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New Delhi: In another judgment, the strict law for the prevention of Money Laundering Act and to protect honest public servants in the discharge of their official duties, the Supreme Court on Wednesday ruled that prior government sanctions are necessary to prosecute a government employee in a money laundering case and ruled that Section 197 of the Code of Criminal Procedure on sanctions applies would be in PMLA cases Also. A bench of Justices Abhay S Oka and Augustine George Masih dismissed the filing Enforcement Directorate that PMLA provisions have an overriding effect on the provisions of the other statutes, including the CrPC in the area of sanctions.
Extending the scope of Section 197(1) to PMLA on money laundering cases, the bench said the objective is to protect the public servants from prosecution and to ensure that they are not prosecuted for anything they do in the course of their tasks. “This provision is for the protection of honest and upright officers. However, the protection is not unconditional. They can be prosecuted with a previous sanction from the competent authority.” the bench said while rejecting the agency’s plea.
“Section 65 makes the provisions of the CrPC applicable to all proceedings under the PMLA, provided they are not inconsistent with the provisions of the PMLA. The words ‘All other proceedings’ include a complaint under Section 44(1) , (b) of the PMLA. We have carefully gone through the provisions of the PMLA. We have not found any provision therein which is inconsistent with the provisions of Section 197(1) of the CrPC applicability cannot be excluded unless there is one. provision in the PMLA which is inconsistent with Section 197(1).We have therefore not been drawn to any such provision. Therefore, we are of the opinion that the provisions of Section 197(1) of the CrPC are applicable to a complaint under. of Section 44(1)(b) of the PMLA,” the bench said.
Section 197(1) says that when a person who is or was a judge, magistrate or a public servant who cannot be removed from office except by or with the sanction of the Government, is charged with an offense alleged to have been committed by him while acting in the discharge of his official duties, no court shall take cognizance of such violation except with the foregoing sanction.
The agency submitted that Section 71 of PMLA has an overriding effect on the other statutes, including the CrPC, and the requirement to obtain sanction under this law will be inconsistent with the provisions of the PMLA. It said the money laundering cannot be considered to have been done in the performance of official duties that required protection. But the bank was not convinced and quashed the prosecution of a senior bureaucrat for lack of sanctions.
“Section 65 is an earlier section which makes the provisions of the CrPC specifically applicable to PMLA, provided that only those provisions of the CrPC shall apply which are not inconsistent with the provisions of the PMLA. Therefore, when a particular provision of CrPC CrPC applies to proceedings under the PMLA under section 65 of the PMLA, section 71 (1) cannot override the provision of CrPC applicable to the PMLA ) will apply to the provisions of the PMLA, Section 71 cannot be invoked to say that the provision of Section 197(1) of the CrPC shall not apply to the PMLA,” the bench said.