Justice M. Nagaprasanna, Karnataka High Court

The Karnataka High Court dismissed a batch of criminal petitions seeking to quash an FIR registered under the stringent provisions of the Unlawful Activities (Prevention) Act, 1967 (UAPA) and the Bharatiya Nyaya Sanhita, 2023, observing that clandestine funding acts as the "oxygen" that enables extremist movements to survive.

The Bench held that courts must remain extremely circumspect in stifling an investigation where allegations touch upon economic subversion intertwined with national security, making a thorough probe imperative rather than merely permissible.

The case arose after accused No. 2, Micah Mark, was intercepted at the Kempegowda International Airport in possession of 24 international debit cards issued under a generic false identity by a US-based bank, unearthing an alleged cross-border network operated by "The Timothy Initiative" that funneled nearly ₹100 crores to finance Left-Wing Extremism (LWE) in Naxal-affected regions like Chhattisgarh, Assam, and Karnataka.

The Bench of Justice M Nagaprasanna held, "The preservation of National security, therefore, demands robust vigilance against financial channels that sustain extremism. Effective intelligence gathering, strict regulatory oversight, inter-agency coordination, and rigorous enforcement of anti-money laundering. Institutions tasked with financial monitoring and security enforcement must act with both precision and urgency to dismantle these covert networks. Protecting National security is thus a collective constitutional obligation, and preventing the funding of extremism forms an indispensable part of that solemn duty."

Senior Advocate M. S. Shyam Sundar appeared for the Petitioner, while Special Public Prosecutor B. N. Jagadeesha appeared for the Respondents.

The Court further held, "Therefore, this is not a case warranting exercise of inherent jurisdiction to nip the crime in the bud. The case concerns National security. National security is the invisible architecture upon which the sovereignty, stability and constitutional order of a nation rest. One of the gravest threats to National security in the present times is, the clandestine funding of extremism. Funding, therefore, becomes the oxygen that enables extremist movements to survive and proliferate. The danger of extremist financing lies not merely in the money transferred, but in the consequences it unleashes. Left unchecked, such funding can transform ideological extremism into organized violence, threatening National unity and public safety."

Brief Facts

Both these criminal petitions arose out of a common criminal proceeding registered for multiple offences punishable under the Bharatiya Nyaya Sanhita, 2023, and Sections 13, 17, and 18 of the Unlawful Activities (Prevention) Act, 1967 ('UAPA'). 

The genesis of the case traced back to the interception of accused No. 2 at the Kempegowda International Airport, where he was allegedly found in possession of 24 international debit cards. Subsequent search and seizure operations were carried out by the Enforcement Directorate for suspected violations under the Foreign Exchange Management Act (FEMA).

During the investigation, the Enforcement Directorate allegedly unearthed a wide financial network linked to a US-based organization named "The Timothy Initiative." It was revealed that more than a thousand international debit cards issued by Truist Bank, USA, under the generic name “Santosh Kumar” and coded region-wise, were systematically used to withdraw foreign funds running into crores of rupees across various states in India, including areas affected by Left-Wing Extremism (LWE).

The prosecution further alleged that Ajit Veghese Mathai (accused No. 3) managed the finance operations through shell entities, Jonathan S. Rajan supervised the overall operations including the indoctrination of individuals, and the remaining accused acted as field-level facilitators for cash withdrawals. Acting on this material, the Enforcement Directorate shared a detailed dossier with the Director General of Police, Karnataka, which culminated in the registration of the impugned FIR.

Contentions of the Parties

The Petitioners/Accused Persons contended on behalf of the petitioners that the Enforcement Directorate possessed no legal authority to communicate with the jurisdictional police or request the registration of an FIR, and that such an action was completely outside the statutory framework. It was argued that the Enforcement Directorate was acting under the PMLA and since no Enforcement Case Information Report (ECIR) had been recorded, it could not have invoked Section 66(2) of the PMLA to share information.

It was further submitted that the stringent provisions of the UAPA were deliberately added as a counterblast to a writ petition filed by accused No. 2 alleging custodial torture. The petitioners maintained that they belonged to a Christian missionary helping the poor, and there was no prima facie material connecting them to any terrorist activity.

Per contra, the respondents strongly opposed the petitions, arguing that the investigation was at an incipient stage and, given the gravity of the allegations touching upon national security, it ought not to be nipped in the bud. It was submitted that the systematic withdrawal of close to ₹100 crores using hundreds of camouflaged debit cards in Naxal-affected regions clearly pointed toward an organized network funding left-wing extremism. The Directorate highlighted that immediately after the interception of accused No. 2, the organization’s global portal became inaccessible and back-end cloud data was remotely deleted, which amounted to intentional destruction of material evidence.

Consideration and Findings

The Court observed that Section 66(2) of the PMLA explicitly empowers the competent authority to share information with other law enforcement agencies if the material in possession indicates the contravention of any other law for the time being in force. The Court rejected the narrow interpretation suggested by the petitioners, holding that the statutory architecture was deliberately designed to prevent vital information from remaining siloed within a single agency.

The Court held that statutes operating in cognate fields must be construed harmoniously and not in watertight compartments. It turned down the contention that search and seizure under FEMA barred the disclosure of information, ruling that PMLA and FEMA must be read in tandem to safeguard the financial integrity of the nation.

Upon examining the definition of “unlawful activity” under Section 2(o) of the UAPA alongside Sections 13, 17, and 18, the Court noted that the detailed dossier shared by the Enforcement Directorate was not barren. The systematic influx of foreign funds through false identities into regions under active Naxal influence prima facie constituted an activity intended to cause disaffection against India and threaten its sovereignty.

The Court emphasized that national security serves as the invisible architecture of constitutional order and that clandestine funding acts as the oxygen for extremist movements. It held that when allegations touch upon economic subversion intertwined with national security, the Courts must be extremely circumspect, and an exhaustive investigation becomes imperative rather than merely permissible.

"The Courts must therefore be circumspect in stifling investigation, particularly where allegations touch upon issues of economic subversion intertwined with National security. In the teeth of such accusations as observed hereinabove, investigation is not merely permissible - it becomes imperative", the Court said.

Consequently, the Court found no merit in the petitions and dismissed them, clarifying that the observations made were confined to the consideration of quashing under Section 528 of the Bharatiya Nagarik Suraksha Sanhita (BNSS) and would not bind or influence the ongoing independent investigation.

Cause Title: Micah Mark v. State of Karnataka and Ors. [Criminal Petition No.8401 OF 2026 C/w Criminal Petition No.8417 OF 2026]

Appearances:

Petitioner: Senior Advocate M. S. Shyam Sundar, Advocate Timothy Charles.

Respondents: Special Public Prosecutor B. N. Jagadeesha, Special Public Prosecutor Madhu N. Rao.

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