Major Court Order Clears Bhujbal Family in PMLA Case
In a significant legal development, a special court in Mumbai has discharged Maharashtra minister Chhagan Bhujbal and his relatives from a high-profile money laundering case linked to alleged irregularities in the Maharashtra Sadan construction project and related dealings. The decision brings an end to a legal saga that has spanned nearly a decade, marked by arrests, bail hearings and multiple rounds of trial in different courts. The discharge was granted on the grounds that the Prevention of Money Laundering Act (PMLA) charges could not be sustained in the absence of a legally established predicate offence, a foundational requirement in money laundering cases.
Details of the Court Verdict and Legal Reasoning
On Friday, a special PMLA court presided over by Special Judge Satyanarayan Navander in Mumbai ruled that the prosecution could not proceed against Chhagan Bhujbal and the other accused because there was no subsisting predicate offence on the basis of which the money laundering charges were framed. Under the PMLA, a predicate offence — such as corruption or cheating — must be legally established before a money laundering case can be pursued. In this instance, courts had earlier discharged the accused in the underlying cases, meaning the essential foundation for the PMLA proceeding was missing.
The judge noted that if there is no existence of a predicate offence and no proceeds of crime linked to it, the continuation of the PMLA proceedings would be “a dead wood” exercise. As such, the court accepted the applications for discharge filed by Bhujbal, his son Pankaj and nephew Sameer, along with several others.
Accused and Entities Cleared by the Court
Besides Chhagan Bhujbal, who currently serves as the state’s food and civil supplies minister, the court discharged his son Pankaj Bhujbal and his nephew Sameer Bhujbal. A total of 46 individuals and entities were cleared in the PMLA case following the hearing. Among those discharged were former MP Sanjay Kakade and various companies linked to the Bhujbal family and other accused.
The court found that many of the accused had already been discharged in related cases — including corruption and cheating cases under investigation by the Anti-Corruption Bureau (ACB) and other agencies — and that those discharge orders had attained legal finality as they were not challenged by the state.
Background of the Money Laundering Case
The Enforcement Directorate (ED) had initiated the money laundering case under the PMLA based on two First Information Reports (FIRs) lodged by the Anti-Corruption Bureau and the Economic Offences Wing (EOW). The FIRs alleged financial irregularities in awarding state contracts for the construction of Maharashtra Sadan — a state guest house in New Delhi — as well as in a residential project in Navi Mumbai.
The ED claimed that Bhujbal, during his tenure as Public Works Department (PWD) minister in the mid-2000s, awarded contracts to certain firms without proper tendering, and that kickbacks and undue benefits were received through companies associated with his family. However, the special court observed that the preliminary cases underpinning these allegations had already collapsed due to lack of evidence, leaving no viable predicate offence for the PMLA prosecution.
Historical Legal Journey of the Case
The Maharashtra Sadan case has a long history. Following a public interest litigation and subsequent inquiry orders, the ACB filed FIRs in 2015 alleging irregularities in the awarding of public works contracts. The Enforcement Directorate then launched money laundering proceedings in 2016 based on those allegations. Bhujbal and several others were arrested in March 2016 in connection with the probe and spent over two years in custody before being granted bail by the Bombay High Court in 2018.
In earlier stages, courts had discharged Bhujbal and other accused from corruption charges related to the Maharashtra Sadan case in 2021 after finding that the essential ingredients of corruption, criminal conspiracy or fraud were not established. Similarly, in the case concerning the Navi Mumbai housing project, a Sessions Court had discharged most of the accused, determining that the allegations did not constitute a criminal offence.
The ED’s PMLA proceedings depended on those underlying allegations. Once the predicate offences were legally extinguished through prior discharge orders, the PMLA court held that there was no “proceeds of crime” to pursue under the anti-money laundering framework.
Reactions and Implications of the Court Order
The discharge of Bhujbal and his family has significant political and legal implications. As a senior leader of the Nationalist Congress Party (NCP) and a state minister with key portfolios, Bhujbal’s legal relief comes at a time when the political climate in Maharashtra is highly competitive, with multiple parties vying for public support ahead of future elections. The court’s decision removes a long-standing legal shadow over his political career and may reinforce his standing within his party and among supporters.
Defence counsel argued that the absence of evidence and the finality of prior discharge orders left no legal basis for continuing PMLA proceedings. The court’s acceptance of this argument reflects a strict interpretation of statutory requirements under the Prevention of Money Laundering Act, particularly the need for a predicate offence.
Meanwhile, the Enforcement Directorate had maintained that sufficient material existed to show that predicate offences were committed, including allegations of layering and siphoning of alleged proceeds of crime. However, the court’s focus on the legal necessity of a subsisting predicate offence effectively undermined the ED’s case.
Overview of Proceeds and Allegations
According to probe agency estimates referenced in the case, the proceeds of crime in relation to the Maharashtra Sadan allegations were believed to be around Rs 21 crore. Additionally, buyers in the Navi Mumbai residential project were reportedly cheated to the tune of over Rs 44 crore, according to allegations in the underlying FIRs. However, these figures could not be sustained as legal evidence once the predicate offences were extinguished.
Legal Precedent and the Role of Predicate Offences
The ruling reinforces legal principles that underpin anti-money laundering prosecutions in India. Under the PMLA, prosecution cannot proceed without an established predicate offence under Indian law. Predicate offences — such as corruption, cheating or fraud — form the foundation for claiming proceeds of crime. If a court finds that such predicate offences are not established, any PMLA proceeding based on them cannot legally continue.
In essence, the absence of legally sustainable underlying cases rendered the entire PMLA prosecution untenable, leading the court to discharge the accused after nearly a decade of litigation.
End of a Long Legal Chapter
The discharge of Chhagan Bhujbal, his son and nephew in the Maharashtra Sadan money laundering case marks the culmination of one of the state’s most long-running legal battles involving a senior political figure. With predicate offences deemed non-existent and prosecution unable to proceed under the PMLA, the court’s order effectively closes a chapter that began with arrests in 2016. The implications of this relief will resonate in legal and political circles, particularly as debates continue over accountability, anti-corruption enforcement and the intersection of law and politics in India’s governance framework.
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