Delhi High court quashes PMLA proceedings, LOC against Indiabulls, employees

The Delhi High Court on Monday quashed the Enforcement Directorate (EC) proceedings against Indiabulls Housing and Finance Limited (IHFL) and its employees as well as the Look Out Circular (LOC) issued against them..A division bench of Justices Mukta Gupta and Anish Dayal quashed the proceedings, the summoning orders and the LOC after it was informed that the Bombay High Court has already quashed the Maharashtra FIR which was the predicate offence for the ED's Enforcement Case Information Report (ECIR). The Court held that no action under Prevention of Money Laundering Act (PMLA) can be resorted to unless there is an underlying scheduled offence for the same..“In light of the conclusion and finding of the Hon’ble Supreme Court in Vijay Madanlal Choudhary (supra) this Court finds no reason for the said ECIR to be sustained against them, without there being any evidence of a predicate offence or an FIR against them which is in existence or is legally alive,” the Court said..The Court was dealing with a batch of petitions by various employees of IHFL and related companies challenging the ED proceedings in the case.They had argued that they had been roped in by the ED in the said ECIR without there being any underlying predicate offence registered against them..The proceedings emanated out of a first information report (FIR) registered in Maharashtra’s Palghar Police Station on a complaint by one of its shareholders.The complainant, Ashutosh Kamble, who owned around 500 shares in the company, had alleged in his complaint that he sustained losses owing to the devaluation of his shares as a result of suspected siphoning of cash and misdealing by IHFL.Kamble, thereafter, petitioned the Judicial Magistrate at Wada district in Maharashtra, and secured an order under Section 156(3) of the Criminal Procedure Code (CrPC) to lodge a FIR and direct the Palghar police to conduct an inquiry..Senior Advocates Kapil Sibal, Mahesh Jethmalani, Rajiv Nayar, Vikram Nankani and Sidharth Agarwal along with advocates Rishi Agrawala, Karan Luthra, Ankit Banati, Shravan Niranjan, Gaurav Mishra, Jaiyesh Bakshi, Ravi Tyagi, Daman Popli, Mayuri Shukla, Neetu Devrani, Dheeraj Nair, Vishrutyi Sahni, Abinav Sekhri and Aisha Jain. Respondents were represented by Additional Solicitor General (ASG) SV Raju, SPP Zoheb Hossain, Central Government Standing Counsels Anurag Ahluwalia, Ajay Digpaul, Asheesh Jain, Kirtiman Singh, Apporv Kurup and advocates Vivek Gurnani and Danish Faraz Khan, Swati Kwatra, Keshav Mann, Vedansh Anand, Waize Ali Noor, Kunjala Bhardwaj, Madhav Bajaj, Yash Upadhyay, Nidhi Mittal and Ojaswa Pathak. .[Read Judgment]

Delhi High court quashes PMLA proceedings, LOC against Indiabulls, employees

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