The Supreme Court held that the dispensation regarding ...

Money Laundering Investigations Governed by PMLA; Police Excluded; Section 50 Validated; Compliance with Summons Required.

September 11, 2024

Case Laws     Money Laundering     SC

The Supreme Court held that the dispensation regarding Prevention of Money Laundering, Attachment of Proceeds of Crime, and Inquiry/Investigation of offence of Money Laundering, including issuing summons, recording statements, and calling for production of documents, is fully governed by the provisions of the PMLA itself. The jurisdictional police, governed by Chapter XII of the Code, cannot register or investigate the offence of money laundering due to the special procedure prescribed under the PMLA. The ratio in Vijay Madanlal case upheld the validity of Section 50, which enables the authorized Authority to summon any person for giving evidence or producing records during proceedings under the Act. The person summoned is bound to attend and state the truth, and cannot claim protection under Article 20(3) at the summons stage as it is not "testimonial compulsion". The challenge to the summons issued u/s 50 was dismissed as lacking merit. Persons summoned are bound to attend, state the truth, and produce documents as required under sub-sections (3) and (4) of Section 50, failing which they are liable u/s 174 of the IPC. Both appeals were dismissed.

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