Supreme Court on Tuesday dismissed the 2018 money laundering case against Karnataka Deputy Chief Minister DK Shivakumar. Congress leader had moved to the apex court against Karnataka High Court’s 2019 order that refused to quash the Enforcement Directorate (ED) summons issued to him in this case.
Money Laundering Case against DK Shivakumar
In 2017, the Income tax department raided multiple premises of Shivakumar in Delhi and alleged a tax evasion probe against the Karnataka CM and four others.
The other four include CM’s alleged business associate and liquor trader Sachin Narayan, another associate Sunil Kumar Sharma (who operated a fleet of luxury buses), Karnataka Bhawan employee A Hanumanthaiah, and former state government employee and caretaker posted at the Karnataka Bhawan Rajendra N.
The Income tax department seized about Rs 8.59 crore and filled a charge sheet against Shivakumar before a Bengaluru court on charges of tax evasion against all the accused. The ED took cognizance of this complaint and registered an FIR against the Congress leader.
Shivakumar was first arrested in September 2019, and granted bail in October of the same year by Delhi High Court.
Supreme Court dismisses the Case
A bench of Justices Surya Kant and KV Viswanathan quashed the case against DK Shivakumar as a proceeding against him under the Prevention of Money Laundering Act (PMLA).
Supreme Court held Karnataka High Court’s verdict ‘unsustainable’ given its recent Pavana Dibbur Judgement.
Section 120B of the Indian Penal Code (IPC) has been deemed a standalone offense by the High Court, which can be used as a basis for invoking anti-money laundering laws.
Pavana Dibbur Judgement
In November, the apex court in the Pavana Dibbur case held that section 120B of IPC becomes a scheduled offense only when a conspiracy is done to commit an offense that is otherwise scheduled. The court clarified that the legislative intent behind PMLA was not to make every offense included in scheduled ‘a scheduled offense’ by applying Section 120B.
Referring to this judgment, the Supreme Court quashed the proceeding under PMLA against Shivakumar and the other accused.
“Given the Pavana Dibbur decision, the reasons assigned by the high court in the impugned judgment cannot be sustained. Appeals are accordingly allowed while setting aside the impugned judgment, the proceedings initiated against the appellants under the PMLA are hereby quashed,” the apex court held on Tuesday.
ED’s Review Petition against Pavana Dibbur Judgement
ED has filed a review petition against the Supreme Court’s Pavana Dibbur Judgement. If the petition gets accepted then the High Court verdict will stand affirmed, allowing ED to seek or recall this recent judgment if necessary.
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