ED can't investigate offences other than money laundering: Delhi HC

The court added that the predicate offence has to be necessarily investigated and tried by the authorities empowered by law in that regard.

Published: 25th January 2023 12:29 PM  |   Last Updated: 25th January 2023 12:29 PM   |  A+A-

Delhi HC

Delhi HC (File Photo | PTI)

By Express News Service

NEW DELHI: The Delhi High Court has said that the Enforcement Directorate (ED) cannot assume by itself that a predicate offence has been committed as it does not have the powers to probe any offence other than money laundering.

"What needs to be emphasised is that the PMLA empowers the ED to investigate Section 3 offences only. Its power to investigate and enquire stands confined to the offence of money laundering as defined in that Section. However, the same cannot be read as enabling it to assume from the material that it may gather in the course of that investigation that a predicate offence stands committed," single-judge Justice Yashwant Varma held in an order dated January 24.

The court added that the predicate offence has to be necessarily investigated and tried by the authorities empowered by law in that regard.

It averred that "The ED cannot possibly arrogate unto itself the power to investigate or enquire into the alleged commission of those offences. In any case, it cannot and on its own motion proceed on the surmise that a particular set of facts evidence the commission of a scheduled offence and based on that opinion initiate action under the PMLA (Prevention of Money Laundering Act)."

If in the course of its enquiry and investigation, ED comes to the conclusion that the material in its possession shows the commission of an offence created under any other enactment, it would be obliged to furnish requisite information to the concerned agency for necessary action, it was noted.

The observations of the high court were following the hearing of pleas moved by Prakash Industries Limited and Prakash Therma Power Limited challenging the Provisional Attachment Orders (PAO) issued by the ED on November 29, 2018.

It also relied on a Supreme Court observation, pointing out that "The Authorities under the 2002 Act cannot prosecute any person on the notional basis or on the assumption that a scheduled offence has been committed unless it is so registered with the jurisdictional police and/or pending enquiry/trial including by way of criminal complaint before the competent forum."


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