Pinarayi Vijayan Vs K M Shajahan & Ors. (Supreme Court)
Summary: The Supreme Court restored the appellants’ appeals before the Kerala High Court Division Bench against a Single Judge’s order directing registration of FIRs, investigation and filing of the final report. The proceedings arose from information shared by the Enforcement Directorate under Section 66(2) of the Prevention of Money Laundering Act, 2002 concerning alleged offences under the Prevention of Corruption Act, 1988. According to ED’s submissions, the matter involved materials emerging from investigations concerning M/s CMRL and M/s Exalogic, including alleged transfers of funds abroad. The State initially constituted a nine-member Special Investigation Team for a preliminary enquiry. On the writ petitioner’s challenge, the Single Judge quashed that decision and directed the Vigilance and Anti-Corruption Bureau to register FIRs and investigate. Although the appellants had not been parties to the writ proceedings, the Division Bench refused them leave to appeal, reasoning that accused persons had no right to be heard before registration of an FIR and could pursue independent remedies against the FIRs. The State informed the Supreme Court that the FIRs had already been registered on 12 October 2026 and investigation had commenced.
The Supreme Court distinguished police registration of an FIR on receipt of information from registration pursuant to a judicial order containing a finding that the material disclosed a cognizable offence. It reasoned that denying an appellate challenge to that finding could prejudice the appellants in independent proceedings challenging the FIRs. Referring to Section 175(4) of the BNSS, the Court explained that the new procedural framework envisaged participation of a potential accused in specified circumstances before a Magistrate ordered investigation. It expressly clarified that this reference illustrated the changed statutory framework and did not decide its application to the merits of the present case. The Court further observed that the Single Judge’s directions extended beyond registration of FIRs to investigation and filing of the final report, which might require consideration of statutory requirements under the special law, including Section 17A. Holding that the appellants had locus to appeal, it set aside the impugned judgment and order and restored their appeals. Investigation in the impugned FIRs was stayed for ten days from 21 October 2026 to enable them to seek interim relief, with the Division Bench free to decide such relief independently. The Court expressed no opinion on the merits or the validity of the subsequent ECIR and left the latter issue open for appropriate proceedings.
Cases Discussed
FULL TEXT OF THE SUPREME COURT JUDGMENT/ORDER
1. Issue notice.
2. Mr. Koshy John, Mr. Aljo K. Joseph and Mr. Amrish Kumar, learned counsel, accept notice on behalf of respondents.
3. Leave granted. Heard counsel for the parties.
4. Mr. Luthra and Mr. Hariharan, learned Senior Counsel for the appellants argued that the Division Bench erred in law in refusing to grant leave to appeal to the appellants against the Single Judge’s order directing registration of FIR and to conduct investigation against their clients.
5. Mr. Ramesh Babu, learned Senior Counsel for the State submits that First Information Reports (FIRs) (VC 6/2026/SIU-1 & VC 7/2026/SIU-1 at PS-SIU-1, Thiruvananthapuram) have already been registered on 12.10.2026 and investigation commenced as per the direction of the learned Single Judge.
6. Mr. Koshy John, learned counsel for respondent No.1 (writ petitioner before the High Court) contends that FIRs have been registered pursuant to information shared by the Enforcement Directorate under Section 66(2) of the Prevention of Money Laundering Act, 20021, which prima facie discloses a cognizable offence by the former Chief Minister, his daughter and son-in-law (former Minister) and others under the Prevention of Corruption Act, 19882. At the time of registration of FIRs, there is no requirement to hear the accused and the Division Bench had rightly refused to grant leave to appeal.
7. Mr. Zoheb Hossain, learned counsel for the Enforcement Directorate contends that SFIO commenced investigation under Section 447 of the Companies Act, 20133 with regard to the affairs of M/s CMRL and M/s Exalogic, the latter being a wholly owned company of Veena T., daughter of the former Chief Minister [Petitioner in SLP (Crl.) No.20425 of 2026]. In course of investigation, various materials transpired, including transfer of funds to foreign shores by Veena T. and her husband [Petitioner in SLP(Crl.) No.20471/2026]. As such, based on the materials transpired during investigation under the 2002 Act, ED shared information under Section 66(2) with the State Government for necessary action as per law.
8. In response thereto, the Director General of Police constituted a nine-member Special Investigation Team (SIT) to conduct a preliminary enquiry. Respondent No.1, being dissatisfied with such dilatory tactics to avoid registration of FIR and commencement of investigation against the former public servants and others, approached the High Court.
9. The learned Single Judge, after considering the materials on record, quashed the decision of the State Government to conduct a preliminary enquiry and, inter alia, directed as follows:
“Consequently, the 3rd respondent, the Director, Vigilance and Anti-Corruption Bureau, Thiruvananthapuram, is specifically directed to register FIR based on the information furnished under Section 66(2) of the PMLA for the offences disclosed therein under the PC Act, against the suspected persons specifically mentioned therein, forthwith, without any delay, and to investigate the allegations through competent officers of the Vigilance and Anti-Corruption Bureau and file the final report, without much delay.
It is specifically ordered that the DGP or the head of the Special Investigation Team, having custody of the information under Section 66(2) of the PMLA shall hand over the same to the 3rd respondent, forthwith, and the 3rd respondent shall obtain the same for the purpose of registering FIR, without fail and proceed further, in accordance with law. In this connection, the E.D. is directed to forward all necessary documents to the 3rd respondent, forthwith, and the 3rd respondent is free to call for any other documents required for the purpose of investigation after registering FIR..”
10. Admittedly, the appellants were not parties in the writ proceedings. Being aggrieved by the impugned order, they preferred appeals before the Division Bench along with an application seeking leave to appeal against the said order. The Division Bench dismissed their leave to appeal, inter alia, holding as follows:
“17. …….. it is clear that the impugned judgment has not affected the right of the applicants to pursue their constitutional or statutory remedy against the registration of the FIR and in such a situation, it cannot be held that the applicants established a prima facie or arguable case for granting the leave sought for. We find that when sufficient material disclosing commission of cognizable offences are furnished along with the information under Section 66(2) of the PML Act, 2002, there is no necessity for conducting a preliminary inquiry and that the accused in a corruption case has no legal right to be heard before registering the FIR and the accused persons are also not entitled to demand a preliminary inquiry before registering an FIR in a corruption case. Therefore, the points are answered against the applicants and accordingly, we find that the applications seeking leave to file appeals are liable to be dismissed.”
Consequently, the appeals were also dismissed by the High Court.
11. Mr. John has forcefully contended that as per Vijay Madanlal Choudhary v. Union of India [(2023) 12 SCC 1], the State was obliged to register an FIR as per communication made to them under Section 66(2) of the 2002 Act by Enforcement Directorate. The appellants, being accused persons, do not have a right of hearing at the time of registration of such FIR.
12. We are unable to agree to such contention advanced before us. This is not a case where, on receipt of communication under Section 66(2), the State had registered a case on its own. On the contrary, the registration of the FIR and commencement of investigation thereon was pursuant to a judicial order passed by the High Court. While passing such order, the Single Judge had inter alia observed that the materials in the communication by Enforcement Directorate discloses a cognizable offence and therefore, it was obligatory for the State to register an FIR. If the appellants are not permitted to assail such finding in the appellate proceedings, the same shall come in their way, if an independent proceeding is initiated, assailing the First Information Report as per law. That apart, the scheme with regard to registration of an FIR through judicial intervention under the BNSS has undergone a change from what was envisaged under the Code of Criminal Procedure. In the erstwhile Code, Section 156(3) did not require the participation or involvement of the public servant or his superior in exercise of Magisterial discretion to issue direction for registration of FIR. However, under Section 175(4) of the BNSS, such a requirement has been incorporated, which reads as follows:
“175(4) Any Magistrate empowered under section 210, may, upon receiving a complaint against a public servant arising in course of the discharge of his official duties, order investigation, subject to—
(a) receiving a report containing facts and circumstances of the incident from the officer superior to him; and
(b) after consideration of the assertions made by the public servant as to the situation that led to the incident so alleged.”
13. Mr. Zoheb Hossain, learned counsel, argues that such requirement would be hedged by the fact that the offence is committed by public servant in discharge of official duty, which would not apply to former public servants in corruption cases.
14. We have referred to Section 175(4) of the BNSS not in reference to the merits of the case before us, but to elucidate the expansive jurisdiction envisaged in the new law with regard to participation of a potential accused prior to registration of FIR. That apart, we are also minded to observe that the Single Judge has not only directed registration of an FIR, which is the mandate in Vijay Madanlal Choudhary (supra), but also directed commencement of investigation and filing of final report, which may require consideration of other statutory requirements under the special law including sanction under Section 17A thereof.
15. These facts clearly show the appellants had locus to prefer appeal against the impugned judgment and order and their prayer for leave to appeal were incorrectly turned down.
16. Accordingly, we set aside the impugned judgment and order and permit the appellants to pursue their appeals before the Division Bench. The Appeals are restored to file.
17. We make it clear that our observations are limited to the issue at hand, that is, the locus of the appellants to prefer the appeal, and not an expression of opinion on merits. We also give liberty to the appellants to seek interim relief in accordance with law.
18. To enable the appellants to do so, we direct that the investigation in the impugned FIRs shall remain stayed for a period of ten days from today, which, however, shall not be treated as a conclusive opinion expressed on interim relief, and the Division Bench shall be entitled to fashion independently such relief in accordance with law.
19. We are informed that a subsequent ECIR has been registered in respect of the impugned FIRs. We express no opinion with regard to its validity and keep it open to be agitated in appropriate proceedings, if instituted in accordance with law.
20. The appeals are, accordingly, disposed of.
Notes:
1 2002 Act
2 PC Act
3 2013 Act
