‘Astonishing that ED unaware of facts’: PMLA court criticises agency for not knowing case status
The court expressed its displeasure at the agency for not knowing the status of a scheduled offence based on which it began its investigation.
A special Mumbai court on Monday criticised the Enforcement Directorate for not being aware of the status of a scheduled offence based on which it began its investigation, The Indian Express reported.
“It is astonishing to note that ED [Enforcement Directorate] is completely unaware of the facts, details and status of the case relating to the scheduled offence, its present stage, etc,” the court said.
Under the Prevention of Money Laundering Act, the Enforcement Directorate can only file a complaint pertaining to money laundering allegations based on a case registered by another investigative agency. The original case is called a scheduled offence or a predicate offence.
In August, the Supreme Court had ruled that PMLA proceedings cannot continue if there is no scheduled offence.
The court was on Monday hearing a bail plea of businessman Mehul Thakur in the Yes Bank-Mack Star loan fraud case, according to The Times of India. Special Judge MG Deshpande granted him bail.
Mack Star is a joint venture between a Mauritius-based firm, Ocean Deity Investment Limited, and entities belonging to Rakesh and Sarang Wadhawan, promoters of Mumbai-based firm Housing Development and Infrastructure Limited. The central agency claims that Mack Star got several loans amounting to Rs 200 crore in a criminal conspiracy with Yes Bank founder Rana Kapoor.
The first information report in the case was filed by the Central Bureau of Investigation, which claimed that the amount was diverted to the Wadhawans.
On Monday, special Judge MG Deshpande said that mere allegations in the first information report relating to a scheduled offence are not sufficient to look into claims of criminal activity.
“Except FIR relating to the predicate offence, ED is absolutely not in touch with the facts as to whether CBI had filed a chargesheet. Whether the court dealing with the case relating to the scheduled offence has taken cognizance. Whether the trial of the said case is in progress or stalled,” the judge remarked, according to The Indian Express.
During Monday’s hearing, the court said that as per the Enforcement Directorate’s case, the Wadhawans appeared to be the main conspirators in the case, but they were not yet arrested under Section 19 of the PMLA, reported The Times of India.
To this, the counsel representing the Enforcement Directorate said that the Wadhawans were arrested in a separate case, and added that the agency holds the “prerogative of who is to be arrested and who should not be”.
“This is sheer disparity made by the ED for the reasons best known to them,” the judge said in response. “Can the court act simply as their rubber stamp by shutting eyes?”
Last week, in a case related to Iqbal Mirchi, an aid of fugitive gangster Dawood Ibrahim, the special court had directed the Enforcement Directorate to take “serious note” and come up with concrete information about the status of the pending cases, according to The Indian Express.