High Court Quashes PMLA Proceedings Against Advocate Applicant in Money Laundering Case Involving Anil Deshmukh -- Properties Purchased in 2005-2007 Have No Nexus with Alleged 2020-2021 Proceeds of Crime

Nature of Litigation: Criminal application under Section 482 of Cr.P.C. for quashing of process issued in a PMLA case

Remedy Sought

The Applicant sought quashing of the order dated 16.09.2021 issuing process against him in PMLA Special Case No. 1089 of 2021

Filing Reason

The Applicant contended that no offence under Section 3 of PMLA was made out as the properties were purchased before the alleged proceeds of crime and he had no knowledge or involvement

Previous Decisions

The Designated Court issued process against the Applicant and other accused on 16.09.2021 based on prima facie evidence of money trail and scheduled offences

Issues

Whether the process issued against the Applicant under Section 3 punishable under Section 4 of PMLA should be quashed due to lack of prima facie evidence and nexus with proceeds of crime Whether the properties purchased in 2005-2007 can be linked to proceeds of crime generated in 2020-2021 under PMLA

Submissions/Arguments

The Applicant argued that the properties were purchased in 2005-2007, predating the alleged proceeds of crime in 2020-2021, and no offence under Section 3 of PMLA was made out The Applicant submitted that there was no averment of his knowledge of the proceeds of crime, and he was not a shareholder or director of the company involved The prosecution argued based on the money trail and scheduled offences to support the issuance of process

Ratio Decidendi

For an offence under Section 3 of PMLA, there must be a clear nexus between the proceeds of crime and the accused's actions -- Properties purchased years before the alleged generation of proceeds of crime cannot be linked to such proceeds without evidence of knowledge or involvement -- The Court can exercise inherent powers under Section 482 of Cr.P.C. to quash proceedings when essential ingredients of the offence are not satisfied

Judgment Excerpts

Heard, Mr. Sunil Manohar, learned Senior Advocate for the Applicant, Mr. Prashant Mishra, learned Advocate for Respondent No. 1-ED and Ms. Pallavi Dabholkar, learned A.P.P. for the State/Respondent This Criminal Application, filed under Section 482 of the Code of Criminal Procedure, 1973, is preferred by the Applicant against the Order dated 16.09.2021 passed by the City Civil Court & Additional Sessions Judge He submits that the said properties were purchased well before the alleged generation of proceeds of crime, as such, no offence under Section 3 of the PMLA, 2002, was made out against the Applicant

Procedural History

FIR registered on 21.04.2021 under Sections 7 of Prevention of Corruption Act and 120-B of IPC -- ECIR recorded on 11.05.2021 under PMLA -- Complaint filed and PMLA Special Case No. 1089 of 2021 registered -- Designated Court issued process against Applicant on 16.09.2021 -- Applicant filed Criminal Application No. 1075 of 2023 under Section 482 of Cr.P.C. for quashing -- High Court heard arguments and delivered judgment on 23.02.2026