Enforcement Directorate is not a ‘super cop’, says Karnataka High Court

Karnataka HC ruled that the ED’s power under the Prevention of Money-Laundering Act (PMLA) is “derivative and not original”. File | Photo Credit: V Sreenivasa  Murthy

In a set back to the Enforcement Direectorate (ED), the High Court of Karnataka has held that the ED is “not a super cop” and cannot file a private complaint to initiate a money-laundering probe when the competent agencies decline to prosecute a scheduled offence based on the information filed by the ED.

‘Derivative and not original’

The Court ruled that the ED’s power under the Prevention of Money-Laundering Act (PMLA) is “derivative and not original,” and that filing a private complaint under Section 200 Code of Criminal Procedure (Cr.P.C.)/Section 223 Bharatiya Nagarik Surakasha Sanhita is not contemplated under the PMLA Act.

“... one institution in the country does not become supreme so that it is in a position to abuse the powers conferred on it. Law recognises the requirements of checks and balances. The ED is not a super cop to investigate anything and everything which comes into its notice,” the Court observed, adding that the ED must exercise only those powers expressly conferred on it by the PMLA.

Justice M.I. Arun passed the order while allowing a batch of writ petitions filed by Congress Party MLA from Malur constituency K.Y. Nanjegowda, who is also Chairman of the Kolar and Chikkaballapur Milk Union Ltd (KOMUL), Y.B. Ashwathanarayana then Director of KOMUL, K.N. Gopala Murthy, Nagesh N. and Raju Krishna C.

The petitioners had challenged the ED’s ECIR registered in November 2023, the Adjudicating Authority’s order confirming seizure of articles, summons issued to them, and the private complaint filed by the ED before a special court.