Court declines to adjudicate search proceedings; advises petitioner to pursue remedy through Appellate Tribunal
In a significant development, the Madras High Court has directed petitioner Akash Baskaran to seek remedies from the Appellate Tribunal regarding the search and seizure proceedings conducted by the Directorate of Enforcement (ED) under the Prevention of Money-Laundering Act, 2002. The High Court, led by Chief Justice Sushrut Arvind Dharmadhikari and Justice G. Arul Murugan, found it unnecessary to delve into the legality and validity of the search proceedings at this juncture.
The case revolves around a search operation conducted by the ED on May 16, 2025, at Baskaran's premises. The search was part of an investigation into alleged money laundering activities linked to the Tamil Nadu State Marketing Corporation (TASMAC). Baskaran, who claims no affiliation with TASMAC, contested the search's legality, arguing a lack of compliance with Section 17 of the Prevention of Money-Laundering Act, which requires a "reason to believe" the involvement in money laundering.
During the proceedings, the court noted that similar issues had been raised in a connected writ petition by another individual, P.R. Rajesh Kumar, which had already been disposed of with directions to approach the Appellate Tribunal. The High Court reiterated this approach, emphasizing that the petitioner could raise all relevant issues before the Tribunal.
The court also addressed concerns regarding an interim order dated June 20, 2025, which had been in effect, preventing the ED from taking further action. The Additional Solicitor General assured the court that any notices issued by the Adjudicating Authority would be withdrawn, and proceedings would be conducted afresh in accordance with the law.
The judgment underscores the judiciary's stance on directing matters to specialized tribunals for detailed adjudication, allowing for a comprehensive examination of facts and legal arguments. This decision reflects the court's deference to the Appellate Tribunal's jurisdiction and expertise in handling complex money laundering cases.
As a result, the writ petition has been closed, and all interim orders vacated, paving the way for the petitioner to pursue available legal remedies before the Appellate Tribunal.
Bottom line:-
Search and seizure proceedings under the Prevention of Money-Laundering Act, 2002 - Court refused to adjudicate on the legality and validity of search proceedings and relegated the petitioner to approach the Appellate Tribunal, leaving all issues open to be raised before the Tribunal.
Statutory provision(s):
Prevention of Money-Laundering Act, 2002 Section 17, Constitution of India, 1950 Article 226
