BNSS & BSA Grant Discretion To Summon, Examine Witnesses Allowing Trial Courts To Determine How To Proceed In PMLA Cases: Kerala High Court

A division bench of Justice A.Muhamed Mustaque and Justice P. Krishna Kumar observed that delaying the PMLA trial until the conclusion of the trial in the predicate offence could result in the Enforcement Directorate (ED) losing key witnesses. However, the Court also pointed out that if the accused is acquitted of the predicate offence, the PMLA trial would ultimately be rendered futile.

“In this circumstance, we deem it appropriate to leave the matter for the just decision of the trial court. Depending upon the nature of each case, it can take a balanced course. The court may, in its discretion, permit the Enforcement Directorate to examine those witnesses who are required to prove the most important elements of the crime (such as the act of using the proceeds of crime or projecting or claiming it as untainted) while the trial of the predicate offence is pending. In such cases, the court may keep the examination of the rest of the witnesses in abeyance until the conclusion of the trial,” Court said.

The Court was considering the constitutional validity of criminal proceedings initiated under the PMLA in cases where the alleged act of money laundering was committed before the enactment of PMLA or before the amendment to its schedule in 2009.

The appellants contended that they cannot be prosecuted for an alleged act under the PMLA, unless they first convicted for the predicate offence. It was thus argued that trial of the offence under the PMLA should be kept in abeyance until the conclusion of the trial of the predicate offence.

On the other hand, the ED argued that trial under predicate offences and the trial under PMLA should go simultaneously. It was stated that judgment in PMLA case can be withheld until there is conviction in predicate offence.

The Court went to examine the provisions under the BNSS and BSA to determine whether discretion is granted to Trial Courts in the manner of summoning and examining witnesses.

It observed that as per Section 253 of the BNSS, Court may issue process for compelling the attendance of any witnesses.

"The expression 'may … issue any process for compelling the attendance of any witness' confers ample discretion to the trial court for taking a decision as to which of the witnesses are to be summoned before the court," the court said. 

Furthermore, the Court highlighted that Section 254 of the BNSS states that on the date fixed for evidence, the court shall take all evidence produced by the prosecution.

"If the court decides not to issue process to certain witnesses, by exercising its discretion under Section 253, the court is not bound to examine them on the date fixed for the prosecution evidence. Given this scheme of the Sanhita regarding criminal trials, it is evident that Section 253 of the Sanhita, which corresponds to Section 230 of the Code of Criminal Procedure, 1973, empowers the Criminal Courts to decide which witnesses should be summoned first while fixing a date for the prosecution evidence," the court added.

Additionally, the Court stated that as per Section 140 of the BSA, Trial Court has the discretion to decide the order in which the witnesses are to be produced and examined before the court.

However, the Court observed that it is for the Trial Court to decide whether to proceed with the trial in PMLA case or wait until the trial in predicate offence is concluded before continuing with the Trial in PMLA case.

It said, “..if the court finds that the above course prejudices either side, it should proceed with the trial in a full-fledged manner and postpone the pronouncement of judgment until the trial of the predicate offence is concluded.”

In the facts of the case, the Court held that ED relied upon sufficient material to take action under the PMLA. Court added, “The materials available before us prima facie indicate that the Directorate initiated actions against the appellant/petitioners under the PMLA on the basis of some materials. The sufficiency of the materials for attracting the penal offences is a matter to be looked into by the trial court".

The bench observed that based on the court's interim directions the ED had not submitted a final report in those cases. It said that the parties are at liberty to raise such disputes as and when a situation arises and they can also challenge the criminal proceedings in case there are no materials to show that they did not commit any act as alleged subsequent to the enactment of PMLA or the amendments made.

As such, the appeals were dismissed.

Case Title: A.K Samsuddin & Connected Cases

Case No: WA NO. 2076 OF 2016 & Connected Cases

Citation: 2025 LiveLaw (Ker) 213