Issuance of Notice against money laundering allegation

 PLJ 2025 Civil (Note) 67

[Lahore High Court, Lahore]

Present: Shams Mehmood Mirza, J.

AHMAD BIN SHAHID--Petitioner

versus

FEDERATION OF PAKISTAN, etc.--Respondents

W.P. No. 55624 of 2024, decided on 11.11.2024.

Anti-Money Laundering Act, 2010 (VII of 2010)--

----S. 25--Money laundering allegation--Issuance of notice--Violation of law--No authority of FIA--Challenge to--FIA did not adhere to law laid down in judgment PLD 2024 Lahore 244 in issuing impugned notice which was violative of ratio of said judgment--Petition allowed.                                      [Para 4] A

PLD 2024 Lahore 244 ref.

Mr. Muhammad Imran Malik Advocate for Petitioner.

Mr. Sheraz Zaka Assistant Attorney General for Pakistan.

Date of hearing: 11.11.2024.

Order

This writ petition calls into question call up notice dated 10.07.2024 and initiation of inquiry by the Federal Investigation Agency (the FIA) under the Anti Money Laundering Act, 2010 (the Act).

2.       It is contended before this Court that the notice in question violates the law laid down by this Court in the case of Abdul Saboor v. Federation of Pakistan, etc. PLD 2024 Lahore 244.

3.       This Court in the aforementioned case made the following pertinent observations:

13.     The process under the Act is set in motion by the Financial Monitoring Unit (FMU) which receives Suspicious Transactions Reports (STRs) and Currency Transactions Reports (CTRs) from the reporting entities which in turn are analyzed by it and in respect of which it is empowered to call for the record and information from any agency or person. After analyzing the STRS and CTRs, the FMU disseminates the same to concerned Investigating or Prosecuting agencies for inquiry or further action under the Act under Section 6 of the Act.

34.     ... The provisions of Section 9 of the Act and the above excerpts of the SOP manifestly compel the investigating officer to impart the necessary information to the concerned person regarding the property allegedly acquired through proceeds of crime allowing him to answer the allegation against him. This is a necessary pre-condition to commence the proceedings against the person concerned for the purposes of attachment of property. It is noted with concern that despite clear command of Section 9 of the Act and the framing of the SOPs, the investigating officers failed to adhere to the terms thereof in issuing notices to the petitioners which were devoid of the requisite information

35.     Even otherwise, respectable authority supports and validates the proposition that the investigating agency at the time of the inquiry or investigation must confront the person who is said to have committed the offence with the allegation against him together with all the necessary details and particulars enabling him to explain his position

36.     Section 9 read with the SOPs clearly bring out the intent of the Act that call up notice must at the bare minimum specify the information regarding the alleged commission of the offence of money laundering and the details of the property which has allegedly been acquired from the proceeds of crime or contravention of any provision of the Act. The notice which does not fulfill the afore-mentioned requirements cannot be termed as a valid notice under Section 9 of the Act and by the terms of SOPs. It is, however, important to emphasize that issuance of call up natice is just one facet of the investigation for the offence of money laundering. The finding of this Court is confined to the consequence of default in not providing the necessary information to the petitioners in the call up notices. This finding does not question the validity of the inquiry/ investigation that has been initiated which shall not be affected in any manner whatsoever and which shall have no bearing on the material/information/evidence already collected by the investigating officer against the petitioners. This finding furthermore shall not be construed to impede the ongoing investigation against the petitioners that shall continue....

4.       It is apparent that the FIA did not adhere to the law laid down in the aforementioned judgment in issuing the impugned notice which is violative of the ratio of the said judgment as reproduced above. This writ petition is accordingly allowed and notice dated 10.07.2024 is set aside for being without lawful authority and of no legal effect. The FIA shall, however, be at liberty to proceed in the matter in accordance with the observations made in the case of Abdul Saboor v Federation of Pakistan etc PLD 2024 Lahore 244.

(Y.A.)  Petition allowed