CBI–ED Nexus: 31 FAQs on Crime, Proceeds of Crime & PMLA

By CA Satish Agarwal Corporate Law Articles August 24, 2026

Summary: The supplied material explains the CBI–ED nexus, stating that the CBI investigates the scheduled or predicate offence while the ED independently investigates money laundering under the Prevention of Money Laundering Act, 2002 (PMLA). Where a CBI case involves a PMLA scheduled offence and identifiable proceeds of crime (PoC), the CBI FIR, investigation or charge-sheet may provide the factual foundation for ED proceedings. Section 5 of the PMLA permits provisional attachment where its requirements are met, followed by adjudication and proceedings before the ED’s Special Court. The material states that CBI and ED investigations may proceed simultaneously within their respective statutory jurisdictions and that the ED is not subordinate to the CBI. It also discusses the possible impact of CBI closure, discharge, quashing, acquittal or conviction on corresponding ED proceedings, depending on the nature and finality of the judicial order. CBI evidence may become relevant to ED, while ED financial tracing may assist CBI. The material further describes information and investigative links involving DRI, SFIO, Income Tax, SEBI and RBI.

CBI–ED Nexus Explained: 31 FAQs on Predicate Offences, Proceeds of Crime, Parallel Investigations, Attachments, Adjudication and Inter-Agency Coordination

1. What is CBI- ED nexus for investigations against Crimes & Proceed of crimes?

(i) The CBI–ED nexus is quite strong, but the 2 agencies investigate “different” legal offences and operate under “different” statutes.

(ii) In many cases, the CBI investigation becomes the foundation for the ED investigation, particularly when the CBI case involves a PMLA scheduled offence and there is an identifiable Proceeds-of-Crime (PoC) trail.

2. What is tabular format for CBI→ED nexus against investigations

S.No	Subject	CBI	ED
(i)	Offence	To investigates the predicate / scheduled offence	To investigates the money laundering under PMLA, 2002
(ii)	Primarily acts	IPC, 1860 / BNS, 2023, Prevention of Corruption Act (PCA) 1988 and etc.	PMLA, 2002
(iii)	Focus on	How the crime was committed?	What was happened to the PoC?
(iv)	Charge-sheet	Files charge-sheet before the competent court	Files PMLA prosecution complaint before the ED’s Special Court
(v)	Establish criminal liability	For the scheduled offence	(a) For money-laundering offence (b) For proceedings relating to the attachment/confiscation of PoC
(vi)	Deals mainly with	Original/predicate crime	PoC and their money laundering offences
(vii)	Example	(a) Bribery (b) Corruption (c) Cheating (d) Criminal conspiracy (e) Etc.	(a) Possessing (b) Concealing (c) Using (d) Projecting PoC as untainted property (e) Claiming PoC as untainted property

3. What is flow chart on CBI→ED nexus for investigations?

(i) The Supreme Court has “expressly” dealt with cases when the CBI FIR/charge-sheet constituted the predicate offence and subsequently became the basis for the ED’s PMLA investigation.

(ii) Section 5 of PMLA, 2002 “specifically” permits provisional attachment when the ED has reason to believe that a person possesses PoC and that they may be dealt with so as to frustrate confiscation

(iii) However, the ED is “not” subordinate to CBI

(iv) Flow chart on CBI-ED nexus for investigations

CBI investigation

↓

Scheduled / predicate offence established or alleged

↓

Generation of PoC

↓

ED records Enforcement Case Information Report (ECIR)

↓

ED investigates laundering of the PoC

↓

Tracing / identification of PoC

↓

Provisional attachment under Section 5 PMLA, 2002

↓

Adjudicating Authority for confirmation of attachment

↓

ED’s Special Court for prosecution/confiscation proceedings

4. What is best example for CBI→ED nexus against investigations?

The ED does “not” merely act as an extension of CBI.
The ED investigation is independently under PMLA, 2002

(i) The CBI’s role

- To investigate the cheating when a person cheated the Govt. and generated INR 100 crore.

(ii) The ED’s role

(a) To investigate what happened to that INR 100 crore?

(b) To investigate was it transferred through shell companies, converted into property, routed abroad, layered through bank accounts, or projected as legitimate money?

(iii) The CBIè ED nexus

(a) Hence, even though the CBI’s scheduled offence may trigger or provide the factual foundation for the ED

(b) The ED has to establish the ingredients of money-laundering under PMLA, 2002.

(iv) The Supreme Court recognition

- The Supreme Court has recognised precisely this relationship, in one case, the Court recorded that the CBI offences became the “predicate offence” leading to investigation by the ED under PMLA, 2002.

5. What is happens when CBI closes the case?

(i) The Supreme Court has considered situations when the CBI FIR concerning the scheduled offence was subsequently closed, beside the ED had already registered an ECIR and initiated PMLA proceedings.

(ii) The precise consequence depends on the nature and stage of the CBI proceedings and the judicial orders involved.

(iii) The CBI closure report / acquittal / quashing of the scheduled offence can have major implications for the corresponding ED proceedings.

(iv) Normally 3 actions are involved in the investigations commencing from CBI’s FIR and ending to ED’s attachments like:

(a) CBI’s FIR

(b) ED’s investigation

(iv) ED’s investigations shall be badly affected due to CBI closure report accepted by CBI’s competent court because the existence of PoC is intrinsically linked to criminal activity relating to a scheduled offence.

(vi) However, the legal consequence must be examined based on the exact nature of the CBI order:

(a) Closure report merely filed

(b) Closure report accepted by CBI’s competent court

(d) Quashing of FIR

(e) Acquittal

(f) Conviction

(g) Partial acquittal

(h) Conviction of some accused but acquittal of others

6. What is best example for CBIè ED reverse nexus against investigations?

(i) The reverse nexus is also possible therefore the relationship is “not” always CBI è ED.

(ii) Example for CBI→ED reverse nexus

(iii) During a PMLA investigation, ED may discover an independent offence, these are falling within CBI’s jurisdiction and ED may share information/material with CBI for:

(a) Fraud

(b) Forgery

(d) Corruption

(e) Cheating

(f) Criminal

(g) Conspiracy

(iv) The Supreme Court’s role

- There are also recent instances when the Supreme Court has instructed / ordered for coordination between CBI, ED, SEBI and SFIO, including exchange of documents and complaints between agencies.

7. What is distinction between CBI and ED for adjudication?

(i) There is actually “no common” CBI–ED adjudication mechanism.

(ii) The CBI investigates but it does “not” normally have an adjudicating authority comparable to the PMLA Adjudicating Authority

(iii) The ED’s adjudication mechanism / flow chart

ED Investigation

↓

Provisional Attachment

↓

Adjudicating Authority

↓

Special Court

(iv) The Adjudicating Authority under PMLA examines whether the provisional attachment under Section 5 of PMLA, 2002 should be confirmed.

(v) The Supreme Court record itself illustrates the process where ED’s Section 5 of PMLA, 2002 attachment was placed before the Adjudicating Authority for confirmation.

(vi) The CBI establishes/investigates the underlying criminality

(vii) The ED investigates the financial consequences and laundering of the PoC generated from that criminality

(viii) The PMLA Adjudicating Authority “separately” adjudicates the legality of ED’s provisional attachment

8. What is flow chart on CBI→ED nexus for investigations and adjudications?

CBI Registration of FIR/RC

↓

CBI Investigation of Scheduled/Predicate Offence

↓

CBI collects evidence of crime and financial transactions

↓

CBI Charge-sheet / Final report before the competent court

↓

ED examines whether crime generated “proceeds of crime”

↓

ED registers/opens PMLA investigation Enforcement Case Information Report (ECIR)

↓

ED search / seizure / summons / statements / bank & financial investigation

↓

ED Identification & tracing of PoC

↓

ED Provisional Attachment under Section 5 PMLA, 2002

↓

ED Complaint before PMLA Adjudicating Authority

↓

ED Adjudicating Authority issues notice under Section 8 PMLA, 2002

↓

ED Adjudicating Authority Confirmation / non-confirmation of attachment

↓

ED’s Special Court

↓

Trial of money-laundering offence and eventual confiscation/restoration as provided by PMLA, 2002

9. What is CBI’s “specific” role for investigations and adjudications?

(i) The CBI ordinarily investigates the underlying criminal offence like:

(a) Bribery/Corruption

(b) Cheating

(d) Fraud

(e) Forgery

(f) Bank Fraud

(g) Criminal Breach of Trust

(h) Offences Under the Prevention of Corruption Act (PCA) 1988

(i) Other Offences which are included in the Schedule to PMLA, 2002.

(ii) The CBI is required to investigate the fraud when a person or group of persons alleged fraudulently obtained money from a bank.

(iii) The CBI is required to investigate that who committed fraud

(iv) The CBI is required to investigate that how offence committed.

(v) The CBI is required to file chargesheet before the competent court.

10. What is ED’s “specific” role for investigations and adjudications?

(i) The ED is required to investigate the underlying money laundering offence

(ii) The ED is required to investigate that what happened of money generated from schedule offence

(iii) The ED is required to investigate:

(a) Whether money transferred to shell companies?

(b) Whether money used to acquire immovable properties?

(d) Whether money transferred to related entities?

(e) Whether money converted into apparently legitimate investments?

11. What is flow chart for CBI’s chargesheet and ED’s attachment?

CBI FIR/RC

↓

CBI investigation

↓

CBI report/charge-sheet concerning scheduled offence

↓

ED identifies PoC

↓

ED attachment

12. Whether ED is 100% depended on CBI’s investigation?

(i) The ED is not 100% depended on CBI’s investigation

(ii) The ED is not to investigate the offence on behalf of CBI

(iii) The ED is to independently investigates for:

(a) Proceeds of Crime (PoC)

(b) Generation of PoC

(d) Concealment of PoC

(e) Acquisition of PoC

(f) Use of PoC

(g) Layering of PoC

(h) Transfer of PoC

(i) Projection/Claiming as Untainted Property of PoC

(j) The persons involved in the laundering

13. Whether CBI and ED are permitted to conduct the parallel investigations?

Yes

(i) The CBI is not required to complete 100% investigations and to file chargesheet before the competent court when ED is required to commence investigation under PMLA, 2002

(ii) The CBI investigation and the ED investigation can proceed simultaneously, although each agency must remain within its statutory jurisdiction.

(iii) The CBI and the ED’s parallel investigations do not mean that the 2 agencies have identical jurisdiction.

14. Who is adjudicating authority for CBI and ED?

(i) The CBI does not have a PMLA–type Adjudicating Authority.

(ii) The CBI file its chargesheet / Final Report to competent Court

(iii) The ED approach for provisional attachment before adjudicating authority

(iv) The Adjudicating Authority is required to examine under Section 5 of PMLA 2002 whether provisionally attachment is required to continue or to revoke / cancel

(v) The Adjudicating Authority is required to issue Show Cause Notice (SCN) to the person concerned under section 8 of PMLA 2002 whether the property should be declared involved in money laundering and for explaining about:

(a) Source of income

(b) Earnings

15. What are 3 judicial / administrative proceedings for CBI and ED?

S.No	Stage	Authority	Principal question
(i)	CBI criminal investigation	CBI	Whether scheduled / predicate offence was committed?
(ii)	PMLA attachment adjudication	ED’s Adjudicating Authority	Whether the property involved in money-laundering and is the attachment liable to be confirmed?
(iii)	PMLA criminal trial	ED’s Special Court	Whether the offence of money-laundering has been committed?

16. What are ED’s actions when CBI accused is acquitted?

(i) Normally 3 actions are involved in the investigations commencing from CBI’s FIR and ending to CBI’s acquitted like:

(a) CBI’s investigations

(b) CBI’s findings for scheduled offence

(ii) ED’s investigations shall be badly affected due to accused acquitted by CBI’s competent court because the existence of PMLA 2002 is intrinsically linked to criminal activity relating to a scheduled offence.

(iii) However, the legal consequence must be examined based on the exact nature of the CBI’s competent court order:

(a) Why and how the acquittal occurred?

(b) What is finality of the order?

(d) What are PoC?

(iv) The CBI acquittal “not” automatically terminates ED proceedings, therefore it needed to be examined whether the judicial determination has extinguished the scheduled offence which is the source of the alleged PoC and, consequently, whether the statutory foundation for the PMLA proceedings survives

17. Whether CBI evidence can become ED evidence?

Yes

(i) The documents collected by the CBI can be extremely important to ED like:

(a) FIR

(b) Search/seizure records

(d) Forensic reports

(e) Company records

(f) Statements

(g) Emails

(h) Accounting records

(i) Property documents

(j) Charge-sheet

(k) Witness statements

(l) Documentary evidence establishing the scheduled offence

(ii) The ED can independently collect and rely upon relevant material in its PMLA investigation.

(iii) Conversely, ED’s financial tracing may provide information useful to CBI.

(iv) This creates a 2-way evidentiary and intelligence nexus, “without” making one agency subordinate to the other.

18. What are important criteria for CBI→ED nexus?

(i) Jurisdictional nexus

- The CBI investigates the scheduled offence and the ED investigates money-laundering.

(ii) Factual nexus

- The CBI and ED both may examine the “same” transaction, persons, companies and documents.

(iii) Evidentiary nexus

- The material generated in 1 investigation can become relevant to the other.

(iv) Procedural nexus

- The progress of the scheduled-offence proceedings can have consequences for PMLA attachment/prosecution.

(v) Adjudicatory nexus

- The CBI’s criminal proceedings and ED’s attachment adjudication /PMLA trial are separate proceedings before different authorities.

Conclusion

(a) The CBI establishes the “crime”

(b) The ED follows the “money”

(d) The ED’s Special Court ultimately determines criminal liability for money-laundering.

19. What is comparison between CBI, ED, DRI, SFIO, Income Tax, SEBI and RBI?

Agency	Principal statute / framework	Primary function	Predicate / underlying offence?	Financial investigation	Attachment / freezing power	Adjudication / final forum
CBI	(a) DSPE Act (b) PCA (c) BNS (d) Other laws	(a) Corruption (b) Fraud (c) Conspiracy (d) other offences within jurisdiction	Yes, where the offence is a PMLA scheduled offence	Yes, incidental to criminal investigation	Court-directed / statutory seizure no general PMLA attachment power	The competent Court
ED	(a) PMLA, 2002 (b) FEMA, 1999	(a) Money laundering (b) Foreign-exchange violations	Yes, for PMLA, scheduled offence is the predicate offence	Core function	(a) PMLA Section 5 (b) FEMA Section 37 (c) Related powers	(a) PMLA Adjudicating Authority (b) ED’s Special Court (c) Appellate forums
DRI	(a) Customs Act, 1962 (b) NDPS Act where applicable	(a) Smuggling (b) Customs-duty evasion (c) Prohibited/ (d) restricted imports & exports	Can be, where the Customs/other offence is a PMLA scheduled offence	Yes	Customs seizure/ confiscation mechanisms	(a) Customs Adjudicating Authority (b) CESTAT (c) Court
SFIO	Companies Act, 2013	Investigation of serious corporate fraud	Can be, where underlying offence is scheduled under PMLA	Yes, corporate/ financial fraud	Powers under Companies Act, including statutory search/ seizure	(a) Special Court (b) NCLT/ NCLAT depending on issue
Income Tax Deptt.	Income-tax Act, 1961	(a) Tax assessment (b) Undisclosed income (c) Tax evasion	Can generate information /evidence relevant to PMLA	Yes	Provisional attachment / recovery mechanisms under Income-tax Act	Income-tax Authorities CIT(A) ITAT High Court Supreme Court
SEBI	(a) SEBI Act, 1992 (b) Securities laws	(a) Securities-market violations (b) Insider trading (c) Manipulation and securities fraud	Can provide predicate facts certain offences may be PMLA scheduled offences	Yes	Freezing of securities/ accounts and statutory regulatory measures	SEBI adjudication SAT Supreme Court
RBI	(a) RBI Act (b) FEMA framework (c) Banking Regulation Act	(a) Monetary/ banking regulation (b) FEMA administration (c) Regulatory supervision	Generally regulatory/ referral role, rather than predicate-crime investigation	Regulatory financial intelligence	Regulatory restrictions; FEMA matters may be referred to ED	(a) RBI / competent authority (b) FEMA adjudication principally through ED

20. What is CBI→ED nexus with RBI / Banks, Income tax, SEBI, DRI, Customs & SFIO?

RBI / Banks

↓

Suspicious / irregular financial transaction

Income Tax

↓

Undisclosed income / tax irregularity and “criminal” offence

SEBI

↓

Market manipulation / securities fraud

DRI

↓

Customs / smuggling / trade-related offence

SFIO

↓

Serious corporate fraud under section 447 of Companies Act, 2013

CBI

↓

Corruption / fraud / conspiracy / criminal offence

All of these may generate information relevant to:

↓

PMLA / FEMA investigation

The ED frequently becomes the financial–investigation convergence point for information originating from several regulators and investigating agencies.

21. What is importance of predicate offence under PMLA for CBI, DRI, SFIO & SEBI?

The underlying “criminal” activity is treated a predicate / schedule offence when it’s covered within PMLA Schedule like:

(i) CBI→ED nexus

(a) When CBI investigates corruption/fraud and the offence is a scheduled offence under PMLA schedule and generates identifiable PoC the information / FIR / charge–sheet relating to the scheduled offence can become the basis for ED to investigate the offence of money-laundering under Section 3 of the PMLA.

(b) The ED investigation focuses on the laundering, possession, concealment, acquisition, use, or projection of the PoC, subject to the statutory requirements of the PMLA, 2002.

(ii) DRI→ED nexus

(a) When DRI detects serious customs-related offence and the offence is a scheduled offence under PMLA schedule and generates identifiable PoC the information/FIR/ charge–sheet relating to the scheduled offence can become the basis for ED to investigate the offence of money-laundering under Section 3 of the PMLA

(iii) SFIO→ED nexus

(a) When SFIO discovers serious corporate fraud and the offence is a scheduled offence under PMLA schedule and generates identifiable PoC the information/FIR/ charge–sheet relating to the scheduled offence can become the basis for ED to investigate the offence of money-laundering under Section 3 of the PMLA

(iv) SEBI→ED

(a) When SEBI detects securities fraud/manipulation and the offence is a scheduled offence under PMLA schedule and generates identifiable PoC the information/FIR/ charge–sheet relating to the scheduled offence can become the basis for ED to investigate the offence of money-laundering under Section 3 of the PMLA

22. What is RBIè ED nexus?

(i) RBI is primarily a regulator, “not” a conventional criminal investigating agency like CBI or ED. The FEMA-related violations, information can flow:

RBI regulatory examination

↓

Identification of suspected FEMA violation

↓

Referral / information to ED

↓

ED investigation under FEMA

(ii) The ED is the principal agency responsible for investigation and enforcement of FEMA, 1999, therefore RBI→ED is principally a regulatory–to–enforcement

(ii) Hence RBI è ED nexus is different from CBI è ED = predicate-crime-to-money-laundering nexus.

23. What is DRI→ED nexus?

(i) The DRI is particularly important in customs cases and focuses on:

(a) Smuggling

(b) Customs-duty evasion

(d) Misdeclaration

(e) Prohibited/restricted goods

(f) Import/export fraud.

(ii) The ED is particularly important in certain cases and focuses on:

(a) Foreign exchange

(b) Overseas remittances

(d) Layering

(e) Foreign assets

(f) Proceeds of crime (PoC)

(g) Money laundering.

24. What is best example for DRI→ED nexus?

A fake import declared at INR 100 crore

DRI to discovers whether actual value was INR 250 crore

↓

INR 150 crore differential routed through overseas entities

↓

DRI investigates customs offence

The ED investigates the financial/foreign–exchange and PMLA dimensions when statutory conditions are met.

25. What is flow chart for SFIO→ED nexus?

The SFIO investigates the corporate fraud.

↓

Company

↓

Fake invoices

↓

Circular transactions

↓

Related-party entities

↓

Diversion of funds

↓

Layering through subsidiaries

↓

ED can then investigate:

↓

Where did the diverted money go?

The corporate fraud cases can produce a particularly extensive SFIO–ED overlap, while the legal mandates remain distinct.

26. What is best example for Income Tax→ED nexus?

The Income Tax investigation discovers

↓

Undisclosed income INR 200 crore and the investigation reveal:

(a) Accommodation entries

(b) Shell companies

(d) Unexplained foreign remittances

(e) Benami-type structures

(f) Layering of funds

↓

The Income Tax Department (ITD) deals with the tax consequences.

↓

The ED may examine whether the underlying “criminal” offence and financial trail satisfy PMLA, 2002 requirements.

27. What is best example for SEBI→ED nexus?

A securities-market manipulation case:

↓

Promoter / broker / intermediary

↓

Manipulation / fraudulent trading

↓

Artificial price increase

↓

Sale of shares

↓

INR 500 crore realised

↓

The SEBI may investigate the securities violation.

↓

The ED may subsequently examine whether the resulting property constitutes PoC and whether there has been money laundering under PMLA, 2002
The SEBI determines securities-law violations and the ED determines the PMLA, 2002 consequences when the statutory ingredients are met.

28. What is specific role for CBI, DRI, SFIO, Income Tax, SEBI, RBI and ED?

(i) The CBI’s role

- Who committed the crime?

(ii) The DRI’s role

- What was smuggled / mis-declared and what customs offence occurred?

(iii) The SFIO’s role

- How was the company/corporate structure used to commit the fraud?

(iv) The Income Tax’s role

- What income was concealed and what is “criminal” offence conducted?

(v) The SEBI’s role

- Was the securities market manipulated or defrauded?

(vi) The RBI’s role

- Was there a regulatory/foreign-exchange/banking violation?

(vii) The ED’s role

- Where is the money/property and has it been laundered or dealt with in violation of FEMA, 1999?

29. What is common transaction for CBI, DRI, SFIO, Income Tax, SEBI, RBI and ED?

1 transaction can legitimately generate “multiple” proceedings like INR 1,000 crore corporate fraud

↓

The SFIO examines for corporate fraud investigation

↓

The CBI examines for criminal conspiracy/cheating/corruption, within jurisdiction

↓

The Income Tax examines for undisclosed income/tax consequences and “criminal” offence

↓

The SEBI examines for securities-market violations

↓

The ED examines for PMLA/FEMA financial trail

↓

The RBI examines for banking/foreign-exchange regulatory issues

↓

The DRI examines for import/export/customs violations are involved

30. What is adjudication for CBI, DRI, SFIO, Income Tax, SEBI, RBI and ED?

An adjudication against “criminal” investigation by CBI, DRI, SFIO, Income Tax, SEBI, RBI or ED

↓

The investigation

↓

The criminal prosecution before the competent court, when applicable.

↓

An administrative/regulatory adjudication

↓

The Income Tax authorities, SEBI, Customs authorities or PMLA Adjudicating Authority

↓

A statutory adjudication

↓

An appeal to designated appellate authority, tribunal or court.

31. What is master nexus for CBI, DRI, SFIO, Income Tax, SEBI, RBI→ED?

RBI / Banks

↓

Income Tax evasion and “criminal” offence

↓

SEBI

↓

DRI→CBI / SFIO→ED

↓

Other law-enforcement/regulatory agencies

↓

ED’s investigation

↓

Attachment / seizure under applicable law

↓

PMLA Adjudicating Authority

↓

ED’s Special Court

↓

Appellate / Constitutional Courts

******

(Author can be reached at email address [email protected] or on Mobile No. 9811081957)

Disclaimer: The contents of this article are solely for informational purpose. Neither this article nor the information as contained herein constitutes a contract or will form the basis of a contract. The material contained in this article does not constitute or substitute professional advice that may be required before acting on any matter. While every care has been taken in the preparation of this article to ensure its accuracy at the time of publication. Satish Agarwal assumes no responsibility for any error which despite all precautions may be found herein. We shall not be liable for direct, indirect or consequential damages if any arising out of or in any way connected with the use of this article or the information as contained herein.