Authority: High Court of Jammu & Kashmir and Ladakh at Srinagar

Order Date: 21.08.2026

Case Overview

  • Parties: M/S Reach Dredging Limited (Petitioner) vs. Directorate of Enforcement, Government of India (Respondent).
  • Petition: CRM(M) No.589/2025 filed by Reach Dredging Ltd challenging a summons dated 17.09.2025 issued under Section 50 of the Prevention of Money Laundering Act, 2002 (PMLA) and the underlying Enforcement Case Information Report (ECIR) No.SRZO/08/2025 dated 30.07.2025.
  • Background of the Dispute: The company won e‑NIT No.1 of 2018‑19 (dated 17.07.2018) for construction of a flood spill channel across Hokersar Wetland. Letter of Intent was issued on 15.09.2018 and allotment order on 01.02.2019. Work was completed in 2020 to the satisfaction of the department and the Wildlife Department.
  • Subsequent Investigation: On 18.04.2025, the Anti‑Corruption Bureau, Srinagar registered FIR No.7/2025 for offences under Section 5(1)(d) of the J&K Prevention of Corruption Act and Section 120‑B of the RPC. The petitioner had earlier obtained an interim direction (CRM(M) No.580/2025) on 23.09.2025 restraining the ACB from filing a charge‑sheet.
  • Legal Questions Raised:

1. Whether, after the 2018 amendment omitting Section 13(1)(d) of the Central Prevention of Corruption Act, there is any corresponding provision in the Central Act pari materia with Section 5(1)(d) of the J&K PC Act.

2. If not, whether the Enforcement Directorate can lawfully proceed under PMLA for money‑laundering when the predicate offence is not a scheduled offence.

  • Arguments Presented:
  • Petitioner: Contended that the predicate offence is not a scheduled offence post‑amendment, rendering the ED’s jurisdiction void.
  • Respondent (ED): Asserted that Section 5(1)(d) J&K PC Act is pari materia with Section 13(1)(d) Central PC Act, which (via Section 2(2) PMLA) makes it a scheduled offence; cited ECIR registration.
  • Statutory Interpretation: The judgment examined definitions under PMLA, particularly Section 2(u) (proceeds of crime) and Section 3 (money laundering), and quoted Supreme Court precedent (Vijay Madanlal Choudhary v. Union of India, 2022 SCC OnLine SC 929) emphasizing the necessity of a scheduled offence.
  • Legislative Analysis: The court reviewed the pre‑amendment provisions of Section 5(1)(d) J&K PC Act and Section 13(1)(d) Central PC Act, the objects and reasons of the Prevention of Corruption (Amendment) Act, 2018, and the amended Section 7 of the Central PC Act, which now comprehensively covers the conduct described in Section 5(1)(d) J&K PC Act.
  • Conclusion on Scheduled Offence: The court held that amended Section 7 of the Central PC Act is listed in Paragraph 8 of the Schedule to PMLA and is a scheduled offence; therefore, by virtue of Section 2(2) PMLA, the J&K provision corresponds to a scheduled offence.

Final Outcome

  • The petition is dismissed. The summons dated 17.09.2025 and the ECIR registration are upheld as lawful. No relief is granted to Reach Dredging Ltd.

Topics: Legal Jurisdiction, Money Laundering, Anti‑Corruption Law