Mumbai, Feb 03: The special court has closed the money laundering case initiated by the Enforcement Directorate against Multi Commodity Exchange of India Ltd (MCX), its promoters, Jignesh Shah and others, noting that the predicate offence registered by the CBI was closed in January 2024.
CBI case background
The CBI, in August 2014, had registered a case against Multi Commodity Exchange Ltd (MCX), Financial Technologies India Ltd (FTIL), MCX-SX (Stock Exchange), Smt Visaka More, Rajesh Dangeti, Muralidhar Rao, J M Gupte and Jignesh Shah.
It was alleged that during 2009–10, officials of SEBI, in collusion with MCX-SX, suppressed information regarding buyback arrangements with Punjab National Bank, IFCI and IL&FS, and obtained an extension of recognition for MCX-SX to trade in currency derivatives from September 16, 2009, to September 15, 2010.
The CBI had claimed that SEBI officials deliberately did not initiate action against MCX-SX for cancellation of recognition in currency derivatives even after the Whole Time Member (WTM), SEBI, rejected the application to operate in other segments.
Closure of predicate offence
However, after nine years of investigation, the CBI filed a closure report on November 10, 2023. The closure report was accepted by the special court on January 29, 2024.
It was therefore submitted that the scheduled offence had ceased to exist in view of the closure report filed by the CBI and accepted by the special judge, and hence no prosecution could be pursued under the Prevention of Money Laundering Act (PMLA) in the absence of a scheduled offence.
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Court’s observation
After considering the submissions, the court closed the money laundering case, observing that, “If no offence of money laundering is made out requiring the filing of such a complaint, the authority authorised under the PMLA shall submit a closure report before the Special Court. Since the closure report filed by the CBI, EOB, in respect of the predicate offence has been accepted by the Special Court, the continuation of the ECIR is not maintainable.”
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