RANA AYYUB VERSUS DIRECTORATE OF ENFORCEMENT

RANA AYYUB  VERSUS DIRECTORATE OF ENFORCEMENT 

Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले

REPORTABLE

IN THE SUPREME COURT OF INDIA

CRIMINAL ORIGINAL JURISDICTION

WRIT PETITION (CRIMINAL) NO. 12 OF 2023

RANA AYYUB …PETITIONER

VERSUS

DIRECTORATE OF ENFORCEMENT

THROUGH ITS ASSISTANT DIRECTOR …RESPONDENT

J U D G M E N T

V. Ramasubramanian, J.

1. Challenging a summoning order issued by the Court of the

Special Judge, Anti-Corruption, CBI Court No.1, Ghaziabad, on a

complaint lodged by the respondent under Section 45 read with

Section 44 of the Prevention of Money-laundering Act, 20021

, the

petitioner has come up with the above writ petition under Article

32 of the Constitution of India.

2. We have heard Ms. Vrinda Grover, learned Counsel for the

petitioner and Mr. Tushar Mehta, learned Solicitor General of

India for the respondent.

1

 For short, “PMLA” or the “Act”, as the case may be.

1

3. It is the case of the petitioner that during the pandemic, she

initiated crowdfunding campaign through an online

crowdfunding platform named “Ketto” and ran three campaigns

from April 2020 to September 2021. In connection with the same,

the Mumbai Zonal Office of the Enforcement Directorate initiated

an enquiry against the petitioner under the Foreign Exchange

Management Act, 19992

 through an Office Order dated 3.8.2021.

4. It appears that thereafter a complaint was lodged on

7.9.2021 by one Vikas Sankritayan, claiming to be the founder of

Hindu IT Cell, in FIR No.2049/2021 with Indirapuram Police

Station, Ghaziabad for alleged offences under Sections 403, 406,

418 and 420 IPC read with Section 66D of the Information

Technology (Amendment) Act, 2008 and Section 4 of the Black

Money Act.

5. In the meantime, the petitioner received an order under

Section 37 of the FEMA read with Section 133(6) of the Incometax Act, 1961 from the Mumbai Zonal Office of the Enforcement

Directorate seeking certain documents, in addition to the

documents submitted by the petitioner in response to the

2

 For short, “FEMA”

2

previous Office Order dated 3.8.2021 issued by the very same

Mumbai Zonal Office.

6. After the petitioner submitted a detailed response to the

Mumbai Zonal Office of the Enforcement Directorate, the Delhi

Zone-II Office of the Directorate of Enforcement registered a

complaint in ECIR No.DLZO-II/58/2021 on 11.11.2021, in the

Court of the Special Judge at Ghaziabad. It was stated in the said

complaint that the FIR registered on 7.9.2021 on the file of the

Indirapuram Police Station, Ghaziabad formed the basis for the

complaint of the Enforcement Directorate.

7. After the registration of the aforesaid complaint by the

Enforcement Directorate, the petitioner was summoned to the

Delhi Zone-II Office and her statement under Section 50 of the

PMLA was recorded on 15.12.2021.

8. Thereafter, a provisional order of attachment of the bank

account of the petitioner in HDFC Bank, Koperkhairane Branch,

Navi Mumbai, Maharashtra, was passed by the Directorate of

Enforcement on 4.2.2022. Pursuant to the order of provisional

attachment, the Adjudicating Authority issued a show cause

notice dated 8.3.2022.

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9. While things stood thus, a Look out Circular was issued

against the petitioner, but the same was set aside by the High

Court of Delhi in a writ petition filed by the petitioner. In a

second writ petition filed by the petitioner, the High Court of

Delhi restrained the Directorate of Enforcement from taking

further steps under Section 8 of the PMLA on the short ground

that the validity period of 180 days, of the order of provisional

attachment, came to an end statutorily on 4.8.2022.

10. Thereafter, the Court of the Special Judge, Anti-Corruption,

CBI Court No.1, Ghaziabad, passed an order on 29.11.2022

taking cognizance of the complaint lodged by the respondent and

summoning the petitioner for appearance on 13.12.2022. Upon

coming to know of the said Summoning Order, the petitioner has

come up with the above writ petition. It is claimed by the

petitioner in paragraph 5(v) of the writ petition that “No summons

have yet been received…” by her and that she had annexed a

screenshot of the e-court website reflecting the case details.

However, a print out of the copy of the Summoning Order is filed

along with the writ petition.

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11. At the outset, it is made clear by Ms. Vrinda Grover, learned

Counsel for the petitioner that the challenge to the impugned

Summoning Order is limited to the question of territorial

jurisdiction alone and that the impugned Summoning Order is

not being challenged on any ground other than the lack of

territorial jurisdiction.

12. In brief, the contention of the learned Counsel for the

petitioner is that under Section 44(1) of the PMLA, an offence

punishable under the Act, shall be triable only by the Special

Court constituted for the area in which the offence has been

committed. This is notwithstanding anything contained in the

Code of Criminal Procedure, 19733

. Apart from the non-obstante

clause with which Section 44(1) begins, Section 71 of the Act also

gives overriding effect to PMLA. Therefore, it is contended by the

learned Counsel for the petitioner that the Special Court in

Maharashtra alone could have taken cognizance of the complaint.

13. Heavy reliance is placed by the learned Counsel for the

petitioner on the opinion of this Court in paragraphs 353 to 358

of the decision in Vijay Madanlal Choudhary & Ors. vs. Union

3

 For short, “Cr.P.C”

5

of India & Ors.4

. It was held in the said decision that the trial of

the offence of money-laundering should proceed before the

Special Court constituted for the area in which the offence of

money-laundering has been committed and that in case the

scheduled offence is triable by the Special Court under a special

enactment elsewhere, both the trials need to proceed

independently, but in the area where the offence of moneylaundering has been committed. Paragraphs 356 and 357 of the

decision in Vijay Madanlal Choudhary (supra) read as follows:

“356. The amendment of 2013 in fact clarifies the

dispensation to be followed in regard to trials

concerning offence of money-laundering under this Act

and the trial in relation to scheduled offence including

before the Special Court trying such (scheduled)

offence. By virtue of this clause, the trials regarding

the offence of money-laundering need to proceed before

the Special Court constituted for the area in which the

offence of money-laundering has been committed. In

case the scheduled offence is triable by Special Court

under the special enactment elsewhere, the provision,

as amended, makes it amply clear that both the trials

after coming into effect of this Act need to proceed

independently, but in the area where the offence of

money-laundering has been committed.

357. In that, the offence of money-laundering ought to

proceed for trial only before the Special Court

designated to try money-laundering offences where the

offence of money-laundering has been committed. This

is a special enactment and being a later law, would

prevail over any other law for the time being in force in

terms of Section 71 of the 2002 Act.”

4

 2022 SCC OnLine SC 929

6

14. On facts, it is the contention of the learned Counsel for the

petitioner that no part of the alleged offence of money-laundering

was committed within the jurisdiction of the Special Court,

Ghaziabad and that the petitioner’s bank account where the

alleged proceeds of crime were deposited, is located in Navi

Mumbai, Maharashtra. Even the proceedings for the provisional

attachment of the bank account were initiated in New Delhi.

Therefore, it is contended that the lodging of the complaint at

Ghaziabad was an abuse of the process of the court and that the

same having been done at the instance of the founder of the

Hindu IT Cell, is completely vitiated. It is also contended that the

Court of the Special Judge, ought to have returned the complaint

to the respondent, in terms of Section 201 of the Code of

Criminal Procedure and that the Order taking cognizance is

vitiated also by non-application of mind.

15. In response, it is contended by Mr. Tushar Mehta, learned

Solicitor General that under the scheme of the Act, the complaint

of money-laundering should follow the complaint in respect of the

scheduled offence. Since the complaint in respect of the

scheduled offence was registered on 7.9.2021 in Indirapuram

Police Station, Ghaziabad, the respondent necessarily had to

7

lodge the Enforcement Case Information Report (ECIR) on

11.11.2021, on the file of the same court, within whose

jurisdiction the scheduled offence became triable. In addition, it

is contended by the learned Solicitor General that the petitioner

was alleged to have received money through an online

crowdfunding platform and that there were several victims within

the territorial jurisdiction of the Court of the Special Judge who

had contributed money. In other words, it is the contention of

the learned Solicitor General that a part of the cause of action

had actually arisen within the jurisdiction of the Court of the

Special Judge, Ghaziabad.

16. From the rival contentions, it appears that two questions

arise for consideration before us. They are (i) whether the trial of

the offence of money-laundering should follow the trial of the

scheduled/predicate offence or vice versa; and (ii) whether the

Court of the Special Judge, Anti-Corruption, CBI Court No.1,

Ghaziabad, can be said to have exercised extra-territorial

jurisdiction, even though the offence alleged, was not committed

within the jurisdiction of the said Court.

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17. In order to find an answer to question No.1, it is necessary

for us to take note of a few provisions of the PMLA.

18. The word “money-laundering” is defined in Section 2(1)(p) of

the Act to have the same meaning as assigned to it in Section 3.

Section 3 of the Act makes a person guilty of the offence of

money-laundering, if he (i) directly or indirectly attempts to

indulge; or (ii) knowingly assists or; (iii) knowingly is a party; or

(iv) is actually involved in any process or activity. Such process or

activity should be connected to ‘proceeds of crime’ including its

concealment or possession or acquisition or use. In addition, a

person involved in such process or activity connected to proceeds

of crime, should be projecting or claiming it as untainted

property. The Explanation under Section 3 makes it clear that

even if the involvement is in one or more of the following activities

or processes, namely, (i) concealment; (ii) possession; (iii)

acquisition; (iv) use; (v) projecting it as untainted property; or (vi)

claiming it as untainted property, the offence of moneylaundering will be made out.

19. Thus, Section 3 comprises of two essential limbs, namely, (i)

involvement in any process or activity; and (ii) connection of such

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process or activity to the proceeds of crime. The expression

“proceeds of crime” is defined in Section 2(1)(u) to mean any

property derived or obtained, directly or indirectly, by any person

as a result of criminal activity relating to a scheduled offence or

the value of such property or where such property is taken or

held outside the country, then the property equivalent in value

held within the country or abroad.

20. PMLA provides for a two-pronged approach, one for dealing

with the proceeds of crime and the other for dealing with the

person guilty of the offence of money-laundering. While Chapter

III and Chapter VI prescribe the procedure for dealing with the

proceeds of crime, through a process of attachment, confirmation

through adjudication and an appellate remedy to the Special

Tribunal, Chapter VII deals with the prosecution of the money

launderers by Special Courts.

21. Section 43(1) of the Act provides for the constitution of

Special Courts, by the Central Government, in consultation with

the Chief Justice of the High Court. Sub-section (2) of Section 43

empowers a Special Court constituted under Section 43(1), also

10

to try an offence other than the offence punishable under Section

4 of the PMLA, with which the accused may be charged at the

same trial under the Cr.P.C. In other words, a Special Court is

constituted under Section 43(1) primarily for the purpose of

trying an offence punishable under Section 4. But sub-section (2)

of Section 43 confers an additional jurisdiction upon such a

Special Court to try any other offence with which the accused

may be charged at the same trial. Section 43 reads as follows:-

“43. Special Courts.—(1) The Central Government, in

consultation with the Chief Justice of the High Court,

shall, for trial of offence punishable under section 4,

by notification, designate one or more Courts of

Session as Special Court or Special Courts for such

area or areas or for such case or class or group of

cases as may be specified in the notification.

Explanation.—In this sub-section, “High Court”

means the High Court of the State in which a Sessions

Court designated as Special Court was functioning

immediately before such designation.

 (2) While trying an offence under this Act, a

Special Court shall also try an offence, other than an

offence referred to in sub-section (1), with which the

accused may, under the Code of Criminal Procedure,

1973 (2 of 1974), be charged at the same trial.”

22. Section 44 deals with the question of territorial jurisdiction

of the Special Court, constituted under Section 43(1). At the

outset, Section 44(1) takes note of two different contingencies,

11

namely, (i) cases where the scheduled offence as well as the

offence of money-laundering are committed within the territorial

jurisdiction of the same Special Court constituted under Section

43(1); and (ii) cases where the Court which has taken cognizance

of the scheduled offence, is other than the Special Court which

has taken cognizance of the complaint of the offence of moneylaundering. Section 44(1) reads as follows:

“44. Offences triable by Special Courts.—

(1) Notwithstanding anything contained in the Code of

Criminal Procedure, 1973 (2 of 1974),—

(a) an offence punishable under section 4 and any

scheduled offence connected to the offence under that

section shall be triable by the Special Court constituted

for the area in which the offence has been committed:

Provided that the Special Court, trying a scheduled

offence before the commencement of this Act, shall

continue to try such scheduled offence; or;

(b) a Special Court may, upon a complaint made by an

authority authorised in this behalf under this Act take

cognizance of offence under section 3, without the

accused being committed to it for trial;

Provided that after conclusion of investigation, if no

offence of money-laundering is made out requiring filing

of such complaint, the said authority shall submit a

closure report before the Special Court; or

(c) if the court which has taken cognizance of the

scheduled offence is other than the Special Court which

has taken cognizance of the complaint of the offence of

money-laundering under sub-clause (b), it shall, on an

application by the authority authorised to file a complaint

under this Act, commit the case relating to the scheduled

offence to the Special Court and the Special Court shall,

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on receipt of such case proceed to deal with it from the

stage at which it is committed.

(d) a Special Court while trying the scheduled offence or

the offence of money-laundering shall hold trial in

accordance with the provisions of the Code of Criminal

Procedure, 1973 (2 of 1974), as it applies to a trial before

a Court of Session.

Explanation.—For the removal of doubts, it is clarified

that,—

(i) the jurisdiction of the Special Court while dealing with

the offence under this Act, during investigation, enquiry

or trial under this Act, shall not be dependent upon any

orders passed in respect of the scheduled offence, and

the trial of both sets of offences by the same court shall

not be construed as joint trial;

(ii) the complaint shall be deemed to include any

subsequent complaint in respect of further investigation

that may be conducted to bring any further evidence, oral

or documentary, against any accused person involved in

respect of the offence, for which complaint has already

been filed, whether named in the original complaint or

not.”

23. What is dealt with by Section 44(1)(a) is a situation where

there is no complication. Section 44(1)(a) lays down the most

fundamental rule relating to territorial jurisdiction, by providing

that an offence punishable under Section 4 of the PMLA and any

scheduled offence connected to the same shall be triable by the

Special Court constituted for the area in which the offence has

been committed. It is relevant to note that Section 44(1)(a) uses

the expression “offence” in three places in contradistinction to the

expression “scheduled offence” used only once. This usage is not

without significance. In all three places where the word “offence”

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alone is used, it connotes the offence of money-laundering. The

place where the expression “scheduled offence” is used, it

connotes the predicate offence. By prescribing that an offence

punishable under Section 4 of the PMLA and any scheduled

offence connected to the same shall be triable by the Special

Court constituted for the area in which “the offence” has been

committed, Section 44(1)(a) makes it crystal clear that it is the

Special Court constituted under Section 43(1), which will be

empowered to try even the scheduled offence connected to the

same.

24. After mapping out/laying down such a general but

fundamental rule, the Act then proceeds to deal with a more

complicated situation in Section 44(1)(c). The question as to what

happens if the Court which has taken cognizance of the

scheduled offence is other than the Special Court which has

taken cognizance of the offence of money-laundering, is what is

sought to be answered by clause (c) of sub-section (1) of Section

44. If the Court which has taken cognizance of the scheduled

offence is different from the Special Court which has taken

cognizance of the offence of money-laundering, then the authority

authorised to file a complaint under PMLA should make an

14

application to the Court which has taken cognizance of the

scheduled offence. On the application so filed, the Court which

has taken cognizance of the scheduled offence, should commit

the case relating to the scheduled offence to the Special Court

which has taken cognizance of the complaint of moneylaundering.

25. Therefore, it is clear that the trial of the scheduled offence

should take place in the Special Court which has taken

cognizance of the offence of money-laundering. In other words,

the trial of the scheduled offence, insofar as the question of

territorial jurisdiction is concerned, should follow the trial of the

offence of money-laundering and not vice versa.

26. Since the Act contemplates the trial of the scheduled offence

and the trial of the offence of money-laundering to take place

only before the Special Court constituted under Section 43(1), a

doubt is prone to arise as to whether all the offences are to be

tried together. This doubt is sought to be removed by Explanation

(i) to Section 44(1). Explanation (i) clarifies that the trial of both

sets of offences by the same Court shall not be construed as joint

trial.

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27. A careful dissection of clauses (a) and (c) of sub-section (1)

of Section 44 shows that they confer primacy upon the Special

Court constituted under Section 43(1) of the PMLA. These two

clauses contain two Rules, namely, (i) that the offence punishable

under the PMLA as well as a scheduled offence connected to the

same shall be triable by the Special Court constituted for the

area in which the offence of money-laundering has been

committed; and (ii) that if cognizance has been taken by one

Court, in respect of the scheduled offence and cognizance has

been taken in respect of the offence of money-laundering by the

Special Court, the Court trying the scheduled offence shall

commit it to the Special Court trying the offence of moneylaundering.

28. It is only because of the Special Court constituted under

Section 43(1) being conferred primacy that Section 44(1) begins

with the words “notwithstanding anything contained in the Code

of Criminal Procedure”. Though the PMLA contains a non-obstante

clause in relation to the Cr.P.C, both in Section 44(1) and in

Section 45(1), there are two other provisions where the Code of

Criminal Procedure is specifically declared to apply to the

proceedings before a Special Court. Section 46(1) specifically

16

makes the provisions of the Cr.P.C applicable to proceedings

before a Special Court. Similarly, Section 65 of the PMLA makes

the provisions of Cr.P.C apply to arrest, search and seizure,

attachment, confiscation, investigation, prosecution and all other

proceedings under the Act.

29. Therefore, it is clear that the provisions of the Cr.P.C. are

applicable to all proceedings under the Act including proceedings

before the Special Court, except to the extent they are specifically

excluded. Hence, Section 71 of the PMLA providing an overriding

effect, has to be construed in tune with Section 46(1) and Section

65.

30. Having taken note of the relevant provisions of the PMLA,

which have a bearing upon the jurisdiction of the Special Court,

let us now turn our attention to some of the provisions of the

Cr.P.C, which deal with the question of territorial jurisdiction.

31. As pointed out by this Court in Kaushik Chatterjee vs.

State of Haryana & Ors.5

, the question of territorial jurisdiction

in criminal cases revolves around, (i) place of commission of the

offence; or (ii) place where the consequence of an act, both of

5

 2020 (10) SCC 92

17

which constitute an offence, ensues; or (iii) place where the

accused was found; or (iv ) place where the victim was found; or

(v) place where the property in respect of which the offence was

committed, was found; or (vi) place where the property forming

the subject-matter of an offence was required to be returned or

accounted for, etc., according as the case may be.

32. As articulated in Kaushik Chatterjee (supra), the

jurisdiction of a civil court is limited by territorial as well as

pecuniary limits, but the jurisdiction of a criminal court is

determined by (i) the offence; and/or (ii) the offender.

33. The discussion on the question of territorial jurisdiction in

terms of the provisions of the Cr.P.C can be cut short by

extracting the principles culled out in paragraphs 19 to 21 of the

decision in Kaushik Chatterjee. They read as follows:

“19. Chapter XIII of the Code of Criminal Procedure, 1973

contains provisions relating to jurisdiction of criminal

courts in inquiries and trials. The Code maintains a

distinction between (i) inquiry; (ii) investigation; and (iii)

trial. The words “inquiry” and “investigation” are defined

respectively, in clauses (g) and (h) of Section 2 of the Code.

20. The principles laid down in Sections 177 to 184 of the

Code (contained in Chapter XIII) regarding the jurisdiction

of criminal courts in inquiries and trials can be

summarised in simple terms as follows:

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20.1. Every offence should ordinarily be inquired into and

tried by a court within whose local jurisdiction it was

committed. This rule is found in Section 177. The

expression “local jurisdiction” found in Section 177 is

defined in Section 2(j) to mean “in relation to a court or

Magistrate, means the local area within which the court or

Magistrate may exercise all or any of its or his powers

under the Code”.

20.2. In case of uncertainty about the place in which,

among the several local areas, an offence was committed,

the Court having jurisdiction over any of such local areas

may inquire into or try such an offence.

20.3. Where an offence is committed partly in one area

and partly in another, it may be inquired into or tried by a

court having jurisdiction over any of such local areas.

20.4. In the case of a continuing offence which is

committed in more local areas than one, it may be

inquired into or tried by a court having jurisdiction over

any of such local areas.

20.5. Where an offence consists of several acts done in

different local areas it may be inquired into or tried by a

court having jurisdiction over any of such local areas.

(Numbers 2 to 5 are traceable to Section 178)

20.6. Where something is an offence by reason of the act

done, as well as the consequence that ensued, then the

offence may be inquired into or tried by a court within

whose local jurisdiction either the act was done or the

consequence ensued. (Section 179)

20.7. In cases where an act is an offence, by reason of its

relation to any other act which is also an offence, then the

first mentioned offence may be inquired into or tried by a

court within whose local jurisdiction either of the acts was

done. (Section 180)

20.8. In certain cases such as dacoity, dacoity with

murder, escaping from custody, etc., the offence may be

inquired into and tried by a court within whose local

jurisdiction either the offence was committed or the

accused person was found.

20.9. In the case of an offence of kidnapping or abduction,

it may be inquired into or tried by a court within whose

19

local jurisdiction the person was kidnapped or conveyed or

concealed or detained.

20.10. The offences of theft, extortion or robbery may be

inquired into or tried by a court within whose local

jurisdiction, the offence was committed or the stolen

property was possessed, received or retained.

20.11. An offence of criminal misappropriation or criminal

breach of trust may be inquired into or tried by a court

within whose local jurisdiction the offence was committed

or any part of the property was received or retained or was

required to be returned or accounted for by the accused

person.

20.12. An offence which includes the possession of stolen

property, may be inquired into or tried by a court within

whose local jurisdiction the offence was committed or the

stolen property was possessed by any person, having

knowledge that it is stolen property. (Nos. 8 to 12 are

found in Section 181)

20.13. An offence which includes cheating, if committed

by means of letters or telecommunication messages, may

be inquired into or tried by any court within whose local

jurisdiction such letters or messages were sent or received.

20.14. An offence of cheating and dishonestly inducing

delivery of the property may be inquired into or tried by a

court within whose local jurisdiction the property was

delivered by the person deceived or was received by the

accused person.

20.15. Some offences relating to marriage such as Section

494 IPC (marrying again during the lifetime of husband or

wife) and Section 495 IPC (committing the offence under

Section 494 with concealment of former marriage) may be

inquired into or tried by a court within whose local

jurisdiction the offence was committed or the offender last

resided with the spouse by the first marriage. (Nos. 13 to

15 are found in Section 182)

20.16. An offence committed in the course of a journey or

voyage may be inquired into or tried by a court through or

into whose local jurisdiction that person or thing passed in

the course of that journey or voyage. (Section 183).

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20.17. Cases falling under Section 219 (three offences of

the same kind committed within a space of twelve months

whether in respect of the same person or not), cases falling

under Section 220 (commission of more offences than one,

in one series of acts committed together as to form the

same transaction) and cases falling under Section 221,

(where it is doubtful what offences have been committed),

may be inquired into or tried by any court competent to

inquire into or try any of the offences. (Section 184).

21. Apart from Sections 177 to 184, which lay down in

elaborate detail, the rules relating to jurisdiction, Chapter

XIII of the Code also contains a few other sections. Section

185 empowers the State Government to order any case or

class of cases committed for trial in any district, to be tried

in any Sessions Division. Section 186 empowers the High

Court, in case where two or more courts have taken

cognizance of the same offence and a question as to which

of them should inquire into or try the offence has arisen,

to decide the district where the inquiry or trial shall take

place. Section 187 speaks of the powers of the Magistrate,

in case where a person within his local jurisdiction, has

committed an offence outside his jurisdiction, but the

same cannot be inquired into or tried within such

jurisdiction. Sections 188 and 189 deal with offences

committed outside India.”

34. It may be seen from the principles culled out from Sections

177 to 184 of the Cr.P.C that almost all contingencies that are

likely to arise have been carefully thought out and laid down in

these provisions.

35. The only contingency that could not have been provided in

the above provisions of the Cr.P.C, is perhaps where the offence

of money-laundering is committed. This is why Section 44(1)

begins with a non-obstante clause. The whole picture is thus

21

complete with a combined reading of Section 44 of the PMLA and

the provisions of Sections 177 to 184 of the Cr.P.C.

36. Once this combined scheme is understood, it will be clear

that in view of the specific mandate of clauses (a) and (c) of subsection (1) of Section 44, it is the Special Court constituted under

the PMLA that would have jurisdiction to try even the scheduled

offence. Even if the scheduled offence is taken cognizance of by

any other Court, that Court shall commit the same, on an

application by the concerned authority, to the Special Court

which has taken cognizance of the offence of money-laundering.

This answers the first question posed before us.

37. Coming to the second question arising for our

consideration, clause (a) of sub-section (1) of Section 44 leaves no

semblance of any doubt that the offence of money-laundering is

triable only by the Special Court constituted for the area in which

the offence of money-laundering has been committed. To find out

the area in which the offence of money-laundering has been

committed, we may have to go back to the definition in Section 3

of the PMLA.

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38. As we have pointed out earlier, the involvement of a person

in any one or more of certain processes or activities connected

with the proceeds of crime, constitutes the offence of moneylaundering. These processes or activities include, (i) concealment;

(ii) possession; (iii) acquisition; (iv) use; (v) projecting as

untainted property; or (vi) claiming as untainted property.

39. In other words, a person may (i) acquire proceeds of crime

in one place, (ii) keep the same in his possession in another

place, (iii) conceal the same in a third place, and (iv) use the

same in a fourth place. The area in which each one of these

places is located, will be the area in which the offence of moneylaundering has been committed. To put it differently, the area in

which the place of acquisition of the proceeds of crime is located

or the place of keeping it in possession is located or the place in

which it is concealed is located or the place in which it is used is

located, will be the area in which the offence has been

committed.

40. In addition, the definition of the words “proceeds of crime”

focuses on “deriving or obtaining a property” as a result of

criminal activity relating to a scheduled offence. Therefore, the

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area in which the property is derived or obtained or even held or

concealed, will be the area in which the offence of moneylaundering is committed.

41. Having seen the legal landscape on the question of

jurisdiction, let us now come back to the facts of the case on

hand. It is the case of the petitioner that what was attached by

the Enforcement Directorate under Section 5 of the Act as

proceeds of crime, was the bank account of the petitioner in Navi

Mumbai, Maharashtra and that therefore the offence of moneylaundering, even according to the respondent has been

committed in Maharashtra.

42. But the said contention overlooks the six different types of

processes or activities mentioned in Explanation (i) under Section

3 of the Act, as connected with proceeds of crime, namely,

concealment, possession, acquisition, or use, etc.

43. Even according to the petitioner, she ran three campaigns

from April 2020 to September 2021 in an online crowdfunding

platform named “Ketto”. From the pleadings on record, we are not

able to make out (i) the number of persons who provided funds;

and (ii) the places where the donors were located.

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44. The bank account of the petitioner in HDFC Bank,

Koperkhairane Branch, Navi Mumbai, Maharashtra, is the

ultimate destination, to which all funds reached. Therefore, Navi

Mumbai, Maharashtra is the place where the proceeds of crime

were taken possession of (if they were actually proceeds of crime).

Therefore, Navi Mumbai, Maharashtra is a place where only one

of the six different processes or activities listed in Section 3 has

been carried out. The other activity namely acquisition of the

proceeds of crime (if they really are) has taken place in the virtual

mode with people from different parts of the country/world

transferring money online. If acquisition has taken place in the

real physical world, the difficulty with respect to the question of

jurisdiction would have been lesser. Since acquisition has taken

place in the virtual world, the places from where online transfers

of money took place, are known only to the petitioner or perhaps

their Bankers.

45. Therefore, the question of territorial jurisdiction in this case

requires an enquiry into a question of fact as to the place where

the alleged proceeds of crime were (i) concealed; or (ii) possessed;

or (iii) acquired; or (iv) used. This question of fact will actually

depend upon the evidence that unfolds before the Trial Court. It

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will be useful in this regard to extract Paragraph 38 of the

decision in Kaushik Chatterjee which reads as follows: -

“38. But be that as it may, the upshot of the above

discussion is:

38.1. That the issue of jurisdiction of a court to try an

“offence” or “offender” as well as the issue of territorial

jurisdiction, depend upon facts established through

evidence.

38.2. That if the issue is one of territorial jurisdiction, the

same has to be decided with respect to the various rules

enunciated in Sections 177 to 184 of the Code.

38.3. That these questions may have to be raised before

the court trying the offence and such court is bound to

consider the same.”

46. Therefore, we are of the view that the issue of territorial

jurisdiction cannot be decided in a writ petition, especially when

there is a serious factual dispute about the place/places of

commission of the offence. Hence, this question should be raised

by the petitioner before the Special Court, since an answer to the

same would depend upon evidence as to the places where any

one or more of the processes or activities mentioned in Section 3

were carried out. Therefore, giving liberty to the petitioner to raise

the issue of territorial jurisdiction before the Trial Court, this writ

petition is dismissed. There will be no order as to costs.

…………………………….J.

(V. Ramasubramanian)

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…………………………….J.

(J.B. Pardiwala)

New Delhi

February 07, 2023

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