SC Requires Prior Sanction for Prosecuting Public Servants in Money Laundering Cases

Source: This post on SC Requires Prior Sanction for Prosecuting Public Servants in Money Laundering Cases has been created based on the article “Prior sanction required to prosecute public servants for money laundering: SC” published in Indian express on 7th November 2024.

Why in news?

The Supreme Court ruled that a prior government sanction is required under Section 197(1) of the Code of Criminal Procedure (CrPC) before prosecuting public servants for offences under the Prevention of Money Laundering Act (PMLA).

This ruling came while upholding the Telangana High Court’s decision, which set aside a trial court’s cognizance of money laundering charges against IAS officers Bibhu Prasad Acharya and Adityanath Das, as well as former Andhra Pradesh CM Jagan Mohan Reddy.

Justification and Legal Basis:

1. Applicability of Section 197(1) of CrPC to PMLA: Section 197(1) of CrPC mandates that before prosecuting a public servant for actions taken as part of their official duties, prior government sanction is required.

Since both Acharya and Das were acting as public servants, the Court held that they are protected under this provision. The alleged offenses arose from their official functions. Hence, the safeguard of prior sanction under Section 197(1) is applicable.

2. PMLA Sections 65 and 71 in Relation to CrPC: Section 65 of PMLA explicitly states that provisions of the CrPC will apply to proceedings under the PMLA, provided they are not inconsistent with the PMLA.

The Court found no inconsistency between the PMLA and CrPC’s Section 197(1). Therefore, Section 197(1) remains applicable in cases under the PMLA, requiring prior sanction before prosecuting public servants.

Section 71 of PMLA grants PMLA provisions an overriding effect over other laws only when there is an inconsistency. The Court clarified that Section 65 mandates that CrPC provisions, including Section 197(1), apply to PMLA cases unless inconsistent.

Since there was no inconsistency identified between the two statutes, Section 71 does not override Section 197(1) of CrPC.

3. Importance of Prior Sanction:

The ruling underscores the principle that a law should not be interpreted to make any of its provisions redundant. If Section 71 of the PMLA were to override Section 197(1) of CrPC, it would render Section 65 ineffective.

Therefore, the Court emphasized that both provisions must be applied harmoniously, with CrPC protections for public servants intact within PMLA proceedings.

Source: Polity and nation