Umbilical cord between FIR & ECIR snaps after latter’s birth, says Madras High Court

Justices S.M. Subramaniam and A.D. Maria Clete rule that money laundering trial cannot be postponed until the criminal proceedings in predicate offence reach finality

The umbilical cord between a First Information Report (FIR) and an Enforcement Case Information Report (ECIR) gets snapped immediately after the birth of the latter, and hence, the trial in a Prevention of Money Laundering Act (PMLA) case need not be postponed until the criminal case booked for the predicate offence reaches finality, the Madras High Court has held.

A Division Bench of Justices S.M. Subramaniam and A.D. Maria Clete said the Directorate of Enforcement (ED) certainly requires the pre-existence of a scheduled economic offence, booked by any other agency, such as Central Bureau of Investigation (CBI) or the local police, before registering a ECIR under the PMLA of 2002 on the suspicion that the money could have been laundered.

However, after the registration of the ECIR, the investigation to be carried out by the ED would become independent and would have to be dealt with only under the provisions of the PMLA. Being a special enactment, the PMLA would have an overriding effect over all the other criminal laws, including the Code of Criminal Procedure (now Bharatiya Nagarik Suraksha Sanhita), the Bench said.

“The ECIR is born from the FIR but once the ECIR is born, the umbilical cord that connects the ECIR with the FIR loses its relevance and the ECIR becomes an independent document in itself. Consequently, a new life in the form of the ECIR emerges, which has a breath of its own without the support of the FIR. So, the FIR and ECIR become two different documents, and both tend to take shape on its own, independent of each other,” the judges wrote.

The observations were made while allowing a criminal revision petition filed by the ED against an order passed by the Principal Sessions Court-cum-Special Court under the PMLA in Puducherry on April 30, 2024. The Principal Sessions Court had decided to postpone the trial in a PMLA case against former MLA Ashok Anand until the disposal of his 2018 appeal against the conviction in a disproportionate assets case.

The Division Bench led by Justice Subramaniam agreed with ED Special Public Prosecutor (SPP) N. Ramesh that the Puducherry Sessions-cum-Special Court ought not to have postponed the commencement of the PMLA trial indefinitely when the offence of money laundering remains to be distinct and independent of the criminal proceedings related to the predicate offence booked by the CBI.

“The wider implications and ramifications of the offence of money laundering cannot be equated with the offences under the other penal laws. The objective of the PMLA is to protect the economic status of our country. Therefore, we are of the considered opinion that the trial court has committed an error in postponement of the PMLA trial during the pendency of the criminal appeal,” the Bench said.

It also said that after the completion of the appeal proceedings in the disproportionate assets before the Madras High Court, the convict might appeal before the Supreme Court and cite that as a reason to postpone the PMLA trial further. Such a course could not be permitted. “In any angle, pendency of a criminal appeal cannot be an absolute bar for proceeding with the PMLA trial,” the judges observed.

They quashed the Sessions Court order and directed it to proceed with the trial.

Published - October 14, 2024 02:34 pm IST