New Delhi: The Delhi High Court has criticised the Enforcement Directorate (ED) for seeking to sustain a money-laundering case by adding another FIR registered six years ago, even after the original case forming the basis of the proceedings had been closed by a court.
“In the present matter, however, the first FIR predated the ECIR and continued to subsist for nearly six years before the addendum was sought to be introduced. It added, “If such a course were to be accepted without limitation, it would confer an untrammelled licence upon the ED to continually rope in prior FIRs, even where the connection is tenuous or founded upon a slender factual thread, merely to keep an ECIR alive. The conduct of the ED in this regard is found wanting and raises serious concerns. This circumstance further fortifies the conclusion of this Court that the impugned addendum is vitiated by illegality, procedural impropriety, irrationality and a colourable exercise of power.”
A bench of Justice Anish Dayal, in a 115-page judgment released on Thursday, observed that such conduct raised serious concerns. The ED cannot, therefore, be permitted to take the position that it may turn the clock backwards and selectively draw upon an earlier predicate offence in order to sustain an existing ECIR after the original predicate offence has ceased to subsist,” the court said.
The court said that accepting such a course would give the ED an “untrammelled licence” to continually rope in earlier FIRs even where their connection to the alleged offence was tenuous or based on a slender factual thread merely to keep an ECIR (ED’s FIR) alive.
The court’s rebuke came in the petitions filed by the family members of late Dr Mahendra Prasad, a seven-time MP and the founder of Aristo Pharmaceuticals. The members had sought quashing of the money-laundering case and the consequential proceedings arising from it. The members included the lawmaker’s daughter-in-law, his two grandchildren, the brother-in-law, and the daughter-in-law’s brother. The agency subsequently searched the premises of the family members and issued summons to them. The family members, represented by a battery of senior advocates including Siddharth Agarwal, Dayan Krishnan and N.
Two months later, in August, the ED issued an addendum to its case and added another FIR registered in 2019 as an additional scheduled offence.
Hariharan, submitted that it was “quite strange” that the ED chose to add the 2019 FIR after the trial court had accepted the cancellation report, despite the agency having been aware of the FIR since 2023.
The Delhi High Court in October last year had directed that no coercive steps be taken against the petitioners.
In the present case, the ED had registered its case in December 2021, based on an FIR lodged by the lawmaker’s wife before the Economic Offences Wing (EOW) in September 2021, alleging that certain persons had forged the signatures of the lawmaker’s wife on share transfer forms and bank documents. However, the EOW subsequently filed a cancellation report in December 2022, concluding that no offence was made out.
The trial court accepted the report and closed the case in June last year.
