[S.50 PMLA] Application For Recording Statement Of Accused Can Only Be Made Before Sessions/ Special Court, Not Magistrate: Karnataka HC

The Karnataka High Court has said that in light of the statutory framework of Prevention of Money Laundering Act, applications for recording statements of an accused/ suspect can only be made before the Special Court designated to try cases under the Act. A single judge bench of Justice M Nagaprasanna said, "PMLA mandates that anything emanating from the PMLA shall be considered only by the Special Court." The bench made the observation while allowing the petition filed by one Harsha D, an accused in the PSI recruitment scam, challenging the order of the Magistrate which allowed the application filed by Directorate of Enforcement (ED) under Section 50(3) of the Act seeking permission to record written statement of five accused including the petitioner who were in its custody. Findings: At the outset, the bench noted that Section 43 of PMLA directs the constitution of a Special Court or a designated Court and such Court to be the Court of Session. Therefore, in terms of Section 43 for trying the offence punishable under the PMLA designated Court is the Court of Session. Moreover, Section 50 empowers the authorities under the PMLA with regard to summons, production of documents and to give evidence. Section 71 of the PMLA makes the provisions of PMLA to have overriding effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force. Referring to the application filed by ED the bench said, "The intention of the Investigating Officer appointed to investigate into the ECIR was to record the statements in terms of subsections (2) and (3) of Section 50. Therefore, the provisions of PMLA were invoked against the petitioner and it is during investigation where the offence under Sections 3 and 4 is made out and the statements are sought to be recorded." It said that if the ED wants to invoke the provisions of the PMLA to discern the offence under Section 3, the designated Court is the Court of Session alone which had the power to even consider any application emanating from the provisions of the PMLA. "Merely because custody is ordered by the learned Magistrate, he cannot be clothed with the powers of a Court of Session, which alone has the power to consider any application of the kind that was made before the learned Magistrate." It added, "The learned Magistrate was dealing with an application filed under Section 50 of the PMLA. It was completely without jurisdiction for the learned Magistrate to have considered the application filed under Section 50 of the PMLA. It ought to have been placed before the concerned Court for taking permission to record the statements as it is trite that the Special Court can always have the power of the Magistrate and not the other way round since it touches upon the jurisdiction." The bench opined, "The acts of the accused may result in several proceedings under the IPC, under special enactments or under any other law that would govern such accused and those enactments may require the accused to be tried before a Special Court. If the offence alleged is amalgam of the offences under the IPC which is to be tried before a Magistrate and the other offences to be tried before a Special Judge, any proceedings that the prosecution wants to initiate under special enactment it shall be only before the Special Court." Accordingly it allowed the petition. Case Title: HARSHA D v. STATE BY HIGH GROUND POLICE STATION Case No: WRIT PETITION No.19042 OF 2022 Citation: 2022 LiveLaw (Kar) 419 Date of Order: 17TH DAY OF OCTOBER, 2022 Appearance: SANDESH J.CHOUTA, SR.ADVOCATE A/W ARUN G, ADVOCATE for petitioner; K.S.ABHIJITH, HCGP FOR R1 & R2; MADHUKAR DESHPANDE, SPL.P.P. FOR R3 Click Here To Read/Download Order

[S.50 PMLA] Application For Recording Statement Of Accused Can Only Be Made Before Sessions/ Special Court, Not Magistrate: Karnataka HC

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[S.50 PMLA] Application For Recording Statement Of Accused Can Only Be Made Before Sessions/ Special Court, Not Magistrate: Karnataka HC

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