HC dismisses Karti Chidambaram's plea challenging ED summons

Concurring with the Centre's view that the probe over money laundering charges on Aircel-Maxis deal was being monitored by the Supreme Court, the Madras High Court today dismissed a batch of petitions including that of former Union minister P Chidambaram's son Karti challenging summons by the Enforcement Directorate.
Petitioners, including Karti Chidambaram and Advantage Strategic Consultants Private Limited's directors had challenged the summons.
The firm, facing probe into the Aircel-Maxis deal had challenged the search operations (besides the summons) conducted in its premises as against the law.
Karti, through his power of attorney N R R Arun Natarajan, had sough quashing the summons issued to him by ED.

He had, inter alia contended that the summons was malice in law, adding a campaign was on to bring discredit and harm to the reputation of his father Chidambaram, a leading Opposition leader. Karti had received ED summons last year, in June, July and August.
On November 30 last year, P Chidambaram alleged in the High Court that the ED proceedings against his son under the Prevention of Money Laundering Act had been launched to cause political embarrassment to him.

It was contended by Advantage Consultants that the summons and searches carried out in December 2015 by the ED violated Article 14 of the Constitution and were disproportionate to the powers conferred under the Foreign Exchange Management Act, read with the Income Tax Act. Similar grounds were cited by Karti Chidambaram against the summons.

After hearing arguments of both sides, Justice B Rajendran concurred with the argument of the Centre's counsel that the overall probe and related matters in the Aircel-Maxis case were being monitored by the Supreme Court.
Special Public Prosecutor Anand Grover argued that the present petitions were outside of the jurisdiction of the High Court.
In his order, the Judge said "since the investigation carried on by the authorities is being monitored by the Supreme Court, it is too early for this court to take up these writ petitions for adjudication on merits."
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The judge, who recorded the submission of the Special Public Prosecutor for ED with regard to summons issued to Karti, said, "Normally, this court cannot interfere with the summons issued to any citizen seeking certain information."

"Further, the petitioners need not apprehend that any vindictive action will be taken against them by respondents. The officials of the respondents or the respondents have never indulged in harassing the petitioners or their family members as alleged. The object behind issuing the summons is only to ascertain certain facts within the knowledge of petitioner."
"It is further stated that initially the representative of the respective petitioners can appear before the respondents, on summons, for an inquiry and if necessary, the respective petitioners will be required to appear before the respondents."
"It is therefore submitted that the respondent has no intention to either humiliate or harass the petitioners, as alleged. The said statement made by the learned Special Public prosecutor is recorded."

The judge rejected the arguments submitted by senior counsel Gopal Subramaniam, who appeared on behalf of the petitioners, that the authorities had no jurisdiction to carry out investigation under the provisions of PMLA, unless a predicated offence is made out against them.
The submission "cannot be countenanced at this stage", the judge said.
"Unless an investigation is carried out by the department, it cannot be concluded as to whether any predicated offence has been made out or not by the petitioners. Therefore, it is too early on the part of the petitioners to contend that they have not committed any predicated offence warranting an investigation by the respondents."

Further, in the complaint made by the ED, it has been clearly stated that investigation is required to be carried out relating to the manner in which FIPB approval has been granted by the then Finance Minister P Chidambaram, the court said.
In the complaint, the ED "has sought permission and/or leave to carry out further investigation which has also been granted by the special court.Therefore, based on such leave granted by the special court, the Enforcement Directorate has got every right to continue the investigation and to file a supplementary charge sheet as contemplated under Section 173 (8)."
Such a course of action adopted by the ED "cannot be restrained by this court by entertaining these writ petitions especially when the entire case is monitored by the supreme court", the judge said.