PMLA Prosecution Maintainable if Predicate Offence Resists Final Closure Through Pending Protest Petitions or Remand.

In brief

The question

1. Whether the discharge of the accused is warranted if some predicate offences have been quashed or closed by the police, while others remain active or pending judicial consideration via protest petitions

The court held

The Court answered the issues in the negative, holding that PMLA proceedings are sustainable so long as any foundational scheduled offence remains active, including those pending via protest petitions

It also directed

It held that the ED had produced sufficient material to establish a *prima facie* case against all petitioners

The High Court dismissed all Criminal Revision petitions, upholding the Special Judge's order dated 21.08.2025 and directing the trial to proceed

01Facts

Eleven entities and one individual (Jogendra Tiwari) filed revision petitions against the Special Judge, PMLA, Ranchi’s order dated 21.08.2025, which rejected their discharge applications in ECIR Case No. 08 of 2023

pp. 4-5

The ED initiated the case based on four primary FIRs involving land fraud (the "Roy Bangla" case), illegal sand mining, and liquor smuggling

pp. 5-7

The ED alleged that Jogendra Tiwari was the "Beneficial Owner" of multiple firms used to layer and integrate proceeds of crime (POC) totaling ₹13.29 Crores

pp. 10, 58-65

The petitioners sought discharge on the grounds that several predicate FIRs had been quashed or resulted in final reports (closure), arguing that PMLA proceedings cannot survive without a subsisting scheduled offence

pp. 11-13

02Issues

i.1. Whether the discharge of the accused is warranted if some predicate offences have been quashed or closed by the police, while others remain active or pending judicial consideration via protest petitions

p. 29, para 36(i)

ii.2. Whether the material collected during investigation established a *prima facie* case and "grave suspicion" sufficient to frame charges under Section 3 of the PMLA

p. 29, para 36(ii)

03Law Applied

The court primarily applied Section 3 of the PMLA defining money laundering

p. 32

and Section 2(1)(u) regarding "proceeds of crime"

p. 30

It relied on the landmark precedent *Vijay Madanlal Choudhary v. Union of India (2022)*, which established that PMLA proceedings are standalone but depend on the existence of a scheduled offence

pp. 33-35

It further applied the principles of discharge under Section 250 of the Bharatiya Nagarik Suraksha Sanhita (BNSS), 2023

pp. 35-36

and Section 227 of the CrPC, as interpreted in *Sajjan Kumar v. CBI* and *M.E. Shivalingamurthy v. CBI*, which mandate that at the stage of framing charges, the court must only look for "grave suspicion" and a *prima facie* case rather than conducting a mini-trial

pp. 45-48

The court also noted that the filing of a "Protest Petition" keeps a predicate case "legally active" even if a closure report was filed

p. 73

Provisions in the judgment · 33 · Linked ones open on LawLens

Bharatiya Nagarik Suraksha Sanhita, 2023 Section 438 Section 442 Section 250 Section 232 Section 262 Section 268 Section 193

Prevention of Money-Laundering Act, 2002 Section 2 Section 3 Section 4 Section 24 Section 45 Section 70

Indian Penal Code, 1860 10 provisions

Section 419 Section 420 Section 467 Section 468 Section 471 Section 379 Section 427 Section 34 Section 272 Section 273

Code of Criminal Procedure, 1973 9 provisions

Section 173 Section 200 Section 202 Section 227 Section 228 Section 239 Section 244 Section 245 Section 313

Prevention of Corruption Act, 1988 Section 13

04Reasoning

The Court reasoned that while some liquor-related FIRs were quashed, the ED’s quantification of POC (₹5.66 Crores) relied exclusively on four "active" predicate FIRs related to land and sand

pp. 70-71

Regarding the Land FIRs where police filed final reports, the Court observed that since Protest Petitions are pending, the offences remain *sub judice* and legally active

p. 71, 73

The Court found that Jogendra Tiwari acted as the central controller of a "Single Economic Unit," using the petitioner entities to "layer" illicit cash and "integrate" it by paying for government liquor licenses, thereby projecting tainted funds as untainted property

p. 74

Applying the "grave suspicion" test, the Court held that the synchronized 1145% spike in cash deposits during the license application period constituted sufficient foundational facts to trigger the reverse burden of proof under Section 24 of the PMLA

p. 20, 69

The Court emphasized that it cannot marshal evidence or consider the accused's defense at the discharge stage

p. 51, 80