ED moves Delhi High Court challenging dismissal of complaint against Sonia, Rahul Gandhi in National Herald case

The Enforcement Directorate (ED) has approached the Delhi High Court challenging the trial court order dismissing a money laundering complaint against Congress leaders Sonia Gandhi, Rahul Gandhi and others in the National Herald case. .The criminal revision petition is likely to be listed for hearing before the Court next week. .Special judge (PC Act) Vishal Gogne of the Rouse Avenue Court had on December 16 rejected ED's complaint, holding that it was not maintainable under the Prevention of Money Laundering Act (PMLA) since the case was based on a private complaint filed by BJP leader Subramanian Swamy and not any First Information Report (FIR). “Since the present prosecution complaint pertaining to the offence money laundering is founded on cognisance and summoning order upon a complaint under Section 200 CrPC filed by a public person, namely Dr Subramanian Swamy, and not upon an FIR, cognizance of the present complaint is impermissible in law,” the special judge ruled.He underscored that ED can initiate a money laundering case only based on an FIR with respect an offence mentioned in the schedule of the PMLA."An investigation and the consequent prosecution complaint pertaining to the offence of money laundering defined under Section 3 and punishable under Section 4 is not maintainable in the absence of a FIR or the offence mentioned in the Schedule to the Act," the special court said as it dismissed the ED complaint against Gandhis..Apart from Gandhis, Suman Dubey, Sam Pitroda, Young Indian, Dotex Merchandise and Sunil Bhandari had also been made accused by the ED..The National Herald case stems from a private complaint by former Union Minister Subramanian Swamy accusing Sonia Gandhi, Rahul Gandhi, Motilal Vora, Oscar Fernandes, Suman Dubey, Sam Pitroda, and Gandhi family-controlled Young Indian of cheating, criminal conspiracy, criminal breach of trust and misappropriation of property.The ED filed a prosecution complaint against the Gandhis as well as Pitroda and others on April 15 this year..According to ED, there was laundering of 'proceeds of crime' derived from the alleged fraudulent takeover of the properties of Associated Journals Limited (AJL) – publishers of National Herald, which is worth more than ₹2,000 crore - by a company called Young Indian. Gandhis are stated to be the majority shareholders in the firm. It is ED's case that the shares of AJL were transferred to Young Indian under a criminal conspiracy to illegally obtain the assets of AJL. The value of shares, the immovable properties of AJL and the rent generated from them are the alleged proceeds of crime in the ED case.However, the Gandhis have contended that it is a strange and unprecedented case where allegations of money laundering have been made without the use or projection of the property. The Congress leaders have refuted ED’s allegations that Young Indian was used to usurp AJL’s assets in exchange for a loan. It is their argument that the loan was to make AJL debt-free..The ED has stated in its appeal that the trial court order is "totally perverse in law" as the sole reason the court declined to take cognisance was that the prosecution complaint (chargesheet) cannot be based on a scheduled offence emanating from a private complaint by a private individual and that the scheduled offence must be registered only by a law enforcement agency. According to ED's plea, the trial court erred in its findings. The agency has contended that the cognisance taken by a court on a private complaint stands on a much higher footing than "a mere FIR registered by police because there is a possibility that the cognisance may be declined after filing of a chargesheet by police"."In the present matter, cognizance of the private complaint [by Dr Subramanian Swamy] constituting the scheduled offence had already been taken by the competent court and upheld all the way upto the Hon’ble Supreme Court. Hence, the scheduled offence stood on a much higher pedestal than a mere FIR lodged by police," the agency has said. The agency added that the Court's reasoning "turns basic criminal law jurisprudence on its head for the reason that it is well settled that ‘any person can set the criminal law in motion’."As per the plea,"The impugned order has, in effect, given a hall pass to a category of money launderers only on the ground that the scheduled offence is reported by a private individual by way of a complaint to a magistrate." Further, the ED has argued that the effect of the trial court judgement is to amend and rewrite the PMLA, especially Section 2(1)(u) and Section 2(1)(y) to add words to the expression ‘scheduled offence’ to mean ‘scheduled offence only registered by a law enforcement agency’"This is impermissible and amounts to judicial legislation, the agency's plea states. .Follow Bar and Bench channel on WhatsAppDownload the Bar and Bench Mobile app for instant access to the latest legal news.