Summary
A journalist summoned by the Special Court at Ghaziabad on an Enforcement Directorate complaint of money laundering arising from online crowdfunding challenged the summons under Article 32 solely for want of territorial jurisdiction, her bank account being in Navi Mumbai. The Supreme Court dismissed the petition: under Section 44(1)(a) and (c) of the Prevention of Money-laundering Act, 2002 the trial of the scheduled offence follows the trial of the money-laundering offence before the Special Court, not the reverse; money laundering is committed wherever any of the Section 3 processes of concealment, possession, acquisition, use, projecting or claiming occurred, and where funds were acquired online from donors in different places that is a question of fact for the trial court. The objection may be raised before the Special Court.
Issues
- Whether, under the Prevention of Money-laundering Act, 2002, the trial of the offence of money laundering follows the trial of the scheduled offence or vice versa.
- Whether a Special Court at Ghaziabad lacked territorial jurisdiction over a money-laundering complaint where the proceeds of alleged crowdfunding fraud were received in a bank account in Navi Mumbai, and whether that question can be decided in a writ petition.
Provisions considered
- Sections 3, 2(1)(u), 43, 44(1)(a) and (c), 46(1), 65 and 71, Prevention of Money-laundering Act, 2002Section 44(1)(a) makes both the money-laundering offence and the connected scheduled offence triable by the Special Court for the area where the money-laundering offence was committed, and Section 44(1)(c) requires a court seized of the scheduled offence to commit it to that Special Court; Sections 46(1) and 65 apply the Criminal Procedure Code except where excluded, so Section 71 is read in harmony with them. Money laundering is committed in each area where proceeds of crime are acquired, possessed, concealed, used or projected as untainted. (¶¶ 18, 19, 22, 23, 24, 25, 27, 28, 29, 36, 38, 39, 40)
- Sections 177 to 184, Code of Criminal Procedure, 1973The rules of territorial jurisdiction summarised in Kaushik Chatterjee, including trial in any local area where part of the offence or any of several acts occurred, complete the picture together with Section 44 of the Act; the only contingency the Code could not provide for is where the offence of money laundering is committed, hence the non obstante clause. (¶¶ 31, 32, 33, 34, 35)
Held
- The Navi Mumbai account was the ultimate destination of the funds and so the place of possession of the alleged proceeds, but only one of the six processes in Section 3; acquisition occurred in the virtual mode through online transfers from persons in different parts of the country, and the places of acquisition, concealment or use are facts known to the petitioner and her bankers which must emerge in evidence before the trial court. (¶¶ 41, 42, 43, 44, 45)
- Following Kaushik Chatterjee, questions of territorial jurisdiction depend on facts established through evidence and must be raised before the court trying the offence, which is bound to consider them; a serious factual dispute about the place of commission cannot be resolved in a writ petition. (¶¶ 45, 46)
Result
Writ petition dismissed without costs; liberty granted to the petitioner to raise the issue of territorial jurisdiction before the Special Court at Ghaziabad.