By TIOL News Service

CHENNAI, APRIL 27, 2018: THE issue is - Whether the petitioner can seek exemption from personal appearance merely by citing general exemptions granted u/s 160 of the CrPC even though such appearance is mandated by investigating authorities during enquiry. And the answer is NO.

Facts of the case:

The petitioner has preferred the Writ Petition challenging the summons issued consequently in proceedings dated 7.9.2016 for the petitioner's personal appearance by the Enforcement Directorate, Kolkata. The petitioner sought relief in a way to direct the Investigating Authorities to forbear the Enforcement Directorate (ED) officials in Kolkata from taking any action or proceeding against her under the Prevention of Money Laundering Act (PMLA) of 2002 in connection with the professional legal fees received after deduction of tax from her client M/s. Saradha Realty India Ltd.

the High Court held that,

++ when the petitioner describes her position and status not only as a Senior Advocate, but also appearing in all High Courts, including the Supreme Court of India, then this Court has to draw the factual inference that the petitioner can never said to be incapable of attending or participating for the effective investigation of the case being undertaken by the Investigating Authorities under the provisions of the "PMLA". This Court expects that as a responsible and dutiful citizen of this great Nation, the petitioner would participate in the process of investigation in order to cull out the truth;

++ general provisions are not made in order to defeat the very purpose and the object of the course of investigations. Such proviso clauses are provided granting certain exemptions to a particular class or category of persons in order to ensure that the fundamental rights ensured under the Constitution to the citizens of this great Nation are protected under Article 21, which ensures not only life but also a decent life. When the Supreme Court has elaborated the scope and meaning of Article 21, so as to ensure a decent life to the citizen, then the same is to be preserved in all respects. Whether the circumstances, arises, when the authorities competent should be prevented from exercising an excessive power than it is required for the purpose of protecting the fundamental rights enshrined under Article 21 of the Constitution of India. However, under the guise of protection granted under Article 21 of the Constitution, the course of investigation in a case under the PMLA cannot be paralised;

++ it is unambiguously made clear that the provisions of the "PMLA" shall have overriding effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force. "PMLA" has overriding effect and the provisions of the CrPC would apply only if they are not inconsistent with the provisions of the PMLA. The case of Gautam Kundu also subsequently referred in the case of Nikesh Tarachand Shah so that the conditions stipulated in Sec. 45 of the "PMLA" was struck down by the Supreme Court. The other provisions of the Code were not only upheld and it is clarified in those two decisions by the Supreme Court of India that the provisions of the "PMLA" will prevail over the procedures contemplated under the CrPC and it is further emphasised that the CrPC would apply only if they are not inconsistent with the provisions of the PMLA Act;

++ the petitioner is seeking exemption only on the ground that a woman is exempted from personal appearance u/s 160 of the CrPC. In no circumstances with reference to the current day developments of our great Nation, women can never be underestimated or blindly considered as vulnerable. May be in certain circumstances in certain areas, women are vulnerable, however, not in all circumstances in all areas. Therefore, this Court has to consider the position, status and the capacity of a woman for the purpose of granting any exemption from participating or for personal appearance in investigation of such cases. When such is the current position, the spirit of Sec. 160 cannot be interpreted so as to nullify or paralise an effective investigation process of cases under PMLA. In all respects, the Courts also should ensure that such investigations or prosecutions are done in accordance with the procedures contemplated under such Special Acts, and to see that a meaningful investigations and prosecutions are done and the cases are disposed of in accordance with law;

++ no writ can be entertained against the summons issued for the personal appearance of a person in order to give evidence or statement. The writ petition against such summons issued under the provisions of the Special Act, namely, "PMLA" can be entertained only on exceptional circumstances. Judicial review in this regard are certainly limited. The Constitutional Courts have to ascertain the facts and the circumstances for the purpose of granting any such exemption, and the same cannot be granted otherwise under the provisions of the "PMLA";

++ in the present case on hand, the Investigating Authorities have explained the instances and the circumstances under which they have insisted upon the petitioner's personal appearance for further clarification. It is further recorded that the statements/explanations and the documents submitted by the petitioner's Counsel were not satisfactory and certain ingredients are to be ascertained only by getting a personal statement from the petitioner in relation to the financial transactions. Therefore, this Court is of an opinion that there is no irregularity or illegality in respect of insisting the petitioner for personal appearance for the purpose of seeking certain clarifications so as to cull out the truth in relation to the financial transactions and the documents filed by the petitioner before the Enforcement Directorate through her authorised agent;

++ the petitioner based on mere apprehension, cannot be permitted to move this writ petition that the Investigating Authorities are having certain personal motive. Absolutely, there is no materials on record to show that there are personal motive against the petitioner. The personal motives or the mala fide intention are to be substantiated with sufficient materials. A mere statement made in an affidavit that the authorities are having certain personal motive or mala fide intention can never be accepted for the purpose of granting the relief in a writ petition, more specifically, in the nature of a case like on hand. However, the petitioner has not substantiated the allegations of mala fides, except by stating that the petitioner was directed to appear before the Investigating Authorities, so that they are having an idea to arrest her. Such apprehensions can never be entertained in a writ petition under the given circumstances;

++ if there are sufficient materials to proceed against the petitioner and if the Investigating Authorities are having enough materials to proceed against a person in a manner known to law and by adhering to the provisions of law, then they are duty bound to do so as the law so warrants. Thus, all the decisions to be taken only after completing an effective investigation. The investigation process should not be hampered at this stage. The decisions in this regard are to be taken only after the completion of the investigation by the competent authorities by strictly following the provisions of law. The Courts cannot presume that what possible actions could be taken by the competent authorities at this stage, even before the completion of the investigation. Thus, this Court is of a strong opinion that interference at this stage in respect of the facts and the circumstances of the present case on hand, is certainly unwarranted;

++ Sec. 2(u) of the "PMLA", defines "Proceeds of Crime". The "Proceeds of Crime" can be identified only after the completion of the investigation and after the registration of a complaint by the Investigating Authorities. The "Proceeds of Crime" means any property derived or obtained, directly or indirectly, by any person as a result of criminal activity. When the Investigating Authorities are in the process of verification of the documents and the clarifications in respect of the statements given by the petitioner, the Court cannot come to a conclusion that there is no "Proceeds of Crime" against the petitioner. The "Proceeds of crime" has to be concluded only after the completion of the investigation and after filing the complaint under the "PMLA";

++ Sec. 50(2) states that "the Director, Additional Director, Joint Director, Deputy Director or Assistant Director" shall have the power to summon any person whose attendance he considers necessary whether to give evidence or to produce any records during the course of any investigation. The word "person" employed u/s 50(2) has to be understood with reference to the definition provided u/s 2(s) of "PMLA";

++ the petitioner cannot say that the authorities are incompetent to summon any person. In fact, the Investigating Authorities are empowered to summon any person defined u/s 2(s) for the purpose of conducting investigations. Such persons summoned are duty bound to respond to the summons and in failure, they are empowered to initiate further prosecution against the person, to whom the summon was issued. Thus, every person summoned under PMLA is duty bound to appear before the competent authorities. Non appearance will lead to further prosecution under the provisions of law.

(See 2018-TIOL-800-HC-MAD-PMLA)