Jharkhand High Court
M/S Gupta Traders vs State Through Enforcement Directorate on 27 February, 2026
Author: Sujit Narayan Prasad
Bench: Sujit Narayan Prasad
2026:JHHC:5999
IN THE HIGH COURT OF JHARKHAND AT RANCHI
-----
Cr. Revision No. 1075 of 2025
—–
M/s Gupta Traders, Sindhi Chowk, P.O., P.S. & District-
Dumka, Jharkhand, Pin No- 814101 through its authorized
representative Jogendra Tiwari, son of Shri Rameshwar
Tiwari, aged about 44 years, resident of Station Road, P.O.
& P.S. -Mihijam, District – Jamtara, (Jharkhand).
...... Petitioner
Versus
State through Enforcement Directorate, Ranchi through
Additional Director, having its Zonal Office at Plot No.
1502/B, Airport Road, Hinoo, P.O. Hinoo, P.S. Airport,
District Ranchi (Jharkhand).
… … Opposite Party
With
Cr. Revision No. 1120 of 2025
—–
M/s Maihar Hotels & Resorts Pvt. Ltd., Daburgram; P.O.,
P.S. & District- Deoghar, Jharkhand, Pin No-814112
through its authorized representative Jogendra Tiwari son of
Shri Rameshwar Tiwari, aged about 44 years, resident of –
Station Road, P.O. & P.S. Mihijam, District – Jamtara,
(Jharkhand). …… Petitioner
Versus
State through Enforcement Directorate, Ranchi through
Additional Director, having its Zonal Office at Plot No.
1502/B, Airport Road, Hinoo, P.O. Hinoo, P.S. Airport,
District Ranchi (Jharkhand). … … Opposite Party
With
Cr. Revision No. 1121 of 2025
—–
M/s Basukinath Traders, Near Hero Honda Showroom,
Dudhani, P.O., P.S. & District- Dumka, Jharkhand, Pin-
814101 through its authorized representative Jogendra
Tiwari son of Shri Rameshwar Tiwari, aged about 44 years,
resident of Station Road, P.O. & P.S. Mihijam, District
Jamtara, (Jharkhand). … … Petitioner
Versus
State through Enforcement Directorate, Ranchi through
Additional Director, having its Zonal Office at Plot No.
1502/B, Airport Road, Hinoo, P.O. Hinoo, P.S. Airport,
District Ranchi (Jharkhand). … … Opposite Party
With
Cr. Revision No. 1122 of 2025
—–
M/s Santhal Pargana Builders Pvt. Ltd Ist Floor, Plot No.
D/2, MIG, Harmu Housing Colony, P.O. Harmu, P.S. Argora,
Ranchi, Pin No. 834002 through its authorized
Page | 1
2026:JHHC:5999
representative Jogendra Tiwari, son of Shri Rameshwar
Tiwari, aged about 44 years, resident of Station Road, P.O.
& P.S. Mihijam, District Jamtara.
...... Petitioner
Versus
State through Enforcement Directorate, Ranchi through
Additional Director, having its Zonal Office at Plot No.
1502/B, Airport Road, Hinoo, P.O. Hinoo, P.S. Airport,
District Ranchi (Jharkhand).
… … Opposite Party
With
Cr. Revision No. 1126 of 2025
—–
M/s Prashant Traders, Gandhi Maidan, PO. & PS. Dumka,
District- Dumka, Jharkhand Pin No. 814101 through its
authorized representative Jogendra Tiwari, son of Shri
Rameshwar Tiwari, aged about 44 years, resident of Station
Road, P.O. & P.S. Mihijam, District Jamtara, (Jharkhand).
...... Petitioner
Versus
State through Enforcement Directorate, Ranchi through
Additional Director, having its Zonal Office at Plot No.
1502/B, Airport Road, Hinoo, P.O. Hinoo, P.S. Airport,
District Ranchi (Jharkhand).
… … Opposite Party
With
Cr. Revision No. 1127 of 2025
—–
M/s Baidynath Enterprises, Opposite Bus Stand Dumka
Road, P.O., P.S. & Dist.- Jamtara, Jharkhand- Pin No.
815354 through its authorized representative Jogendra
Tiwari son of Shri Rameshwar Tiwari, aged about 44 years,
resident of – Station Road, P.O. & P.S. Mihijam, District
Jamtara, (Jharkhand). … … Petitioner
Versus
State through Enforcement Directorate, Ranchi through
Additional Director, having its Zonal Office at Plot No.
1502/B, Airport Road, Hinoo, P.O. Hinoo, P.S. Airport,
District Ranchi (Jharkhand).
… … Opposite Party
With
Cr. Revision No. 1128 of 2025
—–
Jogendra Tiwari @ Yogendra Tiwari, son of Shri Rameshwar
Tiwari, aged about 43 years, resident of – Station Road, P.O.
& P.S. Mihijam, District – Jamtara, (Jharkhand).
...... Petitioner
Versus
State through Enforcement Directorate, Ranchi through
Additional Director, having its Zonal Office at Plot No.
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2026:JHHC:5999
1502/B, Airport Road, Hinoo, P.O. Hinoo, P.S. Airport,
District Ranchi (Jharkhand).
… … Opposite Party
With
Cr. Revision No. 1129 of 2025
—–
M/s Sanjit Hembram, Old Wine Shop, Chitranjan Road, P.O.
& P.S.- Mihijam, District-Jamtara, Jharkhand – 815354
through its authorized representative Jogendra Tiwari, aged
about 44 years, s/o Rameshwar Tiwari, resident of Station
road, P.O. & P.S. Mihijam, Dist. Jamtara.
...... Petitioner
Versus
State through Enforcement Directorate, Ranchi through
Additional Director, having its Zonal Office at Plot No.
1502/B, Airport Road, Hinoo, P.O. Hinoo, P.S. Airport,
District Ranchi (Jharkhand).
… … Opposite Party
With
Cr. Revision No. 1132 of 2025
—–
M/s Anand Traders, Dumka Road, P.O., P.S. & Dist.-
Jamtara, Jharkhand- Pin No. 814101 through its authorized
representative Jogendra Tiwari son of Shri Rameshwar
Tiwari, aged about 44 years, resident of Station Road, P.O.
& P.S. Mihijam, District – Jamtara, (Jharkhand).
...... Petitioner
Versus
State through Enforcement Directorate, Ranchi through
Additional Director, having its Zonal Office at Plot No.
1502/B, Airport Road, Hinoo, P.O. Hinoo, P.S. Airport,
District Ranchi (Jharkhand).
… … Opposite Party
With
Cr. Revision No. 1133 of 2025
—–
M/s Rajmahal Traders, Dudhani, P.O., P.S. & District-
Dumka, Jharkhand, Pin No- 814101 through its authorized
representative Jogendra Tiwari, son of Shri Rameshwar
Tiwari, aged about 44 years, resident of Station Road, P.O.
& P.S. Mihijam, District – Jamtara, (Jharkhand).
...... Petitioner
Versus
State through Enforcement Directorate, Ranchi through
Additional Director, having its Zonal Office at Plot No.
1502/B, Airport Road, Hinoo, P.O. Hinoo, P.S. Airport,
District Ranchi (Jharkhand).
… … Opposite Party
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2026:JHHC:5999
With
Cr. Revision No. 1134 of 2025
—–
M/s Saran Alcohol Pvt. Ltd., Gilanpara, PO+PS Dumka,
District- Dumka, Jharkhand, Pin No-814101 through its
authorized representative Jogendra Tiwari, son of Shri
Rameshwar Tiwari, aged about 44 years, resident of – Station
Road, P.O. & P.S. Mihijam, District – Jamtara, (Jharkhand).
...... Petitioner
Versus
State through Enforcement Directorate, Ranchi through
Additional Director, having its Zonal Office at Plot No.
1502/B, Airport Road, Hinoo, P.O. Hinoo, P.S. Airport,
District Ranchi (Jharkhand).
… … Opposite Party
——
CORAM: HON’BLE MR. JUSTICE SUJIT NARAYAN PRASAD
——-
For the Petitioners : Mr. Anshuman Sinha, Advocate
: Mr. Aditya Tiwari, Advocate
: Mr. Prakhar Prakash, Advocate
: Mr. Ankit Apurva, Advocate
For the Opp. Parties : Dr. (Mrs.) Vandana Singh, Advocate
: Ms. Neha Pandey, Advocate
: Ms. Khushbu, Advocate
——
C.A.V. on 04.02.2026 Pronounced on 27/02/2026
1. Since these matters are interlinked and, as such,
these are heard together and being disposed of by this
common order/judgment.
2. All these Criminal Revision petitions have been filed
under sections 438 & 442 of Bhartiya Nagarik Suraksha
Sanhita, 2023.
3. These Criminal Revision petitions are directed
against the order dated 21.08.2025 passed by the learned
Special Judge, PML Act, Ranchi in connection with ECIR
Case No. 08 of 2023 arising out of ECIR/RNZO/09/2022
registered for the offence under Sections 3 punishable under
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2026:JHHC:5999
Section 4 of the Prevention of Money Laundering Act, 2002
(in short PMLA,2002) whereby and whereunder, the
Miscellaneous Criminal Applications filed by the petitioner
seeking discharge, have been rejected.
Factual Matrix:
4. The brief facts of the case as per the pleadings made
in the instant petitions which requires to be enumerated
herein, read as under:
(i) The basis of present ECIR case is following 4 FIR [1.
Deoghar Town PS Case No. 342 of 2020 dated
11.07.2020 u/s.419/420/467/468/471/379/427/
120B/34 of the IPC (Land FIR), 2. Jasidih PS Case No
FIR No. 50 of 2020 dated 21.01.2020 u/s.
420/166/463/467/468/471/120B/34 IPC (Land FIR),
3. Margomunda PS Case No 27 of 2020 dated
16.07.2020 u/s. 420/379/120B IPC and section 4/21
of Jharkhand Mines Minerals (Development &
Regulation), 1957 and Section 54 of J.M.M. Grant Rules,
2004 [Sand FIR] and 4. Rikhiya PS Case No 01 of 2022
dated 01.01.2022 u/s. 272/273/467 IPC and section
47A of Jharkhand Excise Duty Act, 1915 (Liquor FIR)].
The details of above mentioned 4 FIR is as follows.
(ii) In short as per first FIR i.e. Deoghar Town PS Case
No. 342 of 2020 dated 11.07.2020 u/s.
419/420/467/468/471/379/427/120B/34 of the IPC
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2026:JHHC:5999
(Land FIR) is that informant Kiran Singh had purchased,
the land located in Deoghar, in Mouza- Shyamganj,
Mohalla- Castair’s Town popularly known as “Roy
Bangla” in the year 1998 and were in peaceful
possession of the same and had also been paying all the
taxes to the government against the said property since
1998 till the accused Jogendra Tiwari and others took
over the possession of the land by using illegal means,
demolished the old house situated thereon and
fraudulent sold of parts of the land. It also surfaced that
the petitioner also received proceeds of crime arising out
of such sale of property.
(iii) In short as per second FIR i.e. Jasidih PS Case
No FIR No. 50 of 2020 dated 21.01.2020 u/s.
420/166/463/467/468/471/120B/34 IPC (Land FIR)
is that the petitioner Jogendra Tiwari along with the
other accused persons hatched criminal conspiracy for
issuance and production of forged land possession
certificate (LPC) and deed for land measuring 27,413.25
square feet at Mouza Shyamaganj, thana no. 413, Plot
No. 775 and 776 District Deoghar. LPC of the aforesaid
land was sent by Amar Prasad vide email dt 16.01.2020
at 5.40P.M. to District Sub Registrar bearing letter no.
1024 dt. 03.07.2019. It is further pertinent to mention
here that Amar Prasad had already been transferred as
on 16.01.2020 and handed over his charge to Circle
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2026:JHHC:5999
Officer Anil Kumar Singh on 14.10.2019. On the basis
of said LPC land against which the complainant had
executed the agreement to sale dated 11.09.2019 was
registered in the name of (i) M/s. Saran Alcohal Pvt. Ltd.
and others and (ii) Brij Mohan Singh vide two deeds both
dated 17.01.2020.
(iv) In short as per third FIR i.e. Margomunda PS
Case No. 27 of 2020 dated 16.07.2020 u/s.
379/420/120B/34 of the IPC and section 4/21 of Mines
and Minerals (Development and Regulation) 1957 and
section 54 of Jharkhand Minor Mineral Grant Rules
2004 (sand FIR) registered against M/s. Saran Alcohal
Pvt. Ltd and others. It was found shortage of 11250
cubic feet sand at storage place in surprise check on
14.07.2020 and it is suspected that the above-
mentioned sand illegally transferred/sold resulting in
wrongful loss to exchequer.
(v) In short as per fourth FIR Rikhiya PS Case No.
01 of 2022 dated 01.01.2022 u/s. 272/273/467 of the
IPC and section 47 A of Jharkhand Excise Duty Act
1915, (Liquor FIR) is that on 01.01.2022 a Maruti Dzire
car bearing registration no. JH15W2850 was seized
along with cash Rs. 151400, two mobiles and liquors.
The driver Chandramani interrogated about the liquor.
He gave a receipt of M/s. Saran Alcohol Pvt. Ltd. As per
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2026:JHHC:5999
receipt the vehicle no. JH15G 4463 was allotted to carry
the liquor but he was smuggling the liquor in his own
vehicle. Amrendra Tiwari and Jogendra Tiwari are the
directors of M/s. Saran Alcohol Pvt. Ltd. It is suspected
that the said M/s. Saran Alcohol Pvt. Ltd is involved in
such illegal trading of liquor.
(vi) ED registered case no. ECIR/RNZ/09/2022 dt.
31.03.2022 on the basis of aforesaid FIR, as because
sections 419/420/467/471/120B of IPC are mentioned
as scheduled offense and Enforcement Directorate took
up the investigation. During the investigation
additionally 15 other FIR merged for the purpose of
investigation.
(vii) The searches were conducted by ED in the
present case on 23.08.2023 and 24.08.2023 at various
premises related to Jogendra Tiwari (petitioner in Cr.
Revision 1128 of 2025) and various incriminating
records have been seized as a result of the same. The
documents seized demonstrate that Jogendra Tiwari was
running the sand and liquor business in the name of
other individuals who were just named lenders or were
his employees/ associates, and the actual control of
these businesses was with Jogendra Tiwari.
(viii) Further, from the seized records and post-
search investigation, it is also revealed that Jogendra
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Tiwari was indeed receiving the difference between the
actual consideration and the consideration mentioned in
the sale deed against the sale of land at Roy Bangla in
cash. That Jogendra Tiwari is involved in various illegal
businesses, including (i) the illegal sale of sand without
challan through his entities and entities under his
control, which on paper belong to various other
individuals; (ii) illegal storage of liquor at the retail shops
which are under his control and the licenses for the said
retail shops are in the name of various other individuals.
From the above-mentioned illegal activities, some cases
also culminated into scheduled offence in certain
criminal cases. The Accused Jogendra Tiwari, has
amassed a huge amount of cash, and the said cash was
integrated by depositing the same in bank accounts of
his entities and entities/ individuals under his control,
and the same was subsequently utilized for paying the
license fee for the wholesale sale of liquor through his
entities in 2021 and acquired a huge amount from the
said businesses.
(ix) The records seized clearly show that Jogendra Tiwari
was running the business of sand and liquor in the name
of other individuals who were just name lenders or were
his employees/associates and the actual control of these
businesses was with Jogendra Tiwari.
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2026:JHHC:5999
(x) Through the aforesaid illegal activities which in some
cases culminated into scheduled offence in certain
criminal cases, the accused, Jogendra Tiwari has
amassed a huge amount of cash and the said cash was
integrated by depositing the same in bank accounts of
his entities and entities/individuals under his control,
and the same was subsequently utilized for paying the
license fee for the wholesale of liquor through his entities
in the year 2021 and acquired huge amount from the
said businesses.
(xi) It is established from the seized documents and
digital evidences that Jogendra Tiwari conducted
business in the name of other individuals although he is
the beneficial owner of the said business.
(xii) Thus, the Accused/ Applicant as per the
prosecution complaint has handled the alleged proceeds
of crime amounting to Rs 13,29,92,620/- earned illegally
from land, sand and liquor and thereby committed an
offence under PMLA.
(xiii) The Prosecution Complaint (PC) bearing ECIR
Case No. 08/2023 was filed on 16.12.2023 before the Ld.
Special Judge (PMLA), Ranchi against the prime accused
Jogendra Tiwari and 11 associated entities ie. Petitioners
herein.
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2026:JHHC:5999
(xiv) The Learned Special Court (PMLA), Ranchi,
after due consideration, took cognizance of the offence
on 22.12.2023.
(xv) Thereafter separate discharge petitions were
filed by the present Petitioners before the Learned
Special Judge (PMLA), Ranchi. The Learned Special
Judge (PMLA), after hearing the parties at length and
perusing the voluminous records, has opined that a case
is made out against the Petitioners.
(xvi) Accordingly, the Petitioners’ discharge
applications were rejected vide order(s) dated
21.08.2025.
(xvii) These instant revision applications have been
preferred against the said order dated 21.08.2025.
Arguments advanced on behalf of the petitioner:
5. Learned counsel for the petitioner has taken the
following grounds in assailing the impugned orders:
(i) Learned counsel appearing on behalf of
petitioner has submitted that the Learned Special
Judge erred in rejecting the discharge application
without appreciating that prosecution under the
Prevention of Money Laundering Act, 2002 (“PMLA”)
cannot survive independently in the absence of a live
and subsisting scheduled offence. It is settled law that
the existence of a scheduled offence under Section
Page | 11
2026:JHHC:59992(1)(y) of the PMLA is the sine qua non for the
registration and continuation of proceedings under
Section 3 read with Section 4 of the PMLA. The Hon’ble
Supreme Court in Vijay Madanlal Choudhary v.
Union of India, (2023) 12 SCC 1, has unequivocally
held that where the predicate offence ceases to exist,
either by way of acquittal, quashing, or final form
without cognizance, the very basis for prosecution
under PMLA also extinguishes. In the present case, the
scheduled offences forming the foundation of ECIR No.
08/2023 have either been quashed, closed, or
culminated in acquittals, rendering the proceedings
under PMLA wholly unsustainable in law.
(ii) The Learned Special Judge failed to appreciate
that the quantified proceeds of crime (“POC”) as alleged
by the Enforcement Directorate in its Section 45
complaint amount to Rs. 13,29,92,620/-, out of which
the portion attributed to liquor-related transactions, is
factually misconceived. As per the ED’s own
prosecution complaint, none of the FIRs pertaining to
liquor, including Rikhiya P.S. Case No. 01/2022 form
part of the quantified proceeds of crime. Moreover, all
liquor-related FIRs have either been quashed or have
not proceeded to cognizance. Thus, even assuming the
ED’s case to be true in entirety, the liquor-based POC
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2026:JHHC:5999
does not legally exist and has been wrongly relied upon
in the impugned order.
(iii) It has further been submitted that the
remaining alleged proceeds of crime, particularly Rs.
5.62 crore linked to the Roy Bangla land transaction
are derived from Deoghar Town P.S. Case No.
342/2020 and Jasidih P.S. Case No. 50/2020, both of
which have been concluded by way of final report
submissions by the jurisdictional police. In these cases,
no cognizance has been taken by any court, and only
protest petitions are pending. Therefore, even these
land-linked transactions do not qualify as proceeds of
crime within the meaning of Section 2(1)(u) of the
PMLA.
(iv) Learned counsel has submitted that because
multiple other FIRs relied upon by the Enforcement
Directorate for alleging illegal sand sale or stock
discrepancy, including Margomunda P.S. Case No.
27/2020 which have either been quashed by the
Hon’ble High Court, led to acquittals, or remanded
without cognizance being taken. Accordingly, there
exists no surviving predicate offence from which any
proceeds of crime can be said to have originated. The
legal substratum for initiating or continuing
prosecution under the PMLA is thus wholly absent.
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2026:JHHC:5999
(v) It has been submitted that the impugned order
merely reproduces the allegations from the complaint
and assumes their truth without applying the settled
legal standard for discharge under Section 227 CrPC.
The Hon’ble Supreme Court in State by Karnataka
Lokayukta v. M.R. Hiremath, (2019) 7 SCC 515 and
P. Vijayan v. State of Kerala and Another, (2010) 2
SCC 398, has categorically held that discharge must
be granted where the material on record raises mere
suspicion and not grave suspicion. The Trial Court has
thus abdicated its duty to filter out untenable
prosecutions at the stage of discharge.
(vi) Learned counsel for the petitioners has
submitted that the invocation of the presumption
under Section 24 of the PMLA at the discharge stage is
premature and contrary to law.
(vii) It has further been submitted that the
attribution of criminal liability to the Petitioner
company solely on account of its being managed by Mr.
Jogendra Tiwari is contrary to settled legal principles
governing corporate criminal liability. In Sunil Bharti
Mittal v. CBI, (2015) 4 SCC 609 and GHCL
Employees Stock Option Trust v. India Infoline
Ltd., (2013) 4 SCC 505, the Hon’ble Supreme Court
held that vicarious liability is not attracted in criminal
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2026:JHHC:5999
law unless there is specific statutory provision and
direct evidence of mens rea on the part of the company.
In the absence of any overt act attributable to the
Petitioner, its prosecution is wholly untenable.
(viii) Learned counsel has submitted that the
allegations made by the ED pertain to regulatory
irregularities such as stock misreporting, delayed fee
payments, or challan discrepancies. These may at best
constitute breaches of administrative norms but cannot
amount to scheduled offences under the PMLA. In
Pankaj Bansal v. Union of India and Others, 2023
SCC OnLine SC 1244, the Supreme Court cautioned
against over-criminalization of regulatory infractions.
(ix) It has further been submitted that the rejection
order relies on a mechanical and erroneous approach
that “all issues must be gone into at trial,” thereby
circumventing the judicial duty to scrutinize the
complaint at the discharge stage. In Union of India v.
Prafulla Kumar Samal and Another, (1979) 3 SCC
4, it was held that a Court must undertake a careful
assessment of the material to see if the ingredients of
the offence are made out before putting the accused to
the rigours of trial.
(x) Learned counsel for the petitioners has
submitted that even assuming that some predicate
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2026:JHHC:5999
offences remain technically pending, the ED has failed
to demonstrate the essential ingredients of money
laundering as defined under Section 3 of the PMLA.
There is no evidence of the property being derived from
a scheduled offence or projected as untainted. In
Parvathi Kollur and Anr. v. State by Directorate of
Enforcement, 2022 SCC OnLine SC 1975, the
Supreme Court reiterated that such causal linkage is
mandatory.
(xi) It has been submitted that the Hon’ble Calcutta
High Court in Nik Nish Retail Ltd. v. ED, 2022 SCC
OnLine Cal 4044, relying on Vijay Madanlal (Supra),
held that once the FIR constituting the scheduled
offence is quashed, the ECIR and consequential
proceedings under PMLA cannot survive.
(xii) Learned counsel for the petitioners has
submitted that the Hon’ble Delhi High Court in Harish
Fabiani and Others v. ED and Others, 2022 SCC
OnLine Del 3121, also quashed PMLA proceedings
upon quashing of the predicate offence by the Bombay
High Court, confirming that ED proceedings cannot
survive in vacuum.
(xiii) It has been submitted that the Hon’ble Supreme
Court in State of Punjab v. Davinder Pal Singh
Bhullar and Others, (2011) 14 SCC 770, affirmed the
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2026:JHHC:5999
principle that where the foundation is removed, the
entire superstructure must fall. The scheduled offences
having been quashed or closed, the ECIR and
prosecution complaint lose legal efficacy.
(xiv) It has also been submitted that allowing the
prosecution to continue under the PMLA without any
subsisting scheduled offence or credible material to
support the alleged proceeds of crime would amount to
a colorable exercise of jurisdiction, and would render
the criminal justice process itself a punishment in
violation of Article 21 of the Constitution of India.
(xv) It has further been submitted that continuation
of proceedings in such circumstances offends the
principles of legality, proportionality, and fairness and
amounts to gross abuse of the process of law, liable to
be interdicted in exercise of revisional jurisdiction of
this Hon’ble Court.
(xvi) Learned counsel has submitted that it is clear
from the above-mentioned facts that there are no
proceeds of crime in terms of Section 2 (1) (u) of PMLA.
In terms of the absence of Proceeds of Crime in terms
of Section 2 (1) (u) of PMLA, there cannot be any Money
Laundering.
(xvii) Learned counsel for the petitioners has
submitted that on the basis of above-mentioned judicial
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2026:JHHC:5999
pronouncements, it can safely be said that an accused
is entitled for discharge, if the evidence which the
prosecution proposes to adduce for proving his guilt,
even if fully accepted, cannot show that the accused
has committed the offence, then there will be no
sufficient ground for proceeding with the trial.
6. Learned counsel for the petitioners, on the aforesaid
grounds, has submitted that it is, therefore, a fit case where
the impugned orders need to be interfered with.
Arguments advanced on behalf of the Opposite
Party/Respondent:
7. While on the other hand, Mrs. Vandana Singh,
learned counsel for the opposite party has vehemently
opposed the prayer of the petitioner and submitted that till
date several predicate offences registered and pending
against the petitioners, it has been established that the
petitioner is involved in various illegal businesses including
the illegal sale of sand without challan through his entities
and entities under his control which on paper belong to
various other individuals, illegal storage of liquor at the retail
shops which are under his control and the licenses for the
said retail shops are in the name of various other individuals.
8. She has further submitted that during the
investigation of the instant case, it surfaced that the accused
petitioner was involved directly / indirectly in the activities
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2026:JHHC:5999
related to money laundering; it was also found that Jogendra
Tiwari had concealed crucial information as it is established
from the seized documents and digital devices, he runs
business in the name of other individuals. However, he is the
beneficial owner of the said businesses.
9. Further, it is found during investigation that the
present accused has amassed an enormous amount of cash,
and the said cash was integrated by depositing the same in
bank accounts of his entities and entities/ individuals under
his control, and the same was subsequently utilized for
paying the license fee for the wholesale sale of liquor through
his entities in the year 2021 and acquired huge amount from
the said businesses.
10. The admission by Petitioner M/s Gupta Traders in its
petition that it received Rs. 1,67,50,000/-as a loan from M/s
Saran Alcohol Pvt. Ltd. is inherently incriminating as the
M/s Saran Alcohol Pvt. Ltd. is neither a Non-Banking
Financial Company (NBFC) nor a bank authorized to
disburse commercial loans. It is the primary accused entity
named in three active predicate FIRs for land fraud, illegal
sand mining, and liquor smuggling.
11. Learned counsel has submitted that receiving such a
massive sum from a criminally implicated entity, especially
when the recipient (Gupta Traders) had a negligible cash-in-
hand, constitutes grave suspicion of knowing involvement in
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2026:JHHC:5999
the process of laundering. This was not a business
transaction but a transfer of tainted capital to a vehicle used
for integration.
12. She has further submitted that similarly, the
Petitioners’ argument that the massive cash deposits were
“business turnover” is contradicted by the timing and
quantum of the funds. The investigation revealed a sudden,
synchronized infusion of cash into the accounts of all 12
Petitioners in June and July 2021, a period that coincides
perfectly with the government notification inviting
applications for wholesale liquor licenses.
13. Learned counsel has submitted that entities like M/s
Anand Traders received Rs. 34.70 Lakhs and M/s Mishra
Wines received Rs. 50.47 Lakhs in cash deposits during this
short window, which was an 1145.87% increase over their
previous year’s deposits. The Petitioners have failed to
provide any credible source or business rationale for this
sudden cash windfall. The quantum of cash deposited in
June 2021 was disproportionate to any historical business
turnover declared by these entities in previous assessment
years.
14. It has been submitted that whether these were
genuine business transactions or a sophisticated laundering
operation is a question of fact that can only be determined
by the Trial Court after appreciating the evidence at stage of
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2026:JHHC:5999
trial. Accepting the Petitioners’ self-serving audited books at
the discharge stage would amount to conducting a mini-trial,
which is impermissible in law.
15. It has further been submitted that the contentions
raised by the Petitioners regarding the “premature”
invocation of Section 24 of the PMLA are legally untenable in
context of the statutory scheme of the Act therefore, the Ld.
Special Judge, in the impugned order, has correctly and
lawfully held that the presumption under Section 24 is
mandatory and has been triggered at this stage.
16. It has been submitted that Section 24 of the PMLA
imposes a reverse burden of proof on the accused. The law
mandates that once the prosecution establishes the
“foundational facts” regarding the commission of a
scheduled offence and the generation of proceeds of crime,
the Ld. Court “shall presume” that the proceeds of crime are
involved in money laundering.
17. It has been submitted that the prosecution has
meticulously quantified the Proceeds of Crime at Rs.
5,66,34,500/-, derived specifically from the criminal
activities alleged in these active FIRS (Land Fraud and Sand
Theft), and further the investigation has established a direct
financial trail showing the flow of illicit cash into the bank
accounts of the 12 Petitioner entities and its subsequent use
for acquiring Liquor Licenses.
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2026:JHHC:5999
18. It has further been submitted that once these facts
are established the legal presumption under Section 24
stands invoked. The burden then shifts entirely onto the
Petitioners to prove that the property is untainted.
19. Learned counsel for the ED has submitted that in the
instant case, the Ld. Special Judge has passed a detailed,
reasoned, and speaking order dated 21.08.2025. The Ld.
Judge has meticulously considered the material on record,
including the existence of four active and pending predicate
FIRs; the specific money trail in crores being layered into the
Petitioners’ accounts; and the admissions of the accused
such as M/s Gupta Traders admitting in its Petition the
receipt of funds from M/s Saran Alcohol. The order correctly
identifies that these materials raise a grave suspicion against
the Petitioners.
20. Therefore, the Petitioners’ defenses regarding the
legitimacy of loans, the nature of land disputes, or the
interpretation of financial entries are triable issues that can
only be adjudicated after leading evidence during trial. Any
interference by this Hon’ble Court at this stage would
amount to usurping the jurisdiction of the Ld. Trial Court
and stifling a legitimate prosecution at its threshold. The
order correctly identifies that these materials raise a grave
suspicion against the Petitioners.
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2026:JHHC:5999
21. Learned counsel has further submitted that in the
light of the above, the points raised in the Criminal Revision
Petition are devoid of merit, as the Learned Special Court has
correctly appreciated the existence of a prima facie case
against the Petitioners. The Hon’ble Special Court has
already determined that there is enough material to proceed,
and the arguments regarding the appreciation of evidence
are triable issues that cannot be adjudicated at this stage.
The trial must now proceed to allow for a thorough
examination of the evidence presented by the prosecution.
22. On the basis of above submission, learned counsel
has submitted that the present Petitions filed by the
Petitioner, seeking to set aside the order dated 21.08.2025
passed in connection with ECIR Case No. 08 of 2023 arising
out of ECIR/RNZO/09/2022 by the Ld. Special Judge, PMLA
Ranchi, should be dismissed. The detailed reasoning
provided in the said order clearly demonstrates that the
discharge application filed by the Petitioner was devoid of
merit. Consequently, the present petition should be rejected,
and the order dated 21.08.2025 passed by the Special Court
required no interference.
Analysis:
23. This Court has heard the learned counsel for the
parties at length and has also gone through the finding
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recorded by the learned trial Court in the impugned order as
also the prosecution complaint.
24. In order to appreciate the contention of the learned
counsel for the parties this Court has gone through the
entire material available on record.
25. It is evident from record that the prosecution in the
present case was initiated based on the registration of ECIR
Case No. 08 of 2023 arising out of ECIR/RNZO/09/2022
registered by the Respondent (ED) under provisions of the
PMLA. The said ECIR Case No. 08 of 2023 arises out of four
FIR (FIR Nos. 342/2020, 50/2020, 27/2020, and 01/2022)
registered by the different police station. FIR 342/2020 is
related to fraudulently acquiring the ‘Roy Bungalow’ land,
FIR 27/2020 related to illegal sale of sand while acting as
the Mine Developer & Operator, FIR 01/2022 for liquor
smuggling and FIR 50/2020 is related to production of
forged Land Possession Certificate (LPC).
26. The investigation by the directorate further revealed
the existence of a strong criminal syndicate operating with
the singular objective of generating illicit wealth through
organized criminal activities-specifically illegal sand mining,
fraudulent land grabbing, and illicit liquor trade. It is
ascertained that Jogendra Tiwari acted as the “Beneficial
Owner” of the Petitioner entities, controlling their financial
Page | 24
2026:JHHC:5999
operations to launder the Proceeds of Crime (POC) generated
from these activities.
27. Regarding the Generation of Proceeds of Crime via
Land Fraud (“Roy Bungalow” Case), the investigation
revealed that the syndicate targeted a prime property in
Deoghar (FIR Nos. 342/2020 & 50/2020). They forcefully
grabbed the land, demolished existing structures, and
created forged documents to fraudulently transfer the title.
It is established that the syndicate sold parcels of this land
to various buyers by coercing them to pay a significant
portion of the consideration in cash, over and above the
value declared in the registered sale deeds.
28. Regarding the Illegal Sand Mining Scam, the
investigation unearthed a massive racket of theft of natural
resources. Specifically, in Margomunda P.S. Case No.
27/2020, it was revealed that M/s Saran Alcohol Pvt. Ltd.,
appointed as the Mine Developer and Operator (MDO),
engaged in the surreptitious removal and sale of sand.
29. Regarding the Illegal Liquor Trade, investigation into
FIR No. 01/2022 (Rikhiya P.S.) and other FIR Nos. 13/2020,
33/2020 disclosed that the syndicate utilized fraudulent
invoices of M/s Saran Alcohol Pvt. Ltd. to provide a cover for
the illegal transport of liquor. Further it has come in the
investigation that financial analysis of the 12 Petitioner
entities revealed a synchronized and unexplained 1145.87%
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2026:JHHC:5999
increase in cash deposits in the year 2021 (specifically June-
July) compared to the previous year. A total of Rs.
6,26,20,930/- was infused into the bank accounts of the
Petitioners during this period.
30. The investigation further revealed specific instances
of Layering through sham loans and M/s Saran Alcohol,
being a named accused in three predicate FIRs, acted as the
fountainhead of tainted funds, and this transfer was a
calculated move to layer POC before integration.
31. Based on the material evidence collected, a
Prosecution Complaint was filed on 16.12.2023 vide ECIR
Case No. 08/2023. Subsequently, the Ld. Special Judge
(PMLA), Ranchi, upon perusal of the evidence including the
active predicate FIRs and the specific money trail, rejected
the discharge petitions of the accused (petitioners herein)
vide order dated 21.08.2025, holding that a strong prima
facie case made out against the Petitioners and against the
said order(s) dated 21.08.2025 these revision petition has
been preferred.
32. Now this Court is adverting to the contentions of the
learned counsel for parties wherein it has been contended by
the learned counsel for the petitioners that prosecution
under the Prevention of Money Laundering Act, 2002
(“PMLA”) cannot survive independently in the absence of a
live and subsisting scheduled offence. In the present case,
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2026:JHHC:5999
the scheduled offences forming the foundation of ECIR No.
08/2023 have either been quashed, closed, or culminated in
acquittals, rendering the proceedings under PMLA wholly
unsustainable in law. It has further been contended that all
liquor-related FIRs have either been quashed or have not
proceeded to cognizance. Thus, even assuming the ED’s case
to be true in entirety, the liquor-based Proceed of crime does
not legally exist and has been wrongly relied upon in the
impugned order. It has further been contended that the
remaining alleged proceeds of crime, linked to the Roy
Bangla land transaction are derived from Deoghar Town P.S.
Case No. 342/2020 and Jasidih P.S. Case No. 50/2020, both
of which have been concluded by way of final report
submissions by the police. In these cases, no cognizance has
been taken by any court, and only protest petitions are
pending. Therefore, even these land-linked transactions do
not qualify as proceeds of crime within the meaning of
Section 2(1)(u) of the PMLA. Accordingly, on the basis of the
aforesaid it has been submitted that there is no surviving
predicate offence from which any proceeds of crime can be
said to have originated, thus the legal substratum for
initiating or continuing prosecution under the PMLA is thus
wholly absent.
33. Per contra, the learned counsel for the respondent
has contended that till date several predicate offences
registered and pending against the petitioners, it has been
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2026:JHHC:5999
established that the petitioner is involved in various illegal
businesses including the illegal sale of sand without challan
through his entities and entities under his control which on
paper belong to various other individuals, illegal storage of
liquor at the retail shops which are under his control and the
licenses for the said retail shops are in the name of various
other individuals.
34. It has further been contended that learned Special
Court has meticulously considered the material on record,
including the existence of four active and pending predicate
FIRs; the specific money trail of Rs. 6.26 Crores being layered
into the Petitioners’ accounts; and the admissions of the
accused such as M/s Gupta Traders admitting in its Petition
the receipt of funds from M/s Saran Alcohol.
35. Referring the aforesaid fact the learned counsel for
the respondent/ED has contended that the Petitioners’
defenses regarding the legitimacy of loans, the nature of land
disputes, or the interpretation of financial entries are triable
issues that can only be adjudicated after leading evidence
and any interference by this Hon’ble Court at this stage
would amount to usurping the jurisdiction of the Trial Court
and stifling a legitimate prosecution at its threshold.
36. In the background of the factual aspect stated
hereinabove and taking into consideration the contention of
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the learned counsel for the parties, the issues which require
consideration are–
(i) Whether the order(s) dated 21.08.2025 by which the
application for discharge filed by the petitioners have
been dismissed, can be said to suffer from an error?
(ii) Whether on the basis of the evidence which has been
collected in course of investigation, prima facie case
against the petitioners is made out or not?
37. Since both the issues are interlinked as such, they
are taken up together.
38. This Court, before appreciating the aforesaid issues,
deems it fit and proper to discuss herein some of the
provisions of law as contained under the Act, 2002 with its
object and intent.
39. The Act 2002 was enacted to address the urgent need
to have a comprehensive legislation inter alia for preventing
money-laundering, attachment of proceeds of crime,
adjudication and confiscation thereof including vesting of it
in the Central Government, setting up of agencies and
mechanisms for coordinating measures for combating
money-laundering and also to prosecute the persons
indulging in the process or activity connected with the
proceeds of crime.
40. It is, thus, evident that Act 2002 was enacted in order
to answer the urgent requirement to have a comprehensive
legislation inter alia for preventing money-laundering,
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attachment of proceeds of crime, adjudication and
confiscation thereof for combating money-laundering and
also to prosecute the persons indulging in the process or
activity connected with the proceeds of crime.
41. It needs to refer herein the definition of “proceeds of
crime” as provided under Section 2(1)(u) of the Act, 2002
which reads as under:
“2 (1) (u) “proceeds of crime” means any property derived
or obtained, directly or indirectly, by any person as a result
of criminal activity relating to a scheduled offence or the
value of any such property or where such property is taken
or held outside the country, then the property equivalent in
value held within the country or abroad; [Explanation.–For
the removal of doubts, it is hereby clarified that “proceeds
of crime” include property not only derived or obtained from
the scheduled offence but also any property which may
directly or indirectly be derived or obtained as a result of
any criminal activity relatable to the scheduled offence;]”
42. It is evident from the aforesaid provision that
“proceeds of crime” means any property derived or obtained,
directly or indirectly, by any person as a result of criminal
activity relating to a scheduled offence or the value of any
such property or where such property is taken or held
outside the country, then the property equivalent in value
held within the country or abroad.
43. In the explanation it has been referred that for
removal of doubts, it is hereby clarified that “proceeds of
crime” include property not only derived or obtained from the
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2026:JHHC:5999
scheduled offence but also any property which may directly
or indirectly be derived or obtained as a result of any criminal
activity relatable to the scheduled offence. The aforesaid
explanation has been inserted in the statute book by way of
Act 23 of 2019.
44. It is, thus, evident that the reason for giving
explanation under Section 2(1)(u) is by way of clarification to
the effect that whether as per the substantive provision of
Section 2(1)(u), the property derived or obtained, directly or
indirectly, by any person as a result of criminal activity
relating to a scheduled offence or the value of any such
property or where such property is taken or held outside the
country but by way of explanation the proceeds of crime has
been given broader implication by including property not
only derived or obtained from the scheduled offence but also
any property which may directly or indirectly be derived or
obtained as a result of any criminal activity relatable to the
scheduled offence.
45. The “property” has been defined under Section 2(1)(v)
which means any property or assets of every description,
whether corporeal or incorporeal, movable or immovable,
tangible or intangible and includes deeds and instruments
evidencing title to, or interest in, such property or assets,
wherever located.
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46. The schedule has been defined under Section 2(1)(x)
which means schedule to the Prevention of Money
Laundering Act, 2002. The “scheduled offence” has been
defined under Section 2(1)(y) which reads as under:
“2(y) “scheduled offence” means– (i) the offences specified
under Part A of the Schedule; or (ii) the offences specified
under Part B of the Schedule if the total value involved in
such offences is [one crore rupees] or more; or (iii) the
offences specified under Part C of the Schedule.”
47. It is evident that the “scheduled offence” means the
offences specified under Part A of the Schedule; or the
offences specified under Part B of the Schedule if the total
value involved in such offences is [one crore rupees] or more;
or the offences specified under Part C of the Schedule.
48. The offence of money laundering has been defined
under Section 3 of the Act, 2002 which reads as under:
“3. Offence of money-laundering.–Whosoever directly or
indirectly attempts to indulge or knowingly assists or
knowingly is a party or is actually involved in any process
or activity connected with the [proceeds of crime including
its concealment, possession, acquisition or use and
projecting or claiming] it as untainted property shall be
guilty of offence of money-laundering. [Explanation.– For
the removal of doubts, it is hereby clarified that,– (i) a
person shall be guilty of offence of money-laundering if such
person is found to have directly or indirectly attempted to
indulge or knowingly assisted or knowingly is a party or is
actually involved in one or more of the following processes
or activities connected with proceeds of crime, namely:– (a)
concealment; or (b) possession; or (c) acquisition; or (d) use;
or (e) projecting as untainted property; or (f) claiming as
untainted property, in any manner whatsoever; (ii) the
process or activity connected with proceeds of crime is aPage | 32
2026:JHHC:5999continuing activity and continues till such time a person is
directly or indirectly enjoying the proceeds of crime by its
concealment or possession or acquisition or use or projecting
it as untainted property or claiming it as untainted property
in any manner whatsoever.]”
49. It is evident from the aforesaid provision that “offence
of money-laundering” means whosoever directly or indirectly
attempts to indulge or knowingly assists or knowingly is a
party or is actually involved in any process or activity
connected with the proceeds of crime including its
concealment, possession, acquisition or use and projecting
or claiming it as untainted property shall be guilty of offence
of money-laundering.
50. It is further evident that the process or activity
connected with proceeds of crime is a continuing activity and
continues till such time a person is directly or indirectly
enjoying the proceeds of crime by its concealment or
possession or acquisition or use or projecting it as untainted
property or claiming it as untainted property in any manner
whatsoever.
51. The punishment for money laundering has been
provided under Section 4 of the Act, 2002.
52. The various provisions of the Act, 2002 alongwith
interpretation of the definition of “proceeds of crime” has
been dealt with by the Hon’ble Apex Court in the case of
Vijay Madanlal Choudhary and Ors. Vs. Union of India
and Ors. (Supra) wherein the Bench comprising of three
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Hon’ble Judges of the Hon’ble Supreme Court has decided
the issue by taking into consideration the object and intent
of the Act, 2002.
53. It is evident that the purposes and objects of the 2002
Act for which it has been enacted, is not limited to
punishment for offence of money-laundering, but also to
provide measures for prevention of money-laundering. It is
also to provide for attachment of proceeds of crime, which
are likely to be concealed, transferred or dealt with in any
manner which may result in frustrating any proceeding
relating to confiscation of such proceeds under the 2002 Act.
This Act is also to compel the banking companies, financial
institutions and intermediaries to maintain records of the
transactions, to furnish information of such transactions
within the prescribed time in terms of Chapter IV of the 2002
Act.
54. The predicate offence has been considered in the
aforesaid judgment wherein by taking into consideration the
explanation as inserted by way of Act 23 of 2019 under the
definition of the “proceeds of crime” as contained under
Section 2(1)(u), whereby and whereunder, it has been
clarified for the purpose of removal of doubts that, the
“proceeds of crime” include property not only derived or
obtained from the scheduled offence but also any property
which may directly or indirectly be derived or obtained as a
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2026:JHHC:5999
result of any criminal activity relatable to the scheduled
offence, meaning thereby, the words “any property which
may directly or indirectly be derived or obtained as a result
of any criminal activity relatable to the scheduled offence”
will come under the fold of the proceeds of crime.
55. In the judgment rendered by the Hon’ble Apex Court
in Vijay Madanlal Choudhary and Ors. Vs. Union of India
and Ors. (supra) it has been held that the Authority under
the 2002 Act, is to prosecute a person for offence of money-
laundering only if it has reason to believe, which is required
to be recorded in writing that the person is in possession of
“proceeds of crime”. Only if that belief is further supported
by tangible and credible evidence indicative of involvement
of the person concerned in any process or activity connected
with the proceeds of crime, action under the Act can be taken
forward for attachment and confiscation of proceeds of crime
and until vesting thereof in the Central Government, such
process initiated would be a standalone process.
56. Now, after having discussed the judgments passed by
the Hon’ble Apex Court on the issue of various provisions of
the Act, 2002, this Court, is proceeding to discuss the
principle governing discharge.
57. Section 250 of Bharatiya Nagarik Suraksha Sanhita,
2023 (‘BNSS’ for brevity) provides for discharge in sessions
cases. It reads as follows:
Page | 35
2026:JHHC:5999“250.Discharge (1) The accused may prefer an
application for discharge within a period of sixty days
from the date of commitment of the case under section
232 (BNSS). (2) If, upon consideration of the record of the
case and the documents submitted therewith, and after
hearing the submissions of the accused and the
prosecution in this behalf, the Judge considers that there
is not sufficient ground for proceeding against the
accused, he shall discharge the accused and record his
reasons for doing so.”
58. Section 227 of Code of Criminal Procedure (‘CrPC‘ for
brevity) contemplates discharge by the Court of Session. The
trial Judge is required to discharge the accused if the Judge
considers that there is no sufficient ground for proceeding
against the accused. Section 250(2) BNSS corresponds to
section 227 CrPC. Section 250(1) BNSS stipulates a time
limit of 60 days from the date of committal of the case within
which an application for discharge should be filed by the
accused.
59. Section 239 CrPC provides for discharge of accused
in warrant cases instituted upon a police report. The power
under section 239 Cr.P.C. is exercisable when Magistrate
considers the charge against the accused to be groundless.
Section 262(2) BNSS is similar to section 239 CrPC but
section 262 BNSS provides an opportunity to the learned
Magistrate to examine the accused either physically or
through audio – video electronic means. Section 262(1) BNSS
stipulates a time limit of 60 days from the date of supply of
documents under section 230 BNSS within which an
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2026:JHHC:5999
application should for discharge should be filed by the
accused.
60. Section 245 Cr.P.C. deals with warrant cases
instituted otherwise than on a police report. Section 245
CrPC corresponds t.o section 268 of BNSS. The power under
section 245 (1) Cr.P.C. is exercisable when the Magistrate
considers that no case against the accused has been made
out which, if unrebutted would warrant his conviction. The
Magistrate has the power of discharging the accused at any
previous stage of the case under section 245 (2) Cr.P.C.
Sections 227 and 239 Cr.P.C. provide for discharge before
the recording of evidence on the basis of the police report,
the documents sent along with it and examination of the
accused after giving an opportunity to the parties to be
heard. But the stage of discharge under section 245 Cr.P.C.,
on the other hand, is reached only after the evidence referred
in section 244 is taken. Despite the difference in the
language of the provisions of sections 227, 239 and 245
Cr.P.C. and whichever provision may be applicable, the
Court is required to see, at the time of framing of charge, that
there is a prima facie case for proceeding against the
accused. The main intention of granting a chance to the
accused of making submissions as envisaged under sections
227 or 239 of Cr.P.C. is to assist the Court to determine
whether it is required to proceed to conduct the trial.
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2026:JHHC:5999
61. The issue of discharge was the subject matter before
the Hon’ble Supreme Court in the case of State of
Tamilnadu, by Inspector of Police in Vigilance and Anti-
Corruption v. N. Suresh Rajan and Others, (2014) 11
SCC 709, wherein at paragraphs no. 29, 32.4, 33 and 34 the
Hon’ble Apex Court has been observed as under:–
“29. We have bestowed our consideration to the rival
submissions and the submissions made by Mr. Ranjit
Kumar commend us. True it is that at the time of
consideration of the applications for discharge, the court
cannot act as a mouthpiece of the prosecution or act as a
post office and may sift evidence in order to find out whether
or not the allegations made are groundless so as to pass an
order of discharge. It is trite that at the stage of
consideration of an application for discharge, the court has
to proceed with an assumption that the materials brought
on record by the prosecution are true and evaluate the said
materials and documents with a view to find out whether
the facts emerging therefrom taken at their face value
disclose the existence of all the ingredients constituting the
alleged offence. At this stage, probative value of the
materials has to be gone into and the court is not expected
to go deep into the matter and hold that the materials would
not warrant a conviction. In our opinion, what needs to be
considered is whether there is a ground for presuming that
the offence has been committed and not whether a ground
for convicting the accused has been made out. To put it
differently, if the court thinks that the accused might have
committed the offence on the basis of the materials on record
on its probative value, it can frame the charge; though for
conviction, the court has to come to the conclusion that the
accused has committed the offence. The law does not permit
a mini trial at this stage.
32.4. While passing the impugned orders [N. Suresh
Rajan v. Inspector of Police, Criminal Revision Case (MD)
No. 528 22 of 2009, order dated 10-12-2010 (Mad)],Page | 38
2026:JHHC:5999[State v. K. Ponmudi, (2007) 1 Mad LJ (Cri) 100], the court
has not sifted the materials for the purpose of finding out
whether or not there is sufficient ground for proceeding
against the accused but whether that would warrant a
conviction. We are of the opinion that this was not the stage
where the court should have appraised the evidence and
discharged the accused as if it was passing an order of
acquittal. Further, defect in investigation itself cannot be a
ground for discharge. In our opinion, the order impugned [N.
Suresh Rajan v. Inspector of Police, Criminal Revision Case
(MD) No. 528 of 2009, order dated 10-12-2010 (Mad)]
suffers from grave error and calls for rectification.
33. Any observation made by us in this judgment is for the
purpose of disposal of these appeals and shall have no
bearing on the trial. The surviving respondents are directed
to appear before the respective courts on 3-2-2014. The
Court shall proceed with the trial from the stage of charge
in accordance with law and make endeavour to dispose of
the same expeditiously.
34. In the result, we allow these appeals and set aside the
order of discharge with the aforesaid observations.
62. It is further settled position of law that defence on
merit is not to be considered at the time of stage of framing
of charge and that cannot be a ground of discharge. A
reference may be made to the judgment as rendered by the
Hon’ble Apex Court in State of Rajasthan v. Ashok Kumar
Kashyap, (2021) 11 SCC 191. For ready reference
Paragraph no. 11 of the said judgment are quoted below:–
“11. While considering the legality of the impugned
judgment [Ashok Kumar Kashyap v. State of
Rajasthan, 2018 SCC OnLine Raj 3468] and order passed
by the High Court, the law on the subject and few decisions
of this Court are required to be referred to.
11.1. In P. Vijayan [P. Vijayan v. State of Kerala, (2010) 2
SCC 398 : (2010) 1 SCC (Cri) 1488], this Court had anPage | 39
2026:JHHC:5999occasion to consider Section 227 CrPC What is required to
be considered at the time of framing of the charge and/or
considering the discharge application has been considered
elaborately in the said decision. It is observed and held that
at the stage of Section 227, the Judge has merely to sift the
evidence in order to find out whether or not there is
sufficient ground for proceeding against the accused. It is
observed that in other words, the sufficiency of grounds
would take within its fold the nature of the evidence
recorded by the police or the documents produced before the
court which ex facie disclose that there are suspicious
circumstances against the accused so as to frame a charge
against him. It is further observed that if the Judge comes
to a conclusion that there is sufficient ground to proceed, he
will frame a charge under Section 228 CrPC, if not, he
will discharge the accused. It is further observed that while
exercising its judicial mind to the facts of the case in order
to determine whether a case for trial has been made out by
the prosecution, it is not necessary for the court to enter into
the pros and cons of the matter or into a weighing and
balancing of evidence and probabilities which is really the
function of the court, after the trial starts.
11.2. In the recent decision of this Court in M.R. Hiremath
[State of Karnataka v. M.R. Hiremath, (2019) 7 SCC
515 : (2019) 3 SCC (Cri) 109 : (2019) 2 SCC (L&S) 380], one
of us (D.Y. Chandrachud, J.) speaking for the Bench has
observed and held in para 25 as under : (SCC p. 526)“25. The High Court [M.R. Hiremath v. State, 2017 SCC
OnLine Kar 4970] ought to have been cognizant of the fact
that the trial court was dealing with an application
for discharge under the provisions of Section 239 CrPC. The
parameters which govern the exercise of this jurisdiction
have found expression in several decisions of this Court. It
is a settled principle of law that at the stage of considering
an application for discharge the court must proceed on the
assumption that the material which has been brought on the
record by the prosecution is true and evaluate the material
in order to determine whether the facts emerging from the
material, taken on its face value, disclose the existence ofPage | 40
2026:JHHC:5999the ingredients necessary to constitute the offence. In State
of T.N. v. N. Suresh Rajan [State of T.N. v. N. Suresh
Rajan, (2014) 11 SCC 709 : (2014) 3 SCC (Cri) 529 : (2014)
2 SCC (L&S) 721], adverting to the earlier decisions on the
subject, this Court held : (SCC pp. 721-22, para 29)’29. … At this stage, probative value of the materials has to
be gone into and the court is not expected to go deep into the
matter and hold that the materials would not warrant a
conviction. In our opinion, what needs to be considered is
whether there is a ground for presuming that the offence
has been committed and not whether a ground for
convicting the accused has been made out. To put it
differently, if the court thinks that the accused might have
committed the offence on the basis of the materials on
record on its probative value, it can frame the charge;
though for conviction, the court has to come to the conclusion
that the accused has committed the offence. The law does
not permit a mini trial at this stage.'”
63. Further it is pertinent to mention here that power
to discharge an accused was designed to prevent harassment
to an innocent person by the arduous trial or the ordeal of
prosecution. How that intention is to be achieved is
reasonably clear in the section itself. The power has been
entrusted to the Sessions Judge who brings to bear his
knowledge and experience in criminal trials. Besides, he has
the assistance of counsel for the accused and Public
Prosecutor. He is required to hear both sides before framing
any charge against the accused or for discharging him. If the
Sessions Judge after hearing the parties frames a charge and
also makes an order in support thereof, the law must be
allowed to take its own course. Self-restraint on the part of
the High Court should be the rule unless there is a glaring
Page | 41
2026:JHHC:5999
injustice which stares the court in the face. The opinion on
any matter may differ depending upon the person who views
it. There may be as many opinions on a particular matter as
there are courts but it is no ground for the High Court to
interdict the trial. It would be better for the High Court to
allow the trial to proceed. Reference in this regard may be
taken from the judgment as rendered by the Hon’ble Apex
Court in Stree Atyachar Virodhi Parishad v. Dilip
Nathumal Chordia and Another, (1989) 1 SCC 715.
64. Further, the difference between the approach with
which the Court should examine the matter in the discharge
has been explained by the Hon’ble Supreme Court in Amit
Kapoor v. Ramesh Chander and Another, (2012) 9 SCC
460, in the following words:–
“17. Framing of a charge is an exercise of jurisdiction by the
trial court in terms of Section 228 of the Code, unless the
accused is discharged under Section 227 of the Code.
Under both these provisions, the court is required to
consider the “record of the case” and documents submitted
therewith and, after hearing the parties, may
either discharge the accused or where it appears to the
court and in its opinion there is ground for presuming that
the accused has committed an offence, it shall frame the
charge. Once the facts and ingredients of the Section exists,
then the court would be right in presuming that there is
ground to proceed against the accused and frame the
charge accordingly. This presumption is not a presumption
of law as such. The satisfaction of the court in relation to the
existence of constituents of an offence and the facts leading
to that offence is a sine qua non for exercise of such
jurisdiction. It may even be weaker than a prima facie case.
Page | 42
2026:JHHC:5999There is a fine distinction between the language of
Sections 227 and 228 of the Code. Section 227 is the
expression of a definite opinion and judgment of the Court
while Section 228 is tentative. Thus, to say that at the stage
of framing of charge, the Court should form an opinion that
the accused is certainly guilty of committing an offence, is
an approach which is impermissible in terms of Section 228
of the Code.
30. We have already noticed that the legislature in its
wisdom has used the expression “there is ground for
presuming that the accused has committed an offence”. This
has an inbuilt element of presumption once the ingredients
of an offence with reference to the allegations made are
satisfied, the Court would not doubt the case of the
prosecution unduly and extend its jurisdiction to quash the
charge in haste. A Bench of this Court in State of
Maharashtra v. Som Nath Thapa (1996) 4 SCC 659 referred
to the meaning of the word “presume” while relying
upon Black’s Law Dictionary. It was defined to mean “to
believe or accept upon probable evidence”; “to take as
proved until evidence to the contrary is forthcoming”. In
other words, the truth of the matter has to come out when
the prosecution evidence is led, the witnesses are cross-
examined by the defence, the incriminating material and
evidence is put to the accused in terms of Section 313 of the
Code and then the accused is provided an opportunity to
lead defence, if any. It is only upon completion of such steps
that the trial concludes with the court forming its final
opinion and delivering its judgment. Merely because there
was a civil transaction between the parties would not by
itself alter the status of the allegations constituting the
criminal offence.
65. Thus, it is evident that the law regarding the
approach to be adopted by the Court while considering an
application for discharge of the accused person the Court has
to form a definite opinion, upon consideration of the record of
Page | 43
2026:JHHC:5999
the case and the documents submitted therewith, that there
is not sufficient ground for proceeding against the accused.
66. The Hon’ble Apex Court has further dealt with the
proper basis for framing of charge in the case of Onkar Nath
Mishra and Others v. State (NCT of Delhi) and Another,
(2008) 2 SCC 561 wherein at paragraphs 11, 12 and 14 it
has been held as under:–
“11. It is trite that at the stage of framing of charge the court
is required to evaluate the material and documents on
record with a view to finding out if the facts emerging
therefrom, taken at their face value, disclosed the existence
of all the ingredients constituting the alleged offence. At that
stage, the court is not expected to go deep into the probative
value of the material on record. What needs to be considered
is whether there is a ground for presuming that the offence
has been committed and not a ground for convicting the
accused has been made out. At that stage, even strong
suspicion founded on material which leads the court to form
a presumptive opinion as to the existence of the factual
ingredients constituting the offence alleged would justify the
framing of charge against the accused in respect of the
commission of that offence.
12. In State of Karnataka v. L. Muniswamy [(1977) 2 SCC
699 : 1977 SCC (Cri) 404], a three-Judge Bench of this Court
had observed that at the stage of framing the charge, the
Court has to apply its mind to the question whether or not
there is any ground for presuming the commission of the
offence by the accused. As framing of charge affects a
person’s liberty substantially, need for proper consideration
of material warranting such order was emphasised.
14. In a later decision in State of M.P. v. Mohanlal
Soni [(2000) 6 SCC 338 : 2000 SCC (Cri) 1110] this Court,
referring to several previous decisions held that : (SCC p.
342, para 7)Page | 44
2026:JHHC:5999“7. The crystallised judicial view is that at the stage of
framing charge, the court has to prima facie consider
whether there is sufficient ground for proceeding against the
accused. The court is not required to appreciate evidence to
conclude whether the materials produced are sufficient or
not for convicting the accused.”
67. In the judgment passed by the Hon’ble Supreme
court in the case of Sajjan Kumar v. CBI, reported
in (2010) 9 SCC 368, the Hon’ble Supreme Court has
considered the scope of Sections 227 and 228 CrPC. The
principles which emerged therefrom have been taken note of
in para 21 as under:
“21. On consideration of the authorities about the scope of
Sections 227 and 228 of the Code, the following principles
emerge:
(i) The Judge while considering the question of framing the
charges under Section 227 CrPC has the undoubted power
to sift and weigh the evidence for the limited purpose of
finding out whether or not a prima facie case against the
accused has been made out. The test to determine prima
facie case would depend upon the facts of each case.
(ii) Where the materials placed before the court disclose
grave suspicion against the accused which has not been
properly explained, the court will be fully justified in framing
a charge and proceeding with the trial.
(iii) The court cannot act merely as a post office or a
mouthpiece of the prosecution but has to consider the broad
probabilities of the case, the total effect of the evidence and
the documents produced before the court, any basic
infirmities, etc. However, at this stage, there cannot be a
roving enquiry into the pros and cons of the matter and
weigh the evidence as if he was conducting a trial.
(iv) If on the basis of the material on record, the court could
form an opinion that the accused might have committedPage | 45
2026:JHHC:5999offence, it can frame the charge, though for conviction the
conclusion is required to be proved beyond reasonable
doubt that the accused has committed the offence.
(v) At the time of framing of the charges, the probative value
of the material on record cannot be gone into but before
framing a charge the court must apply its judicial mind on
the material placed on record and must be satisfied that the
commission of offence by the accused was possible.
(vi) At the stage of Sections 227 and 228, the court is
required to evaluate the material and documents on record
with a view to find out if the facts emerging therefrom taken
at their face value disclose the existence of all the
ingredients constituting the alleged offence. For this limited
purpose, sift the evidence as it cannot be expected even at
that initial stage to accept all that the prosecution states as
gospel truth even if it is opposed to common sense or the
broad probabilities of the case.
(vii) If two views are possible and one of them gives rise to
suspicion only, as distinguished from grave suspicion, the
trial Judge will be empowered to discharge the accused and
at this stage, he is not to see whether the trial will end in
conviction or acquittal.”
68. In the judgment passed by the Hon’ble Supreme
court in the case of M.E. Shivalingamurthy v. CBI,
reported in (2020) 2 SCC 768, the above principles have
been reiterated in para 17, 18, 28 to 31 and the Hon’ble
supreme court has explained as to how the matters of grave
suspicion are to be dealt with. The aforesaid paragraphs are
quoted as under:
“17. This is an area covered by a large body of case law.
We refer to a recent judgment which has referred to the
earlier decisions viz. P. Vijayan v. State of Kerala and
discern the following principles:
Page | 46
2026:JHHC:599917.1. If two views are possible and one of them gives rise to
suspicion only as distinguished from grave suspicion, the
trial Judge would be empowered to discharge the accused.
17.2. The trial Judge is not a mere post office to frame the
charge at the instance of the prosecution.
17.3. The Judge has merely to sift the evidence in order to
find out whether or not there is sufficient ground for
proceeding. Evidence would consist of the statements
recorded by the police or the documents produced before the
Court.
17.4. If the evidence, which the Prosecutor proposes to
adduce to prove the guilt of the accused, even if fully
accepted before it is challenged in cross-examination or
rebutted by the defence evidence, if any, “cannot show that
the accused committed offence, then, there will be no
sufficient ground for proceeding with the trial”.
17.5. It is open to the accused to explain away the materials
giving rise to the grave suspicion.
17.6. The court has to consider the broad probabilities, the
total effect of the evidence and the documents produced
before the court, any basic infirmities appearing in the case
and so on. This, however, would not entitle the court to
make a roving inquiry into the pros and cons.
17.7. At the time of framing of the charges, the probative
value of the material on record cannot be gone into, and the
material brought on record by the prosecution, has to be
accepted as true.
17.8. There must exist some materials for entertaining the
strong suspicion which can form the basis for drawing up a
charge and refusing to discharge the accused.
18. The defence of the accused is not to be looked into at the
stage when the accused seeks to be discharged under
Section 227 CrPC (see State of J&K v. Sudershan Chakkar).
The expression, “the record of the case”, used in Section 227
CrPC, is to be understood as the documents and the articles,
if any, produced by the prosecution. The Code does not give
Page | 47
2026:JHHC:5999
any right to the accused to produce any document at the
stage of framing of the charge. At the stage of framing of the
charge, the submission of the accused is to be confined to
the material produced by the police (see State of
Orissa v. Debendra Nath Padhi).
28. It is here that again it becomes necessary that we
remind ourselves of the contours of the jurisdiction under
Section 227 CrPC. The principle established is to take the
materials produced by the prosecution, both in the form of
oral statements and also documentary material, and act
upon it without it been subjected to questioning through
cross-examination and everything assumed in favour of the
prosecution, if a scenario emerges where no offence, as
alleged, is made out against the accused, it, undoubtedly,
would ensure to the benefit of the accused warranting the
trial court to discharge the accused.
29. It is not open to the accused to rely on the material by
way of defence and persuade the court to discharge him.
30. However, what is the meaning of the expression
“materials on the basis of which grave suspicion is aroused
in the mind of the court’s”, which is not explained away?
Can the accused explain away the material only with
reference to the materials produced by the prosecution? Can
the accused rely upon material which he chooses to produce
at the stage?
31. In view of the decisions of this Court that the accused
can only rely on the materials which are produced by the
prosecution, it must be understood that the grave suspicion,
if it is established on the materials, should be explained
away only in terms of the materials made available by the
prosecution. No doubt, the accused may appeal to the broad
probabilities to the case to persuade the court to discharge
him.”
69. It has been further held in the case of Asim
Shariff v. National Investigation Agency, (2019) 7 SCC
148, that mini trial is not expected by the trial court for the
Page | 48
2026:JHHC:5999
purpose of marshalling the evidence on record at the time of
framing of charge. It has been held at paragraph no. 18 of
the said judgment as under:–
“18. Taking note of the exposition of law on the subject laid
down by this Court, it is settled that the Judge while
considering the question of framing charge under
Section 227 CrPC in sessions cases (which is akin to
Section 239 CrPC pertaining to warrant cases) has the
undoubted power to sift and weigh the evidence for the
limited purpose of finding out whether or not a prima facie
case against the accused has been made out; where the
material placed before the court discloses grave suspicion
against the accused which has not been properly explained,
the court will be fully justified in framing the charge; by and
large if two views are possible and one of them giving rise
to suspicion only, as distinguished from grave suspicion
against the accused, the trial Judge will be justified in
discharging him. It is thus clear that while examining
the discharge application filed under Section 227 CrPC, it is
expected from the trial Judge to exercise its judicial mind to
determine as to whether a case for trial has been made out
or not. It is true that in such proceedings, the court is not
supposed to hold a mini trial by marshalling the evidence
on record.”
70. In the case of Asim Shariff v. NIA, (supra), it has
been held by the Hon’ble Apex Court that the words ‘not
sufficient ground for proceeding against the
accused’ clearly show that the Judge is not a mere post
office to frame the charge at the behest of the prosecution,
but has to exercise his judicial mind to the facts of the case
in order to determine whether a case for trial has been made
out by the prosecution. In assessing this fact, it is not
necessary for the court to enter into the pros and cons of the
Page | 49
2026:JHHC:5999
matter or into a weighing and balancing of evidence and
probabilities which is really his function after the trial starts.
At the stage of Section 227, the Judge has merely to sift the
evidence in order to find out whether or not there is sufficient
ground for proceeding against the accused. The sufficiency
of ground would take within its fold the nature of the
evidence recorded by the police or the documents produced
before the court which ex-facie disclose that there are
suspicious circumstances against the accused so as to frame
a charge against him.
71. Thus, from aforesaid legal propositions it can be
safely inferred that if, upon consideration of the record of the
case and the documents submitted therewith, and after
hearing the submissions of the accused and the prosecution
in this behalf, the Judge considers that there is no sufficient
ground for proceeding against the accused, he
shall discharge the accused and record his reasons for doing
so and if, after such consideration and hearing as aforesaid,
the Judge is of the opinion that there is ground for presuming
that the accused has committed an offence, the trial Court
shall frame the charge. However, the defence of the accused
cannot be looked into at the stage of discharge. The accused
has no right to produce any document at that stage. The
application for discharge has to be considered on the premise
that the materials brought on record by the prosecution are
true.
Page | 50
2026:JHHC:5999
72. Thus, at the time of considering an application for
discharge, the Court is required to consider to the limited
extent to find out whether there is prima facie evidence
against the accused to believe that he has committed any
offence as alleged by the prosecution; if prima facie evidence
is available against the accused, then there cannot be an
order of discharge
73. At the stage of discharge, the Judge has merely to sift
and weigh the evidence in order to find out whether or not
there is sufficient ground for proceeding against the accused
and in other words, the sufficiency of grounds would take
within its fold the nature of the evidence recorded by the
prosecution or the documents produced before the court
which ex facie disclose that there are suspicious
circumstances against the accused so as to frame the charge
against him and after that if the Judge comes to a conclusion
that there is sufficient ground to proceed, he will frame a
charge and, if not, he will discharge the accused.
74. While exercising its judicial mind to the facts of the
case in order to determine whether a case for trial has been
made out by the prosecution, it is not necessary for the Court
to enter into the pros and cons of the matter or into a weighing
and balancing of evidence and probabilities which is really the
function of the court, after the trial starts.
Page | 51
2026:JHHC:5999
75. It is considered view that at this stage of the instant
case, the Court was only required to consider whether a prima
facie case has been made out or not and whether the accused
is required to be further tried or not because at the stage of
considering the discharge application, the mini trial is not
permissible.
76. The test to determine a prima facie case against the
accused would naturally depend on the facts of each case
and it is difficult to lay down the rule of universal application
and if the material placed before the Court discloses grave
suspicion against the accused which has not been properly
explained, the Court will be fully justified in rejecting the
discharge application and proceeding with the trial.
77. Thus, from the aforesaid judicial pronouncements it
is evident that at the stage of considering discharge, trial
court is not to examine and assess in detail the material
placed on record by the prosecution nor is it for the court to
consider the sufficiency of the materials to establish the
offence alleged against the accused persons. Marshalling of
facts and appreciation of evidence at the time of considering
discharge is not in the domain of the court. Discharge
application can be rejected even on the basis of strong
suspicion founded upon materials before the court which
leads the court to form a presumptive opinion as to the
Page | 52
2026:JHHC:5999
existence of the factual ingredients constituting the offence
alleged against the accused.
78. It needs to refer herein that ingredients of offences
should be seen in the material produced before the court and
duty of court at the stage of considering the discharge is to
see whether the ingredients of offences are available in the
material produced before the court. Contradictions in the
statements of witnesses or sufficiency or truthfulness of the
material placed before the court cannot be examined at the
stage of consideration of discharge. For this limited purpose,
the court may sift the evidence. Court has to consider
material only with a view to find out if there is ground for
presuming that the accused has committed an offense and
not for the purpose of arriving at a definite conclusion.
“Presume‟ means if on the basis of materials on record, court
can come to the conclusion that commission of the offense is
a probable consequence, then a case for framing of charge
exists.
79. Thus, it is well settled that at the time of considering
discharge meticulous examination of evidence is not
required, however the evidence can be sifted or weighed at
least for the purpose of recording a satisfaction that a prima
facie case is made out to proceed in the case. Further the
trial Court is not required to discuss the evidence for the
purpose of conducting a trial but the discussion of the
Page | 53
2026:JHHC:5999
materials on record is required to reflect the application of
judicial mind for finding that a prima-facie case is made out
against the petitioner.
80. It is settled connotation of law that at the stage of
discharge the probable defence of the accused is not to be
considered and the materials, which are relevant for
consideration, are the allegations made in the First
Information Report/complaint, the statement of the
witnesses recorded in course of investigation, the documents
on which the prosecution relies and the report of
investigation submitted by the prosecuting agency. The
probative value of the defence is to be tested at the stage of
trial and not at the stage of discharge and at the stage of
considering discharge application minute scrutiny of the
evidence is not to be made.
81. Further it is settled position of law that at the stage
of discharge, the trial Court is not required to meticulously
examine and marshal the material available on record as to
whether there is sufficient material against the accused
which would ultimately result in conviction. The Court
is prima facie required to consider whether there is sufficient
material against the accused to presume the commission of
the offence. Even strong suspicion about commission of
offence is sufficient for rejecting the discharge and the guilt
or innocence of the accused has to be determined at the time
Page | 54
2026:JHHC:5999
of the trial after evidence is adduced and not at the stage of
consideration of discharge and, therefore, at the stage of
considering the discharge, the Court is not required to
undertake an elaborate inquiry for the purpose of sifting and
weighing the material.
82. Thus, from aforesaid legal propositions it can be
safely inferred that if, upon consideration of the record of the
case and the documents submitted therewith, and after
hearing the submissions of the accused and the prosecution
in this behalf, the Judge considers that there is no sufficient
ground for proceeding against the accused, he
shall discharge the accused and record his reasons for doing
so and if, after such consideration and hearing as aforesaid,
the Judge is of the opinion that there is ground for
presuming that the accused has committed an offence, the
trial Court shall frame the charge.
83. At the stage of discharge, the Judge has merely to sift
and weigh the evidence in order to find out whether or not
there is sufficient ground for proceeding against the accused
and in other words, the sufficiency of grounds would take
within its fold the nature of the evidence recorded by the
prosecution or the documents produced before the court
which ex facie disclose that there are suspicious
circumstances against the accused so as to frame the charge
against him and after that if the Judge comes to a conclusion
Page | 55
2026:JHHC:5999
that there is sufficient ground to proceed, he will frame a
charge and, if not, he will discharge the accused.
84. While exercising its judicial mind to the facts of the
case in order to determine whether a case for trial has been
made out by the prosecution, it is not necessary for the Court
to enter into the pros and cons of the matter or into a
weighing and balancing of evidence and probabilities which
is really the function of the court, after the trial starts.
85. It is considered view that at this stage of the instant
case, the court was only required to consider whether a
prima facie case has been made out or not and whether the
accused is required to be further tried or not because at the
stage of considering the discharge application, the mini trial
is not permissible.
86. In the backdrop of aforesaid case laws and judicial
deduction, this Court is now proceeding to examine the fact
so as to come to the conclusion as to whether the evidence
which has been collected in course of investigation and has
been brought on record, as would be available in the
impugned order prima facie case against the petitioner is
made out or not?
87. In the prosecution complaint annexed to the main
petition, the role and other incriminating material against
the present petitioners have been mentioned, for ready
Page | 56
2026:JHHC:5999
reference the relevant paragraphs of the aforesaid
prosecution complaints are being quoted as under:
15.3 Process and Activities used in commissioning the
offence of Money laundering15.3.1 In view of the above, it is clear that, the activities
connected with the proceeds of crime viz its acquisition,
possession, use, concealment, and projecting or claiming
as untainted property, was carried out by the Accused
Number 1. Hence, the offence of money laundering u/s 3
of PMLA, 2002, is made out.
15.3.2 The activities of directly indulging, actually involved
and knowingly is a party in the process of its acquisition,
possession, use, concealment, projecting and claiming the
proceeds of crime as untainted, to the tune of Rs
13,29,92,620/- was carried out by the accused No. 1
Jogendra Tiwari.
15.3.3 The activities of directly indulging and actually
involved in the process of its possession, use, and
projecting the proceeds of crime as untainted, to the tune
of Rs 2,04,85,000/- was carried out by the accused No. 2
M/s Saran Alcohol Pvt. Ltd.
15.3.4 The activities of directly indulging and actually
involved in the process of its possession, use, and
projecting the proceeds of crime as untainted, to the tune
of Rs 5,40,000/- was carried out by the accused No. 3 M/s
Santhal Pargana Builders Pvt. Ltd.
15.3.5 The activities of directly indulging and actually
involved in the process of its possession, use, and
projecting the proceeds of crime as untainted, to the tune
of Rs 47,75,100/- was carried out by the accused No. 4
M/s Prashant Traders.
15.3.6 The activities of directly indulging and actually
involved in the process of its possession, use, and
projecting the proceeds of crime as untainted, to the tune
of Rs 1,51,20,000/- was carried out by the accused No. 5
M/s Anand Traders.
15.3.7 The activities of directly indulging and actually
involved in the process of its possession, use, andPage | 57
2026:JHHC:5999projecting the proceeds of crime as untainted, to the tune
of Rs 17,40,000/- was carried out by the accused No. 6
M/s Baidyanath Enterprises.
15.3.8 The activities of directly indulging and actually
involved in the process of its possession, use, and
projecting the proceeds of crime as untainted, to the tune
of Rs 49,96,590/- was carried out by the accused No. 7
M/s Basukinath Traders.
15.3.9 The activities of directly indulging and actually
involved in the process of its possession, use, and
projecting the proceeds of crime as untainted, to the tune
of Rs-5,00,000/- was carried out by the accused.
15.3.10 The activities of directly indulging and actually
involved in the process of its possession, use, and
projecting the proceeds of crime as untainted, to the tune
of Rs 29,50,000/- was carried out by the accused No. 9
M/s Rajmahal Traders.
15.3.11 The activities of directly indulging and actually
involved in the process of its possession, use, and
projecting the proceeds of crime as untainted, to the tune
of Rs 82,59,240/- was carried out by the accused No. 10
M/s Mishra Wines.
15.3.12 The activities of directly indulging and actually
involved in the process of its possession, use, and
projecting the proceeds of crime as untainted, to the tune
of Rs 23,05,000/- was carried out by the accused No. 11
M/s Sanjit Hembram.
15.3.13 The activities of directly indulging and actually
involved in the process of its possession, use, and
projecting the proceeds of crime as untainted, to the tune
of Rs 9,50,000/- was carried out by the accused No. 12
M/s Maihar Hotels & Resorts Pvt. Ltd.
15.3.14 The accused Jogendra Tiwari in his statements
has tried to hide the true nature of these transactions and
has tried to mislead the investigation and is also involved
in the destruction of potential evidence thus, Jogendra
Tiwari has directly indulged in the process and activity of
concealment of proceeds of crime and projecting/claiming
it as untainted property.
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2026:JHHC:5999
SPECIFIC ROLE OF THE ACCUSED IN THE
COMMISSION OF OFFENCE OF MONEY LAUNDERING
BY DIRECTLY OR BY INDIRECTLY ATTEMPTS TO
INDULGE OR KNOWINGLY ASSIST OR KNOWINGLY IS
A PARTY OR IS INVOLVED IN USE IN
CONCEALMENT/POSSESSION/ACQUISITION OR USE
IN PROJECTING OR CLAIMING PROCEEDS OF CRIME
AS UNTAINTED PROPERTY UNDER SECTION 3 OF
PMLA 2002
S. Name of the Role in the case
No. Accused
1. Jogendra Tiwari a) Accused Jogendra Tiwari has
committed the scheduled offence
as mentioned in the FIRs.
Through these illegal activities,
Jogendra Tiwari has acquired
huge amounts of cash which
nothing but the proceeds of
crime to the tune of Rs
13,29,92,620/-.
b) Accused Jogendra Tiwari has
generated huge proceeds of crime
from the illegal sale of sand
without challan and also from
the fraudulent sale of lands and
deposited the same in the bank
account of himself and the
entities under his control.
c) Further, the same proceeds of
crime were also utilised for
payment of license fees in the
application for getting wholesale
liquor license.
d) Jogendra Tiwari has indulged,
knowingly is a party and is
actually involved in the process
related to proceeds of crime by (1)
placement -depositing the
proceeds of crime generated in
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2026:JHHC:5999
the form of cash by the
commission of the scheduled
offence, in the bank accounts of
his entities, the individuals
associated with him and their
entities, (ii) layering in some
cases the proceeds of crime are
routed through various accounts
under his control (ii) integration
the said proceeds of crime are
then integrated in the entities
belonging to Jogendra Tiwari
and/or his associates and/or
their entities and used for
payment of license fee for
wholesale sale of liquor. Further
the accused Jogendra has been
found to indulge in concealment,
possession, acquisition, use and
projecting the proceeds of crime
as untainted property.
e) Jogendra Tiwari is the
beneficial owner of the accused
entities No. 2 to No. 12 as he was
controlling the day to day
businesses of these entities.
Therefore, the accused Jogendra
Tiwari is guilty of the offence of
money laundering as defined u/s
3 read with Section 70 of PMLA.
2. M/s Saran The activities of directly
Alcohol Pvt. Ltd. indulging and actually involved
in the process of its possession,
use, and projecting the proceeds
of crime as untainted, to the tune
of Rs 2,04,85,000/- was carried
out by the accused No. 2 M/s
Saran Alcohol Pvt. Ltd. Jogendra
Tiwari is the beneficial owner of
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this company and was handling
day to day business of this
company. Accordingly, M/s
Saran Alcohol Pvt. Ltd. is guilty
of the offence of money
laundering u/s 3 of PMLA, 2002
read with section 70 of PMLA and
punishable under section 4 of
PMLA.
3. M/s Santhal The activities of directly
indulging and actually involved
Pargana Builders
in the process of its possession,
Pvt. Ltd.
use, and projecting the proceeds
of crime as untainted, to the tune
of Rs. 5,40,000/- was carried out
by the accused No. 3 M/s
Santhal Pargana Builders Pvt.
Ltd. Jogendra Tiwari is the
beneficial owner of this company
and was handling day to day
business of this company.
Accordingly, M/s Santhal
Pargana Builders Pvt. Ltd. is
guilty of the offence of money
laundering u/s 3 of PMLA, 2002
read with section 70 of PMLA and
punishable under section 4 of
PMLA.
4. M/s Prashant The activities of directly
indulging and actually involved
Traders
in the process of its possession,
use, and projecting the proceeds
of crime as untainted, to the tune
of Ra 47,75,100/- was carried
out by the accused No. 4 M/s
Prashant Traders. Jogendra
Tiwari is the beneficial owner of
this partnership firm and was
handling day to day business of
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this company. Accordingly, M/s
Prashant Traders is guilty of the
offence of money laundering u/s
3 of PMLA, 2002 read with
section 70 of PMLA and
punishable under section 4 of
PMLA.
5. M/s Anand The activities of directly
indulging and actually involved
Traders.
in the process of its possession,
use, and projecting the proceeds
of crime as untainted, to the tune
of Rs 1,51,20,000/- was carried
out by the accused No. 5 M/s
Anand Traders Jogendra Tiwari
is the beneficial owner of this
partnership firm and was
handling day to day business of
this company. Accordingly, M/s
Anand Traders is guilty of the
offence of money laundering u/s
3 of PMLA, 2002 read with
section 70 of PMLA and
punishable under section 4 of
PMLA.
6. M/s Baidyanath The activities of directly
Enterprises indulging and actually involved
in the process of its possession,
use, and projecting the proceeds
of crime as untainted, to the tune
of Rs 17,40,000/- was carried
out by the accused No. 6 M/s
Baidyanath Enterprises.
Jogendra Tiwari is the beneficial
owner of this partnership firm
and was handling day to day
business of this company.
Accordingly, M/s Baidyanath
Enterprises is guilty of the
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2026:JHHC:5999
offence of money laundering u/s
3 of PMLA, 2002 read with
section 70 of PMLA and
punishable under section 4 of
PMLA.
7. M/s Basukinath The activities of directly
Traders. indulging and actually involved
in the process of its possession,
use, and projecting the proceeds
of crime as untainted, to the tune
of Rs 49,96,590/- was carried
out by the accused No. 7 M/s
Basukinath Traders. Jogendra
Tiwari is the beneficial owner of
this partnership firm and was
handling day to day business of
this company. Accordingly, M/s
Basukinath Traders is guilty of
the offence of money laundering
u/s 3 of PMLA, 2002 read with
section 70 of PMLA and
punishable under section 4 of
PMLA.
8. M/s Gupta The activities of directly
Traders. indulging and actually involved
in the process of its possession,
use, and projecting the proceeds
of crime as untainted, to the tune
of Rs 5,00,000/- was carried out
by the accused No. 8 M/s Gupta
Traders. Jogendra Tiwari is the
beneficial owner of this company
and was handling day to day
business of this company.
Accordingly, M/s Anand Traders
is guilty of the offence of money
laundering u/s 3 of PMLA, 2002
read with section 70 of PMLA and
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2026:JHHC:5999
punishable under section 4 of
PMLA.
9. M/s Rajmahal The activities of directly
Traders indulging and actually involved
in the process of its possession,
use, and projecting the proceeds
of crime as untainted, to the tune
of Rs 29,50,000/- was carried
out by the accused No. 9 M/s
Rajmahal Traders. Jogendra
Tiwari is the beneficial owner of
this partnership firm and was
handling day to day business of
this company. Accordingly, M/s
Rajmahal Traders is guilty of the
offence of money laundering u/s
3 of PMLA, 2002 read with
section 70 of PMLA and
punishable under section 4 of
PMLA.
10. M/s Mishra The activities of directly
Wines indulging and actually involved
in the process of its possession,
use, and projecting the proceeds
of crime as untainted, to the tune
of Rs 82,59,240/- was carried
out by the accused No. 10 M/s
Mishra Wines. Jogendra Tiwari is
the beneficial owner of this
partnership firm and was
handling day to day business of
this company. Accordingly, M/s
Mishra Wines is guilty of the
offence of money laundering u/s
3 of PMLA, 2002 read with
section 70 of PMLA and
punishable under section 4 of
PMLA.
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11. M/’s Hembram The activities of directly
Sanjit indulging and actually involved
in the process of its possession,
use, and projecting the proceeds
of crime as untainted, to the tune
of Rs 23,05,000/- was carried
out by the accused No. 11 M/s
Sanjit Hembram. Jogendra
Tiwari is the beneficial owner of
this partnership firm and was
handling day to day business of
this company. Accordingly, M/s
Sanjit Hembram is guilty of the
offence of money laundering u/s
3 of PMLA, 2002 read with
section 70 of PMLA and
punishable under section 4 of
PMLA.
88. It has come in the investigation that Jogendra Tiwari
(Accused No.1 as per Prosecution Complaint), who acted as
the “Beneficial Owner” and central controller of all eleven co-
accused entities (Accused No. 2 to 12 as per Prosecution
Complaint). The investigation has meticulously mapped the
flow of funds through the three distinct stages of money
laundering ie. Placement, Layering and Integration.
89. It has come in the prosecution complaint that Based
on FIR Nos. 342/2020 and 50/2020, the investigation
established in The Land Scam (“Roy Bungalow”) that the
syndicate forcefully usurped the prime “Roy Bungalow” land
in Deoghar. They sold parcels of this land to various buyers
by collecting a significant portion of the consideration in
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cash, over and above the value declared in the registered sale
deeds.
90. It has come during investigation that Accused
Jogendra Tiwari (one of the petitioners herein) has
committed the scheduled offence as mentioned in the FIRs
and through these illegal activities, Jogendra Tiwari has
acquired huge amounts of cash which nothing but the
proceeds of crime to the tune of Rs 13,29,92,620/-.
91. It has further come in investigation that Accused
Jogendra Tiwari has generated huge proceeds of crime from
the illegal sale of sand without challan and also from the
fraudulent sale of lands and deposited the same in the bank
account of himself and the entities under his control. It has
specifically stated in the prosecution complaint that
Jogendra Tiwari is the beneficial owner of the accused
entities No. 2 to No. 12 (petitioners herein) as he was
controlling the day-to-day businesses of these entities.
92. Consequently, based on the evidence gathered
during the course of the investigation, prima facie, the
learned special Court found that the incriminating materials
are available against the petitioner Jogendra Tiwari
including entities No. 2 to No. 12, and accordingly rejected
the discharge application filed by the petitioners.
93. The main thrust of contention of the learned counsel
for the petitioner that prosecution under the Prevention of
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Money Laundering Act, 2002 (“PMLA”) cannot survive
independently in the absence of a live and subsisting
scheduled offence. In the present case, the scheduled
offences forming the foundation of ECIR No. 08/2023 have
either been quashed, closed, or culminated in acquittals,
rendering the proceedings under PMLA wholly
unsustainable in law.
94. In the aforesaid context, it needs to refer herein that
the offence of money laundering as contemplated in Section
3 of the PMLA has been elaborately dealt with by the three
Judge Bench in Vijay Madanlal Choudhary (supra), in
which it has been observed that Section 3 has a wider reach.
The offence as defined captures every process and activity in
dealing with the proceeds of crime, directly or indirectly, and
is not limited to the happening of the final act of integration
of tainted property in the formal economy to constitute an
act of money laundering. Of course, the authority of the
Authorised Officer under the Act to prosecute any person for
the offence of money laundering gets triggered only if there
exist proceeds of crime within the meaning of Section 2(1)(u)
of the Act and further it is involved in any process or activity.
Not even in case of existence of undisclosed income and
irrespective of its volume, the definition of “Proceeds of
Crime” under Section 2(1)(u) will get attracted, unless the
property has been derived or obtained as a result of criminal
activity relating to a scheduled offence. The property must
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qualify the definition of “Proceeds of Crime” under Section
2(1)(u) of the Act. As observed, in all or whole of the crime
property linked to scheduled offence need not be regarded as
proceeds of crime, but all properties qualifying the definition
of “Proceeds of Crime” under Section 2(1)(u) will necessarily
be the crime properties.
95. Further it needs to refer herein that the Hon’ble Apex
Court in the case of Pavana Dibbur vs. The Directorate of
Enforcement (2023) 15 SCC 91 has considered the effect of
the appellant not being shown as an accused in the predicate
offence by taking into consideration Section 3 of the Act,
2002. It has been held that who could commit an offence
under the PMLA may not be named in the scheduled offence.
The statutory prerequisite is the existence of a “criminal
activity relating to a scheduled offence” from which proceeds
of crime are generated, not that every person accused of
money laundering must also be an accused in the predicate
FIR.
96. The decision clarifies that the offence of
money laundering is independent of the predicate
offence. The accused need not be part of the initial
crime to be held liable for laundering the proceeds.
The law focuses on the act of concealing or
converting proceeds of crime, and those who
facilitate this process, even if they were not
involved in the original criminal activity, can still
be prosecuted for money laundering.
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97. It requires to refer herein to constitute any property
as proceeds of crime, it must be derived or obtained directly
or indirectly by any person as a result of criminal activity
relating to a scheduled offence. The explanation clarifies that
the proceeds of crime include property, not only derived or
obtained from scheduled offence but also any property which
may directly or indirectly be derived or obtained as a result
of any criminal activity relatable to the scheduled offence.
Section 2(1) (u) also clarifies that even the value of any such
property will also be the proceeds of crime.
98. Further if a person who is unconnected with the
scheduled offence, knowingly assists the concealment of the
proceeds of crime or knowingly assists the use of proceeds of
crime, in that case, he can be held guilty of committing an
offence under Section 3 of the PMLA. Therefore, it is not
necessary that a person against whom the offence under
Section 3 of the PMLA is alleged must have been shown as
the accused in the scheduled offence.
99. It requires to refer herein that the legal presumption
under Section 24(a) of the Act 2002, would apply when the
person is charged with the offence of money-laundering and
his direct or indirect involvement in any process or activity
connected with the proceeds of crime, is established. The
existence of proceeds of crime is, therefore, a foundational
fact, to be established by the prosecution, including the
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involvement of the person in any process or activity
connected therewith. Once these foundational facts are
established by the prosecution, the onus must then shift on
the person facing charge of offence of money- laundering to
rebut the legal presumption that the proceeds of crime are
not involved in money-laundering, by producing evidence
which is within his personal knowledge of the accused.
100. As stated above in the instant case it has been
emphatically contended by the learned counsel for the
petitioner that all predicate offences forming the substratum
of the PMLA case have been extinguished. But from the
record it is evident that there is the existence of the active
and pending predicate offences. From perusal of prosecution
complaint, it is evident that in Paragraph 9.3 (Page 77) of the
Prosecution Complaint, after discussing the generation of
proceeds from the illegal liquor trade (relating to the 9 FIRs
that were later quashed), the Directorate explicitly stated
that “However, the said proceeds of crime are not being
considered here.”
101. This specific declaration serves as conclusive proof
that the prosecution’s/ED final quantification of Proceeds of
Crime (POC) was never dependent on these 9 liquor FIRs
which have been referred by the petitioners in support of the
aforesaid contention.
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102. But herein the financial bedrock of the case ie.
specifically, the Rs. 5,66,34,500/-currently being relied
upon is derived exclusively from the four active and pending
predicate FIRs as aforesaid.
103. The prosecution’s case stands independently,
robustly, and unassailably on the following four active and
pending predicate FIRs,:
(I) The Land FIRs (Deoghar Town P.S. Case No. 342/2020
& Jasidih P.S. Case No. 50/2020) : The Petitioners
claim these cases are closed because the police filed a
Final Form, but as per the counter affidavit this fact is
appears to be factually incorrect as the Trial Court has
not accepted the Final Forms and the original
complainants have filed Protest Petitions in both the
aforesaid cases, which are pending judicial
consideration. Therefore, from the aforesaid it can be
safely inferred that the allegation of the scheduled
offence under PML Act (Section 467 IPC – Forgery,
Section 420 IPC-Cheating) is sub judice and legally
active.
(II) In the Sand FIR (Margomunda P.S. Case No. 27/2020),
the petitioners admit that the cognizance order was
quashed but as per the counter affidavit it is evident
that the High Court remanded the matter back to the
Trial Court to pass a fresh, reasoned order and it is
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2026:JHHC:5999settled law that a matter on remand is unequivocally a
pending proceeding.
(III) So far as the status of Rikhiya P.S. Case No. 01/2022
is concerned, it has been averred in the counter
affidavit that cognizance has been duly taken by the
competent court and the said case is active and
pending trial.
104. Therefore, on the basis of aforesaid fact it is
considered view that Petitioners’ reliance on the judgment
of the Hon’ble Supreme Court in Vijay Madanlal
Choudhary v. Union of India (supra) is not fit to be
accepted as the said judgment mandates the closure of
PMLA proceedings only if the accused is finally acquitted
or the scheduled offence is finally quashed and it explicitly
clarifies that PMLA proceedings can continue where the
scheduled offence is pending enquiry/trial including by
way of criminal complaint before the competent forum.
105. Thus, on the basis of the aforesaid it is considered
view of this Court that since the jurisdictional fact of a
scheduled offence subsists, therefore the Learned Special
Judge while taking into consideration the aforesaid factual
aspect has rejected the application for discharge and has
committed no error.
106. Further in the instant case since the foundational
predicate FIRs are active and pending judicial
consideration, the Proceeds of Crime generated therefrom
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are legally valid, subsisting, and form the basis of the
prosecution under PML, Act 2002.
107. It needs to refer herein that as per the averment made
in the counter affidavit in one of the case a “Protest
Petition” has been filed after acceptance of final report
which is still pending. In the aforesaid context it needs to
refer that although protest petition has not been stipulated
under the Code but the same is a legally recognised or
accepted practice available to the complainant/victim to
make an objection to a closure report filed by the police
under Section 173(2) Cr.P.C./193 BNSS.
108. The Hon’ble Apex Court in Popular Muthiah v.
State represented by Inspector of Police (2006) 7 SCC
296 held that when the final form is filed, the Magistrate
has jurisdiction, in the event a Protest Petition is filed to
treat the same as a complaint petition and if a prima facie
case is made out, to issue processes. More fully, in Vishnu
Kumar Tiwari v. State of Uttar Pradesh (2019) 8 SCC
27, after discussing judgements of the SC and various
High Courts, the apex court held that if a Protest Petition
fulfils the requirements of a complaint, the Magistrate may
treat the Protest Petition as a complaint and deal with the
same as required under Section 200 read with Section 202
of the Code. Thus, from the aforesaid it is evident that
pending protest petition for adjudication by the concerned
court amounts to the pending proceeding.
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109. Further as per the prosecution complaint the
commission of scheduled offences is established by the
four active FIRs (FIR Nos. 342/2020, 50/2020, 27/2020,
and 01/2022) and since these FIRs contain specific
allegations of Forgery (Section 467 IPC), Cheating (Section
420 IPC), and Criminal Conspiracy (Section 120B IPC)
which are the schedule offence under the Act 2002,
therefore the contention of the learned counsel for the
petitioner is not fit to be accepted.
110. Further the Petitioners’ attempt to portray
themselves as legitimate businesses is not fit to be
accepted since as per the prosecution complaint, the
investigation has revealed that they operated as a “Single
Economic Unit” under the beneficial ownership of
Jogendra Tiwari and their actions define the very offence
of money laundering under Section 3 of the PMLA,
specifically the act of “projecting” tainted funds as
untainted property by acquiring government licenses.
111. Further the Prosecution Complaint establishes that
Petitioners like M/s Basukinath Traders, M/s Maihar
Hotels, and M/s Rajmahal Traders received funds layered
through Kolkata-based shell companies to project
legitimacy and funds were routed through entities like M/s
Mackmorn Commodities Pvt. Ltd. and M/s Manish Co. Pvt.
Ltd. on the very same day they were received from other
sources, proving a clear intent to camouflage the trail
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before reaching the Petitioners for the payment of license
fees.
112. The argument which has emphatically been made
that in most of the cases, the order taking cognizance has
been quashed and subsequently, the criminal proceeding
has also been dropped by the concerned court but even
accepting the same, since the culpability has surfaced
against all the petitioners as discussed hereinabove in
pursuance to the four cases, i.e., Deoghar Town PS Case
No. 342 of 2020, Jasidih PS Case No FIR No. 50 of 2020,
Margomunda PS Case No 27 of 2020 and Rikhiya P.S. Case
No 01 of 2022, which are still operative including the
matter where the protest petition has been filed and, as
such, merely on the ground that some of the cases have
been dropped by virtue of the quashing of the order taking
cognizance, the petitioners cannot be absolved from facing
trial due to the basic reason that predicate offence
pertaining to aforesaid four cases, are still active and in
that view of the matter, the prima facie allegation is there.
Hence, what is being prayed that in some of the cases the
criminal prosecution has been dropped, the same ought to
have been taken into consideration by the learned Special
Judge, which cannot be said to be an acceptable
argument, reason being that the learned Special Judge has
taken into consideration the aforesaid four cases which are
still active.
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113. It needs to refer herein that the Hon’ble Apex Court
in the case of Pradeep Nirankarnath Sharma Versus
Directorate of Enforcement and Another 2025 SCC
OnLine SC 560 has observed that as established in
multiple judicial pronouncements, cases involving
economic offences necessitate a thorough trial to unearth
the complete chain of events, financial transactions, and
culpability of the accused, therefore the material
submitted by the respondent, coupled with the broad
legislative framework of the PMLA, indicates the necessity
of allowing the trial to proceed and not discharging the
appellant at the nascent stage of charge framing and
discharging the appellant at this stage would be premature
and contrary to the principles governing the prosecution
in money laundering cases, for ready reference the relevant
paragraphs are being quoted as under:
“30. The PMLA was enacted with the primary objective of
preventing money laundering and confiscating the proceeds
of crime, thereby ensuring that such illicit funds do not
undermine the financial system. Money laundering has far-
reaching consequences, not only in terms of individual acts
of corruption but also in causing significant loss to the public
exchequer. The laundering of proceeds of crime results in a
significant loss to the economy, disrupts lawful financial
transactions, and erodes public trust in the system. The
alleged offences in the present case have a direct bearing
on the economy, as illicit financial transactions deprive the
state of legitimate revenue, distort market integrity, and
contribute to economic instability. Such acts, when
committed by persons in positions of power, erode publicPage | 76
2026:JHHC:5999confidence in governance and lead to systemic
vulnerabilities within financial institutions.
31. The illegal diversion and layering of funds have a
cascading effect, leading to revenue losses for the state and
depriving legitimate sectors of investment and financial
resources. It is settled law that in cases involving serious
economic offences, judicial intervention at a preliminary
stage must be exercised with caution, and proceedings
should not be quashed in the absence of compelling legal
grounds. The respondent has rightly argued that in cases
involving allegations of such magnitude, a trial is imperative
to establish the full extent of wrongdoing and to ensure
accountability.
32. The PMLA was enacted to combat the menace of money
laundering and to curb the use of proceeds of crime in the
formal economy. Given the evolving complexity of financial
crimes, courts must adopt a strict approach in matters
concerning economic offences to ensure that perpetrators do
not exploit procedural loopholes to evade justice.
33. The present case involves grave and serious
allegations of financial misconduct, misuse of position, and
involvement in transactions constituting money laundering.
The appellant seeks an end to the proceedings at a
preliminary stage, effectively preventing the full
adjudication of facts and evidence before the competent
forum. However, as established in multiple judicial
pronouncements, cases involving economic offences
necessitate a thorough trial to unearth the complete
chain of events, financial transactions, and
culpability of the accused.
34. The material submitted by the respondent,
coupled with the broad legislative framework of the
PMLA, indicates the necessity of allowing the trial to
proceed and not discharging the appellant at the
nascent stage of charge framing. The argument that
the proceedings are unwarranted is devoid of
substance in light of the statutory objectives, the
continuing nature of the offence, and the significant
financial implications arising from the alleged acts.
Page | 77
2026:JHHC:5999Discharging the appellant at this stage would be
premature and contrary to the principles governing
the prosecution in money laundering cases.”
114. Thus, from perusal of case record, statements of
witnesses, materials available on record and in view of law
laid down by the Hon’ble Apex Court as referred hereinabove,
this Court is of the considered view that prima-facie sufficient
materials are available on record against the present
petitioners.
115. Accordingly, both the issues are answered herein.
116. It needs to refer herein that the Hon’ble Apex Court
in the case of Munna Devi v. State of Rajasthan and
Another, (2001) 9 SCC 631 has observed that the revisional
power under the Code of Criminal Procedure cannot be
exercised in a routine and casual manner. While exercising
such powers the High Court has no authority to appreciate
the evidence in the manner as the trial and the appellate
courts are required to do. Revisional powers could be
exercised only when it is shown that there is a legal bar
against the continuance of the criminal proceedings or the
framing of charge or the facts as stated in the first
information report even if they are taken at the face value
and accepted in their entirety do not constitute the offence
for which the accused has been charged.
117. Thus, it is evident that the revisional power can only
be exercised to correct patent error of law or procedure which
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would occasion unfairness, if it is not corrected. The
revisional power cannot be compared with the appellate
power. A Revisional Court cannot undertake meticulous
examination of the material on record as it is undertaken by
the trial court or the appellate court. This power can only be
exercised if there is any legal bar to the continuance of the
proceedings or if the facts as stated in the charge-sheet are
taken to be true on their face value and accepted in their
entirety do not constitute the offence for which the accused
has been charged.
118. The Hon’ble Apex Court in the case of Asian
Resurfacing of Road Agency (P) Ltd. and
Another v. CBI, (2018) 16 SCC 299 has held that
interference in the order framing charges or refusing
to discharge is called for in the rarest of rare case only to
correct the patent error of jurisdiction.
119. The Hon’ble Apex Court in the case of State of Tamil
Nadu v. R. Soundirarasu and Others, (2023) 6 SCC 768
has held in paragraph 81 to 83 as under:
“81. The High Court has acted completely beyond the
settled parameters, as discussed above, which govern the
power to discharge the accused from the prosecution. The
High Court could be said to have donned the role of a
chartered accountant. This is exactly what this Court
observed in Thommandru Hannah Vijayalakshmi
[CBI v. Thommandru Hannah Vijayalakshmi, (2021) 18
SCC 135]. The High Court has completely ignored that
it was not at the stage of trial or considering anPage | 79
2026:JHHC:5999appeal against a verdict in a trial. The High Court has
enquired into the materials produced by the accused
persons, compared with the information compiled by
the investigating agency and pronounced a verdict
saying that the explanation offered by the accused
persons deserves to be accepted applying the doctrine
of preponderance of probability. This entire exercise has
been justified on account of the investigating officer not
taking into consideration the explanation offered by the
public servant and also not taking into consideration the
lawful acquired assets of the wife of the public servant i.e.
Respondent 2 herein.
82. By accepting the entire evidence put forward by the
accused persons applying the doctrine of preponderance of
probability, the case put up by the prosecution cannot be
termed as “groundless”. As observed by this Court in C.S.D.
Swami [C.S.D. Swami v. State, AIR 1960 SC 7] that the
accused might have made statements before the
investigating officer as to his alleged sources of income, but
the same, strictly, would not be evidence in the case.
83. Section 13(1)(e) of the 1988 Act makes a departure from
the principle of criminal jurisprudence that the burden will
always lie on the prosecution to prove the ingredients of the
offences charged and never shifts on the accused to
disprove the charge framed against him. The legal effect of
Section 13(1)(e) is that it is for the prosecution to establish
that the accused was in possession of properties
disproportionate to his known sources of income but the
term “known sources of income” would mean the sources
known to the prosecution and not the sources known to the
accused and within the knowledge of the accused. It is for
the accused to account satisfactorily for the money/assets
in his hands. The onus in this regard is on the accused to
give satisfactory explanation. The accused cannot make an
attempt to discharge this onus upon him at the stage of
Section 239CrPC. At the stage of Section 239CrPC, the court
has to only look into the prima facie case and decide
whether the case put up by the prosecution is groundless.”
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120. It requires to refer herein that the ambit and scope of
exercise of power of discharge, are fairly well settled which
has been elaborately discussed in the preceding paragraph
and as per settled proposition of law no comprehensive
assessment of the materials or meticulous consideration of
the possible defence need to be undertaken at this stage nor
any exercise of weighing materials in golden scales is to be
undertaken at this stage. The only deliberation at the stage
of discharge is as to whether prima facie case was made out
or not and whether the accused is required to be further tried
or not.
121. Further, it is well settled that the revisional power
cannot be parallelled with appellate power. The Revisional
Court cannot undertake meticulous examination of the
material on record as is undertaken by the Trial Court or the
Appellate Court.
122. From perusal of the impugned orders, it is evident
that the Ld. Special Judge has duly considered the rival
submissions, examined the documents and statements
placed on record, and thereafter passed a reasoned order.
The discharge application filed by the Petitioners were
rejected only after satisfaction that sufficient grounds exist
to proceed against him.
123. Hence, on the basis of discussion made herein above
and taking into consideration the settled position of law
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discussed and referred hereinabove and further taking into
consideration the ratio of the judgment rendered by the
Hon’ble Apex Court in the case of
Pradeep Nirankarnath Sharma Versus Directorate of
Enforcement and Another (supra), this court is of the
considered view that there is no illegality in the impugned
order dated 21.08.2025 passed by the learned Special Judge,
PMLA Ranchi in connection with ECIR Case No. 08 of 2023.
124. Accordingly, this Court do not find any justifiable
reason to interfere with the impugned order dated
21.08.2025 consequently, these criminal revision petitions
are hereby dismissed.
125. Pending Interlocutory Applications, if any, also stand
disposed of.
(Sujit Narayan Prasad, J.)
Date : 27/02/2026
Birendra/-A.F.R.
Uploaded on 28.02.2026
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