PMLA Court Can Try Corruption Cases Along With Money Laundering Case After Transfer: Kerala High Court

The Kerala High Court has held that a Special Court constituted under the Prevention of Money Laundering Act (PMLA) can try a scheduled offence under the Prevention of Corruption Act once the case is committed to it.

It held that this remains so even if the court is not the one specifically notified to try offences under the anti-corruption law.

Justice A. Badharudeen made the finding while dismissing a petition filed by the Central Bureau of Investigation (CBI). The agency had challenged an order transferring a corruption case from the Special Court (SPE/CBI)-II, Ernakulam, to the Special Court dealing with PMLA cases at Kozhikode.

“...it is held that a Special Court constituted under the PML Act, on committal of a case under Section 44(1)(c) of PML Act, is legally competent and having jurisdiction to try the scheduled offence/offences even though the same is not a notified court to try the scheduled offence/offences.”

The CBI challenged the transfer of a corruption case that was pending before the Special Court (SPE/CBI)-II, Ernakulam. The case was committed to the PMLA Special Court at Kozhikode, where a connected money laundering case was already pending.

The investigating agency argued that only the notified Special Court under the Prevention of Corruption Act had jurisdiction to try the scheduled offence. It contended that transferring the case to the PMLA Special Court amounted to an erroneous exercise of jurisdiction. The Directorate of Enforcement supported the CBI's stand.

One of the accused opposed the plea. The accused argued that the PMLA permits the Special Court to try both the money laundering case and the connected scheduled offence once the latter is committed to it. Reliance was placed on Sections 44(1)(a), 44(1)(c) and 71 of the PMLA.

The court examined the relevant provisions of the PMLA. It held that under Section 44, the Special Court is competent to try both the money laundering offence and the connected scheduled offence once the latter is committed to it.

The court further observed that where another court has already taken cognisance of the scheduled offence, the case can be committed to the PMLA Special Court. It held that the Special Court must proceed with the trial from the stage at which the case is committed.

“Section 44(1)(c) would indicate that, if the court which has taken cognizance of the scheduled offence is other than the Special Court which has taken cognizance of the complaint of the offence of money-laundering under sub-clause (b), it shall, on an application by the authority authorised to file a complaint under this Act, commit the case relating to the scheduled offence to the Special Court and the Special Court shall, on receipt of such case proceed to deal with it from the stage at which it is committed.”, it observed.

The court also observed that Section 71 of the PMLA gives the Act overriding effect over inconsistent provisions contained in other laws.

Finding no infirmity in the transfer order, the court dismissed the CBI's petition. It also directed the registry to forward a copy of the judgment to the Special Court at Kozhikode so that the trial could proceed.

For Petitioner: Advocates Sreelal N Warrier, Spl Public Prosecutor, CBI

For Respondents: Senior Advocate A Sudhi Vasudevan, Advocates Jose Jones Joseph, M Ajay, Divya Nagaraj, V.P Prasad and Jaishankar V Nair, Standing Counsel (ED)