Srinagar: The Jammu and Kashmir High Court on Thursday referred to a Division Bench of the court the plea by Farooq Abdullah challenging the proceedings initiated by Enforcement Directorate (ED) against him in a money laundering case.
When the matter came up for hearing before the Single Bench of Justice Dhiraj Singh Thakur, the court observed that a similar matter titled Ahsan Ahmad Mirza Vs ED is pending before the coordinate bench of the court and it would better in the interest of justice that the present case is also referred to the bench.
Justice Dhiraj said,” Considering the fact that the genesis of the proceedings both against the petitioner, Dr Farooq Abdullah as also the appellant, Ahsan Ahmad Mirza, lies in the case which is pending trial before the Designated Court and the issues being common, in my opinion, therefore, are required to be considered together,”
The Writ court recorded that the matter be considered by a Division Bench of this Court, after both the Counsel for the petitioner Sidharth Luthra and Government Counsel Tushar Mehta, Solicitor General of India expressed no objection.
“Be that as it may, the Registrar Judicial of this Court is directed to list this matter along with records of WP (C) 2780/2019 before the appropriate Bench after seeking due permission from the Chief Justice,” Court directed.
Earlier, Justice Ali Mohammad Magrey had recused himself from hearing the plea of the former Chief Minister.
The case arises out of allegations regarding siphoning of funds of Jammu and Kashmir Cricket Association (JKCA).
When the allegations emerged in 2012, Abdullah, who was then the President of JKCA, convened an immediate meeting of the office bearers of JKCA.
Subsequently, an FIR was registered for criminal breach of trust under Sections 409, 406, and 120B of the Ranbir Penal Code (RPC).
Then General Secretary and Treasurer Saleem Khan and Ahsan Ahmad Mirza were named as accused persons. Simultaneously, Abdullah constituted an in-house probe committee to look into the issue.
In May 2012, this committee submitted its interim report, in which it confirmed the embezzlement of funds by certain office bearers of the JKCA.
Then in September 2015, the Jammu & Kashmir High Court directed that the investigation in the case be transferred to the Central Bureau of Investigation (CBI).During the course of its investigation, the CBI arraigned Abdullah as an accused.
It was alleged that he had appointed Ahsan Ahmad Mirza as Treasurer of the JKCA in violation of the provisions of the JKCA Rules, 1957, and thereby facilitated the actions of Mirza. It was further alleged that Abdullah unduly authorised Mirza to operate bank accounts and authorised the return of a loan to the tune of Rs. 1.9 crore to Mirza. The ED registered a case against Abdullah in 2018.
Abdullah’s petition contends that the ED did not have jurisdiction to register the said case. On the date of registration of the Enforcement Case Information Report (ECIR), the erstwhile State of Jammu & Kashmir was governed by the Constitution of Jammu & Kashmir, 1956 and had special status in terms of Article 370 of the Constitution of India. Thus, the Prevention of Money Laundering Act (PMLA) was not a law which could extend to the State, as Parliament had not have legislative competence to enact the said law in terms of the Constitution (Application to Jammu and Kashmir) Order, 1954.
Despite having no jurisdiction, the ED initiated its investigation and summoned Mirza and others under Section 50 PMLA. This was challenged by Mirza before the High Court. However, in a judgment passed in October 2019, the Court declined the challenge on the basis of its interpretation of the term ‘corresponding law’. While doing so, the petition contends, the lack of legislative competence of Parliament to extend the PMLA to J&K was not raised or considered by the Court.
In December 2020, the ED attached the properties of Abdullah and others worth Rs 11.86 crore in connection with its money laundering probe linked to alleged financial irregularities in the JKCA.
“A bare perusal makes it amply clear that the ED has simply adopted the case of the CBI and the resulting Final Report filed against the Petitioner. Barring the recording of a handful of statements under Section 50 PMLA, no independent inquiry has been conducted into the present case, rendering it inherently biased. Nowhere has the ED satisfactorily offered reasons to believe the Petitioner is in possession of proceeds of crime, or that such proceeds are likely to be concealed, transferred or dealt with in any manner which may result in frustrating any proceedings under the PMLA, as is required under Section 5 PMLA. Admittedly, the properties attached have no relation to the present case,” the plea states.
It is further contended that the properties attached by the ED are either ancestral or acquired by Abdullah prior to the date of the alleged offences, and hence were not involved in any alleged money laundering or related criminal activity.
On these grounds and others, Abdullah has sought quashing of the original complaint dated January 15, 2021 pending before the Adjudicating Authority of the ED, as well as the provisional attachment order, the ECIR, and the notice dated February 5, 2021 issued under Section 8 of the PMLA by the Adjudicating Authority.
Abdullah contends that it is a settled principle of constitutional law that there can be no retrospective application of criminal law. Hence, his arraignment in the present case falls foul of the rule against retrospectively, as Section 120-B was not a scheduled offence as on the date of the alleged commission of the offence.