Delhi High Court impleads Centre in Shivakumar plea in money laundering case

The Delhi High Court on Tuesday sought the Centre’s stand on a petition by Karnataka Deputy Chief Minister DK Shivakumar against certain provisions of the anti-money laundering law and a probe by the Enforcement Directorate (ED) against him, while directing that the interim protection to him from coercive action will continue.

A bench of Justices Navin Chawla and Ravinder Dudeja made the central Government a party to the petition, filed in 2022, on a request by the Congress leader’s senior counsel, Kapil Sibal, after the additional solicitor general (ASG) contended that a petition challenging a central enactment was not maintainable in the absence of the Union of India.

ASG SV Raju, appearing for the ED, said either Shivakumar should withdraw his petition or the court should dismiss it as not maintainable.

The bench, however, allowed the Centre’s impleadment and granted it four weeks to file a reply, observing that the petition had been pending since 2022 and this objection was being raised for the first time.

Further, the issues for determination were flagged in 2022 and the matter was listed for final hearing after the filing of written submissions, it added.

“Let the amended memo of parties be filed. Notice be issued to the Union of India. Counter affidavit, if any, be filed in four weeks of receipt of notice,” the court ordered. As the court directed that the interim order granting protection from coercive action to Shivakumar would continue, ASG Raju said he was withdrawing his earlier assurance on not taking any steps against the senior politician.

The bench, however, remarked that as per the earlier order, the ED was bound not to take coercive steps in the matter.

“Look at the manner in which the order has been passed. It does not say your statement. (It says) till further orders, the respondent will be bound. Not that you are saying,” the bench clarified and listed it for hearing on July 23.

The Congress leader had moved the High Court in 2022 seeking quashing of the entire investigation, including summons issued to him in the Enforcement Case Information Record (ECIR) registered by the agency in 2020, following an alleged disproportionate assets case.

In his petition, Shivakumar has assailed the money laundering probe against him on several grounds, including that the ED was re-investigating the same offence which it had already investigated in a previous case lodged by it in 2018.

In its submissions filed through lawyers Mayank Jain, Parmatma Singh and Madhur Jain, Shivakumar has earlier said that the present investigation constituted a second set of proceedings against him and was an abuse of process of law and a malafide exercise of power.

The petition also contended that the inclusion of Section 13 (Criminal misconduct by a public servant) of the Prevention of Corruption Act in the Schedule of the Prevention of Money Laundering Act is ultra vires the Constitution.

The plea submitted that Section 13 was a complete code which envisaged the aspect of laundering of ill-gotten wealth by a public servant in the form of assets and there cannot be any further activity of laundering the proceeds again.

On May 2, 2023, the High Court had ordered that ED would be “bound” by its stand that there would be no coercive action against Shivakumar in the case.

The central agency has opposed the petition on the grounds that the two ECIRs lodged by the agency pertain to different cases with certain overlapping of facts which cannot be termed as re-investigation.

The ED has said that the scheduled offences in both cases were different, a nd the quantum of proceeds of crime involved was also different.

The ED has further said that as per the first ECIR, the scheduled offence is section 120B IPC and the quantum of proceeds of crime recorded in it is Rs 8.59 crore.

The present ECIR, on the other hand, related to disproportionate assets to the tune of Rs 74.93 crores and emanated from a different FIR of CBI lodged in Bangalore on October 3, 2020, under the Prevention of Corruption Act, the reply stated.

The agency has claimed that on the basis of preliminary enquiry done by the CBI, ACB, Bangalore, it was found that Shivakumar and his family were in alleged possession of disproportionate assets of the known source of income during the check period April 1, 2013 to April 30, 2018.

The ED further said it was well settled that at the stage of investigation, it was premature to take the plea of double jeopardy and that it was wholly impermissible in a petition challenging the constitutional validity of certain provisions of the special act to pass the interim orders in the nature of final anticipatory bail.