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PMLA: Hearing of accused at the pre-cognizance stage

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The applicability of the mandatory rule under the first proviso to Section 223(1) of the BNSS IS Core issue, which requires giving the accused a hearing before taking cognizance, to a PMLA complaint filed before the BNSS came into force but where cognizance was taken after its commencement.The Supreme Court set aside the High Court’s judgment and the Special Court’s cognizance order, holding that the first proviso to Section 223(1) of the BNSS is substantive and mandatory. The Special Court was directed to afford the appellant an opportunity to be heard at the stage of taking cognizance.

1. Factual Background

  • ECIR and Arrest: The Directorate of Enforcement (ED/Respondent) registered an ECIR against Parvinder Singh (Appellant) on July 24, 2023, and subsequently arrested him on April 27, 2024.
  • Filing of Complaint: The ED filed a prosecution complaint under Sections 44 and 45 of the PMLA on June 24, 2024, before the designated Special Court. On the same day, the Special Court ordered the complaint to be registered as a miscellaneous case and fixed a hearing for cognizance.
  • Transition to BNSS: On July 1, 2024, the old Code of Criminal Procedure, 1973 (CrPC) was repealed and replaced by the BNSS.
  • Cognizance and Recall: On July 2, 2024 (after the BNSS took effect), the Special Court took cognizance of the offence without giving the appellant a prior hearing. The appellant later filed an application to recall the cognizance order, citing a breach of the first proviso to Section 223(1) of the BNSS. The Special Court dismissed this application on March 22, 2025, calling it a dilatory tactic, and proceeded to frame charges.

2. High Court’s Ruling

The Appellant challenged the orders before the High Court of Uttarakhand. The High Court dismissed the challenge against the cognizance order, ruling that because the PMLA proceedings were initiated before the BNSS commenced, the old CrPC applied pursuant to the savings clause under Section 531(2)(a) of the BNSS. It did, however, partly allow the other revision by quashing the framed charges and remanding the matter back for a fresh hearing on charges.

3. Arguments Raised

  • On Behalf of the Appellant: It was argued that the provisions governing complaints under the CrPC/BNSS seamlessly apply to PMLA trials since there is no textual inconsistency. Because cognizance was taken on July 2, 2024, the first proviso to Section 223(1) of the BNSS was fully active and mandated a pre-cognizance hearing for the accused. A mere ministerial act like numbering a complaint before July 1 did not qualify as a pending “inquiry” to trigger the savings clause of the old CrPC.
  • On Behalf of the Respondent (ED): The Additional Solicitor General (ASG) contended that the PMLA is a standalone special enactment, meaning general chapters of the BNSS regarding magistrate complaints do not apply. Alternatively, the ED argued that an “inquiry” had already commenced prior to July 1, 2024, when the court first dealt with the complaint, meaning the old CrPC was correctly applied under Section 531(2)(a) of the BNSS. They also argued that no actual prejudice was suffered by the appellant due to the lack of a hearing.

4. Key Legal Issues & Findings of the Supreme Court

A. Interplay Between PMLA and the CrPC / BNSS

The Supreme Court re-affirmed its established precedents (Tarsem Lal, Yash Tuteja, and Kushal Kumar Agarwal) holding that provisions regulating complaint procedures (previously Sections 200–205 of the CrPC, now Sections 223–228 of the BNSS) apply directly to PMLA complaints. There is no structural inconsistency between these statutes. Denying this linkage would dangerously strip a PMLA Special Court of basic powers, such as dismissing meritless complaints or dispensing with personal attendance.

B. Definition of “Inquiry” and Section 531(2)(a) of the BNSS

The Court clarified that under Section 2(1)(k) of the BNSS, an “inquiry” is a conscious, judicial act requiring the application of a judicial mind.

  • A purely administrative or ministerial act—such as directing a complaint to be numbered and fixing a future date for a cognizance hearing—does not constitute the commencement of an inquiry.
  • Drawing from Hardeep Singh v. State of Punjab, the Court held that since judicial mind had not been applied to the complaint before July 1, 2024, no inquiry was legally pending under the old CrPC. Consequently, the savings clause in Section 531(2)(a) could not be utilized to bypass the BNSS.

C. Nature of the First Proviso to Section 223(1) of the BNSS

The Court delivered a landmark interpretation regarding the pre-cognizance hearing rule:

  • Substantive Right: The first proviso to Section 223(1) of the BNSS is not merely a procedural or regulatory mechanism; it is substantive in nature. It directly feeds into the right to a fair trial protected under Article 21 of the Constitution of India.
  • Mandatory Character: The word “shall” in the proviso is strictly mandatory.
  • Effect of Non-compliance: Taking cognizance without granting the accused a prior opportunity to be heard is an illegality that renders the order void ab initio. The prosecution’s argument that the accused must demonstrate “prejudice” was completely rejected, as this constitutes an absolute illegality rather than a curable procedural irregularity.

5. Final Direction

The Supreme Court set aside the High Court’s judgment and the Special Court’s cognizance order dated July 2, 2024. The case was remanded to the Special Court with a directive to grant the appellant a proper hearing at the pre-cognizance stage and complete the entire exercise within 8 weeks.

2026 INSC 519

Parvinder Singh V. Directorate of Enforcement (D.O.J. 19.05.2026)

2026 INSC 519 click here to view full text of judgment

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Electricity Regulation: Supreme Court Declines to Interfere with Interim Order Permitting Third-Party Participation

September 4, 2026 No Comments

This special leave petition challenges an interim order passed by the High Court of Jharkhand, which rejected the petitioners’ preliminary objection regarding the maintainability of a Public Interest Litigation (PIL) filed by ‘Energy Watchdog’ and allowed the respondent to participate in departmental proceedings. The Supreme Court declined to interfere with the interim measure under Article 136 of the Constitution, noting that the High Court’s cautious approach aimed to ensure transparency in an inquiry involving alleged unauthorized power supplies and massive cross-subsidy surcharge defaults.

  • Brief of Judgment: Petitioner No. 1 entered into an agreement with Jharkhand Bijli Vitran Nigam Ltd. (JBVNL) for surplus captive power supply, which later triggered complaints by Energy Watchdog alleging lack of valid ‘captive user’ status and unauthorized power transmission. After JBVNL issued show cause and demand notices for cross-subsidy surcharges exceeding Rs. 280 crores total, a PIL was instituted. The High Court held the PIL maintainable and permitted the complainant to take part in the proceedings to ensure full disclosure of facts. The Supreme Court upheld this interim arrangement while clarifying that JBVNL must act independently and that all legal questions regarding third-party intervention under the Electricity Act, 2003 remain open for final adjudication.
  • Statutory Framework of the Electricity Act: Reaffirming precedents like PTC India Ltd. and Southern Power Distribution Company, the Electricity Act is an exhaustive code leaving no unallocated regulatory residue outside commissions like the State Commission, which is mandated to ensure transparency under Section 86.
  • Justification for Interim Measure: The High Court adopted a pragmatic interim measure because the circumstances suggested that prior administrative inaction warranted third-party inputs to bring full facts before JBVNL.
  • Preservation of Legal Contentions: The Supreme Court explicitly refrained from commenting on the merits, leaving it open for the High Court to comprehensively examine the scope and ambit of third-party intervention during the final hearing of the writ petition.

2026 INSC 954

M/s. Amalgam Steels and Power Ltd. and Anr. v. Energy Watchdog and Ors. (D.O.J. 03.09.2026)

2026 INSC 954 click here to view full text of judgment

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Empowering Educational Regulators: Upholding NCTE’s Mandate to Mandate Performance Appraisal Reports for Teacher Training Institutions

September 4, 2026 No Comments

This civil appeal addresses the statutory authority of the National Council for Teacher Education (NCTE) to mandate the online submission of annual Performance Appraisal Reports (PAR) along with a processing fee from recognized Teacher Education Institutions (TEIs). The Supreme Court allowed the appeal and set aside the Delhi High Court’s Division Bench judgment, ruling that the NCTE and its Executive Committee possess full statutory and ancillary powers under the NCTE Act, 1993, to enforce accountability and regulatory oversight over educational institutions.

  • Brief of Judgment: The litigation originated when TEIs challenged a 2019 Public Notice issued by the Member Secretary of the NCTE’s Executive Committee requiring them to submit online PARs and nominal processing fees. While a single judge dismissed the challenge, the Division Bench quashed the notice on the premise that the specific proforma had not been explicitly approved by the general body of the Council and that delegation to the Member Secretary was improper. The Supreme Court strongly disapproved of the High Court’s pedantic approach, holding that statutory regulators must be empowered to enforce institutional transparency, performance audits, and accountability without judicial overreach.
  • Statutory Framework and Duty Bearers: The judgment emphasizes that following the enactment of Article 21A and the Right of Education (RTE) Act, 2009, elementary school teachers, TEIs, and the NCTE act as critical constitutional duty bearers responsible for upholding high standards of educational quality.
  • Scope of Regulatory Powers: Section 12(k) of the NCTE Act expressly empowers the Council to evolve suitable performance appraisal systems and mechanisms to enforce accountability, which includes the incidental power to collect processing fees and utilize digital portals for management information systems.
  • Role of the Executive Committee: The Executive Committee, operating as the executive arm of the Council, is fully competent to implement decisions made by the General Body, such as substituting cumbersome annual renewal regimes with streamlined PAR submissions.
  • Reversal of High Court Judgment: The Supreme Court set aside the High Court’s order, reaffirming that courts must support and enable the effective functioning of statutory regulators rather than restrict them through hyper-technical interpretations.

2026 INSC 953

The National Council for Teacher Education v. Association of NCTE Approved Colleges Trust and Ors. (D.O.J. 03.09.2026)

2026 INSC 953 click here to view full text of judgment

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Relief for Homebuyers: Waiver of Time Extension and Penalty Charges in Corporate Insolvency Resolution

September 4, 2026 No Comments

This civil appeal addresses the plight of homebuyers and the Successful Resolution Applicant (SRA) who faced severe liabilities in the form of time extension and penalty charges imposed by NOIDA after a real estate developer (“Granite Gate Properties Private Limited”) was subjected to Corporate Insolvency Resolution Process (CIRP). The Supreme Court allowed the appeal filed by the homebuyers’ Authorized Representative and dismissed NOIDA’s appeal, ruling that penal time extension charges resulting from the original developer’s defaults cannot be validly mulcted on the innocent homebuyers and the SRA as CIRP costs.

  • Brief of Judgment: The developer took perpetual leases for two high-rise projects (“Lotus Boulevard” and “Lotus Panache”) in Sectors 100 and 110, Noida, but subsequently defaulted and became a Corporate Debtor. Homebuyers pooled their own resources under a “Pool and Build” mechanism to keep the project afloat, and a Resolution Plan was approved under an SRA. The National Company Law Appellate Tribunal (NCLAT) had directed time extension charges for up to three years to be treated as CIRP costs, while NOIDA sought even extended charges up to the tenth year under subsequent office orders. The Supreme Court set aside these directions, holding that penal charges intended to deter a defaulting developer cannot be shifted onto homebuyers and the SRA.
  • Role and Nature of NOIDA: While NOIDA operates as a local development authority engaged in commercial and urban planning ventures, its foundational purpose remains public welfare and infrastructural development rather than mere profit-seeking.
  • Exemption from Past Sins: The delay and default were committed by the erstwhile corporate debtor, not by the homebuyers or the SRA who stepped in to rescue the project; consequently, penalizing them for “past sins” is legally unjustified.
  • Rejection of CIRP Cost Classification: The Supreme Court set aside the NCLAT’s direction to treat the time extension charges as CIRP costs and flatly rejected NOIDA’s demand for extended delay penalties stretching up to the tenth year.

2026 INSC 952

The Authorised Representative for Granite Gate Properties Private Limited, Ms. Rakesh Verma v. M/s New Okhla Industrial Development Authority and Ors. (D.O.J. 03.09.2026)

2026 INSC 952 click here to view full text of judgment

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Overturning a Murder Conviction Based on Unsubstantiated Confessions

September 4, 2026 No Comments

This criminal appeal challenges a High Court judgment that upheld the conviction of the sole appellant (A1) for kidnapping and murder while acquitting all co-accused. The Supreme Court allowed the appeal and set aside the conviction, ruling that the prosecution relied entirely on inadmissible confessions, unverified electronic evidence lacking mandatory Section 65B certificates, and a failure to prove the essential links connecting the appellant to the crime scene.

  • Brief of Judgment: Following a missing person report and a ransom demand, the police recovered the victim’s body from a refrigerator inside an apartment allegedly leased by the appellant. While the trial court convicted multiple accused, the High Court acquitted all except the appellant, grounding his conviction on the sole watchman testimony (PW3) and drawing an adverse inference under Section 106 of the Evidence Act regarding the presence of the body. The Supreme Court found the investigation to be shoddy, noting that crucial electronic records lacked Section 65B certificates, the ownership of the flat and the watchman’s employment were unproven, and the foundational reliance on police confessions rendered the prosecution’s case legally unsustainable.
  • Inadmissibility of Electronic Evidence: Both the call detail records and the ATM CCTV footage used to track financial transactions and movements were rendered inadmissible due to the complete absence of mandatory certificates under Section 65B of the Indian Evidence Act, alongside a failure to examine the nodal or bank officers.
  • Unproven Flat Ownership and Watchman Testimony: The prosecution failed to establish the ownership of the apartment through documents or verify the employment of PW3 as a watchman, which completely undermined the “last seen” theory and invalidated the application of Section 106 of the Evidence Act.
  • Flawed Test Identification Parade (TIP): The TIP identifying the appellant was legally compromised because the witness (PW3) admitted that photographs of the suspects had been shown to him prior to the identification process in jail.
  • Reliance on Confessions: The entire prosecution theory stemmed from inadmissible police confessions and a speculative web of relationships, with zero substantive or independent corroborative evidence linking the appellant to the murder or the ransom money.

2026 INSC 951

Kondapaka Sridhar @ Shekar @ Madhu @ Gopi @ Chinna v. The State of Telangana (D.O.J. 03.09.2026)

2026 INSC 951 click here to view full text of judgment

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