TNR News Network
New Delhi:
In a significant setback to the Enforcement Directorate (ED), a Delhi court on Tuesday declined to entertain the agency’s money laundering case against Congress leaders Sonia Gandhi and Rahul Gandhi in the National Herald matter, holding that the proceedings lacked the mandatory legal foundation.
The ruling brings immediate relief to the Gandhis, with the court concluding that the ED’s complaint under the Prevention of Money Laundering Act (PMLA) could not stand in the absence of a registered FIR for a scheduled offence.
Special Judge Vishal Gogne of the Rouse Avenue Court ruled that the prosecution complaint was not maintainable at this stage as it stemmed from a private complaint and not from an FIR — a prerequisite under the PMLA for initiating money laundering proceedings.
PMLA case cannot proceed without FIR, says court
The court observed that the ED’s case originated from a private complaint filed by BJP leader Subramanian Swamy before a magistrate, rather than an FIR relating to a predicate offence listed under the PMLA. Under the statute, the judge noted, investigation and prosecution for money laundering can commence only when there is a legally registered scheduled offence.
“In the absence of such an FIR, taking cognisance of the alleged offence of money laundering would be impermissible,” the court said while dismissing the prosecution complaint and refusing to take cognisance under Sections 3 and 4 of the Act.
Merits not examined, ED given liberty
At the same time, the court pointed out that the Delhi Police’s Economic Offences Wing (EOW) has since registered an FIR in the matter. In view of this development, the judge said it would be premature to examine the substance of the allegations raised by the ED at this stage.
The court left the door open for the agency to make fresh submissions in accordance with law, noting that the investigation is stated to be ongoing.
Apart from Sonia and Rahul Gandhi, the ED had named Suman Dubey, Sam Pitroda, Young Indian, Dotex Merchandise and Sunil Bhandari as accused in its complaint.
ED alleged Rs 2,000-crore asset takeover
The ED had alleged that assets of Associated Journals Limited (AJL), publisher of the now-defunct National Herald newspaper, were fraudulently taken over by Young Indian — a company in which Sonia and Rahul Gandhi are majority shareholders. According to the agency, the properties involved were valued at over Rs 2,000 crore, and the shares, immovable assets and rental income constituted proceeds of crime.
The Gandhis have consistently denied the allegations, arguing that the case was legally untenable as it alleged money laundering without any use, projection or enjoyment of the property, as required under the law. They maintained that Young Indian was formed to make AJL debt-free through a loan arrangement and not to usurp its assets.
Congress calls verdict exposure of ‘political vendetta’
Reacting to the order, Congress spokesperson Supriya Shrinate said the court’s decision had exposed the “malafide and illegal” nature of the ED’s action. She said the court had clearly ruled that without an FIR, the agency had no jurisdiction to proceed.
“This politically motivated prosecution of the principal opposition party stands exposed,” Shrinate said, adding that there was no money laundering, no proceeds of crime and no movement of property. “These baseless charges, driven by a witch hunt and reputation assassination, have been defeated,” she said.
The National Herald case traces its origin to a private complaint filed by Subramanian Swamy alleging cheating, criminal conspiracy and misappropriation. The ED had filed its prosecution complaint on April 15 this year and has indicated it may challenge Tuesday’s order.
