PMLA | 'Reason To Believe' Can't Be Mere Suspicion, Require Sufficient Evidence: Telangana High Court

The Telangana High Court has held that to constitute the offence of money laundering, the Enforcement Directorate must prove a reasonable basis to believe that the offence has been committed and generation of direct or indirect crime proceeds as a result of criminal activity which can be related to the offence. “However, the fact remains that accused Nos.1 to 3 were acquitted and in fact, entire tender process was cancelled and no crime proceeds were generated in favour of the joint venture company, including the petitioner herein. When crime proceeds were not generated or such crime proceeds did not come into possession of the petitioner, the authorities have no jurisdiction to continue the proceedings under the PML Act.” Factual Background: The case of the ED was that an FIR registered by the Economic Offences Wing of Bhopal, in 2019, for the offences under Sections 420, 468, 471 and 120-B of the Indian Penal Code, 1908, Section 66 of the Information Technology Act, 2000 and Section 7 of the Prevention of Corruption Act, 2018 read with Section 13 of the Prevention of Corruption Act, 2018 for un-authorised access to the e-tender procurement portal, issued by Madhya Pradesh against the petitioner and others alleged to be involved. In the two charge sheets, there is no mention of the petitioner.” The Court also observed that the only incident linking the petitioner to the alleged crime is the deposit of 10lakhs into the account of M/s Osmo I.T Solutions, which was allegedly used as bribes for garnering tender.