Decoding the big SC verdict on Prevention of Money Laundering Act

In an important judgment on Wednesday, the Supreme Court upheld the provisions of the Prevention of Money Laundering Act and retained the powers of the Enforcement Directorate. The Parliament in its wisdom has regarded the property derived or obtained as a result of specified criminal activity, being an offence under the concerned legislation mentioned in the Schedule.” ON TWIN BAIL On the issue of twin bail conditions under the PMLA, the court ruled that the stringent conditions for bail under the Act are legal and not arbitrary. “The fact that some of the offences may be non-cognizable offences under the concerned legislation or regarded as minor and compoundable offences, yet, the Parliament, in its wisdom, having perceived the cumulative effect of the process or activity concerning the proceeds of crime generated from such criminal activities as being likely to pose threat to the economic stability, sovereignty and integrity of the country and thus, grouped them together for reckoning it as an offence of money laundering, is a matter of legislative policy. It is a proven fact that international criminal network that support home grown extremist groups relies on transfer of unaccounted money across nation, thus, by any stretch of imagination, it cannot be said that there is no compelling State interest in providing stringent conditions of bail for the offence of money-laundering.” ON PREDICATE OFFENCE The court made it clear that the offence under Section 3 is dependent on illegal gain of property as a result of criminal activity relating to a scheduled offence. ACQUITTAL OR DISCHARGE IN PREDICATE OFFENCE “If a person is finally discharged and acquitted of the scheduled offence or criminal case against him is quashed by a court of competent jurisdiction, there can be no offence of money laundering against him or anyone claiming such property being linked to the stated scheduled offence to him,” the judgment stated while making it clear that acquittal or discharge in the predicate offence or quashing of such offence will lead to acquittal or discharge in the offence of money laundering as well.