Alleged Lack Of Jurisdiction Of Court No Ground To Transfer Case : Supreme Court Dismisses PFI Student Wing Leader's Plea

The Supreme Court on Monday dismissed a petition filed by KA Rauf Sheriff, the General Secretary of the Campus Front of India (the student wing of the banned Popular Front of India), seeking transfer of the money laundering case against him from Lucknow in Uttar Pradesh to Ernakulam in Kerala.

The money laundering case was registered in 2018 by taking a UAPA case relating to a PFI arms training camp in Narath in Kerala in 2013 (in which 22 persons were convicted under UAPA and other offences) as the predicate offence. The petitioner was not an accused in the arms training camp case.

Sherrif was arrested by the ED in the PMLA case in December 2020. Kerala journalist Siddique Kappan and few others were also later added as accused in the PMLA case before the Special Court at Lucknow.

Seeking transfer, the petitioner’s arguments before the Top Court were four-fold:

• The proceedings pending before the Special Court, Lucknow are without jurisdiction as all alleged criminal activities took place in Kerala;
• Seven out of 10 accused are residents of Kerala, even as per the Enforcement Directorate’s prosecution complaint;
• 26 witnesses out of the total 40 hail from Kerala;
• The petitioner was lawfully remanded to custody by the Special Judge, Ernakulam under Section 167(2) of the Code and so, the filing of the prosecution complaint at Lucknow is impermissible.

ED vehemently opposed these contentions.

A bench comprising Justices V Ramasubramanian and Pankaj Mithal relied on the recent judgement in Rana Ayyub vs. Directorate of Enforcement through its Assistant Directorate, which held that the jurisdiction of the Special PMLA Court is not bound by the place where the schedule offence took place and that the jurisdiction is assumed over the place where any of the acts constituting the offence of money laundering took place.

To claim jurisdiction at Lucknow, the ED cited certain money transactions to PFI leaders which allegedly took place in UP.  The Supreme Court therefore held that the Lucknow court cannot be said to be totally lacking in jurisdiction.

“In any case, the lack of jurisdiction of a Court to entertain a complaint can be no ground to order its transfer. A congenital defect of lack of jurisdiction, assuming that it exists, inures to the benefit of the accused and hence it need not be cured at the instance of the accused to his detriment. Therefore, the first ground on which transfer is sought, is liable to be rejected", the bench observed.

The Court also rejected the petitioner’s argument pertaining to the number of accused and witnessing hailing from Kerala.

“The second ground on which transfer is sought is that 7 out of 10 accused persons are residents of Kerala. But this can hardly be a ground for ordering the transfer of investigation. Similarly, the third ground that a majority of witnesses are also from Kerala/ South India is also no ground to order the transfer of the complaint.”

Further, the Bench also rejected the petitioner’s content pertaining to section 167(2) of the Code.

“An order under Section 167(2) of the Code had to be passed necessarily by the Magistrate “to whom an accused person is forwarded”. In fact, Section 167(2) contains the words “whether he has or has not jurisdiction to try the case”. Therefore, the argument revolving around Section 167(2) of the Code also fails.” These observations prompted the Court to dismiss the transfer plea.

Senior Advocate S Nagamuthu appeared for the petitioner. Additional Solicitor General KM Nataraj appeared for the ED.

Case Title: Ka Rauf Sherif Vs Directorate Of Enforcement & Ors. | Transfer Petition (Criminal) No.89 Of 2023

Citation : 2023 LiveLaw (SC) 284

Code of Criminal Procedure 1973- Section 406- The lack of jurisdiction of a Court to entertain a complaint can be no ground to order its transfer. A congenital defect of lack of jurisdiction, assuming that it exists, inures to the benefit of the accused and hence it need not be cured at the instance of the accused to his detriment- Para 11

Code of Criminal Procedure 1973- Section 406-That most of the accused and witnesses are from A state is not a ground to transfer case from B state to A state-Para 12

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