Delhi High Court Refuses To "Throttle" ED Probe At Summons Stage Against Man Who Transacted With Lalu Yadav's Family

While denying relief to a man seeking copy of ECIR in a money laundering case, the Delhi High Court has said that it cannot throttle the investigative process of the Enforcement Directorate at the stage of issuance of summons under PMLA.

Justice Swarana Kanta Sharma dismissed the plea moved by one Amit Katyal, who was not named as an accused in the land for job scam case, seeking quashing of ECIR and a summon issued by ED.

Katyal also sought to restrain ED from taking any coercive action against him, including conducting further investigation in the money laundering case.

It was his case that he apprehended that in light of the recent raids conducted by ED at his premises, he may be arrested in the ECIR if he joined investigation in compliance of the summons received.

He further contended that despite co-operating in the investigation and not being an accused in the predicate offence, he was being repeatedly called by ED since he had a business transaction with the family members of Lalu Prasad Yadav. 

Rejecting the plea, the court said that ED’s investigation in the ECIR is still continuing and Katyal was merely summoned to appear and submit certain documents in relation to the case.

Justice Sharma said that Katyal had joined investigation in the ECIR upon being summoned by ED on six occasions in past between March till August and thus, no tenable grounds were shown as to why the impugned summon deserved to be quashed.

“Even otherwise, as held in several judicial precedents discussed above, this Court cannot throttle the investigative process at the stage of issuance of summons to the petitioner,” the court said.

Regarding quashing of ECIR, the court observed that the prayer was highly premature as Katyal had not placed on record the ECIR copy since he was not in possession of the same.

“In this regard, it is relevant to note that it is not mandatory for the Directorate of Enforcement to furnish a copy of ECIR to the person who is under investigation, as held by Hon‘ble Apex Court in Vijay Madanlal Choudhary (supra), and the petitioner herein has only been summoned under Section 50 of PMLA,” the court said.

It added: “Thus, in these circumstances, when the petitioner has only been summoned under Section 50 of PMLA, and the ECIR is not available on record, nor the petitioner has made out any ground at this stage for which this Court should pass any direction to call upon the respondent to place before this Court a copy of ECIR, which is also one of the prayers in this petition, this Court is of the opinion that the prayer for quashing of ECIR is premature and without any merit.”

Furthermore, the court observed that merely because once again a summon has been issued under Section 50 of PMLA, no case for grant of no-coercive steps can be made out.

“It is also clear as per the scheme of PMLA that power to issue summons under Section 50 of PMLA is different from the power to arrest under Section 19 of PMLA, and the issuance of summons to join investigation and give some evidence or document to the investigation agency cannot be presumed to culminate into the arrest of person being so summoned,” the court said.

Counsel for Petitioner: Mr. Mukul Rohtagi, Senior Advocate with Ms. Bina Gupta, Mr. Gurpreet Singh, Mr. Bakul Jain, Ms. Sheena, Ms. Akasha Saini, Mr. Shiv Kumar Gupta and Mr. Naman Agarwal, Advocates

Counsel for Respondent: Mr. Zoheb Hossain, Special Counsel for ED with Mr. Vivek Gurnani, Mr. Baibhav, Mr. Kartik Sabharwal and Mr. Ankur Tiwari, Advocates

Title: AMIT KATYAL v. DIRECTORATE OF ENFORCEMENT

Citation: 2023 LiveLaw (Del) 1056

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