PMLA | Delhi High Court To Examine Whether Pension, Other Retiral Benefits Can Constitute 'Proceeds Of Crime'
The Delhi High Court is set to examine a plea raising the question whether pension, gratuity, provident fund, leave encashment and fixed deposits created from statutory retiral dues can be treated as “proceeds of crime” under the Prevention of Money Laundering Act (PMLA) in the absence of a direct nexus with criminal activity relating to a scheduled offence.Justice Swarana Kanta Sharma...
The Delhi High Court is set to examine a plea raising the question whether pension, gratuity, provident fund, leave encashment and fixed deposits created from statutory retiral dues can be treated as “proceeds of crime” under the Prevention of Money Laundering Act (PMLA) in the absence of a direct nexus with criminal activity relating to a scheduled offence.
Justice Swarana Kanta Sharma issued notice to the Directorate of Enforcement (ED) on a petition filed by one Santosh Kumar Gupta and another individual challenging an order passed by the PMLA Appellate Tribunal in four appeals.
The petitioners have sought a declaration that pension, gratuity, EPF, leave encashment and FDRs created from statutory retiral dues do not constitute “proceeds of crime” within the meaning of Section 2(1)(u) of the PMLA.
They have also contended that continued withholding of their pensionary and retiral dues, despite judicial orders, violates Articles 14, 21 and 300A of the Constitution of India.
They have further sought directions to the ED to comply with orders passed by the Special Judge, CBI Court, Jaipur, on May 21, 2018, and by the Appellate Tribunal on May 27, 2024 and May 28, 2025, and consequently release or de-freeze their pension, gratuity, provident fund, leave encashment and retiral benefit-related accounts/FDRs along with accrued interest.
They have additionally sought a direction to attach alternative properties to the extent of Rs. 35.5 crore, stated to be the amount allegedly invested with a co-accused since 2014 and retained by him, and consequently release them from the attachment in terms of the Appellate Tribunal's orders.
The Court has directed the ED to file its counter-affidavit within four weeks.
“Issue notice. The learned counsel accepts notice on behalf of the respondent. Let the counter affidavit be filed within a period of four weeks from date, with an advance copy to the learned counsel for the petitioners, who may file rejoinder thereto, if any, at least two days prior to the next date of hearing,” the Court said.
The matter is now listed on December 03.
Title: SANTOSH KUMAR GUPTA & ANR v. DEPUTY DIRECTOR, DIRECTORATE OF ENFORCEMENT