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Which Special Court Should Try Connected PC Act and PMLA Cases? Madras High Court Applies the Dual-Designation Solution

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Which Special Court Should Try Connected PC Act and PMLA Cases? Madras High Court Applies the Dual-Designation Solution

When a corruption prosecution and a connected money-laundering prosecution are pending before different Special Courts, section 44 of the Prevention of Money-Laundering Act, 2002 ordinarily points toward one designated PMLA court. A harder problem arises when the scheduled offence is itself governed by a special enactment and the PMLA court is not authorised to try that special offence.

The Madras High Court confronted that problem in The Deputy Director, Directorate of Enforcement v The Deputy Superintendent of Police, CBI and others, Crl.O.P. No. 8776 of 2025, neutral citation 2026:MHC:922, delivered on 5 March 2026. The Division Bench of Manindra Mohan Shrivastava CJ and G. Arul Murugan J transferred the PMLA prosecution to the CBI court already trying the Prevention of Corruption Act, 1988 case because that CBI court was also designated as a Special Court under PMLA.

The ruling is deliberately narrow. It resolves the two proceedings through a court competent under both statutes, but it leaves open the larger question of what must happen when neither of the two Special Courts has dual authority.

The two pending prosecutions

The CBI had registered a case against the private respondents and filed a charge-sheet under section 13(2) read with section 13(1)(e) of the Prevention of Corruption Act, 1988. The scheduled-offence case became C.C. No. 19 of 2014 and was pending before the XIII Additional Special Court for CBI Cases, Chennai.

Because PC Act offences form part of the PMLA Schedule, ED recorded an enforcement case on 31 December 2014. A provisional attachment order followed on 12 March 2015, and the Adjudicating Authority confirmed the attachment. ED then filed its prosecution complaint for the offence under section 3, punishable under section 4 PMLA. That case became C.C. No. 37 of 2015 before the Principal Sessions Judge, Chennai, designated for PMLA matters.

The two trials progressed at different speeds. ED said that the corruption trial was behind the PMLA trial and that documents examined in the predicate case were also relevant to the laundering prosecution. It applied to the CBI court under section 44(1)(c), seeking commitment of the scheduled-offence case to the PMLA court. The CBI court rejected that application on 18 March 2025, partly because the corruption trial had reached an advanced stage and transfer could delay it.

ED challenged that refusal before the High Court.

The ordinary rule under sections 43 and 44 PMLA

Section 43 permits the Central Government, in consultation with the Chief Justice of the High Court, to designate one or more Courts of Session as Special Courts for PMLA cases. Section 43(2) gives such a court additional jurisdiction to try another offence with which the accused may be charged at the same trial under criminal procedure.

Section 44(1)(a) provides that an offence punishable under section 4 PMLA and a connected scheduled offence shall be triable by the Special Court constituted for the area in which the money-laundering offence has been committed. Section 44(1)(c) addresses the situation where a different court has already taken cognizance of the scheduled offence. On an application by the authority authorised to file the PMLA complaint, that court shall commit the scheduled-offence case to the PMLA Special Court, which continues from the stage at which it is received.

The language is mandatory. In paragraphs 10 to 16, the Madras High Court held that a court trying the scheduled offence ordinarily has no discretion to refuse commitment merely because its trial is advanced or transfer may cause delay.

Rana Ayyub and the direction of transfer

The High Court treated Rana Ayyub v Directorate of Enforcement, (2023) 4 SCC 357, as central. In paragraphs 23 to 29 of Rana Ayyub, the Supreme Court explained the relationship between sections 43 and 44. If a court other than the PMLA Special Court has taken cognizance of the scheduled offence, the authorised PMLA authority may seek commitment of that case to the PMLA court.

Rana Ayyub also clarifies the territorial direction of the scheme. The scheduled-offence trial follows the court that has taken cognizance of the money-laundering complaint, rather than the money-laundering trial automatically following the place of the predicate case. Paragraphs 36 to 40 further explain that territorial jurisdiction may be connected to any place where alleged proceeds are acquired, possessed, concealed or used.

The Madras High Court therefore held that the CBI court’s refusal was inconsistent with section 44(1)(c) and Rana Ayyub. But that conclusion exposed a second and more difficult issue.

The special-statute complication

The predicate offence was not an ordinary IPC offence triable by a regular criminal court. It arose under the Prevention of Corruption Act, which establishes its own Special Judges and contains a special trial framework. The Principal Sessions Judge designated under PMLA was not designated to try PC Act offences.

This produced a jurisdictional asymmetry. A literal application of section 44(1)(c) would send the corruption case to the PMLA court, yet that court lacked designation under the PC Act. The CBI court had PC Act jurisdiction but, at first glance, was not the court that had taken cognizance of the PMLA complaint.

The High Court found a fact-specific solution in paragraph 18: the XIII Additional Special Court for CBI Cases was also designated as a PMLA Special Court. It was therefore competent under both enactments. By contrast, the original PMLA court was not competent under the PC Act.

The Supreme Court’s 2022 transfer order

In Assistant Director, Directorate of Enforcement v Inspector of Police, Criminal Appeal arising from SLP (Crl.) Diary No. 18882 of 2022, order dated 30 September 2022, a similar arrangement was adopted in Kerala. On the Additional Solicitor General’s statement that the SPE/CBI-I court at Ernakulam was competent to try both the PC Act and PMLA cases, the Supreme Court transferred the PMLA prosecution to that court.

The limitation of that order is essential. The Supreme Court expressly said that it had not commented on the merits of the legal issue and left it open. The order recorded an agreed and workable transfer; it did not finally interpret the priority between the two special statutes.

The Madras High Court followed the same route. Paragraphs 19 to 21 transferred C.C. No. 37 of 2015, the PMLA prosecution, from the Principal Sessions Judge to the XIII Additional Special Court for CBI Cases, where C.C. No. 19 of 2014 was pending. The larger issue was again left for an appropriate case.

Transfer to one court is not a joint trial

Explanation (i) to section 44(1) states that the jurisdiction of the Special Court under PMLA is not dependent on orders passed in the scheduled-offence case and that trial of both sets of offences by the same court shall not be construed as a joint trial.

That distinction has practical consequences. The corruption charge and the money-laundering charge retain separate ingredients. The prosecution must prove the PC Act offence according to that Act. In the PMLA case, it must establish proceeds of crime within section 2(1)(u) and the accused’s alleged process or activity under section 3. Evidence may overlap, witnesses may be common and one judge may manage both records, but the charges and findings remain legally distinct.

Trying both cases before the same judge promotes coordination; it does not merge the offences or dispense with proof required by either statute.

Why trial progress was not decisive

The CBI court had relied on the advanced stage of the corruption trial and the possibility of delay. Those concerns are legitimate from the standpoint of speedy trial, but the High Court held that they could not override the mandatory structure of section 44(1)(c).

The eventual direction also reduced the practical force of the delay concern. Instead of transferring the advanced PC Act case away from the CBI court, the High Court moved the PMLA case to the same dual-designated court. The judge already seised of the corruption case retained it and acquired the connected PMLA proceeding.

Historical PC Act provision and the 2018 amendment

The scheduled prosecution dates from 2014 and invokes section 13(1)(e) read with section 13(2) of the Prevention of Corruption Act as it applied to the alleged period. The Prevention of Corruption (Amendment) Act, 2018 substantially recast section 13. The current provision refers to criminal misconduct through misappropriation or intentional illicit enrichment, but that revised text cannot be substituted for the historical charge without examining the date of conduct, the amendment and applicable savings principles.

The case therefore should continue to be described by its historically accurate charge. This is a special-statute prosecution; no BNS substitute should be invented for a PC Act offence.

For procedural orientation, the petition invoked the High Court’s inherent jurisdiction historically associated with section 482 CrPC; the current corresponding provision is section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023, subject to commencement and savings.

What remains open

The judgment does not establish that every PC Act case must remain before the CBI court or that every PMLA case must be transferred to the court trying the predicate offence. Its result depended on dual designation.

The unresolved problem may arise where:

1. The PC Act court is not designated under PMLA. 2. The PMLA court is not designated under the PC Act. 3. Both special statutes contain non-obstante or exclusive-jurisdiction provisions pointing in different directions. 4. Neither court can lawfully try both proceedings.

In such a case, a court would have to decide whether section 44 impliedly confers sufficient authority on the PMLA Special Court, whether a fresh designation is necessary, or whether the two prosecutions must remain separate subject to coordinated scheduling. The Madras High Court expressly declined to determine that larger question.

Practical implications

Before seeking commitment or transfer of connected PMLA and special-statute cases, the parties should place the following material on record:

1. The notifications designating each Special Court under PMLA and the predicate statute. 2. The cognizance orders and current stage of both proceedings. 3. The territorial nexus of the alleged money-laundering offence. 4. The exact scheduled offences and the overlapping evidence. 5. A proposed case-management arrangement preserving separate charges and judgments.

The designation notification is not a minor administrative detail. In this case, it supplied the legal bridge that allowed both proceedings to be placed before one competent court.

Conclusion

The Madras High Court applied section 44’s coordinating purpose without pretending that two special statutes automatically collapse into one. Ordinarily, the scheduled-offence case must be committed to the PMLA Special Court on ED’s application. On the unusual facts before it, however, the only court competent under both enactments was the CBI court. The High Court therefore transferred the PMLA prosecution to that dual-designated forum.

The ruling offers a practical solution, not a universal priority rule. Its most important restraint is the express preservation of the larger legal issue for a future case where dual designation is unavailable.

Sources

The Deputy Director, Directorate of Enforcement v The Deputy Superintendent of Police, CBI and others, Crl.O.P. No. 8776 of 2025, 2026:MHC:922, delivered 5 March 2026, Madras High Court judgment portal: https://www.mhc.tn.gov.in/judis

Rana Ayyub v Directorate of Enforcement, W.P. (Crl.) No. 12 of 2023, decided 7 February 2023, (2023) 4 SCC 357: https://api.sci.gov.in/supremecourt/2023/1847/1847_2023_15_1501_41710_Judgement_07-Feb-2023.pdf

Vijay Madanlal Choudhary v Union of India, SLP (Crl.) No. 4634 of 2014 and connected matters, decided 27 July 2022, (2023) 12 SCC 1: https://webapi.sci.gov.in/supremecourt/2014/19062/19062_2014_3_1501_36844_Judgement_27-Jul-2022.pdf

Assistant Director, Directorate of Enforcement v Inspector of Police, Criminal Appeal arising from SLP (Crl.) Diary No. 18882 of 2022, order dated 30 September 2022.

Prevention of Money-Laundering Act, 2002: https://upload.indiacode.nic.in/showfile?actid=AC_CEN_2_2_00035_200315_1517807326550&filename=a2003-15.pdf&type=actfile

Prevention of Corruption Act, 1988: https://www.indiacode.nic.in/bitstream/123456789/12894/1/prevention_of_corruption_act_1988_49_of_1988.pdf

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