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[No PMLA Case Without Scheduled Offence] ED Approaches Bombay High Court Against Special Court's Release Order Based On SC Judgment

Sharmeen Hakim
10 Aug 2022 4:21 PM GMT
[No PMLA Case Without Scheduled Offence] ED Approaches Bombay High Court Against Special Courts Release Order Based On SC Judgment

The Bombay High Court on Wednesday agreed to hear ED's plea against an interim order directing the release of two accused in a money laundering case following the Supreme Court's recent judgement on the Prevention of the Money Laundering Act (PMLA).

Justice PD Naik granted ED circulation for Thursday after the matter was mentioned by Special Public Prosecutor Hiten Venegavkar in the afternoon session.

Earlier in the day the prosecutor had mentioned the matter before the bench of Justice Bharati Dangre, however she refused circulation and said she was disinclined to hear the matter before final orders were passed by the trial court.

The event assumes significance as the trial court's order can impact several other PMLA cases. The ED claimed that the trial court violated principles of natural justice as the agency was not granted time to respond.

Last week a Special court in Mumbai ordered the interim release of two accused in a the PMLA case after they contended were exonerated in the scheduled offence or predicate offence. The accused had filed an application through their lawyer Vijay Aggarwal claiming the court did not have jurisdiction to extend their custody. They were granted relief pending hearing.

The special judge relied on the Vijay MandalChaudhary and others Vs. Union of India [SLP (Crl.) No.4634 of 2014, wherein the Supreme Court held that if there is no scheduled/ predicate offence, the PMLA case cannot continue.

"The guidelines of the Hon'ble Supreme Court in the above authority are very clear. This Court has no jurisdiction to extend judicial custody of the accused under PML Act when there is no scheduled offence," the court said interpreting the judgement.

It therefore granted interim relief to Babulal Varma and Kamalkishore Gupta who were arrested in the money laundering case on January 2021 connected to Omakar Realtors and Developers Private Ltd.

The duo claimed that the ED offence was based on a cheating case filed in Aurangabad, which is a scheduled offence. However, since a 'C' summary report has been filed in the cheating case, even the PMLA case wouldn't survive.


On Wednesday, both accused filed fresh applications seeking discharge on the same grounds. The court has asked ED to respond a kept the applications for hearing day after tomorrow. The judge is likely to pass a common order on both applications.

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