Prevention of Money Laundering Act, 2002 – Discharge and Framing of Charge – Scope of Judicial Review – Petitioner, Director of contractor company, challenged rejection of discharge and framing of charge under Section 3 PMLA – Allegations of submission of 26 fake and forged bitumen invoices leading to generation of proceeds of crime worth Rs. 1,08,95,583/- – Investigation revealing receipt, layering and investment of proceeds of crime through subsidiary and associate companies controlled by petitioner – Held: At stage of discharge and framing of charge, court required only to see existence of prima facie material and not conduct a mini trial – Strong suspicion founded on material sufficient to frame charge – No perversity or illegality in impugned orders [Paras 20–21, 56–60, 100].

Money Laundering – “Proceeds of Crime” – Interpretation of Section 2(1)(u) PMLA – Explanation inserted by Act 23 of 2019 – Scope widened to include property directly or indirectly derived or obtained from criminal activity relatable to scheduled offence – Held: Proceeds generated through fake invoices and subsequently invested in subsidiaries constitute proceeds of crime – Identification of exact amount sufficient at prima facie stage [Paras 25–29, 98–100, 114].

Offence under Section 3 PMLA – Continuing Nature – Involvement Not Limited to Predicate Offence – Petitioner not only linked with scheduled offence but also actively involved in acquisition, possession, use and projection of proceeds of crime as untainted – Held: Person need not be named as accused in predicate offence to be prosecuted under PMLA – Knowingly assisting or being party to laundering activity sufficient [Paras 102–108, 112–113].

Criminal Conspiracy – Role of Director – Vicarious Liability under Section 70 PMLA – Evidence showing petitioner as key decision-maker and controller of day-to-day affairs of parent and subsidiary companies – Statements under Section 50 PMLA and documentary evidence relied upon – Held: Prima facie case of consent, connivance and active role established against petitioner as Director [Paras 93–97].

Discharge – Legal Principles – Court Not to Act as Post Office – Defence Not to be Considered – Revisional Court’s Limited Jurisdiction – Held: Revisional jurisdiction cannot be equated with appellate power – Interference justified only in rare cases of patent illegality or jurisdictional error – No ground made out to interfere with rejection of discharge or framing of charge [Paras 117–123].

Economic Offences – Need for Full Trial – Serious Allegations of Money Laundering – Reliance on Supreme Court Precedents – Held: Economic offences having deep-rooted conspiracies and financial ramifications require thorough trial – Discharge at nascent stage impermissible [Paras 115–116].

Decision: Criminal Revision No. 648 of 2025 and Criminal Revision No. 529 of 2025 dismissed – Orders rejecting discharge and framing charge under Sections 3 and 4 PMLA affirmed – Pending interlocutory applications disposed of.

Criminal Law – Quashing - Cheating – Commercial Transactions – Quashing of Criminal Proceedings – Managing Director of company summoned under Section 420 IPC for alleged non-payment of dues for goods supplied – Respondent had already filed civil suit for recovery which was decreed – Criminal complaint filed belatedly after three years – Held: Dispute essentially civil in nature and criminal proceedings amounted to abuse of process [Paras 9, 44–48].

Section 420 IPC – Dishonest Intention at Inception – Essential Ingredient – Mere failure to pay outstanding dues or subsequent financial incapacity insufficient – Partial payments made and continued business dealings negate dishonest intention at inception – Admission by complainant’s witness that supplies were made to maintain business relations demolishes allegation of inducement – No offence of cheating made out [Paras 16–26].

Evidence – Admission of Complainant’s Witness – Effect – CW-3 admitted supplies were continued to preserve business relationship and not due to fraudulent representation – Such admission held fatal to prosecution case under Section 420 IPC – Inducement and deception not established [Paras 20–22, 47].

Director’s Criminal Liability – Absence of Vicarious Liability under IPC – Managing Director prosecuted after complaint against company dismissed due to striking off – IPC does not recognise vicarious liability unless statutorily provided – In absence of specific allegations of personal fraudulent intent, Director cannot be prosecuted solely for acts done on behalf of company [Paras 27–31, 36–40].

Company as Principal Accused – Effect of Dropping Proceedings Against Company – Complaint against company dismissed – Director acting only as agent of company – Held: Prosecution of Director alone unsustainable when company itself is not an accused and no independent criminality is alleged [Paras 28–33, 39–40].

Cheating vs Breach of Contract – Settled Principles – Assurance to pay in ordinary course of business does not amount to fraudulent inducement – Failure to honour promise due to financial distress or BIFR proceedings gives rise to civil liability only – Criminal law cannot be used as pressure tactic for recovery [Paras 23–25, 37–38].

Inherent Powers – Section 482 CrPC – Abuse of Process – Criminal proceedings initiated after invocation of civil remedies and during pendency of SICA proceedings – Held fit case for exercise of inherent jurisdiction to prevent abuse of process and secure ends of justice [Paras 42–49].

Decision: Petition allowed – Order on Charge dated 04/09/2018 passed by the Metropolitan Magistrate and Revisional Order dated 30/04/2019 passed by the Additional Sessions Judge quashed – Petitioner discharged from offence under Section 420 IPC – All pending applications disposed of.

Cheque Dishonour – Presumption under Sections 118 and 139 NI Act – Rebuttal by Accused – Standard of Proof – Accused admitted signature on cheque but set up defence that cheque was part of multiple cheques issued for chit transaction to a third party – Defence supported by reply notices and contemporaneous documents – Held: Accused need only raise a probable defence and not prove it beyond reasonable doubt – Presumption successfully rebutted on preponderance of probabilities [Paras 12, 15–19].

Cheque Dishonour – Financial Capacity of Complainant – Onus on Complainant – Complainant claimed cash loan of ₹5,00,000/- without documentary proof – Failure to disclose source of funds in statutory notice – Contradictory deposition regarding who sought the loan – Held: Once financial capacity is disputed, burden shifts back to complainant – Failure to prove capacity weakens prosecution case [Paras 7, 12, 19].

Evidence – Non-Examination of Material Witness – Adverse Inference – Transaction allegedly routed through intermediary (R. Venkateshappa) – Complainant admitted no difficulty in examining said person – Same counsel represented complainant and intermediary in connected proceedings – Held: Non-examination of crucial intermediary, despite defence specifically alleging misuse of cheque, is a material omission attracting adverse inference and probabilising defence [Paras 18–19].

Appreciation of Evidence – Perverse Findings – Courts below proceeded solely on admission of signature on cheque – Ignored contradictions in complainant’s testimony, reply notices and defence evidence – Held: Failure to consider entire material on record renders findings perverse and unsustainable in law [Paras 19–20].

Decision: Criminal Revision Petition allowed – Judgments of conviction and sentence dated 06.04.2016 and 17.04.2021 set aside – Petitioner/accused acquitted of offence under Section 138 NI Act – Bail and surety bonds discharged.

Criminal Law – Anticipatory Bail – Economic Offences – Petitioners sought anticipatory bail in FIR alleging cheating and criminal breach of trust in a housing redevelopment project – Petitioners, allegedly acting in concert, misrepresented ownership and control over two flats and induced complainant to invest Rs.1.91 crores – Despite MoUs and arbitral proceedings, FIR disclosed cognizable offences – Custodial interrogation held necessary in light of allegations of forged representations and financial misappropriation – Bail applications dismissed [Paras 1, 6, 7, 20-24]

Cheating – Misrepresentation of Ownership – Petitioners claimed to represent 11 flats before Arbitrator, though they owned only 9 – Two flats allegedly belonged to complainant, who was not party to arbitral proceedings – Petitioners knew complainant paid Rs.1.91 crores, but falsely recorded Rs. 40 lakhs – Allegations of deliberate misrepresentation found plausible at this stage [Paras 6, 15, 21]

Anticipatory Bail – Custodial Interrogation – Economic Offences – Supreme Court rulings relied upon to highlight seriousness of economic offences – Held: Custodial interrogation of petitioners necessary to trace money trail and examine alleged conspiracy – Protection under anticipatory bail would obstruct further investigation [Paras 22-23]

Civil vs Criminal Dispute – Petitioners argued dispute was civil and settlements were executed – Court held such documents do not negate FIR allegations at this stage – Matter involves serious allegations of inducement, fraud, and misuse of investor funds – Civil proceedings do not preclude parallel criminal liability [Paras 10-11, 21]

Decision: Anticipatory bail applications dismissed – Custodial interrogation held necessary in view of serious economic offences and prima facie material suggesting conspiracy, misrepresentation, and financial misappropriation – Observations in judgment confined to bail issue only [Paras 24-26]

Maintainability – Writ Appeal by Statutory Committee – Quasi-judicial authority not “aggrieved” – Admission Supervisory Committee constituted under Section 3 of Act 15 of 2017 passed orders withholding and cancelling admission under OBC category – Single Judge set aside Committee’s orders and declared student eligible – Committee filed writ appeal – Held: Committee’s functions under Section 8 are adjudicatory with Civil Court-like powers under Section 8(3) – Beneficiaries/adversely affected persons are third parties and not the adjudicator – Adjudicating authority cannot challenge superior court’s interference with its quasi-judicial orders – allowing such appeals would undermine judicial discipline and create anomalous situation of adjudicators routinely appealing adverse decisions – Writ appeal dismissed as not maintainable [Paras 1, 5, 9, 13, 17-18, 20].

Medical Education Admissions – Admission Supervisory Committee – Nature of powers – Section 8 Act 15 of 2017 – Committee’s role includes inquiry into complaints/suo motu action and recommendations including declaration of admissions invalid – powers of Civil Court while conducting inquiry – Held: such statutory scheme indicates adjudicatory and not ministerial character – Committee’s decisions under Section 8 operate as quasi-judicial orders [Paras 9, 13, 17].

Judicial Discipline – Adjudicating authority’s locus to litigate – Proper party vs aggrieved party – Committee was arrayed as respondent in writ petition challenging its orders – Held: mere impleadment does not create duty/right in adjudicator to defend its own decision through appeal – decision may be supported/challenged by persons benefited/adversely affected or by appropriate official respondents having duty to ensure fair admissions – Committee itself cannot be appellant against setting aside of its orders [Paras 18-19].

Statutory Appeal under Section 12 Act 15 of 2017 – Practical filing as writ petitions due to procedural vacuum – Court noted administrative history: nomenclature MFA(KME) introduced, but Division Bench earlier directed return of such appeals due to absence of rules on certified copy/court-fee etc – despite 2021 Rules, appeal procedure still not provided – hence writ petitions continue to be treated as maintainable against committee orders and are rostered to Single Bench under education subject codes – However, this does not confer appellate locus on Committee as adjudicator [Paras 14-16, 18].

Decision: Writ appeal dismissed as not maintainable [Para 20].

Civil Writ - Fair Price Shop – Misappropriation of Food Grains – Scope of Revision under Clause 24 – Respondent No.5 was found guilty by District Supply Officer (DSO) of misappropriating wheat (22.6 quintals), rice (11.36 quintals), and pulses, and violating other regulatory requirements – DSO passed order cancelling authorization and forfeiting security deposit – Revision before Deputy Commissioner dismissed, confirming findings of irregularity – Second revision allowed by Hon’ble Minister without recording finding on legality or propriety – Held: Minister exceeded revisional jurisdiction under Clause 24(1) by setting aside findings without examining their correctness – Matter remanded for reconsideration [Paras 3–5, 13–16]

Consumer Rights – Locus of Complainants – Preliminary objection raised that original complainants (ration cardholders) have no locus to challenge Minister’s order – Rejected – Held: Under Distribution Order, 1975, complainants have standing to challenge revisional orders unlike under Licensing Order, 1979 – Judgment in Shivaji Tulshiram Thakre followed – Supreme Court ruling in Vishvas not applicable as it related to Licensing Order [Paras 6–10]

Revisional Powers – Jurisdictional Error – Hon’ble Minister ordered fresh enquiry and reinstatement of authorization based on general statements from cardholders and respondent’s long-standing service – Held: Revisional authority must record findings on legality, propriety, or irregularity of prior orders – Failure to do so renders order unsustainable and beyond jurisdiction [Paras 14–16]

Subsequent Events – Fresh Enquiry – Respondent No.5 relied on post-order enquiry showing no current complaints – Held: Subsequent developments irrelevant where earlier findings of misappropriation were unaddressed by revisional authority – Fresh material not part of record and cannot justify flawed revisional order [Para 12]

Decision: Writ Petition partly allowed – Order dated 19/07/2021 passed by Hon’ble Minister quashed and set aside – Matter remanded to Hon’ble Minister to decide revision afresh after recording findings on allegations of misappropriation – Respondent No.5 to continue operating fair price shop unless otherwise barred – Revision to be decided preferably before 31/05/2026 [Para 17]

Industrial Disputes Act – Section 17B – Payment of Wages During Pendency of Writ – Respondent workman terminated in 2002 – Labour Court directed reinstatement with 50% back wages – Writ petition filed by employer, stay granted in 2007 – Workman filed application under Section 17B in 2018, claiming unemployment – Employer failed to rebut affidavit denying gainful employment – Held: Workman entitled to last drawn or minimum wages from date of application (07.05.2018) till date of superannuation in 2023 [Paras 1-3, 10-11, 15-19]

Delay – Effect on 17B Relief – Delay of 12 years in filing 17B application explained as due to financial hardship – Court declined retrospective relief but allowed limited relief from date of application till superannuation – No bar on relief under 17B merely on account of delay where unemployment established and not rebutted [Paras 5, 10, 18-19]

Employer's Burden – Rebutting Affidavit of Unemployment – Once workman filed affidavit of unemployment, burden shifted to employer to prove gainful employment – Mere assertions insufficient – No proof adduced by employer – Held: Workman entitled to protection under Section 17B [Paras 12-14, 16]

Scope of Court’s Power under Section 17B – Court must grant interim relief where statutory conditions are satisfied – Merits of main case not relevant at interim stage – Minimum wages can be awarded in place of last drawn wages in appropriate cases [Paras 17-18]

Decision: Application under Section 17B allowed in part – Respondent entitled to last drawn or minimum wages (whichever is higher) from 07.05.2018 till deemed superannuation in 2023 – Arrears to be paid within six weeks – Monthly payment to continue till 2023 as per direction – Writ petition to remain pending [Paras 19-21]

Labour Law – Gratuity – Limitation – Application filed after 2–3 years of retirement – Held: No limitation prescribed under the Payment of Gratuity Act, 1972 – Rules cannot override statutory right – Rule 7(5) of the Central Rules clarifies that delayed claims are not invalid – Delay does not defeat the right to gratuity under a beneficial social welfare legislation [Paras 8–10].

Principal Employer – Liability for Gratuity – Contractual Employment – Petitioners argued workers were contractor’s employees – Court held contracts were a camouflage as workers served continuously for over 20 years despite changing contractors – Principal employer liable to pay gratuity under Section 21(4) of Contract Labour (Regulation and Abolition) Act, 1970 – Right to recover from contractors preserved [Paras 13–16].

Wages – Definition – Gratuity Included – As per Section 2(vi)(d) of Payment of Wages Act, 1936, gratuity payable on termination of employment is part of "wages" – Hence, principal employer’s statutory obligation includes gratuity as wage component under applicable labour laws [Paras 17–18].

Interest on Delayed Gratuity – Held: Under Section 7(3A) of Payment of Gratuity Act, 1972, employer is liable to pay interest from date gratuity becomes payable (i.e., from date of retirement), not from date of application – Interest rightly awarded from date of superannuation till payment [Paras 21–22].

Constitutional Law – Article 300A – Gratuity as Property – Gratuity is a vested right and recognized as property under Article 300A of the Constitution – Cannot be denied except by authority of law – Delay or contractual arrangement cannot justify withholding payment [Paras 25–27].

Decision: Petitions dismissed – Orders of Controlling and Appellate Authorities upheld – Respondents entitled to withdraw deposited gratuity amounts and recover any deficit – Principal employer liable to pay and may recover from contractors where applicable.

Service Law – Compassionate Appointment – Pre-2015 Claims – Petitioner sought voluntary retirement on medical grounds in 2013, 14 years before superannuation, and applied for compassionate appointment of his physically disabled son – Claim rejected in 2017 on grounds that 2015 scheme was inapplicable to cases before 05.08.2014 and that no medical incapacitation certificate was submitted – Held: Petitioner’s application dated 09.04.2014 fell within Clause 24 of 2015 Scheme and had to be considered under Circulars of 2005 and 2007 – Circular dated 24.09.2007 provided for ex gratia payment in lieu of compassionate appointment for employees retiring before age 55 due to incapacitation – Bank erred in insisting on certification by medical board where scheme did not so require [Paras 4, 24–34, 36–37]

Ex Gratia Compensation – Eligibility under 2007 Circular – Employee voluntarily retired before 55 due to incapacitation and made timely application – Circular B(iii) of 24.09.2007 provides entitlement to ex gratia payment without need for medical board certification – Bank’s denial based on technicalities rejected – Petitioner's medical retirement accepted without objections, indicating implied recognition of incapacitation – Rejection of benefit arbitrary and unsustainable [Paras 25–33]

Policy Interpretation – Clause 24 of 2015 Scheme – Applications pending as on 04.08.2014 or made before that date must be dealt with under earlier circulars – Bank’s failure to apply Clause 24 and denial of relief under 2007 Circular was unjustified – Bank directed to process ex gratia compensation within 12 weeks [Paras 26, 36–38]

Compassionate Appointment – Financial Hardship – Bank’s argument that petitioner was receiving pension and retiral benefits not relevant – Held: Financial need not sole determinant – Purpose of compassionate appointment includes broader social obligation – Case law in Canara Bank v. M. Mahesh Kumar and Malaya Nanda Sethy applied [Paras 12–13, 35]

Decision: Writ Petition allowed – Impugned communication dated 16.01.2017 set aside – Respondent Bank directed to consider petitioner’s application for appointment of son on compassionate grounds and grant ex gratia compensation under Clause B(iii) of Circular dated 24.09.2007 – Payment to be processed within 12 weeks [Para 38]