35 FAQs on DRI – ED nexus for investigations and Adjudications across India

Summary: The Darshan Mala Series examines the DRI–ED nexus for investigations and adjudications across India, focusing on the relationship between Directorate of Revenue Intelligence proceedings under the Customs Act, 1962 and Enforcement Directorate proceedings under the Prevention of Money Laundering Act, 2002. It explains that Customs investigations and PMLA proceedings may arise from the same transaction and may use overlapping evidence, but remain legally distinct and require satisfaction of the respective statutory ingredients. The FAQs discuss Customs offences, scheduled offences, Proceeds of Crime, ECIRs, parallel investigations, Customs adjudication, PMLA attachment and adjudication, and the consequences when the predicate proceedings fail. Particular attention is given to the distinction between Customs duty or revenue liability and a criminal scheduled offence capable of supporting PMLA action. The Series also examines whether DRI evidence can be relied upon by the ED, whether a Customs demand can automatically constitute Proceeds of Crime, and the need for independent application of mind by the ED. The judicial section discusses Supreme Court and High Court decisions including Vijay Madanlal Choudhary, Pavana Dibbur, Pradeep Kumar, Kanchana Rai, Ajay Kumar Baheti and Seema Garg, with emphasis on the requirement of a valid scheduled offence, identifiable Proceeds of Crime and a demonstrable nexus between the predicate offence and attached property. The concluding propositions state that a Customs or DRI investigation or duty liability does not by itself justify automatic invocation of the PMLA and that the ED must independently establish the statutory foundation for money-laundering proceedings.

1. What is DRI ED nexus for investigations and Adjudications across India?

Ans.

(i) The DRI–ED nexus refers to the legal and evidentiary relationship between investigations conducted by the Directorate of Revenue Intelligence (DRI) under the Customs Act, 1962 and proceedings initiated by the Enforcement Directorate (ED) under the Prevention of Money Laundering Act (PMLA) 2002.

(ii) There can be a very significant nexus between DRI investigations/ adjudication under the Customs Act, 1962 and ED investigations under the PMLA 2002/ FEMA 1999 when the Customs offence generates or involves identifiable Proceeds of Crime (PoC).

(iii) However, the 2 proceedings are legally distinct and one does not “automatically” replace or determine the other.

(iv) In simple terms:

• • The DRI investigates the customs/economic offence and ED investigates the laundering of proceeds generated from that offence when the Customs Act, 1962 offence qualifies as a scheduled offence under the PMLA, 2002.

2. What is basic structure for DRI ED Nexus?

Ans.

S.No	DRI under the Customs Act, 1962	ED under the PMLA, 2002
(i)	To investigates customs offences under the Customs Act, 1962	To investigates money laundering under the PMLA, 2002
(ii)	To investigates the smuggling, misdeclaration, false declaration, duty evasion, prohibited goods under the Customs Act, 1962	To investigates the Proceeds of Crime (PoC) and laundering activities under the PMLA, 2002
(iii)	To issues summons under Section 108 of Customs Act, 1962	To issues summons under Section 50 of PMLA, 2002
(iv)	To seizes goods/documents under the Customs Act, 1962	To searches, seizes and attaches property under the PMLA, 2002
(v)	To issues Show Cause Notice (SCN) and adjudication order under the Customs Act, 1962	To provisionally attach followed by adjudication under the PMLA, 2002
(vi)	To criminally prosecute under the Sec. 132, 135 or etc. of Customs Act, 1962	To prosecute for offence under Section 3 PMLA, 2002

3. Whether a offence investigated by DRI constitute a “Scheduled Offence”?

Ans.

No

(i) Every Customs Act violation is not “automatically” constituting a scheduled offence under the PMLA, 2002.

(ii) The Supreme Court in Pavana Dibbur v. Directorate of Enforcement (2023) specifically discussed the Customs Act provisions appearing in PMLA Schedule.

(iii) The supreme court held that section 132 of the Customs Act, 1962 can operate as a scheduled offence subject to the statutory requirements and monetary threshold applicable under the Schedule of PMLA, 2002.

4. What is flow chart for DRI ED nexus?

Ans.

DRI Intelligence under the Customs Act, 1962
↓
Customs Investigation under the Customs Act, 1962
↓
Scheduled Offence under the PMLA, 2002
↓
Proceeds of Crime (PoC) under the PMLA, 2002
↓
ED’s ECIR under the PMLA, 2002
↓
PMLA Investigation under the PMLA, 2002

5. How the DRI ED nexus works for the investigations?

Ans.

 Stage 1: DRI Investigation 

(i) DRI is permitted to investigate allegations for:

(a) Smuggling

(b) False declaration

(c) Misdeclaration of value or description

(d) Fraudulent import or export

(e) Evasion of customs duty

(f) Illegal importation of prohibited or restricted goods

(g) Use of forged or false documents

(ii) DRI is permitted to collects evidences through:

(a) Search and seizure

(b) Summons

(c) Statements under Section 108 of the Customs Act, 1962

(d) Examination of import or export documents

(e) Digital evidence

(f) Bank records

(g) Overseas trade and financial transactions

 Stage 2: Sharing of Information with the ED 

(iii) The DRI is required to share the information’s obtained during the investigations suggesting

(a) A scheduled offence under PMLA, 2002

(b) Generation of Proceeds of Crime (PoC) under PMLA, 2002

(iv) The DRI’s information and material will form the basis for ED to independently initiate proceedings under PMLA, 2002.

(v) Therefore, the “same” transaction can allow parallel proceedings.

6. What is a best example for DRI ED nexus works against investigations?

Ans.

(i) When the DRI alleges “fraudulent” import through false declarations resulting in criminal customs offences.

(ii) When the alleged “criminal” activity generates property or financial benefits qualifying as Proceeds of Crime (PoC), the ED is permitted to examine whether those proceeds were subsequently concealed, possessed, acquired, used, transferred or projected as untainted property.

(iii) The DRI and ED are permitted to rely upon “overlapping” evidence, but they exercise powers under “different” statutes.

7. Whether the ED can rely on the DRI evidences?

Ans.

Yes

(i) The ED is permitted to rely upon DRI’s information and documents:

(a) DRI’s search records

(b) DRI’s seizure memos

(c) DRI’s recorded statements

(d) DRI’s panchnamas

(e) DRI’s customs documents

(f) DRI’s collected bank records

(g) DRI’s collected digital evidence

(h) DRI’s complaints or prosecution proceedings initiated under the Customs Act, 1962

(ii) However, the ED is required to “independently” satisfy the requirements of PMLA, 2002.

8. Whether the DRI’s evidences are “automatically” money launderings?

Ans.

No

(i) The ED is required to establish the statutory ingredients under PMLA, 2002:

(a) Committed a scheduled offence

(b) Existence of “criminal” activity relating to that scheduled offence

(c) Generation of Proceeds of Crime (PoC)

(d) A process or activity connected with those proceeds under Section 3 PMLA, 2002

(ii) The Supreme Court’s principles in Vijay Madanlal Choudhary emphasize the foundational relationship between the scheduled offence and Proceeds of Crime (PoC).

9. What is the DRI and ED investigations?

Ans.

Alleged fraudulent importation
↓
False declaration / offence under the Customs Act, 1962
↓
Scheduled offence requirements satisfied under the PMLA, 2002
↓
Illegal gain/property generated
↓
Proceeds of Crime (PoC) alleged
↓
ED registers ECIR
↓
PMLA investigation

10. Whether DRI and ED are permitted to conduct parallel investigations?

Ans. Yes

(i) The DRI and ED are permitted to continue the proceedings “simultaneously” because they deal with different statutory consequences.

(ii) The DRI’s question

• • Was there a violation of the Customs Act, 1962?

(iii) The ED’s question

• • Were Proceed of Crime (PoC) generated from scheduled “criminal” activity subsequently involved in money laundering?

(iv) In simple terms

(a) The DRI investigation does not “necessarily” bar ED investigation.

(b) The ED investigation does not “replace” DRI adjudication.

(c) The DRI and ED are permitted to examine “common” documents and transactions.

(v) Conclusion

• • However, ED “cannot” treat every customs irregularity as money laundering “without” establishing the statutory PMLA foundation.

11. What is DRI ED nexus for adjudications?

Ans.

 The DRI / Customs Adjudications 

(i) The Customs’ adjudication is required to determine:

(a) Whether goods are liable to confiscation?

(b) Whether customs duty is payable?

(c) Whether misdeclaration occurred?

(d) Whether penalties should be imposed?

(e) Whether goods, conveyances or currency are liable to confiscation?

(ii) Flow chart for Customs’ adjudications:

Investigation
↓
Show Cause Notice (SCN)
↓
Reply
↓
Personal Hearing
↓
Order-in-Original
↓
Appeal

(iii) The flow chart for DRI’s adjudications:

Commissioner (Appeals)
↓
CESTAT
↓
High Court
↓
Supreme Court

 The ED / PMLA’s Adjudications 

(iv) The PMLA Adjudicating Authority is required to examine the matters concerning attachment and Proceeds of Crime (PoC) under the statutory framework of PMLA, 2002.

(v) Flow chart for ED/PMLA’s adjudications:

ECIR
↓
Investigation
↓
Search/Seizure
↓
Provisional Attachment
↓
Complaint before Adjudicating Authority
↓
Confirmation/Release
↓
Appeal to Appellate Tribunal
↓
High Court
↓
Supreme Court

(vi) Conclusion:

• • The customs adjudication is required to determines customs consequences, where the PMLA adjudication is required to determines whether property is involved in money laundering or Proceeds of Crime (PoC).

12. What are consequences for DRI and ED using the “same” evidences?

(i) This is legally permissible in principle.

S.No	Evidence	DRI Use	ED Use
(a)	Import documents	Misdeclaration	Source of alleged criminal activity
(b)	Bank statements	Financial trail	Tracing proceeds of crime
(c)	Section 108 statements	Customs violation	Supporting evidence
(d)	Digital devices	Customs fraud	Money trail / layering
(e)	Overseas transactions	Import/export violation	Cross-border laundering investigation

(ii) However, the “same” evidence is required to satisfy the requirements of the respective statute.

(iii) Conclusion

(a) The “same” evidence is not “automatically” common guilt or automatic liability.

(b) The DRI and ED are required to independently establish the ingredients required under its own statue.

13. What are consequences on ED’s proceedings against DRI’s case failure?

Ans.

(i) The Supreme Court’s judgement in Vijay Madanlal Choudhary, the offence of money laundering is fundamentally connected with “criminal” activity relating to a scheduled offence and the resulting Proceeds of Crime (PoC).

(ii) Therefore, when the predicate/scheduled offence disappears through a final judicial outcome, the PMLA proceedings based “exclusively” upon that predicate offence may “not” survive.

(iii) However, every situation depends upon:

(a) Whether “another” scheduled offence exists?

(b) Whether ED has identified “independent” Proceeds of Crime (PoC)?

(c) Whether the DRI proceedings are merely adjudicatory or involve “criminal” prosecution?

(d) Whether the predicate case has been finally quashed/acquitted or is merely pending?

(e) Whether there are “multiple” predicates?

(iv) A recent Delhi High Court decision, Kanchana Rai v. Directorate of Enforcement (18 August 2026), reiterated the importance of a valid predicate foundation and held that the ED could “not” continue the particular ECIR “after” its foundational predicate offence had ceased, while also rejecting an attempt to revive the “same” ECIR through an unsustainable addendum involving an unrelated “earlier” FIR.

14. Whether ED can proceed “before” final DRI adjudication?

Ans. Yes

(i) The ED does not “necessarily” have to wait for the completion of customs adjudication, when a legally valid scheduled offence exists and the statutory conditions for PMLA are satisfied, the ED may investigate independently.

(ii) Therefore, pending DRI adjudication does not “automatically” prevent ED investigation.

(iii) Conclusion

• • However, the ultimate findings in the predicate proceedings can become highly significant for the sustainability of PMLA proceedings.

15. What is Civil/Revenue Liability vs Criminal Scheduled Offence?

Ans.

(i) The customs duty demand under the Customs Act, 1962 is not “automatically” money laundering under the PMLA, 2002.

(ii) The ED is permitted to proceed when there should be “criminal” schedule offence under the PMLA, 2002.

(iii) Therefore, the ED is permitted to proceed when there should be “more than” routine or technical custom dispute under the PMLA, 2002

(iv) The ED is required to satisfy 4 conditions to proceed under PMLA, 2002 like:

(a) There should be existed a scheduled offence under Section 2(1)(y) of PMLA, 2002.

(b) There should be existed a “criminal” activity relating to the schedule offence under section 2(1)(y) of PMLA, 2002

(c) There should be existed a Proceeds of Crime (PoC) under Section 2(1)(u) of PMLA, 2002.

(d) There should be existed a process or activity described in Section 3 of PMLA, 2002.

(v) There should be a contravention / violation under Customs Act, 1962 like:

(a) Under-valuation

(b) Over-valuation

(c) Misclassification

(d) Wrongful exemption claims

(e) Import or export fraud

16. What is DRI ED nexus for practical investigation model?

Ans.

(i) DRI →ED nexus for practical investigation model across India

Information / Intelligence
↓
DRI Investigation
↓
Search / Seizure / Statements / Financial Documents
↓
Identification of Customs Offence
↓

Does it qualify as a Scheduled Offence under the PMLA, 2002?

If YES

Financial Trail / Illegal Gain / Property
↓
Information shared / independently available to ED
↓
ED registers ECIR
↓
PMLA Investigation
↓
Attachment of Alleged Proceeds of Crime
↓
Parallel Proceedings

(ii) In simple terms:

S.No	The Customs Act, 1962	The PMLA, 2002
(a)	Show Cause Notice (SCN)	Enforcement Case Information Report (ECIR)
(b)	Customs Adjudication	Attachment Proceedings
(c)	Confiscation	Confirmation of Attachment
(d)	Penalty	Prosecution Complaint
(e)	Criminal Complaint under Customs Act	Prosecution Complaint under PMLA

17. What are the key legal issues involved in DRI and ED cases?

Ans.

 The major litigation issues 

(i) Whether the DRI offence is actually a scheduled offence?

(ii) Whether the required monetary threshold is satisfied?

(iii) Whether there are genuine Proceeds of Crime (PoC)?

(iv) Whether ED can rely upon DRI evidence “without” independent investigation?

(v) Whether DRI statements are legally admissible and reliable in PMLA proceedings?

(vi) Whether customs adjudication findings bind ED?

(vii) What happens when the predicate case fails?

(viii) Whether the “same” property can be confiscated under the Customs Act, 1962 and attachment under the PMLA, 2002?

(ix) Whether parallel adjudication results in duplication or double jeopardy?

(x) Whether a purely “technical” customs violation can trigger PMLA, 2002?

18. What are double prosecutions and punishments?

Ans.

(i) The DRI and ED proceedings are not “automatically” barred when they arise from the “same” transaction like:

(a) The Customs proceedings address violations of customs law

(b) The PMLA addresses money laundering

(c) The statutory ingredients are different

(ii) Therefore, simultaneous proceedings may be legally sustainable.

(iii) However, the DRI and ED can “not” simply duplicate allegations “without” independently satisfying the ingredients of their respective statutes.

19. What is DRI ED nexus in 1 sentence?

Ans.

• The DRI establishes or investigates the underlying customs crime, while ED follows the money trail, but ED can act only where the customs offence provides a legally sustainable PMLA foundation and identifiable Proceeds of Crime (PoC) are involved.

20. What is the conclusion for DRI ED nexus?

Ans.

(i) The DRI–ED nexus is a predicate offence–Proceeds of Crime (PoC) relationship, “not” merely an inter-agency information-sharing arrangement.

(ii) Flow chart for conclusion against DRI ED nexus

The DRI investigates the source crime
↓
The ED investigates the Proceed of Crime (PoC) and money laundering
↓
The DRI and ED may use overlapping evidence
↓
The DRI and ED may conduct parallel proceedings
↓
The ED proceedings ultimately require an independently “sustainable” scheduled offence and Proceed of Crime (PoC) nexus.

(iii) This framework is particularly important for complex cases involving smuggling, gold imports, trade-based money laundering, over/under-invoicing, fraudulent imports and exports, cross-border transactions and customs frauds.

(iv) Recent judicial developments continue to emphasize that the ED’s jurisdiction can “not” rest on a purely notional or extinguished predicate foundation.

The High Courts and Supreme Court Judgments against the DRI–ED Nexus

21. What are High Court and Supreme Court Judgments against the DRI–ED Nexus?

Ans.

• There is no single Supreme Court judgment using the exact expression “DRI–ED nexus.” However, several Supreme Court and High Court judgments establish important legal limitations where:

(i) The DRI/Customs investigates an alleged Customs Act offence

(ii) The ED subsequently initiates PMLA proceedings on substantially the “same” allegations or evidence

(iii) The ED seeks attachment/adjudication “without” independently establishing Proceeds of Crime (PoC) and a valid scheduled offence nexus.

22. What is Supreme Court judgement on Pradeep Kumar v. ED (2025)?

Ans.

(i) The Supreme Court held that when nothing linked the assets to the predicate/scheduled offence, the basic requirement of Proceeds of Crime (PoC) was “not” established.

(ii) The Supreme Court held that unaccounted or unexplained money does not “automatically” constitute Proceeds of Crime (PoC) under the PMLA, 2002.

(iii) The Supreme Court held that customs duty demand does not “automatically” Proceeds of Crime (PoC).

The Supreme Court held that there must be evidence showing that the property was actually derived or obtained from “criminal” activity relating to a scheduled offence under the PMLA, 2002.

23. What is Supreme Court judgement on Pavana Dibbur v. ED (2023)?

Ans.

(i) The Supreme Court held that property can be treated as Proceeds of Crime (PoC) when it is derived or obtained from “criminal” activity relating to a scheduled offence under the PMLA, 2002.

(ii) The Supreme court held that mere possession of property or an allegation of illegality is “not” sufficient relating to a scheduled offence under PMLA, 2002.

(iii) The Supreme court held that there must be a demonstrable nexus between the scheduled offence and the particular property attached by the ED

(iv) The Supreme court held that when the ED merely reproduces the DRI Show Cause Notice (SCN), seizure memo, investigation report or allegations “without” independently identifying Proceeds of Crime (PoC), the attachment can be challenged for lack of statutory nexus.

24. What is Supreme Court judgement on Vijay Madanlal v. Union of India (2022)?

Ans.

(i) The Supreme Court held that PMLA proceedings can “not” proceed merely on an assumption that a scheduled offence has been committed.

(ii) The Supreme Court held that the essential requirements should be satisfied like:

(a) A “criminal” activity relating to a scheduled offence

(b) A property derived or obtained from such “criminal” activity

(c) A direct connection between the alleged property and scheduled offence.

(iii) The Supreme court specifically clarified that “not” every property connected with a “criminal” investigation becomes Proceeds of Crime (PoC).

(iv) The Supreme court held that PMLA proceedings can proceed when DRI alleges:

(a) Customs duty evasion

(b) Misdeclaration

(c) Undervaluation

(d) Overvaluation

(e) Wrongful import/export

(v) The ED cannot “automatically” treat the entire (100%) alleged Customs violation or the entire (100%) transaction value as Proceeds of Crime (PoC).

(vi) The ED is required to independently demonstrate:

Scheduled Offence
↓
Criminal Activity
↓
Property Derived/Obtained
↓
Proceeds of Crime (PoC)
↓
Money Laundering

25. What is Delhi High Court judgement on Kanchana Rai v. ED (2026)?

Ans.

(i) The Delhi High Court held that ED could “not” continue or expand ECIR proceedings “after” the original predicate basis had ceased to survive and subsequently add another FIR.

(ii) The Delhi High Court emphasizes that there should be:

(a) Existence of a genuine nexus

(b) Existence of Proceeds of Crime (PoC)

(c) Legality and timing of ED’s action

(d) Administrative actions must “not” be arbitrary or for purposes outside the statute.

(iii) The Delhi High Court noted that a subsequent FIR can “not” simply be inserted into an ECIR “without” satisfying the legal nexus and Proceeds of Crime (PoC) requirements.

(iv) The High Court held that ED can “not” simply:

Adopt DRI allegations
↓
Register ECIR
↓
Reproduce DRI evidence
↓
Attach property
↓
“Without” independently satisfying PMLA jurisdictional requirements.

26. What is Andhra High Court judgement on Pradeep Kumar v. ED (2023)?

Ans.

(i) The High Court held that when there was “no” valid scheduled offence, the PMLA Adjudicating Authority could “not” continue proceedings merely because Customs authorities had arrested or investigated the person.

(ii) Therefore, the High Court held that the PMLA proceedings and the adjudication order were “without” jurisdiction.

(iii) The Customs investigation or arrest by itself does not “automatically” create a valid PMLA case.

(iv) The statutory requirements of PMLA must independently exist.

27. What is Bombay High Court judgement on Ajay Kumar Baheti v. ED (2022)?

Ans.

(i) The Bombay High Court emphasized that the requirement of a connection between “criminal” activity relating to a scheduled offence and the alleged Proceeds of Crime (Poc) under the PMLA, 2002.

(ii) The Bombay High Court held that the ED is “not” permitted to attach the properties “without” adequately tracing them to the alleged predicate offence under the PMLA, 2002.

28. What is Punjab and Haryana High Court judgement on Seema Garg v. ED (2020)?

Ans.

(i) The Punjab & Haryana High Court held that there must be a direct nexus between the attached property and “criminal” activity relating to a scheduled offence under the PMLA, 2002.

(ii) The Punjab & Haryana High Court held that the ED can “not” attach:

(a) Unrelated assets

(b) Legally acquired assets

(c) Properties having “no” nexus with Proceeds of Crime (PoC)

(iii) The Punjab & Haryana High Court held that “no” blanket attachment based on DRI’s allegations.

29. What is conclusion “after” the Supreme Court and High Courts’ judgements?

Ans.

(i) The ED can “not” become an investigating agency for each the DRI/Customs violation

(ii) The ED can become an investigation agency when discovers “another” possible offence outside its jurisdiction and also informed the competent investigating agency.

(iii) The ED can “not” itself assume jurisdiction “without” the statutory requirements of PMLA, 2002 are satisfied.

(iv) The Allahabad High Court’s emphasizes that ED’s jurisdiction depends upon the existence of a valid predicate offence and Proceeds of Crime (PoC).

(v) The ED can “not” independently expand its jurisdiction when discovers some “other” illegality.

30. What are important legal arguments for DRI ED nexus?

Ans.

(i) The “same” evidence does not “automatically” establish money laundering under the PMLA, 2002.

(ii) The DRI and ED are permitted to use the “same” facts like:

(a) Statements

(b) Documents

(c) Bank records

(d) Import/export documents

(e) Invoices

(f) Emails

(g) Digital evidence

(iii) The DRI investigations do not “automatically” establish an offence under Section 3 PMLA, 2002.

(iv) The ED is required to establish the “additional” statutory ingredient for Proceeds of Crime (PoC)

31. Whether Custom demand is “automatically” Proceed of Crime (PoC)?

Ans. No

(i) A customs duty demand, differential duty liability, penalty, fine or alleged undervaluation does not “automatically” constitute Proceeds of Crime (PoC).

(ii) The ED is required to identify:

(a) What property was obtained?

(b) Who obtained it?

(c) How was it derived from “criminal” activity?

(d) What is the scheduled offence?

(e) What are the quantifiable Proceeds of Crime (PoC)?

(f) What property is actually traceable to Proceeds of Crime (PoC)?

(iii) In absence of above-mentioned chain, a PMLA attachment can be challenged.

32. Whether independent application of mind is necessary?

Ans. Yes

• When the ED’s ECIR, Provisional Attachment Order (POA) or Prosecution Complaint substantially reproduces the DRI investigation “without” independent analysis, an argument can be raised for:

(i) Mechanical exercise of jurisdiction

(ii) “Non” application of mind

(iii) Absence of “independent” satisfaction

(iv) Absence of Proceeds of Crime (PoC) analysis

33. What is legal framework for Challenging DRI’s and ED’s parallel proceedings?

Ans.

S.No	Issue	Legal Challenge
(i)	“Same” DRI evidence used by ED	“Same” evidence alone does “not” prove Section 3 PMLA
(ii)	Customs duty demand	Not “automatically” Proceeds of Crime (PoC)
(iii)	DRI investigation pending	Does not “automatically” justify attachment
(iv)	Property attached	Mandatory have nexus with scheduled offence
(v)	“Unrelated” assets attached	Violates Section 2(1)(u) of PMLA, 2002 requirements
(vi)	“No” valid scheduled offence	PMLA jurisdiction may fail
(vii)	ED reproduces DRI allegations	Challenge for “non” application of mind
(viii)	DRI adjudication “not” concluded	The ED must independently prove PMLA ingredients
(ix)	Customs offence “ultimately” fails	PMLA proceedings concerning linked Proceeds of Crime (PoC) may “not” survive

34. What are Supreme Court and High Courts’ decisions to be quoted in writ petitions?

Ans.

(i) The Supreme Court’s judgements

(a) Vijay Madanlal Choudhary v. Union of India (2022)

(b) Pavana Dibbur v. Directorate of Enforcement (2023)

(ii) The High Courts’s judgements

(a) Kanchana Rai v. Directorate of Enforcement (2026)

(b) Pradeep Kumar v. Deputy Director, ED (2025)

(c) Ajay Kumar Chandraprakash Baheti v. ED (2022)

(d) Seema Garg v. Deputy Director, Directorate of Enforcement (2020)

35. What is 1-line legal proposition for DRI ED nexus?

Ans.

(i) The initiation of a Customs/DRI investigation or creation of a Customs duty liability can “not”, by itself, result in “automatic” invocation of PMLA, 2002.

(ii) The ED is required independently to establish the existence of a scheduled offence, identifiable Proceeds of Crime (PoC) derived from “criminal” activity, and a clear nexus between Proceeds of Crime (PoC) and the property subjected to attachment or prosecution.

(iii) This is the strongest legal foundation for challenging an alleged DRI → ED “automatic” nexus for investigation and adjudication.

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Source: Source of information’s used in preparation of weekly updates are taken from public domain.