Stay on FIR do not bar ED from Registering ECIR for PMLA Offence: Punjab & Haryana HC [Read Order]

The Punjab and Haryana High Court ruled that the stay on FIR do not bar the Enforcement Directorate (ED) from registering Enforcement Case Information Report ( ECIR ) for the Prevention of Money Laundering Act, 2002 ( PMLA ) offence.

The petitioners Sikandar Singh and Vikas Chhoker were arraigned as accused in the said complaints apart from 13 other persons by name and other accused, if found involved after investigation. Broadly, the allegations were that the petitioners and other persons named in the complaint alongwith other unnamed persons were in construction business and had duped the investors after having obtained licence to develop a housing project in Sector 68, Gurugram which also had been obtained on submission of forged and fabricated documents. It was alleged that about 3000 investors had been left high and dry and a wrongful loss of around one thousand crores had been caused.

The primary issue raised in the present petitions is that once the basic order passed on the complaint filed under Section 156(3) Cr.P.C. had been set aside, the FIRs would cease to be in operation and would be rendered nullity. Further, once there was no scheduled offence, no offence under the PMLA would remain.

It was strenuously urged by the Senior Counsel representing the petitioners that the action of the respondent-ED in registering the ECIR after order dated 27.01.2021 having been passed and continuing with the proceedings after the order dated 07.01.2021 having been set aside by the Single Bench of this Court vide order dated 05.07.2023 is illegal, arbitrary and de hors the settled law and accordingly the said ECIR deserves to be quashed.

A Division Bench of Justices Arun Palli and Vikram Aggarwal observed that “Since there were other FIRs also, proceeds of crime cannot be ruled out and, therefore, it cannot be said that no offence of money laundering can be said to have been committed. As has been observed in the preceding paragraphs, the case is only at the stage of investigation and nothing can be said conclusively at this stage. The reality would emerge only once the concerned Investigating Agencies conclude the investigation/inquiry.”

“Still further, once there were other FIRs pending against the petitioners, it cannot be said that there were no proceeds of crime and, therefore, no offence of money laundering, as defined under Section 3 of the PMLA, can be said to have been committed” the Court noted.

To Read the full text of the Order CLICK HERE

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