Safiya Malik

The Division Bench of the High Court of Himachal Pradesh at Shimla, comprising Chief Justice Gurmeet.Singh Sandhawalia and Justice Ranjan Sharma, dismissed a writ petition challenging an arrest made under the Prevention of Money-Laundering Act, 2002 (PMLA). The Court held that it did not possess territorial jurisdiction over the matter, directing the petitioner to seek remedies before the court vested with proper jurisdiction.

The bench was adjudicating a criminal writ petition concerning an arrest effected in New Delhi and subsequent proceedings conducted in Ghaziabad. The petitioner had sought, among other reliefs, quashing of the arrest order, declaration of custody as illegal, and transfer of case records to Himachal Pradesh.

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The petitioner challenged the arrest order dated 18.11.2024 issued under Section 19(1) of the PMLA by the Assistant Director of Enforcement Directorate (ED). He was arrested in New Delhi and presented before the Special Court at Ghaziabad, which subsequently remanded him to custody. The petitioner also contested the remand orders dated 19.11.2024 and 22.11.2024, asserting that the arrest and proceedings violated his fundamental rights under Articles 21 and 22 of the Constitution.

Initially, the petitioner had approached the Supreme Court via Writ Petition (Criminal) No. 514 of 2024. On 13.12.2024, the Apex Court permitted withdrawal of the petition, granting liberty to approach the High Court of Himachal Pradesh.

In the writ petition filed on 31.12.2024, the petitioner sought a declaration that the Ghaziabad court lacked territorial jurisdiction. However, on 23.01.2025, counsel for the petitioner stated that prayer (C)—regarding the transfer of records to Himachal Pradesh—would not be pressed. The Supreme Court in Special Leave to Appeal (Crl.) No. 2606 of 2025 clarified that the order dated 23.01.2025 would not affect the writ petition's adjudication.

During the proceedings, it emerged that a complaint under Sections 44 and 45 of the PMLA had been filed on 10.01.2025, and the Special Court at Ghaziabad took cognizance on 17.01.2025.

The petitioner argued that the predicate offences forming the basis of the ECIR dated 02.07.2024 were committed within Himachal Pradesh. The ECIR cited six FIRs registered in Kangra and Una districts. It was submitted that several of these FIRs had been cancelled and that reliance on them lacked application of mind. Reference was also made to orders of the NGT and a penalty deposited with the GST Department, allegedly ignored during the arrest.

Judgments relied upon included Vijay Mandanlal Choudhary v. Union of India, (2022 SCC OnLine SC 929); V. Senthil Balaji v. State, (2024) 3 SCC 51; Pankaj Bansal v. Union of India, (2023 SCC OnLine SC 1244); Ram Kishor Arora v. Directorate of Enforcement, (2023 SCC OnLine SC 1682); Prabir Purkayastha v. State (NCT of Delhi), (2024) 8 SCC 254; and Arvind Kejriwal v. Directorate of Enforcement, (2024 SCC OnLine SC 1703).

The respondent, represented by the Additional Solicitor General, contended that the ECIR was filed in Delhi and the predicate offence—FIR No. 360/2024 dated 07.11.2024—was registered in Saharanpur, Uttar Pradesh. Consequently, proceedings were initiated in Ghaziabad, where the petitioner was also produced and remanded. It was argued that the Himachal Pradesh High Court lacked jurisdiction.

Reliance was placed on Sections 177 to 180 of the CrPC (now Sections 197 to 200 of the BNSS, 2023), contending that jurisdiction lies where the offence or its consequences occurred. The ASG argued that the petitioner’s firm operated both in Himachal Pradesh and Uttar Pradesh, with illegal mining proceeds allegedly laundered through investments in Saharanpur.

Reference was made to judgments including Rana Ayyub v. Directorate of Enforcement, (2023) 4 SCC 357); Serious Fraud Investigation Office v. Rahul Modi, (2019) 5 SCC 266; Kaushik Chatterjee v. State of Haryana, (2020) 10 SCC 92); Abhishek Banerjee v. Directorate of Enforcement, (2024) 9 SCC 22); and Pradeep Nirankarnath Sharma v. Directorate of Enforcement, (2025 SCC OnLine SC 560).

The Court began by recording that the issue of jurisdiction must precede examination of arrest validity. It noted that the ECIR was registered in Delhi and that the arrest occurred in New Delhi. FIR No. 360/2024 was registered in Saharanpur, and the petitioner was remanded by the Special Court at Ghaziabad.

"No cause of action as such arose regarding the arrest order, which is under challenge, within the jurisdiction of this Court."

The Court acknowledged that illegal mining activities took place in Himachal Pradesh but observed that the proceeds were invested in Uttar Pradesh. It referred to the comprehensive complaint filed by ED, detailing alleged concealment, possession, and laundering of proceeds of crime.

The Court stated: "The petitioner is knowingly a party and directly committed the offence of money laundering by generating the tainted funds being PoC from sale of illegally mined minerals through Jai Maa Jawala Stone Crusher."

Referring to Rana Ayyub, the Court reiterated: "The trial of the scheduled offence, insofar as the question of territorial jurisdiction is concerned, should follow the trial of the offence of money-laundering and not vice versa."

Further, the Court stated that territorial jurisdiction must be determined by the place where possession, concealment, use, or acquisition of proceeds occurred:

"The area in which the place of acquisition of the proceeds of crime is located or the place of keeping it in possession is located or the place in which it is concealed is located or the place in which it is used is located, will be the area in which the offence has been committed."

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It concluded that mere initiation of investigation in Himachal Pradesh or existence of cancelled FIRs did not vest jurisdiction in this Court. "This Court would not be vested with the jurisdiction to entertain the present Writ petition as the said funds have been invested in Uttar Pradesh and the F.I.R has also been lodged there before the arrest of the petitioner."

The Court did not state on the merits of the arrest but held that it lacked jurisdiction to examine the petition. "We deem it fit not to go into the issue of the merits, which have been raised regarding the judicial review of the legality of arrest... once we have come to the conclusion that this Court has no jurisdiction in the peculiar facts and circumstances of the case."

Accordingly, the writ petition was dismissed: "We do not find any merit in the present petition and the same is accordingly dismissed leaving the petitioner to challenge his arrest before the competent Court having jurisdiction."

Advocates Representing the Parties

For the Petitioner: Vikram Chaudhri, Senior Advocate with Diya Bhagwan, Mannat Bir Kaur, and Surya Chauhan, Advocates.

For the Respondents: Anup Rattan, Advocate General with Gobind Korla, Additional Advocate General and Priyanka Chauhan, Deputy Advocate General, S.V. Raju, Additional Solicitor General of India with Zoheb Hossain, Suradhish Vats, Hitarth Raja, Pranjal Tripathi and Ajeet Singh Saklani, Standing Counsel

Case Title: Gian Chand v. State of Himachal Pradesh and Others

Neutral Citation: 2025:HHC:10209

Case Number: Criminal Writ Petition No. 2 of 2025

Bench: Chief Justice Gurmeet.Singh Sandhawalia and Justice Ranjan Sharma

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