Ed moves Delhi HC against trial court order in National Herald case

The appeal follows a detailed order passed on Tuesday by Special Judge Vishal Gogne of the Rouse Avenue Courts, who declined to take cognisance of the ED's prosecution complaint under the Prevention of Money Laundering Act (PMLA) in the absence of an FIR. However, while declining cognisance, the court clarified that it was not examining the merits of the allegations.

The agency has questioned the trial court's findings and sought appellate review, arguing that the refusal to proceed has caused serious prejudice to the investigation and prosecution.

The trial court held that a money-laundering prosecution cannot be sustained in the absence of an FIR in the scheduled (predicate) offence and cannot be founded solely on a private complaint and a summoning order. The trial court ruled that proceedings under Sections 3 and 4 of the PMLA against Sonia Gandhi, Rahul Gandhi, Sam Pitroda, Suman Dubey, Young Indian, Dotex Merchandise Pvt Ltd and others were legally unsustainable, as the ED's case was based on a private complaint filed by BJP leader Subramanian Swamy and the summoning order passed on it in 2014, rather than on a duly registered FIR.

Observing that the investigative potential of an FIR is "qualitatively superior" to that of a complaint case under Section 200 of the CrPC (now Section 223 of the Bharatiya Nagarik Suraksha Sanhita), the court held that registration of an FIR in the predicate offence is a foundational jurisdictional requirement for the ED to initiate money-laundering proceedings, register an ECIR and file a prosecution complaint.

Relying on the statutory scheme of the PMLA, the Supreme Court's judgment in Vijay Madanlal Choudhary, and FATF principles, the court reiterated that an FIR in the scheduled offence is a sine qua non for sustaining a money-laundering prosecution. It also noted that the ED itself has consistently maintained before various forums that an FIR is necessary to trigger PMLA proceedings.

While declining cognisance, the court clarified that it was not examining the merits of the allegations. It recorded that a subsequent FIR was registered by the Economic Offences Wing (EOW), Delhi, on October 3, 2025, during the pendency of the proceedings, and held that both the ED and the EOW are free to pursue further investigation in accordance with law. However, the prosecution's complaint as presently filed was held to be legally untenable.

Challenging these findings before the Delhi High Court, the ED has sought the setting aside of the trial court's order and permission to proceed with the prosecution complaint under the PMLA.

Reacting to the Rouse Avenue Court's ruling, senior advocate Abhishek Manu Singhvi had termed it a "deserved victory" and described the case as the "strangest ever." In a post on X, Singhvi said the trial court did not even find it fit to take cognisance despite allegations of massive money laundering, pointing out that there was no movement of money or transfer of immovable property.

He also underscored that Associated Journals Ltd (AJL) is now owned by Young Indian, a not-for-profit company that cannot distribute profits, dividends or perks, and accused the ruling dispensation of exaggeration and propaganda.

During earlier hearings, Singhvi appeared for Sonia Gandhi, while Senior Advocate R S Cheema represented Rahul Gandhi. Advocates Sumit Kumar and Nikhil Bhalla also appeared for the Gandhi family. Advocate Sushil Bajaj represented Suman Dubey, Senior Advocate Madhav Khurana appeared for Young Indian, and Additional Solicitor General S.V. Raju represented the Enforcement Directorate.

The trial court reiterated that the accused has a statutory right to be heard before cognisance under Section 223 of the BNSS. (ANI)