SC stays PMLA trial as chargesheet in predicate case pending for 7 yrs

The Supreme Court stayed a money laundering trial against four women as no chargesheet has been filed in the predicate offence registered by CBI on Indian Bank's complaint for over seven years

The Supreme Court has stayed a trial against four women accused under the Prevention of Money Laundering Act (PMLA) because a chargesheet in the original criminal case has not been filed even after seven years, Live Law reported.

 

The order came from a Bench of Justices Vikram Nath and Sandeep Mehta, after hearing arguments by Senior Advocate PB Suresh. He appeared for the petitioners and pointed out that they were not named in the original offence (called the predicate offence). He questioned how the PMLA trial could proceed when no chargesheet had been filed in that base case.

 

While staying the trial for the four petitioners, the Supreme Court also issued notices to the Enforcement Directorate (ED) and Indian Bank, which is the complainant in the original case.     

 

 

What is the case?

 

In 2018, the Central Bureau of Investigation (CBI) registered an FIR under Section 120B (criminal conspiracy), Section 406 (criminal breach of trust), Section 420 (cheating), Section 468 (forgery), and Section 471 (using forged documents) of the Indian Penal Code. This was based on a complaint by Indian Bank against Cethar Limited and others, the news report said.

 

Following this, the Enforcement Directorate filed a money laundering case (ECIR) based on the same FIR, which brought the petitioners under investigation.

 

The four women approached the trial court asking to be discharged from the PMLA case, but their plea was rejected. They then filed a criminal revision petition, which was also dismissed by the Madras High Court. Left with no other option, they approached the Supreme Court.

 

What did the petitioners say?

 

All four petitioners are women and family members of the former Chairman and Managing Director of Cethar Limited. They claim they had no role in the company’s financial or operational decisions. 

 

According to petitioners, they have been accused only because of their relationship with the former MD. They also pointed out that they are not named in the original FIR by the CBI and that there is no proof showing they received or controlled any "proceeds of crime". Despite this, their jewellery and other belongings have been seized, and the company itself is now under liquidation, Live Law reported.

 

Similar cases cited

 

To support their plea, the petitioners referred to the Telangana High Court’s decision in Bharathi Cement Corporation Pvt. Ltd vs Directorate of Enforcement. In that case, the high court had paused the PMLA trial until the main case (predicate offence) was decided by the special court.

 

That case involved alleged bribery and irregular allotment of mining leases to Bharathi Cement Corporation, linked to the Andhra Pradesh government. The ED had filed a money laundering case against the company and others, including Bharathi Reddy, wife of former Andhra Pradesh Chief Minister Jagan Mohan Reddy. While the case had reached the Supreme Court, it was later withdrawn at the ED’s request.