage India v. Directorate of Enforcement and Anr.