PMLA Trial Cannot Be Stayed Pending Predicate Offence: Jharkhand HC Dismisses Petition in Neeraj Mittal vs Directorate of Enforcement
Overview of the Case
The Jharkhand High Court recently pronounced a significant ruling in Neeraj Mittal Vs Directorate of Enforcement Represented by Assistant Director, wherein it dismissed a petition seeking to halt proceedings under the Prevention of Money Laundering Act, 2002 (PMLA) until the predicate/scheduled offences reached the stage of framing of charges or resulted in discharge. The Court undertook a detailed examination of the scope of inherent powers under Section 528 of the Bharatiya Nagarik Suraksha Sanhita (BNSS), the statutory framework under Section 44 of the PMLA, and the law laid down by the Supreme Court in a series of authoritative decisions.
Background and Factual Matrix
Origin of the Predicate Offence
On 13.11.2019, the Anti-Corruption Bureau (ACB), Jamshedpur, registered FIR No. 13/2019 under Section 7(a) of the Prevention of Corruption Act, 1988, based on a complaint dated 23.10.2019. The complaint alleged that Suresh Prasad Verma, a Junior Engineer attached to the Road Construction Department, had demanded a bribe of Rs. 28,000/- for releasing an outstanding payment upon completion of a PCC road project.
On 14.11.2019, the ACB laid a trap and apprehended Suresh Prasad Verma in the act of accepting a bribe of Rs. 10,000/-. Simultaneously, a raid at the flat of one Alok Ranjan led to the recovery of cash amounting to Rs. 2.67 crores. Suresh Prasad Verma subsequently gave a statement attributing the seized cash to Veerendra Kumar Ram, Chief Engineer, Swarnrekha Project.
On 11.01.2020, the ACB, Jamshedpur filed a charge-sheet in FIR No. 13/2019 against Suresh Prasad Verma and Alok Ranjan under Section 7(b) of the Prevention of Corruption Act and Section 201 read with Section 120B of the Indian Penal Code, 1860.
Registration of ECIR and Expansion of Investigation
On 17.09.2020, the Directorate of Enforcement registered ECIR/RNSZO/16/2020 based on FIR No. 13/2019, naming Suresh Prasad Verma and Alok Ranjan as accused. Subsequent investigation revealed that the proceeds of crime were acquired by Veerendra Kumar Ram (Accused No. 1) and routed through Delhi-based Chartered Accountant Mukesh Mittal (Accused No. 5) to the bank accounts of his family members and associates.
On 21.02.2023, searches were conducted at Delhi premises of Veerendra Kumar Ram and his close associates to investigate what was described as a larger ongoing conspiracy.
Based on information provided by the Directorate of Enforcement under Section 66(2) of the PMLA, the Economic Offences Wing (EOW), Delhi registered FIR No. 22/2023 on 03.03.2023 against Veerendra Kumar Ram, Mukesh Mittal, and unknown others. On 05.04.2023, an addendum was issued merging the investigation of the PMLA offence arising out of FIR No. 22/2023 with the investigation of ECIR/RNSZO/16/2020.
Arrest of the Petitioner and Filing of Prosecution Complaints
The Directorate of Enforcement filed its initial Prosecution Complaint before the Special Judge, PMLA, Ranchi on 21.04.2023. The petitioner was not named as an accused in this initial complaint. However, on 23.06.2023, the petitioner was arrested by the Directorate of Enforcement and remanded to its custody for seven days by the Special Judge, PMLA, Ranchi.
On 20.08.2023, the Directorate of Enforcement filed a 1st Supplementary Prosecution Complaint before the Special Judge, PMLA, Ranchi, arraying the petitioner as Accused No. 7. Cognizance of the offence in ECIR/RNSZO/16/2020 was taken on 22.08.2023. A further Supplementary Prosecution Complaint was filed on 04.07.2024 arraying three additional accused persons. By the time of hearing, a total of five Supplementary Prosecution Complaints had been filed, with 36 accused persons arrayed in total and alleged proceeds of crime amounting to approximately Rs. 90 crores.
Petitioner's Application Before the Special Court and the Impugned Order
On 05.11.2024, the petitioner moved an application before the Special Judge, PMLA, Ranchi seeking that the ECIR proceedings be kept in abeyance until the framing of charges or discharge in FIR No. 13/2019 (ACB, Jamshedpur) and FIR No. 22/2023 (EOW, Delhi). The Special Judge, PMLA, Ranchi dismissed this application vide order dated 02.12.2024.
The petitioner initially challenged this order before the Supreme Court by way of Special Leave to Appeal (Criminal) No. 4457 of 2025. The Supreme Court, vide order dated 09.04.2025, disposed of the Special Leave Petition while keeping open the remedy of approaching the High Court, observing:
"The petitioner has a remedy of filing appropriate proceedings before the High Court. By keeping open the said remedy, the Special Leave Petition is disposed of. Pending application(s), if any, shall stand disposed of accordingly."
The petitioner thereafter approached the Jharkhand High Court under Section 528 of the BNSS seeking quashing of the order dated 02.12.2024.