7 Feb 2023 5:16 AM GMT
The Supreme Court on Tuesday dismissed the writ petition filed by journalist Rana Ayyub challenging the jurisdiction of a special court in Ghaziabad under the Prevention of Money Laundering Act, 2002 to take cognisance of the complaint filed by the Enforcement Directorate against her for alleged violations in amounts collected through crowdfunding for COVID relief.On January 31, a...
The Supreme Court on Tuesday dismissed the writ petition filed by journalist Rana Ayyub challenging the jurisdiction of a special court in Ghaziabad under the Prevention of Money Laundering Act, 2002 to take cognisance of the complaint filed by the Enforcement Directorate against her for alleged violations in amounts collected through crowdfunding for COVID relief.
On January 31, a division bench of Justices V. Ramasubramanian and J.B. Pardiwala had reserved the verdict in a petition filed by Ayyub challenging the court summons against her on the ground of lack of jurisdiction of the Ghaziabad court.
Senior Advocate Vrinda Grover, appearing on behalf of the journalist, had argued that the Uttar Pradesh court had ‘absolutely no jurisdiction’ since no part of the alleged offence was committed in the state and that the alleged proceeds of crime are in an account maintained in Navi Mumbai. The bench has rejected this argument, while leaving it open to the petitioner to raise the issue before the trial court.
Justice Ramasubramanian read out the operative portion of the order as follows :
“Under Section 3 of PMLA, place where any of six activities or processes are carried out - concealment, possession, acquisition, use, projecting as untainted property, claiming as untainted property, the offence of money laundering is said to have taken place. Navi Mumbai, where the bank account is located, is the destination where the proceeds of crime have reached, if at all. The question as to whether any one or more of the six activities have taken place question of fact which has to be decided based on evidence. Therefore, we leave it open for this issue to be raised before the trial court. Petition dismissed.”
Detailed judgment is yet to be uploaded.
Solicitor General of India Tushar Mehta, appearing for the ED, had argued that the money laundering complaint has to be filed at the place where the scheduled offence has taken place. The ED initiated the investigation based on an FIR registered at Ghaziabad. He also argued that persons from UP and Noida have also donated for Ayyub's campaign and hence a part of the offence has taken place in that jurisdiction. He refuted Grover's argument that money laundering complaint can only be filed at a place where the proceeds of crime are found.
Ayyub came under the scanner of the federal agency for allegedly ‘cheating’ the public by misappropriating charitable donations worth Rs 2.69 crore and for receiving overseas donations without registration under the Foreign Contribution (Regulation) Act, 2010. The investigation was initiated on the strength of a first information report registered in September 2021 by the Indirapuram Police Station in Ghaziabad under various sections of the Indian Penal Code, 1860, Information Technology Amendment Act, 2008, and Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015. What was of interest to the law enforcement agency was a series of three campaigns launched since 2020 by the journalist on an online crowdfunding platform called Ketto to raise funds for slum-dwellers and farmers, relief work in Assam, Bihar, and Maharashtra, and for people impacted by the COVID-19 pandemic in India.
In February, in the course of the investigation, bank balances in the accounts of Ayyub amounting to around Rs 1.77 crore, including a fixed deposit of Rs 50 lakh were attached by means of provisional attachment order. In March, the award-winning journalist was stopped by immigration officials at the Mumbai airport from taking a flight to London, on the basis of a ‘Look out Circular’ issued against her by the ED for allegedly failing to comply with their summons. The Delhi High Court, in April, quashed the circular, allowing Ayyub to travel abroad, and in August, restrained the federal agency from proceeding further with the provisional attachment of her properties in connection with the money laundering probe.
Finally, in October, the Enforcement Directorate concluded the investigation. “The investigation has established that Rana Ayyub had launched the fundraising campaigns with the sole intention to cheat the general public and acquired proceeds of crime in form of fixed deposits and balances in bank accounts projecting them as untainted,” the ED claimed in a statement on October 13, one day after it filed a charge-sheet against Ayyub before a special PMLA court in Ghaziabad under Section 45 read with Section 44 of the anti-money laundering act. Ayyub, a prominent critic of the current ruling dispensation, claimed that she was being targeted and intimidated for her work and for questioning the ruling regime.
On November 29, the special court took cognizance of the prosecution complaint and summoned Ayyub to appear before the court on January 27. The journalist moved the top court in January praying for the proceedings initiated by the Enforcement Directorate in Ghaziabad to be quashed. The petitioner has, inter alia, cited the lack of jurisdiction of the special court in Ghaziabad since the alleged offence occurred in Mumbai.
Also Read - Jurisdiction To Try Money Laundering Offence Not Limited To PMLA Court At Place Where Proceeds Of Crime Are Found : Supreme Court In Rana Ayyub Case
Rana Ayyub v. Directorate of Enforcement | Writ Petition (Criminal) No. 12 of 2023
Citation : 2023 LiveLaw (SC) 86
For Petitioner(s) Ms. Vrinda Grover, Adv. Mr. Soutik Banerjee, Adv. Mr. Aakarsh Kamra, AOR Ms. Devika Tulsiani, Adv. Ms. Mannat Tipnis, Adv.
For Respondent(s) Mr. Tushar Mehta, Solicitor General Mr. Mukesh Kumar Maroria, AOR Mr. Zoheb Hussain, Adv. Mr. Kanu Agarwal, Adv. Mr. K. Parmeshwar, Adv. Mr. Padmesh Mishra, Adv.
Territorial Jurisdiction of Special PMLA Court – Prevention of Money Laundering Act (Act 15 of 2003); Sections 3 and 44 – Place of commission of the offence of money-laundering – The involvement of a person in any one or more of certain processes or activities connected with the proceeds of crime, namely, concealment, possession, acquisition, use, projecting as untainted property, or claiming as untainted property, constitutes the offence of moneylaundering – All the places where any one or more of these processes or activities take place are the places where the offence of money-laundering has been committed – Triable by the special court(s) constituted for the area(s) in which the offence of money-laundering has been committed – Held, the petition could not be entertained since the issue of territorial jurisdiction could not be decided in a writ petition, especially in the presence of a serious factual dispute about the place or places of commission of the offence – Petition dismissed. (Paras 38 to 40)
Prevention of Money-laundering Act, 2002; Section 44 - It is the Special Court constituted under the PMLA that would have jurisdiction to try even the scheduled offence. Even if the scheduled offence is taken cognizance of by any other Court, that Court shall commit the same, on an application by the concerned authority, to the Special Court which has taken cognizance of the offence of money-laundering. (Para 36)
Code of Criminal Procedure, 1973 - Prevention of Money-laundering Act, 2002; Section 46(1), 65, 71 - The provisions of the Cr.P.C. are applicable to all proceedings under the Act including proceedings before the Special Court, except to the extent they are specifically excluded. Hence, Section 71 of the PMLA providing an overriding effect, has to be construed in tune with Section 46(1) and Section 65.(Para 28-29)
Prevention of Money-laundering Act, 2002; Section 3 -The area in which the property is derived or obtained or even held or concealed, will be the area in which the offence of money laundering is committed. (Para 39-40)
Constitution of India, 1950; Article 32, 226 - Prevention of Money-laundering Act, 2002; Section 3 - The issue of territorial jurisdiction cannot be decided in a writ petition, especially when there is a serious factual dispute about the place/places of commission of the offence - This question should be raised by the petitioner before the Special Court, since an answer to the same would depend upon evidence as to the places where any one or more of the processes or activities mentioned in Section 3 were carried out. (Para 46)
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