The Delhi High Court has held that protection granted to an accused in proceedings arising out of a predicate offence does not automatically extend to independent proceedings initiated under the Prevention of Money Laundering Act (PMLA).

Justice Madhu Jain clarified that the proceedings under PMLA are distinct from those relating to the scheduled or predicate offences and, therefore, any protection granted in the latter cannot, by itself, mean that protection be also given to an accused in proceedings under under the anti-money laundering law.

“The protection granted in the predicate offence operates in the context of the said FIR and cannot, by itself, be construed as extending to the distinct and independent proceedings under the PMLA,” the Court said.

It made the observation while dismissing an anticipatory bail plea filed by a man in a money laundering case registered by the Enforcement Directorate (ED).

The accused argued that he had not been named in the predicate FIRs and that he had already secured protection in proceedings concerning the scheduled offence.

He also contended that the allegations against him were based primarily on statements of co-accused persons and that there was no material showing his conscious involvement in money laundering.

Dismissing the plea, the Court rejected the accused's argument that he was granted interim protection by the Supreme Court in the predicate offence and that in order to comply with the directions, he was required to seek anticipatory bail in the PMLA proceedings as well.

It observed that the accused cannot claim pre-arrest protection in the money laundering proceedings merely on the ground that such protection has been granted to him in the predicate offence.

The Court noted that the material placed on record traced proceeds of crime amounting to approximately Rs.26.18 crores to the accused.

It also took note of the accused's conduct after being summoned by the ED. The Court said that although summons under Section 50 of PMLA were issued to him on May 21, May 22 and May 26, he did not personally appear and instead submitted a written response through counsel.

The Court concluded: “In view of the aforesaid material, this Court finds that the condition required under Section 45(1)(ii) of the PMLA is not satisfied and the petitioner has not been able to demonstrate that there are reasonable grounds for believing that he is not guilty of the offence alleged against him.”

It said that the material placed on record, including the accused's conduct, the statements recorded under Section 50 of PMLA, financial trail and analysis of the bank accounts, disclosed sufficient material connecting him with the alleged proceeds of crime.

Accordingly, the Court dismissed the anticipatory bail application. It however clarified that its observations were confined to the consideration of the bail plea and would not affect the merits of the case.

Title: RAM SINGH v. DIRECTORATE OF ENFORCEMENT

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