In a significant ruling, the Supreme Court of India has maintained its stance on money laundering charges, delivering a blow to the Enforcement Directorate (ED) by rejecting its review petition. The apex court clarified that a case of money laundering cannot be established unless there is a direct link to a criminal conspiracy under the Prevention of Money Laundering Act (PMLA).
This decision stems from a pivotal judgment issued on November 29, 2023, wherein the Supreme Court stated that the ED cannot use IPC Section 120 (criminal conspiracy) to construct a money laundering case without a clear connection to money laundering activities. This ruling was challenged by the ED through a review petition, which has now been dismissed by Justices AS Oka and Pankaj Mittal.
The review petition was filed against the backdrop of a Karnataka High Court decision that was contested in the Supreme Court. The High Court had refused to dismiss a PMLA case against a petitioner in a special court in Bengaluru. The Supreme Court, in reviewing the charges applied in this case, found that they were under the IPC and did not fall under the category of ongoing offenses under money laundering. Consequently, it was determined that the ED could not pursue a PMLA case using IPC Section 120-B in this instance.
