PAVANA DIBBUR versus THE DIRECTORATE OF ENFORCEMENT

Citation: [2023] 13 S.C.R. 1049 · Decided: 29-11-2023 · Supreme Court of India · Bench: ABHAY S. OKA · Disposal: Appeal(s) allowed

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Judgment (excerpt)

[2023] 13 S.C.R. 1049 : 2023 INSC 1029
1049
CASE DETAILS
PAVANA DIBBUR
v.
THE DIRECTORATE OF ENFORCEMENT
(Criminal Appeal No. 2779 of 2023)
NOVEMBER 29, 2023
[ABHAY S. OKA AND PANKAJ MITHAL, JJ.]
HEADNOTES
Issue for consideration: Whether the off ence u/s.120B, IPC included 
in Paragraph 1 of the Schedule to the Prevention of Money Laundering Act, 
2002, can be treated as a scheduled off ence even if the criminal conspiracy 
alleged is to commit an off ence which is not a part of the Schedule.
Prevention of Money Laundering Act, 2002 – Paragraph 1 of the 
Schedule – Penal Code, 1860 – s.120B – Appellant purchased the fi rst 
property from Alliance Business School and the second property from 
accused no.1 against whom an FIR was registered alleging that he 
collected Rs.107 crores from the students by claiming himself as the 
Chancellor of the Alliance University – Four FIRs, ECIR registered – 
Complaint fi led against the appellant-accused alleging that she entered 
into a conspiracy with accused no.1 by getting executed nominal sale 
deeds in respect of the fi rst and second properties in her name for the 
benefi t of accused no.1 and facilitated him to use her bank accounts to 
siphon the university funds, assisting him in the activity connected with 
the proceeds of crime – Petition for quashing the complaint fi led by the 
appellant, dismissed by High Court – Appellant pleaded that out of the 
four scheduled/predicate off ences, chargesheets were fi led in the case 
of three off ences wherein only one off ence covered by the Schedule to 
the PMLA was mentioned– It was thus contended that s.120B of IPC 
alone, in the absence of any other scheduled off ence cannot sustain a 
charge under the PMLA and unless there is an allegation regarding a 
conspiracy to commit any scheduled off ence, the prosecution under the 
PMLA cannot lie:
1050 
SUPREME COURT REPORTS 
[2023] 13 S.C.R.
Held: The off ence punishable u/s.120B of the IPC will become a 
scheduled off ence only if the conspiracy alleged is of committing an off ence 
which is specifi cally included in the Schedule – In the present case, in the 
chargesheets fi led in the alleged scheduled off ences, there is no allegation 
of the commission of criminal conspiracy to commit any of the off ences 
included in the Schedule – Except for s.120B, IPC, no other off ence in 
the schedule was applied – Therefore, in this case, the scheduled off ence 
does not exist at all – Hence, the appellant cannot be prosecuted for the 
off ences punishable u/s.3, PMLA – Impugned order quashed and set aside 
– Complaint pending before the Special Court for PMLA cases, Bengaluru 
quashed as regards the present appellant – Code of Criminal Procedure, 
1973 – s.482. [Paras 26, 27]
Prevention of Money Laundering Act, 2002 – s.3 – Plea of the 
appellant that as she was not arraigned as an accused in the chargesheets 
fi led pertaining to the alleged scheduled off ences, she cannot be roped 
in as an accused for the off ences punishable u/s.3:
Held: In a given case, if the prosecution for the scheduled off ence 
ends in the acquittal of all the accused or discharge of all the accused or 
the proceedings of the scheduled off ence are quashed in its entirety, the 
scheduled off ence will not exist, and therefore, no one can be prosecuted for 
the off ence punishable u/s.3 of the PMLA as there will not be any proceeds 
of crime – Thus, in such a case, the accused against whom the complaint 
u/s.3 of the PMLA is fi led will benefi t from the scheduled off ence ending by 
acquittal or discharge of all the accused – Similarly, he will get the benefi t of 
quashing the proceedings of the scheduled off ence – However, an accused 
in the PMLA case who comes into the picture after the scheduled off ence 
is committed by assisting in the concealment or use of proceeds of crime 
need not be an accused in the scheduled off ence – Such an accused can still 
be prosecuted under PMLA so long as the scheduled off ence exists – An 
off ence u/s.3 can be committed after a scheduled off ence is committed – It 
is not necessary that a person against whom the off ence u/s.3 is alleged 
must have been shown as the accused in the scheduled off ence – Plea of 
the appellant rejected. [Paras 15, 16]
Interpretation of Statutes – Prevention of Money Laundering 
Act, 2002 – Paragraph 1 of the Schedule – Penal Code, 1860 – s.120B:
1051
Held: The penal statutes are required to be strictly construed – The 
penal laws must be construed according to the legislative in

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