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Chhattisgarh files plea in Supreme Court challenging PMLA

By LawStreet News Network      27 April, 2023 10:27 PM      0 Comments
Chhattisgarh files plea in Supreme Court challenging PMLA

NEW DELHI: The Chhattisgarh government has approached the Supreme Court challenging the constitutional validity of various provisions of the Prevention of Money Laundering Act (PMLA), alleging the central investigation agencies are being misused in order to intimidate, harass and disturb the normal functioning of an opposition government over there.

On Wednesday, senior advocate Mukul Rohatgi and advocate Sumeer Sodhi, on behalf of the government, mentioned the matter before a bench of Chief Justice of India D Y Chandrachud and Justice P S Narasimha that the issue is of constitutional importance and should be heard urgently.

The bench agreed to take up the matter on May 4.  

The state government has filed an original suit challenging the law under Article 131 of the Constitution which empowered a State to move the top court directly in matters of dispute with the central government or any other state.

The state government, which is first to challenge PMLA and its provisions, said that several complaints are being received by it on behalf of its officials as well as the residents of the state to the effect that ED is "torturing, abusing, and manhandling" them in the garb of conducting a probe.

The state said that an FIR was registered at police station Kadugodi of Bengaluru against one Suryakant Tiwari for offenses punishable under various sections of IPC including assault or criminal force to deter public servant from discharging his duty and destruction of evidence.  

"The complainant in the FIR is Income Tax Department and the allegation pertains to alleged illegal collection on levy of coal as well as attempts to influence public servants through corrupt and illegal means in the State of Chhattisgarh," the suit stated.

In its plea, the state government said the ED on the basis of the predicate offense, registered an ECIR dated September 29, 2022 and started conducting its investigation.  

"The said investigation has resulted in indiscriminate surveys and raids at various Departments and Offices of the State Government, and arrests of State officials," it said.

The suit said, “Karnataka Police has no jurisdiction to register the FIR; if registered on the basis of commission of a cognizable offense, the FIR must be forthwith transferred to the Police which has the jurisdiction to investigate the FIR”.

“The present case is a perfect example of how the Central investigation agencies are being misused by those in power in order to intimidate, harass and disturb the normal functioning of an opposition Government in the State of Chhattisgarh,” it added.

"To name a few, Environment Conservation Board (CECB), Labour Commission, Commissioner of State Tax, Chhattisgarh, Commercial Tax -GST Department, and Commissioner of State Tax have been searched under the guise of an FIR registered by Karnataka Police," it added.

The Congress government said, it is due to this blatant and excessive misuse of powers that it is being forced to approach this court.

"It is imperative to state that this is not the first occasion wherein the ED has resorted to an illegal modus operandi. On multiple occasions, the aforementioned approach has been employed concerning various states that hold a political stance opposite to the one in power at the Centre,” it contended.

The state said such conduct amounts to a severe misappropriation and arbitrary use of power, which goes against the constitutional mandate and investigative agencies are expected to be entirely independent and uninfluenced.

The state government said that it is seeking interference of the court under its original jurisdiction bestowed by virtue of Article 131 of the Constitution, in light of a dispute that has arisen between the state and defendants--Union of India, state of Karnataka and Directorate of Enforcement (ED) – which involves questions of law and facts affecting its legal and constitutional rights.

The suit said “public order” and “police” are state subjects under Seventh Schedule List II, Entries 1 and 2 and the act of allowing one state to register and sit over an FIR for an offense that admittedly took place in another state violates constitutional federalism and autonomy of a state.

“The case of the Plaintiff State is that the said FIR was lodged maliciously in Karnataka by a Central Agency being the Informant, solely with the aim of facilitating the registration of ECIR by ED, so as to disrupt the smooth functioning of the Government in the Plaintiff State,” it said.

The state government said that ECIR registered by the ED deserves to be quashed as the predicate offense is not registered by the jurisdictional Police and the said registration of the case by ED is ex-facie in teeth of law laid down by this court in its 2022 verdict on validity of various provisions of PMLA in the case of Vijay Madanlal Choudhary versus Union of India. 

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