In this 'Leading Questions' piece, Soumen Mohanty and Piyush Kumar Ray discuss the implications and procedural aspects concerning pre-cognizance hearing under Section 223 BNSS vis-à-vis PMLA proceedings.

Question: How is Section 223 BNSS different from Section 200 CrPC?

Answer: Both provisions pertain to the examination of the complainant in complaint proceedings, and to that extent, the procedural framework remains substantially similar. The difference, however, lies in the proviso to Section 223 Bharatiya Nagarik Suraksha Sanhita (“BNSS”), which expressly stipulates that no cognizance of an offence shall be taken without first affording the accused an opportunity of being heard. Under Section 200 of the Code of Criminal Procedure (“CrPC”), the Magistrate examines the complainant and witnesses on oath and may thereafter issue process under Section 204 CrPC. In contrast, Section 223 BNSS introduces a mandatory pre-cognizance hearing for the accused before the Court proceeds further.

The Supreme Court, in Kushal Kumar Agarwal v. Directorate of Enforcement (2025 SCC OnLine SC 1221), has held that the proviso to Section 223 BNSS is applicable in relation to proceedings under the Prevention of Money Laundering Act, 2002 (“PMLA”) instituted after July 1, 2024.

The Supreme Court in Parvinder Singh v. Directorate of Enforcement (2026 INSC 519), clarified that mere ministerial acts undertaken prior to July 1, 2024 would not constitute an “inquiry” under Section 2(1)(k) BNSS. Accordingly, where cognizance was taken after the coming into force of the BNSS, the accused would remain entitled to the mandatory pre-cognizance hearing.

Question: What is the scheme governing complaints and cognizance under the PMLA?

Answer: Section 44(1)(b) of the PMLA empowers the Special Court to take cognizance of the offence of money laundering under Section 3 only upon a complaint filed by an authorised authority. Further, PMLA proceedings are founded upon the existence of a scheduled offence, since in its absence there can be no “proceeds of crime” under Section 2(1)(u). In Yash Tuteja v. Union of India (2024 SCC OnLine SC 533), the Supreme Court held that complaints under the PMLA are governed by Sections 200 to 204 CrPC and, consequently, complaints post 1 July 2024 would be governed by Sections 223 to 226 BNSS.

Question: Does the introduction of Section 223 BNSS alter the manner in which cognizance is taken in PMLA complaints?

Answer: Yes. By virtue of the proviso to Section 223 BNSS, the accused gets a mandatory right of hearing before the Court takes cognizance of the complaint filed by ED.. This is not merely a cosmetic alteration, rather, it introduces a threshold safeguard before the prosecution is permitted to proceed further. In the context of economic offences, this materially alters the nature of proceedings, as the earliest stage of contest may now involve scrutiny of whether the complaint, in its existing form, is prima facie legally sustainable and fit for cognizance.  The hearing cannot turn into a merits-based adjudication or mini-trial as held by the Calcutta High Court in Kaberi Dey v. Sourav Bhattacharjee (2025 SCC OnLine Cal 5928).

Question: What are the practical implications of the pre-cognizance hearing under Section 223 BNSS for an accused in PMLA proceedings?

Answer: The practical significance of the pre-cognizance hearing lies in the fact that the accused is now afforded an opportunity to raise objections before the Special Court takes cognizance of the complaint. Should the accused satisfy the Court that cognizance ought not to be taken, the complaint may either be rejected or returned for reconsideration by the investigating authority. Otherwise, the Court may proceed to take cognizance and continue the proceedings in accordance with law.

The hearing enables the accused to raise substantive objections, including, inter alia, that the complaint fails to disclose the commission of an offence, that the material on record does not justify taking cognizance, or that a legal bar exists at the threshold stage itself. However, the pre-cognizance hearing under Section 223 BNSS remains narrowly confined to examining whether the complaint and materials placed on record prima facie disclose the foundational ingredients of an offence under Section 3 of the PMLA and whether cognizance is legally sustainable.

Question: Whether the benefit under Section 223(1) BNSS extends to supplementary complaints filed after July 1, 2024, where cognizance in the main complaint had already been taken prior to July 1, 2024 under the CrPC, without hearing the accused?

Answer: A Division Bench of the Madras High Court recently considered this issue in G. Ganesan v. Deputy Director, Directorate of Enforcement (2025 SCC OnLine Mad 11885) and held that the benefit of Section 223(1) BNSS would not extend to a supplementary complaint where the original complaint had already been instituted prior to 1 July 2024. The Court further relied upon Section 531(2)(a) of the BNSS, which provides that where an investigation had commenced under the CrPC, such investigation shall continue to be governed by the provisions of the CrPC. Further, the Madras High Court in Rahul Surana v. Enforcement Directorate, (2025 SCC OnLine Mad 10009), while dealing with a challenge to an order involving supplementary complaint, held that pre-cognizance hearing shall not be given to the petitioner if it does not involve taking cognizance of the main prosecution complaint for the first time. However, the same is under challenge before the apex court.

Soumen Mohanty is a Partner and Piyush Kumar Ray is an Associate Partner at AQUILAW.