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Legal Case Shots is a searchable database of Supreme Court of India judgments, each broken down into the case type, the court's key holding, and a practical lesson learnt — with the full judgment available as a PDF for citation or deeper reading.

Criminal LawSupreme Court

Directorate of Enforcement vs Padmanabhan Kishore

Criminal Appeal · Not availableDecided 31 Oct 2022

Criminal Appeal No. 1864 of 2022

Background

The CBI seized Rs. 50,00,000 in cash from a car linked to Andasu Ravinder, an Additional Commissioner of Income Tax, in 2011. Investigation revealed the cash had been paid to him as a bribe by Padmanabhan Kishore, whose income tax file was pending clearance before Ravinder. The CBI charged both under the IPC and the Prevention of Corruption Act. Since this was a "scheduled offence," the Enforcement Directorate separately registered a case against Kishore under the Prevention of Money Laundering Act (PML Act). Kishore challenged this before the Madras High Court, arguing that while the money was still in his hands (before he handed it over as a bribe), it wasn't yet "tainted" — so he could not be prosecuted under the PML Act. The High Court agreed and quashed the PML Act proceedings against him, prompting the ED's appeal.

Decision Breakdown

The Supreme Court held that the High Court's reasoning was incorrect. It clarified that money only remains "untainted" while it is held without the intent to give it as a bribe; once a person forms the intent to hand over money as a bribe, that intent — which necessarily precedes the actual handover — brings the person within Section 3 of the PML Act, which covers "possession," "acquisition," "concealment" or "use" of proceeds of crime, not merely receipt of a bribe by the public servant. Since Kishore's complaint prima facie showed he was actively involved in the process connected with proceeds of crime (i.e., arranging and handing over the bribe with that intent), he could be proceeded against under the PML Act, independent of whether the money became "tainted" only in the recipient's hands. The Court clarified its findings were prima facie only, for the limited purpose of this appeal, and that the actual merits would be decided at trial. The appeal was allowed, the High Court's quashing order was set aside, and the money-laundering case against Kishore was restored.

Lesson Learnt

Under the PML Act, a bribe-giver cannot escape money-laundering liability by arguing the cash was "clean" while still in their own hands — the intent to hand it over as a bribe is enough to implicate them in the process connected with proceeds of crime, even before the public servant actually receives and pockets it.

Directorate of Enforcement vs Padmanabhan Kishore – Legal Case Shots | LegalAware