Hon’ble Madras High Court has dismissed a petition filed by the Directorate of Enforcement (ED) challenging the order of the Principal Sessions Judge, Thoothukudi, refusing to commit the pending disproportionate assets case in Spl.C.No.3 of 2019 to the Special Court at Madurai under Section 44(1)(c) of the Prevention of Money Laundering Act, 2002 (PMLA
The Hon’ble Madras High Court has dismissed a petition filed by the Directorate of Enforcement (ED) challenging the order of the Principal Sessions Judge, Thoothukudi, refusing to commit the pending disproportionate assets case in Spl.C.No.3 of 2019 to the Special Court at Madurai under Section 44(1)(c) of the Prevention of Money Laundering Act, 2002 (PMLA). The Division Bench comprising Hon’ble Chief Justice Mr. Sushrut Arvind Dharmadhikari and Hon’ble Mr. Justice G. Arul Murugan held that the application under Section 44(1)(c) was premature, as the Special Court at Madurai had not taken cognizance of the money laundering complaint. The Hon’ble Court consequently dismissed the petition, vacated the interim stay granted earlier and directed the Principal Sessions Judge, Thoothukudi, to proceed with the disproportionate assets trial with due expedition.
Mr.P.Sidharthan, Special Public Prosecutor for ED Cases submitted that the provisions of the PMLA, when read conjointly, show that the legislature intended one and the same Special Court to try both the scheduled offence and the offence of money laundering arising from it. Referring to Sections 43(2) and 44(1)(a) of the PMLA, it was contended that the statute contemplates trial of both offences by the Special Court and that Section 44(1)(c) was introduced to provide a mechanism by which a scheduled offence pending before another court could be committed to the Special Court, which would thereafter proceed with the case from the stage at which it was received. Reliance was placed on Vijay Madanlal Choudhary v. Union of India, Rana Ayyub v. Directorate of Enforcement, Ranjit Singh Kothari v. State of West Bengal and Deputy Director v. Deputy Superintendent of Police. The ED further submitted that Section 44(1)(c) did not require cognizance by the Special Court as a precondition and that no prejudice would be caused since the Special Court was required to proceed with the case from the stage at which it was committed.
Senior Advocate Mr. Abudu Kumar Rajaratnam, appearing for Mr. Anitha Radhakrishnan (Respondent No.2), and Mr.A.Nagarajan, learned counsel appearing for Respondent Nos.3 to 9, submitted that Section 44(1)(c) of the PMLA applies, on its own wording, only where the Special Court has “taken cognizance of the complaint of the offence of money-laundering”. They submitted that, by the petitioner’s own admission, the Special Court at Madurai had not taken cognizance and had only issued a pre-cognizance notice under Section 223 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS). Relying upon Kushal Kumar Agarwal v. Enforcement Directorate and Seeman v. Varun Kumar, it was submitted that, in complaints filed after 1 July 2024, cognizance cannot be taken until the accused has been given an opportunity of hearing under Section 223 of the BNSS and that stage had not yet been crossed.
It was further submitted that, as a former Minister and MLA, the second respondent was a public servant within the meaning of Section 2(c) of the Prevention of Corruption Act, 1988 and that prosecution sanction under Section 197(1) CrPC (now Section 218 BNSS) was a jurisdictional prerequisite. Since the Special Court at Madurai itself had sought such sanction and the same had not been furnished, it was submitted that the Special Court was legally incapable of taking cognizance against the second respondent, rendering the petition premature. It was also submitted that the disproportionate assets case and the money laundering complaint were pending before courts situated in different Sessions Divisions and that the power to transfer a criminal case from one Sessions Division to another vested exclusively with the High Court under Sections 448 and 449 of the BNSS.
The respondents further submitted that by the time the application seeking transfer was filed, the prosecution had examined 79 witnesses and marked 312 exhibits, the defence had examined six witnesses and marked 74 exhibits, evidence on both sides had been closed, the prosecution had completed its arguments and the defence had argued in part. It was submitted that Section 44(1)(c) was intended to avoid two parallel trials on the same facts and could not be invoked at the stage when the trial had substantially concluded. Reliance was placed on Pankajini Sahu v. Joint Director, Enforcement Directorate to contend that committal under Section 44 was not automatic but called for the exercise of discretion having regard to the interests of justice. It was also pointed out that the petitioner had earlier sought substantially similar relief by filing an application under Sections 301(2) and 302(2) CrPC, which had been dismissed on merits and had not been challenged.
After hearing the parties, the Division Bench framed the question whether the Principal Sessions Judge, Thoothukudi, was right in refusing to send the pending disproportionate assets case to the Special Court at Madurai on an application under Section 44(1)(c) of the PMLA. Referring to the language of Section 44, the Court observed that a bare reading of Section 44(1)(c) made it “clear as day” that the provision speaks of two courts, each of which has already taken cognizance, one of the scheduled offence and the other of the money laundering complaint. The Court observed that the provision explicitly states that the Special Court must have “taken cognizance” and does not state that it is sufficient if the Special Court is likely to take cognizance or is seized of the complaint.
The Court held that, in Rana Ayyub, the Supreme Court treated cognizance by the Special Court as a fact already accomplished and did not state that it was a mere formality capable of being dispensed with. Likewise, Vijay Madanlal Choudhary dealt with the manner in which trials were to proceed once both cases were properly instituted and did not hold that an application under Section 44(1)(c) could be entertained in anticipation of cognizance. On the admitted facts, the Special Court at Madurai had not taken cognizance but had only issued notice under Section 223 BNSS before deciding whether cognizance should be taken. Referring to Kushal Kumar Agarwal and Seeman, the Court observed that compliance with Section 223 BNSS was mandatory before cognizance could be taken. Since one of the essential facts on which Section 44(1)(c) was built had not been satisfied, the Court held that the application was premature.
The Bench further observed that the Special Court at Madurai had called for prosecution sanction in September 2025 and that nearly a year had elapsed without the petitioner producing the same. In the absence of such sanction, the Special Court was not likely to take cognizance against the second respondent. The Court also observed that Section 44(1)(c) exists to save time and avoid the risk of two courts reaching different conclusions on the same facts and was never meant to serve as a means of reopening a trial that had, for all practical purposes, already been fought and finished. Noting the stage of the disproportionate assets trial, the Court held that committing the case to the Special Court at Madurai, which had not even taken cognizance of the connected money laundering complaint, would simply delay the proceedings.
The Court distinguished Deputy Director v. Deputy Superintendent of Police on the ground that, in that case, the Special Court had already taken cognizance, both courts were situated within the same Sessions jurisdiction and the scheduled offence trial was still actively in progress. Similarly, Rana Ayyub was decided at an early stage of the proceedings, while Ranjit Singh Kothari only recognised the legislative intention that one court should try both offences. The Court held that the principle recognised in Pankajini Sahu, namely that committal under Section 44 is not to be ordered as a matter of course but only where the interests of justice require it, applied to the facts of the present case. The Bench also observed that the ED had earlier sought similar relief under Sections 301(2) and 302(2) CrPC, which had been dismissed, and treated that circumstance as relevant while considering the propriety of a second attempt through a different statutory provision.
Holding that the application under Section 44(1)(c) was premature since the Special Court had not taken cognizance of the money laundering complaint and could not presently do so in the absence of the requisite sanction, the Court found no reason to interfere with the order of the Principal Sessions Judge, Thoothukudi. The Criminal Original Petition was accordingly dismissed, the interim stay stood vacated and the trial court was directed to proceed with the disproportionate assets case at the earliest available date.
