The High Court also stated that the actions of the ED and the complainant were “clearly malafide” and lacked serious consideration. The court observed that their conduct was an abuse of the legal process.
MUMBAI: The Bombay High Court, on Tuesday, criticized the Enforcement Directorate (ED) for initiating a money laundering investigation against a real estate developer without proper grounds. The court imposed a fine of Rs 1 lakh each on the ED and the complainant, asserting that central agencies cannot misuse their authority to harass citizens.
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Justice Milind Jadhav, who presided over the case, emphasized the need for law enforcement agencies to act within legal boundaries.
Justice Milind Jadhav remarked, “I am compelled to levy exemplary costs because a strong message needs to be sent to the law enforcement agencies like the ED that they should conduct themselves within the parameters of law and that they cannot take law into their own hands without application of mind and harass citizens.”
The High Court also stated that the actions of the ED and the complainant were “clearly malafide” and lacked serious consideration. The court observed that their conduct was an abuse of the legal process.
Case Background
The case originated when a real estate developer approached the High Court seeking an occupation certificate for a project. While this issue was pending, the Vile Parle police initiated an investigation and forwarded the matter to the ED. Subsequently, the ED began probing the case, alleging that the developer had purchased properties using “proceeds of crime.”
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The ED filed its findings in a special Prevention of Money Laundering Act (PMLA) court. This court accepted the ED’s report and allowed the agency to attach the properties allegedly acquired through illegal means. However, this order was later challenged in the Bombay High Court.
The High Court noted that the complainant, Achhra, approached the magistrate despite knowing that the Mumbai Police had already classified the dispute as civil in nature.
The court stated, “Achhra had a clear sinister motive in his mind, which became clearly evident.”
Achhra reportedly tried to bring the case under the jurisdiction of the Vile Parle police station by making dubious claims about a meeting with the accused, Jain, within its jurisdiction.
The bench clarified that a breach of contract or agreement does not automatically amount to a criminal breach of trust.
It ruled, “Clearly, the allegation or charge under Section 406 (criminal breach of trust) of the IPC has no basis.”
The High Court held that the magistrate’s court order lacked jurisdiction. Consequently, the case registered by the Vile Parle police station was deemed invalid.
Justice Jadhav concluded that the ED’s case, based on this invalidated police investigation, “cannot survive.”
Case Title: Rakesh Brijlal Jain vs State of Maharashtra
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