Apex Court Stays Trial Against Lottery King-Santiago Martin In Money Laundering Case; Issues Notice To ED

The Bench of Justice Abhay S Oka and Justice Ujjal Bhuyan issued notice and sought a reply from the Enforcement Directorate in the present special leave petition which was filed against the order of the trial court rejecting an application on behalf of Martin seeking to keep the PMLA Case in abeyance until the final disposal of the predicate case.

Senior Advocate Aditya Sondhi and Advocate Rohini Musa appeared for the Petitioner.

It was the case of the Petitioner that based on the judgement of the Supreme Court in the case of Vijay Madanlal Choudhary versus Union of India & Ors. an acquittal in the predicate case would automatically result in the non-continuance of proceedings under the PMLA and therefore, in the sequence of trial, it ought to be the trial of the predicate case that ought to be given precedence.

The Petitioner in its petition has said, “The Learned Special Court erred in not appreciating that after the pronouncement of the judgment in Vijay Madanlal’s case, in multiple cases the proceedings under PMLA were dropped or quashed based on the grounds of discharge, quashing, or acquittal in the predicate case…. the Learned Special Court ought to have considered that the trial of the PMLA case can commence only after the conclusion of the trial in the predicate case. It is impossible to conceive of a PMLA case absent a predicate case. In the event of discharge or acquittal of accused in the PMLA case, the PMLA proceedings cannot continue.”

The Petitioner also relied on the view of the Supreme Court in the case of Pavana Dibbur v. Directorate of Enforcement, which has held that if all the accused in the predicate case are acquitted then the other accused in the PMLA case cannot be prosecuted.

The Trial Court had held that both the cases were independent and separate and it had no power to stay the trial of the case pending before it. It had observed, "The apprehension of the petitioner is that if the trial in the PMLA case is proceeded with before the final decision in the predicated case, the accused will be compelled to disclose his defence and that will cause prejudice to the accused. There is no basis for such an apprehension. As stated above, both the cases can be tried separately simultaneously or one after other. The common witness/documents in the cases will be pertaining to the commission of the scheduled offence. All other evidence to be adduced will not be the same. If the evidence to prove the scheduled offence is recorded in the predicate case first and then in the PMLA case, such apprehension of the petitioner can be resolved. So, I find no reason to entertain such an apprehension."

The Petition also stated that the Apex Court in a catena of judgments has held that in case of acquittal, discharge or quashing of proceedings of the scheduled offence the trial of money laundering offence or the proceedings with respect to attachment of the proceed of crime cannot continue. Further, the sum and substance of the interpretation given by the Apex Court in various pronouncements were that the acquittal or discharge or quashing of the scheduled offence the prosecution for the offence of money laundering will automatically be deemed to be non-est.

Cause Title: S Martin v. Directorate of Enforcement (SLP No. 4768 of 2024)