Authority: Gauhati High Court (Kohima Bench)

Order Date: Date not specified

Case Overview

  • Parties: Petitioner – M/s Jyotisha Technology Private Limited (represented by Shri Sachin Minhas); Respondent – Directorate of Enforcement (ED), Guwahati Zonal Office.
  • Petition: Filed under Section 528 of the BNSS and Articles 226/227 of the Constitution seeking quash of five orders: (i) Summoning order dated 22‑03‑2024 by Special Judge (PMLA), Dimapur; (ii) Prosecution complaint in ML Case No. 01/2024 under Section 4 of the PMLA; (iii) Order dated 30‑05‑2024 of the Adjudicating Authority, New Delhi; (iv) Provisional attachment order No. 01/2023 dated 22‑12‑2023 by Deputy Director, ED, Dimapur; (v) ECIR dated 12‑04‑2022 registered by ED, Guwahati.
  • Background: Jyotisha Technology, incorporated on 05‑03‑2019, resells international gift‑cards and e‑wallet services. Separate complaints were lodged against the app‑based token “HPZ Token” for promising large returns on Bitcoin mining investments. FIRs were filed on 08‑10‑2021 (Cyber Crime Police Station, Kohima) and 02‑09‑2021 (CID, Guwahati). A CBI FIR on 08‑06‑2022 implicated Lillian TechnoCab Pvt. Ltd. and others. The ED alleged that approximately ₹115 crore was collected through HPZ Token, routed via the crypto exchange BuyUCoin (operated by Iblock Technologies Pvt. Ltd.) and subsequently laundered through multiple shell companies, including Jyotisha Technology.
  • Allegations against Petitioner: Use of www.astropay.com (prepaid card platform) for betting/gambling and crypto transactions; misuse of PayU payment‑gateway credentials (salt and key) to route traffic from adult and betting sites; mismatch between GST‑declared business and actual transaction pattern; involvement in layering proceeds of crime.
  • Petitioner’s Contentions: No scheduled offence under PMLA directly linked to the company; no money‑trail connecting it to the predicate offence; summoning order issued mechanically without reasoning; prosecution complaint violates Section 66(2) of PMLA; no victim identified; alleged misuse of PayU credentials not substantiated.
  • ED’s Counter‑arguments: Sections 420 and 120B of IPC are scheduled offences; ECIR dated 12‑04‑2022 established a prima facie case; investigation uncovered a nexus between the petitioner and the proceeds of crime; the petitioner acted as a shell company facilitating layering; burden of proof shifts to petitioner under Section 24 of PMLA.
  • Legal Submissions: Petitioner relied on judgments of Vijay Madanlal Choudhary, Rajinder Singh Chadha, Krishna Lal Chawla, and R.K.M. Powergen. ED relied on Bhajan Lal, Neeharika Infrastructure, Pavana Dibbur, and other precedents emphasizing the limited scope for quashing proceedings and the availability of statutory revision under CrPC.
  • Court’s Observations: The petition is not maintainable as a revision under Section 528 BNSS because a specific statutory remedy (revision under Sections 397/401 CrPC) exists; the summoning order is not interlocutory and is amenable to revision, not to inherent jurisdiction; the adjudicating authority’s order is appealable under Section 26 of PMLA; the prosecution complaint discloses a prima facie scheduled offence and proceeds of crime, satisfying the jurisdictional threshold for ED action.

Final Outcome

  • The Gauhati High Court dismissed the petition, holding that the petitioner failed to demonstrate any ground for quashing the summoning order, the provisional attachment, the ECIR, or the adjudicating authority’s order.
  • The court directed that the petitioner must pursue the appropriate statutory revision remedies under the CrPC and the appellate provisions of the PMLA.
  • No order was passed to set aside any of the ED’s actions; the ED’s jurisdiction to investigate money‑laundering involving Jyotisha Technology was upheld.

Topics: Money Laundering, PMLA Proceedings