Supplementary Complaint Under PMLA Doesn't Require Fresh Cognizance: Madras High Court

The Madras High Court recently observed that a supplementary complaint under Section 44 of the Prevention of Money Laundering Act is not a fresh or independent complaint requiring the court to take cognisance. The bench of Justice SM Subramaniam and Justice Mohammed Shaffiq held that a supplementary complaint is a part and parcel of the main complaint for which cognisance has already been taken. The court added that taking multiple cognisance for the same offence would render the judicial process redundant and would result in a delay in the justice delivery process. “The language of the Section makes it clear that supplementary complaint is not a fresh or independent complaint but is deemed to be part and parcel of the main complaint in respect of which cognizance has already been taken. Taking multiple cognizance of the same offence would render the judicial process redundant and result in delay in the justice delivery process. Once cognizance of an offence is taken, any further supplementary prosecution complaint is considered as flowing from the main prosecution complaint for which the Court has already taken cognizance. So adding multiple layers of procedure to an already cognized complaint is a futile exercise,” the court observed. The court was dealing with a petition filed by Rahul Surana to set aside the docket order of the Special Court for PMLA Cases taking cognisance of the case against Surana. The prosecution's case was that Surana Industries Limited entered into a criminal conspiracy to defraud the public sector banks of Rs. 1,301 crores through misappropriation, fraud, and manipulation of accounts. As per the prosecution the company created a web of shell and dummy companies to siphon loan funds via fictitious transactions, which were then layered and ultimately invested in movable and immovable properties as alleged proceeds of crime. The ED filed a Main Prosecution Complaint on September 9, 2022, under Section 44(1)(b) of the PMLA before the Special Court against 8 accused persons, and cognisance was taken for the same, and the case was registered. The ED then filed a First Supplementary Prosecution Complaint on June 11, 2024. Subsequently, a second supplementary prosecution complaint was filed on November 6, 2024 in which the petitioner was included as an accused. The said second complaint was taken on file and process was issued on February 17, 2025 which was challenged by way of present plea. The petitioner argued that he was not given an opportunity to be heard before taking cognisance of the second supplementary complaint, as required under proviso to Section 223(1) of the BNSS. The court noted that the Explanation to Section 44(ii) of the PMLA clarifies that the prosecution complaint shall be deemed to include any subsequent complaint in respect of further investigation that may be conducted to bring any further evidence, oral or documentary, against any accused person involved in respect of the offence, whether named in the original complaint or not. In the present case, the court noted that the cognisance of offence was already taken and thus, the second supplementary complaint does not involve taking cognisance afresh. The court added that though the special judge, in the docket order, had written that cognisance of second supplementary complaint was taken, it should be read as supplementary complaint taken on file. The court added that this was a mere curable error of expression and it would not vitiate the entire proceedings nor could it result in miscarriage of justice. The court rejected the petitioner's argument that a pre-cognisance hearing as prescribed under Section 223(1) of the BNSS was not given to them. The court held that the present plea does not involve taking cognisance of the main prosecution complaint. The court observed that pre pre-cognisance hearing could not be equated with a mini-trial and it was only a procedure for the court to satisfy its jurisdiction and related procedural aspects. The court also rejected the petitioners' argument that the SFIO complaint, based on which the second supplementary complaint was filed, was not fresh material as provided in Section 44 of the Act. Perusing the materials, the court held that the SFIO complaint was not a mere re-evaluation of existing materials but constituted fresh evidence obtained during the course of further investigation. Thus, the court held that the order of the Special Court need not be interfered with and that the petition was devoid of merit. The court thus dismissed the plea Counsel for Petitioner: Mr. Shree Singh for Mr. Vishnu Vardhan. J and Mr. Mayank Pandey Counsel for Respondents: Mr. N. Ramesh Special Public Prosecutor For ED Cases Case Title: Rahul Surana v. The Assistant Director Citation: 2025 LiveLaw (Mad) 427 Case No: CRL RC No. 1541 of 2025Click Here To Read/Download The...

Supplementary Complaint Under PMLA Doesn't Require Fresh Cognizance: Madras High Court

Upasana Sajeev

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