The Madras High Court has quashed the Enforcement Directorate’s (ED) freezing of fixed deposits belonging to RKM Powergen Pvt Ltd, ruling that the agency acted without jurisdiction in the absence of a scheduled (predicate) offence.
A bench held that ED can't act on mere suspicion or conduct roving inquiries under the PMLA.
The Court strongly stated that ED is "not a super cop" or a "loitering munition" to investigate anything it comes across.
Without a scheduled offence and proceeds of crime, ED has no jurisdiction under the PMLA, 2002. Finding no offence or proceeds of crime, the Court allowed the company’s plea and quashed the freeze order. (R.K.M Powergen Private Limited v. The Assistant Director and Ors)