Karnataka High Court
Sri. B S Suresha vs Directorate Of Enforcement on 7 March, 2025
Author: M.Nagaprasanna
Bench: M.Nagaprasanna
1
Reserved on : 20.02.2025
Pronounced on : 07.03.2025 R
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 07TH DAY OF MARCH, 2025
BEFORE
THE HON'BLE MR. JUSTICE M. NAGAPRASANNA
CRIMINAL PETITION No.1129 OF 2025
BETWEEN:
SRI B.S. SURESHA
S/O LATE B.M.SUBBANNA
AGED ABOUT 52 YEARS
RESIDING AT NO.174, BYRATHI
BENGALURU NORTH
DR.SHIVARAMA KARANTH NAGAR
BENGALURU - 560 077.
... PETITIONER
(BY SRI C.V.NAGESH, SR.ADVOCATE FOR
SRI PRAVEEN KAMATH M.R., ADVOCATE)
AND:
DIRECTORATE OF ENFORCEMENT
REPRESENTED BY ITS
ASSISTANT DIRECTOR
MINISTRY OF FINANCE AND
DEPARTMENT OF REVENUE
BENGALURU ZONAL OFFICE
2
3RD FLOOR, BLOCK 'B'
BMTC BUILDING, K.H.ROAD
BENGALURU - 560 027.
... RESPONDENT
(BY SRI ARAVIND KAMATH, ASGI A/W
SRI MADHUKAR DESHPANDE, SPL.PP)
THIS CRIMINAL PETITION IS FILED UNDER SECTION 528 OF
THE BHARATIYA NAGARIK SURAKSHA SANHITA, 2023, PRAYING
TO A) QUASH THE INITIATION OF PROCEEDINGS AND
INVESTIGATION PERTAINING TO ECIR BEARING
F.NO.BGZO/25/2024 REGISTERED BY THE RESPONDENT ARISING
OUT OF THE PREDICATE OFFENCE IN CRIME NO.11/2024,
REGISTERED BY THE LOKAYUKTHA POLICE; B) QUASH THE
SUMMONS ISSUED UNDER SECTION 50 OF PMLA DATED
22/01/2025 BEARING SUMMON
NO.PMLA/SUMMON/BGZO/2025/2889/8748 TO THE PETITIONER
HEREIN (ANNEXURE-A).
THIS CRIMINAL PETITION HAVING BEEN HEARD AND
RESERVED FOR ORDERS ON 20.02.2025, COMING ON FOR
PRONOUNCEMENT THIS DAY, THE COURT MADE THE FOLLOWING:-
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CORAM: THE HON'BLE MR JUSTICE M.NAGAPRASANNA
CAV ORDER
The petitioner is before this Court calling in question initiation
of proceedings pursuant to registration of Enforcement Case
Information Report ('ECIR') arising out of predicate offence in Crime
No.11 of 2024.
2. Heard Sri C.V. Nagesh, learned senior counsel appearing
for the petitioner and Sri Arvind Kamath, learned Additional
Solicitor General of India appearing for the respondent.
3. Shorn of unnecessary details, facts in brief, germane are as
follows:-
The petitioner is a sitting Member of the Legislative Assembly.
The genesis of the present petition is relatable to the accused in
Crime No.11 of 2024. The present petitioner is not an accused. He
has come into the picture as he is presently functioning as the
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Minister for Urban Development and Town Planning in the State of
Karnataka. While investigating in to the offence pursuant to
registration of ECIR against accused No.2, wife of the Chief Minister
and petitioner in Criminal Petition No.1132 of 2025, the petitioner
has been dragged into the proceedings. As observed hereinabove,
the petitioner is dragged in only for the reason that he is presently
holding the portfolio of Minister for Urban Development and Town
Planning. Barring this, the summons nowhere indicates any
involvement of the petitioner. Registration of ECIR and issuance of
summons is what has driven the petitioner to this Court in the
subject petition.
4. The learned senior counsel Sri C.V. Nagesh appearing for
the petitioner would take this Court through the summons and
submits that it is ununderstandable as to what is the crime the
petitioner has committed. The petitioner is not aware of what has
happened in Mysore Urban Development Authority ('MUDA') 15
years ago. He has now become the Minister. There is no allegation
that after him becoming the Minister there is any criminal activity
which concerns Crime No.11 of 2024. Without looking into the role
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of the petitioner, ECIR is registered and summons issued. He would
submit that it violates the right to privacy of the petitioner, as the
questionnaire attached to the summons relates to all the properties
owned by the petitioner and the relatives of the petitioner to be
divulged before entering the hall of the Enforcement Directorate for
interrogation.
5. Per contra, the learned Additional Solicitor General of India
Sri Arvind Kamath would vehemently refute the submissions to
contend that the proceedings under ECIR are civil in nature and
summons are issued for the purpose of getting the information. The
petitioner cannot evade appearing before the Enforcement
Directorate and tendering his evidence. He would submit that the
contention with regard to all the properties being divulged in the
questionnaire is necessary for the reason of analyzing the issue of
money laundering related to Crime No.11 of 2024. He would seek
dismissal of the petition.
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6. I have given my anxious consideration to the submissions
made by the respective learned counsel and have perused the
material on record.
7. The afore-narrated facts are not in dispute. The issue lies
in a narrow compass. The petitioner becomes the cabinet Minister
holding the portfolio of Urban Development and Town Planning. His
tenure as cabinet Minister begins on him being sworn as a Minister
pursuant to his victory in the general Assembly Election of 2023
from Hebbal constituency. The issue in the lis does not relate to the
petitioner at all. It relates to Crime No.11 of 2024. The petitioner is
not an accused in Crime No. 11 of 2024. He is not charged of
conspiracy. He is wanting to be summoned for the purpose of
enquiry. Therefore, it is germane to notice what is the summons
issued to the petitioner under Section 50 of the Prevention of
Money Laundering Act, 2002 ('the Act' for short). The summons
reads as follows:
"Summon No.:PMLA/SUMMON/BGZO/2025/2889/8748
F.No.BGZO/25/2024.
Summon
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Whereas I, V. Muralikkannan, AD (authority under PMLA),
am making investigation or proceeding under the provisions of
the Prevention of Money Laundering Act, 2002 (15 of 2003)
(PMLA).
And whereas, I consider the attendance of Sri Byrathi
Suresh necessary to give evidence and for production of records
in connection with the investigation or proceeding under PMLA.
Now, therefore, in exercise of the powers conferred upon
me under sub-section (2) and sub-section (3) of Section 50 of
PMLA. I require said Shri Byrathi Suresh to appear before me in
person at my office at the mentioned address on 27-01-2025 at
11.00 a.m. to give evidence and to produce records as per
schedule below in connection with the investigation or
proceeding under PMLA.
SCHEDULE
(As per Annexure-'A' enclosed)
GIVEN UNDER MY HAND AND SEAL,THIS 22nd Day of 01,
2025.
Sd/-
Signature and Seal of IO
V.Muralikkannan,
AD, AD[BGZO(3)(1)]
To
Shri Byrathi Suresh,
Minister Urban
Development Department.
Vikas Soudha, Bangalore.
Note:
1. Every proceeding under sub-section (2) and sub-
section (3) of Section 50 of the Prevention of Money Laundering
Act, 2002 shall be deemed to be a judicial proceeding within the
meaning of Section 229 and Section 267 of Bharatiya Nyaya
Sanhita, 2023(45 of 2023).
2. It is hereby informed that if you fail to attend to give
evidence and/or produce records as mentioned in the Schedule
at the place and time as specified in the said summon, you shall
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be liable to penal proceedings under the Prevention of Money
Laundering Act, 2002 (15 of 2003) and other relevant provisions
of Bharatiya Nyaya Sanhita, 2023 (45 of 2023).
1. In person oral deposition.
2. Details as per the attached General Questionnaire."
Summons directed the petitioner to appear before the Enforcement
Directorate in person, for oral deposition, after filling in the details
as per the attached questionnaire. The questionnaire assumes
certain significance. Therefore, it is necessary to notice. It reads as
follows:
"GENERAL INFORMATION QUESTIONNAIRE
(Please bring below mentioned details in hard copy as
well as in soft copy in Pen drive/e-mail)
1. Personal Profile:
(i) Name:
(ii) Alias:
(iii) Date & Place of birth:
(iv) Permanent Address:
(v) Present Address:
(vi) Identification mark:
(vii) Educational qualification and name of the institutes:
(viii) Email ID.
(ix) Website address:
(x) Telephone/Fax/Telex Nos.
(a) Residential:
(b) Business:
(c) Mobile:
(xi) Passport details:
(a) Passport No.
(b) Place & date of issue:
(c) Valid upto -
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(d) Foreign visit with purpose - Furnish the details
date wise for every trip along with the purpose.
(e) Details of previous passport, if any issued:
(xii Aadhaar No:
(xiii) Whether summoned/arrested/detained/ convicted
under FERA/FEMA in the past, if yes:
(a) Date:
(b) Nature of involvement
(c) Name & address of the associated in the case:
(xiv) Whether summoned/arrested/detained/
convicted/under any other criminal offence or under
Customs/DRI/Excise/Income-tax/Police/ other
Department in the past, if yes:
(a) Date
(b) Nature of involvement;
(c) Details of arrest, if any:
(d) Name & address of the associated in the case:
(xv) Languages known:
(a) Read:
(b) Write;
(c) Speak:
2. Family profile (Name, age, address, source of income
& contact numbers.
(i) Father:
(ii) Mother:
(iii) Spouse
(iv) Children:
(a)
(b)
(v) Brothers:
(a)
(b)
(vi) Sisters:
(a)
(b)
(vii) Father-in-law:
(viii) Brother-in-law:
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(a)
(b)
(ix) Sister-in-law:
(a)
(b)
(x) Co-brothers-in-law:
(a)
(b)
3. Associates: if any:
4. Business Profile:
i. Details of firms/companies/proprietary concern and
their subsidiaries related to you in following format,
located in India and Foreign:
Sl. Name of Full address of Name and Income IEC
No. the Entity the entity address of Tax details Number
along with e- authorized
mail/ phone signatory
no.
1.
2.
(Attach separate sheet if required)
ii. Details of all the Bank accounts held in the name
of above said entities and their subsidiaries (in
India and Foreign), in following format:
Name of Branch Bank A/c Type of Name of
the Bank Name No. A/c A/c Holder
(Attach separate sheet if required)
5. Financial Profile:
(i) Personal:
(a) Income tax details
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(i) Permanent Account Number (PAN)
(ii) Ward Number
(iii) Annual Income (Presently)
(iv) Various source of income:
(v) Director's Identification Number (DIN)
(b) Details of all the Bank accounts (India and Foreign):
Name of Branch Bank A/c Type of Name of
the Bank Name No. A/c A/c
Holder
(Attach separate sheet if required)
(c) Details of Lockers:
(d) Details & full address of properties held (also
attach copies of latest Encumbrance Certificate and
Sale Deed of each property).
(i) Ancestral:
(ii)Personal:
(e) Other assets viz., shares/debentures/investment in
insurance policies etc.
(f) Details of Vehicles:
(ii) Family furnish all the below mentioned details, for each
family member i.e, spouse, father, mother,children and
also for the subject entity/ies).
(a) Income tax details:
(i) Permanent Account Number (PAN)
(ii) Ward Number
(iii) Annual Income (Presently)
(iv) Various source of income:
(v) Director's Identification Number (DIN)
(b) Details of all the Bank accounts (India and
Foreign):
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Name of Branch Bank A/c Type of Name of A/c
the Bank Name No. A/c Holder
(Attach separate sheet if required)
(c) Details of Lockers:
(d) Details & full address of properties held (also
attach copies of latest Encumbrance Certificate and
Sale Deed of each property).
(i) Ancestral:
(ii)Personal:
(e) Other assets viz., shares/debentures/investment in
insurance policies etc.
(f) Details of Vehicles:"
The information about the petitioner is sought in its entirety. The
summons does not stop at that. It seeks information of the entire
family members - father, mother, spouse, children, brothers,
sisters, father-in-law, brother-in-law, sister-in-law, co-brothers-in-
law, all associates, the business profile, financial profile of the
noticee and all the members of the family and details of the lockers
and so on and so forth.
8. Section 50 of the Act reads as follows:
"50. Powers of authorities regarding summons,
production of documents and to give evidence, etc.--(1)
The Director shall, for the purposes of Section 13, have the
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same powers as are vested in a civil court under the Code of
Civil Procedure, 1908 (5 of 1908) while trying a suit in respect
of the following matters, namely:--
(a) discovery and inspection;
(b) enforcing the attendance of any person, including any
officer of a reporting entity, and examining him on oath;
(c) compelling the production of records;
(d) receiving evidence on affidavits;
(e) issuing commissions for examination of witnesses and
documents; and
(f) any other matter which may be prescribed.
(2) The Director, Additional Director, Joint Director,
Deputy Director or Assistant Director shall have power to
summon any person whose attendance he considers
necessary whether to give evidence or to produce any
records during the course of any investigation or
proceeding under this Act.
(3) All the persons so summoned shall be bound to
attend in person or through authorised agents, as such
officer may direct, and shall be bound to state the truth
upon any subject respecting which they are examined or
make statements, and produce such documents as may
be required.
(4) Every proceeding under sub-sections (2) and
(3) shall be deemed to be a judicial proceeding within the
meaning of Section 193 and Section 228 of the Indian
Penal Code (45 of 1860).
(5) Subject to any rules made in this behalf by the
Central Government, any officer referred to in sub-section
(2) may impound and retain in his custody for such
period, as he thinks fit, any records produced before him
in any proceedings under this Act:
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Provided that an Assistant Director or a Deputy
Director shall not--
(a) impound any records without recording his reasons
for so doing; or
(b) retain in his custody any such records for a period
exceeding three months, without obtaining the
previous approval of the Joint Director."
Section 50 deals with powers of authorities regarding summons,
production of documents and to give evidence. Sub-section (2)
mandates that the competent officer shall have the power to
summon any person whose attendance he considers necessary
whether to give evidence or to give any records during the course
of investigation or proceedings under the Act. All the persons
summoned shall be bound to attend in person or through
authorised agents as such officer may direct, and shall be bound to
state the truth. Every proceeding under sub-section (2) and
sub-section (3) shall be deemed to be a judicial proceeding. The
Assistant Director, on appearance of the person to whom summons
is issued, has the power to impound any records without giving
reason for so doing and retain in custody any such records without
prior approval for a period of three months. Holding that the person
to whom summons is issued is not cooperating with the
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investigation, it is open to the Enforcement Directorate to arrest the
said person.
9. Admittedly, the petitioner comes into the picture in the
year 2023 as Minister for Urban Development. In Writ Petition
No.1132 of 2025 the Enforcement Directorate has filed detailed
objections. In those detailed objections, nowhere the name of the
petitioner figures. The petitioner is now called to tender evidence. If
the investigation, search, seizure or even order of attachment all
related to their genesis long before entry of the petitioner, it is un-
understandable as to why the petitioner is being summoned.
10. If the petitioner has nothing to do with all that has
happened in MUDA which forms the fulcrum of crime in Crime
No.11 of 2024, it is rather difficult to accept the submission of the
learned Additional Solicitor General that summons cannot be
challenged and whoever is summoned is bound to come and depose
before the Officer. While in the normal circumstance, it would have
been permissible but, in the light of the fact that the petitioner is
not even remotely connected nor the investigation trail conducted
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by the Enforcement Directorate leads to the doors of the petitioner,
in the peculiar facts of the case, it becomes difficult to permit such
summoning.
11. In an identical circumstance where summons was issued
to the former Commissioner of MUDA one Dr.Natesha, the
coordinate Bench, interpreting Section 50 of the Act, in the case of
DR. NATESHA D.B. v. DIRECTORATE OF ENFORCEMENT1 while
allowing the petition formulated 4 issues. They read as follows:
".... .... ....
Issues
8. After considering the arguments of the learned
counsel for the parties, the following issues emerge for
consideration :
i. Whether the authorisation issued to conduct the
impugned search and seizure at the residence of
the petitioner on 28.10.2024 and 29.10.2024, and
the consequent statement recorded under Section
17 of PMLA, 2002 suffers from lack of jurisdiction?
ii. Whether the said impugned search and seizure and
the statement recorded, is bad in law for lack of
the requisite "reason to believe" under section
17(1) of PMLA, 2002, and is therefore, an abuse of
process of law?
1
Writ Petition No.32956 of 2024,Decided on 27.01.2025.
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iii. Whether the impugned summons/notices
issued under Section 50 of PMLA, 2002 and
the various statements recorded thereunder,
be sustained under the law?
iv. Whether, in the course of its administration and execution
of the PMLA, 2002, the attachment of property under
Section 5 of the Act must mandatorily precede the conduct
of search and seizure under Section 17 of the said Act? "
Issue No.3 relates to, whether the summons impugned therein
issued under Section 50 of the Act was sustainable in law. The issue
is answered from paragraphs 35 to 54. They read as follows:
".... .... ....
ISSUE NO. 3
35. The petitioner herein further challenges the
repeated issuance of summons under Section 50 of the PMLA,
arguing that these summons are vague because they do not
specify whether the petitioner is being treated as an accused or
a witness. This, according to the petitioner, violates the
constitutional protection against self-incrimination under Article
20(3) of the Constitution.
36. Section 50 of PMLA deals with Powers of authorities
regarding summons, production of documents and to give
evidence, etc. and the relevant portions thereof, reads thus -
"Section 50. - ...
(2) The Director, Additional Director, Joint Director,
Deputy Director or Assistant Director shall have power to
summon any person whose attendance he considers
necessary whether to give evidence or to produce any
records during the course of any investigation or
proceeding under this Act.
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(3) All the persons so summoned shall be bound to
attend in person or through authorised agents, as such
officer may direct, and shall be bound to state the truth
upon any subject respecting which they are examined or
make statements, and produce such documents as may be
required.
(4) Every proceeding under sub-sections (2) and (3)
shall be deemed to be a judicial proceeding within the
meaning of section 193 and section 228 of the Indian Penal
Code (45 of 1860)."
(Emphasis supplied)
37. In the case of Vijay Madanlal (supra), the
Hon'ble Supreme Court clarified that the process under Section
50 of the PMLA, which involves summoning a person whose
presence is needed for gathering evidence or records, is part of
an inquiry into the proceeds of crime, and not an investigation
for prosecution under the Act. There is no formal accusation
brought against the summoned individual at this stage, to
warrant invoking the constitutional guarantee under Article
20(3).
38. In the case of Abhishek Banerjee v. Directorate
of Enforcement (2024) INSC 668, the Supreme Court dealt
with a challenge to the issuance of summons and reaffirmed the
ratio enunciated in the case of Vijay Madanlal and held that
summons can be issued even to witnesses during the inquiry. It
further stated that the procedure under the Act and its rules
require the officer issuing the summons to follow Rule 11 of the
PMLA Rules, 2005 which mandates the issuance of summons in
Form V. The summons must include details such as the name,
designation, and address of the summoning officer.
39. The Supreme Court in the case of Mahabir Prasad
Rungta v. Directorate of Enforcement, in SLP (Crl) No.
12353/2024, also followed the Vijay Madanlal case and stated
that money laundering charges under the PMLA cannot be
concluded until the trial for the predicate offence is completed.
40. In Sudarshan Ramesh v. Union of India
(2023) SCC OnLine Kar 71, a coordinate Bench of this Court
dealt with a case, where the petitioner was repeatedly
summoned in connection with an investigation involving his
19
brother, who was implicated in a scheduled offence under the
PMLA. The Court noted that despite the petitioner cooperating,
nothing incriminating had been found, and he had been
summoned without any reasonable grounds other than his
family connection. The Court held that the principle of probable
cause or reasonable grounds is fundamental to the criminal
justice system, and that a person cannot be repeatedly
summoned without probable cause for convenience of the
prosecution.
41. In response, the learned Additional Solicitor
General of India, contended that Section 50 of the Act
empowered the authorized officers to summon any person
necessary to give necessary evidence or produce any record. In
support of the same, the learned ASG drew the attention of the
Court to various precedents, including the case of Director
General of Income Tax (Investigation) v. Spacewood
Furnishers Pvt. Ltd. (2015) 12 SCC 179, wherein the
Hon'ble Supreme Court stated that while the reasons for search
and seizure conducted under Income Tax Act, 1961 must be
recorded, they do not need to be communicated to the person
at that time. The Court also emphasized that judicial review
cannot question the adequacy of the reasons for search, but
only their relevance, and that any review of the sufficiency of
the reasons or the authenticity of the information is not
permissible. Therefore, the ASG argued that this Court cannot
review the adequacy of the reasons for the search conducted
under Section 17 and the issuance of summons under Section
50 of the PMLA.
42. In the case of Assistant Commissioner of
Income Tax v. Rajesh Jhaveri Stock Broker Pvt. Ltd.,
(2008) 14 SCC 208, the Hon'ble Apex Court opined that the
phrase "reason to believe" in Section 147 of the Income Tax
Act, 1961 means a cause or justification for the purpose of
assessing or reassessing income chargeable to tax, if income for
any assessment year had escaped assessment. The Court
further held that this expression does not require the assessing
officer to have finally ascertained the facts with legal evidence
or conclusion. It was emphasized that the assessing officer must
act fairly towards the taxpayer while administering the statute.
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43. The learned ASG also referred to the case of Vijay
Madanlal Choudhary & Ors. v. Union of India & Ors.
(2022) SCC OnLine SC 1929, where the Supreme Court
observed that the provisions of the PMLA, 2002 aim not only to
investigate money laundering but also to prevent money
laundering and confiscate any property related to money
laundering. The Court noted that the trifold objectives of the Act
make it distinct from the process of investigating a scheduled
offence. The Court further held that the authority conducting the
search under Section 17 of the Act must forward a copy of the
recorded reasons and material in its possession to the
adjudicating authority in a sealed envelope immediately after
the search and seizure. This procedure ensures that the
contents are not tampered with, thereby guaranteeing
procedural fairness and accountability. The Apex Court also
noted that Section 62 of the Act provides punishment for
officials conducting vexatious searches.
43.1. Relying on the above, in response to the allegation
that the impugned search was arbitrary, the learned ASG
argued that the PMLA has in-built safeguards against
arbitrariness and misuse of power, and therefore, this Court
should not be compelled to review the search and issuance of
summons at this stage.
44. In the case of Kirit Shrimankar v. Union of
India & Ors., WP (Crl.) No. 109/2013, DD 20.11.2014,
and connected matters, the Hon'ble Supreme Court observed
in a challenge to the issuance of summons under Section 108 of
the Customs Act, 1962 or Section 14 of the Central Excise Act,
that seeking extraordinary constitutional relief under Article 32
of the Constitution was premature, where the same was sought
on the grounds that petitioner had alleged that officers
conducting a search at the residence of his ex-wife had
threatened arrest unless the petitioner complied with their
demands. The Court held that the petitioner should have
pursued the remedy under law only when any positive action
was taken to his prejudice.
44.1. Therefore, the learned ASG, relying on the above,
argued that the petitioner herein cannot seek a similar relief
under Article 226 of the Constitution, as no action prejudicial to
the petitioner has yet been taken. The summons issued under
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Section 50 of the PMLA were lawful and aimed at gathering
evidence and records for the investigation under the Act.
Therefore, the petition should be dismissed as premature.
45. The High Court of Kerala in C M Raveendran v.
Union of India (2020) SCC OnLine Ker 7335 reaffirmed the
above ratio, stating that no cause of action arises merely
because a person is called upon to state the truth or make a
statement and produce documents. The Court further held that
any apprehension of being coerced into giving a statement
based on repeated issuance of summons is not a valid ground to
seek constitutional relief under Article 226.
46. In the case of Union of India & Anr. v.
Kunisetty Satyanarayana (2006) 12 SCC 28, the Hon'ble
Supreme Court dismissed a challenge against the framing of
charges in a disciplinary action initiated by the postal
department against the petitioner, who was accused of
submitting a forged 'scheduled tribe' caste certificate. The Court
observed that a writ petition does not lie against a charge-sheet
or show-cause notice, as it does not give rise to a cause of
action. The Court stated that a writ petition can only be filed
when a final order, affecting the rights of the party, is passed.
47. In Virbhadra Singh & Anr. v. Enforcement
Directorate & Anr. (2017) SCC OnLine Del 8930, where the
summons issued under Section 50 of the PMLA were challenged,
and one of the petitioners therein claimed to have been illegally
detained and tortured into making false statements, the High
Court of Delhi ruled that enforcement officers have the authority
to summon and examine any person for investigative purposes.
The Court stated that a person summoned under Section 50 is
not necessarily an accused at that time; they may become an
accused later if arrested or prosecuted. It further held that no
one can avoid responding to a summons simply because of the
apprehension that they might be prosecuted in the future.
48. In the case of Raghav Bahl v. Enforcement
Directorate (WP (Crl.) No.2392/2021), the Delhi High Court
referred to the above case and also to case Kirit Shrimankar
(supra). It concluded that there was no violation of the
petitioner's fundamental or legal rights that would warrant
intervention by the writ court at the summons stage.
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49. In the case of State of Gujarat v. Choodamani
Parmeshwaran Iyer, (2023) SCC OnLine SC 1043, the
Hon'ble Supreme Court dealt with a challenge to summons
under Section 145 of the Central Excise Act and Section 69 of
the Goods and Services Tax Act. The petitioners argued that
they were summoned due to suspected tax evasion and
apprehended arrest. The Court held that those summoned must
appear before the authorities for questioning and that the High
Court's writ jurisdiction cannot be invoked at the summons
stage to seek anticipatory bail.
50. In Directorate of Enforcement v. State of
Tamil Nadu (SLP (Crl.) No.1959-1963/2024), the Supreme
Court clarified that under Section 50 of PMLA, authorized
officers have the power to summon anyone whose attendance is
necessary to give evidence or produce records for investigation.
Those summoned are required to comply with the same.
51. In Talib Hassan Darvesh v. Directorate of
Enforcement, (2024) SCC OnLine Del 1811, the Delhi High
Court rejected a challenge to summons issued by the
Enforcement Directorate (ED) on the grounds that the summons
were vague. The petitioner had argued that the summons did
not specify their status as a witness or suspect and did not
mention the documents required. The Court held that the ED
could issue summons without specifying the exact documents,
as they are authorized to investigate and issue summons under
PMLA. It further ruled that protection from summons cannot be
granted unless the petitioner is absolved in the predicate
offence through discharge, acquittal, or quashing, in line with
the statutory rigours of Section 45 of PMLA.
52. In Moloy Ghatak v. Directorate of Enforcement
(2023) SCC OnLine 7443, the Delhi High Court addressed a
challenge to repeated summons issued to a petitioner who was
not yet an accused in the predicate offence. The Court found the
petitioner's request to quash the Enforcement Case Information
Report (ECIR) prematurely, because the ECIR was not provided
for review, and the petitioner himself was uncertain about his
status. The ED confirmed that the petitioner was not an accused
at the time of the summons and had not been summoned for
prosecution purposes.
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53. In the present case, summons under Section
50 were issued following the 'illegal' search and seizure
conducted under Section 17 of the PMLA. However, as
established in the preceding paragraphs, the reasons
recorded for the search do not satisfy the essential
elements required to establish the commission of an
offence under Section 3 of the PMLA. As a result, the
search and seizure lacked proper authority for there
being no proper reason to warrant such a search. The
respondent-Agency can summon any person to record a
statement or produce a document or record only in cases
where there is credible evidence that an offence under
Section 3 of PMLA has been committed, and in such
circumstances, the person who has been summoned
cannot raise any grievance against the issuance of
summons.
54. Thus, in light of the circumstances of this
case, where no prima facie case has been established
showing that an offence has been committed under the
PMLA, and no incriminating material has been elicited at
the time of search and seizure, the issuance of summons
to the petitioner lacks legal authority. The petitioners
cannot be compelled to appear and record their
statements or produce documents, as such actions would
unjustly infringe upon their personal right to liberty."
(Emphasis supplied)
The coordinate Bench holds that for a summons under Section 50
which is followed by a search and seizure in the case therein under
Section 17 of the Act, where no prima facie case has been
established showing that an offence has been committed under the
Act or no incriminating material has been elicited at the time of
24
search and seizure, issuance of summons to the petitioner lacks
legal authority.
12. The petitioner, in the case at hand, is on a far better
footing. The petitioner therein was earlier working as Commissioner
in MUDA when the allotment of sites had happened in favour of
accused No.2. The present petitioner does not even know what has
happened in MUDA. He comes into the picture only in the year
2023. Therefore, there is no prima facie case made out by the
Enforcement Directorate to summon the petitioner and not stopping
at summons, taking entire financial credentials of the petitioner, his
family members, his close or distant relatives is undoubtedly
violative of petitioner's right to life.
13. If it was a summons simpliciter as obtaining under
Section 41A of the Cr.P.C. or Section 35(3) of BNSS, it would have
been a circumstance altogether different. A caveat, this finding
would not become applicable to every case. The Enforcement
Directorate is entitled to summon and enquire into the matter. In
the peculiar facts of the case where the petitioner is nowhere
25
involved in the incidents that have happened 15 years prior to his
becoming the Minister, answering the summons and answering the
questionnaire to the summons would undoubtedly become an action
not sanctioned in law. Above all, the coordinate Bench considers the
very issue of challenge to the summons by a person who is not an
accused, but had some role to play in the allotment of sites which
forms the fulcrum of crime in Crime No.11 of 2024. The petitioner is
nowhere. Therefore, ECIR registered against the petitioner is
undoubtedly contrary to law.
14. For the aforesaid reasons, the following:
ORDER
(i) Criminal Petition is allowed.
(ii) Enforcement Case Information Report in F.No. BGZO/25/2024 issued against the petitioner by the respondent stands quashed.
(iii) All consequential actions, including summons issued, pursuant to the registration of ECIR are also obliterated.
26Consequently, pending applications if any, also stand disposed.
SD/-
(M.NAGAPRASANNA) JUDGE Bkp CT:MJ