Assistant Director Directorate of Enforcement Vs Gautam Kundu & Anr. (Supreme Court of India)
Summary: The Supreme Court in Assistant Director, Directorate of Enforcement Vs Gautam Kundu & Anr. considered whether persons accused under the Prevention of Money Laundering Act, 2002 (PMLA) could be summoned for further examination and statements under Section 50 after the prosecution complaint had already been filed. The controversy arose from an investigation into alleged investor-fund misappropriation involving Gautam Kundu and Shibamoy Dutta, against whom the Enforcement Directorate had filed a complaint on 12 July 2018. The Special PMLA Court framed charges on 29 December 2021. When the ED sought permission in March 2022 to interrogate the respondents while in custody, the Special Court refused the request on 20 April 2022, having regard to the commencement of trial.
The Gauhati High Court upheld that refusal in the supplied judgment. It observed that a prosecution witness had already been examined and that the alleged subsequently discovered proceeds of crime had not been specifically described. It considered the limits of further investigation under the CrPC, referring to Vinubhai Haribhai Malaviya, and reproduced passages from Vijay Madanlal Choudhary concerning the scope of investigation, inquiry and proceeds of crime under the PMLA. Although other measures might be available during trial, including alteration of charges if evidence emerged, the High Court held that further examination of the respondents for investigation could not be permitted at that stage. It accordingly dismissed the ED’s revision application.
On appeal, the Supreme Court took a different view. The Court identified the decisive question as whether the filing of a PMLA complaint prevents subsequent interrogation and recording of statements under Section 50. It held that the High Court had failed to take account of Explanation (ii) to Section 44(1) of the PMLA, which expressly permitted that course. The Supreme Court therefore set aside the High Court’s order, granted the ED liberty to call the respondents for further examination and directed that they cooperate. The short Supreme Court order does not determine the truth of the money-laundering allegations or the admissibility or weight of any future statement; its operative conclusion concerns the permissibility of further examination notwithstanding the earlier complaint and trial stage.
Cases Discussed
- Vijay Madanlal Choudhary and Others Vs Union of India and Others, 2022 SCC OnLine SC 929 (Supreme Court) — The High Court reproduced the Supreme Court’s discussion of the meaning of investigation, inquiry and proceeds of crime under the PMLA.
- Vinubhai Haribhai Malaviya and Others Vs State of Gujarat and Another, (2019) 17 SCC 1 (Supreme Court) — Cited in submissions and discussed by the High Court on judicial power to order further investigation before trial commences.
- Randhir Singh Rana Vs State (Delhi Administration), (1997) 1 SCC 361 (Supreme Court) — Mentioned within the reproduced Vinubhai passage as overruled.
- Reeta Nag Vs State of West Bengal and Others, (2009) 9 SCC 129 (Supreme Court) — Mentioned within the reproduced Vinubhai passage as overruled.
FULL TEXT OF THE SUPREME COURT JUDGMENT/ORDER
1. Leave granted.
2. The short issue that arises for consideration is as to whether after the filing of the complaint, the accused can be called for interrogation or not for the purpose of recording their statement under Section 50 of the Prevention of Money Laundering Act, 2002 (for short, the PMLA).
3. The High Court, in the impugned judgment, did not take into consideration the explanation (ii) to Section 44 (1) of the PMLA, wherein it is specifically provided that such a course is well open to the investigating agency.
4. In such view of the clear provision contained in Section 44, as afore-stated, we are inclined to set aside the impugned judgment.
5. The impugned order stands set aside.
6. Liberty is given to the appellant to call the respondents for further examination in which case, they shall cooperate with the further interrogation.
7. The appeal stands disposed of accordingly.
8. Pending application(s), if any, shall stand disposed of.
Leave granted.
The appeal is disposed of in terms of the signed order.
Pending application(s), if any, shall stand disposed of.
