NEW DELHI: The Supreme Court on Thursday quashed the Enforcement Directorate complaint against industrialist J Sekar Reddy.
The top court has set aside a Madras High Court order that had dismissed his plea seeking quashing of proceedings related to the Prevention of Money Laundering Act (PMLA) case.
“We are of the firm opinion that the chances to prove those allegations in the court are very bleak... The High Court by the impugned order has recorded the finding without due consideration of the letter of the Income Tax Department and other material in the right perspective. Therefore, in our view, these findings of the High Court cannot be sustained,” the Supreme Court said in its order.
“Accordingly, we set aside the impugned order passed by the High Court,” the order reads.
The top court has observed that the department is itself unable to collect any incriminating material and has not produced it before the court even after a lapse of five-and-a-half years to prove its case beyond reasonable doubt.
“From the material collected by the agency, they themselves are prima facie not satisfied that the offence under PMLA can be proved beyond reasonable doubt...,” it added.
In December 2016, the Income Tax Department, Chennai conducted a search of his official premises and seized a large amount of currency and gold.
Subsequently on December 19, 2016, the CBI registered a case against the appellant and two others.
The Enforcement Directorate after perusing the FIR of the CBI felt that in addition to the scheduled offences, it also attracted the provisions of the PMLA against the appellant and others.
The ED then enquired and conducted an investigation and found new Rs 2000 currency notes of a total value of Rs 33,74,92,000 in a subsequent search of his official and commercial premises.
The CBI had also registered two FIRs in December 2016. He then filed the bail application in the cases before the Principal Special Judge for CBI Cases, Chennai. The Special Court in an order dated March 2017 granted bail to the appellant imposing certain conditions.
Later on, the Madras HC quashed the new CBI FIRs and gave liberty to the CBI to treat the allegations made in the FIRs as supplementary allegations or to merge the same in the first FIR.
The investigation made by the Income Tax Department was closed on the basis of it being accounted money and the records of taxes paid by the industrialist.
Later on, he approached the Madras High Court seeking quashing of the proceedings under the PMLA which was dismissed by the court. This was subsequently challenged before the apex court.