Case Name: Niket Kansal v. Union of India through ED
Case No.: CRM(M) No. 140/2025
Date of Judgment: 22 May 2025
Judge: Justice Wasim Sadiq Nargal
FACTUAL BACKGROUND
Niket Kansal is a 27-year-old guy from Delhi. He works as the operations head of a pharma company called N.K. Pharmaceuticals. NCB (Narcotics Control Bureau) said he was involved in making and selling a cough syrup called “Cocrex,” which contains Codeine, a banned substance. Two criminal cases were filed against him under NDPS Act.
But in Dec 2024, the Special NDPS Court said there is no strong evidence against him and discharged him. Still, the ED (Enforcement Directorate) started new case under PMLA (Prevention of Money Laundering Act), saying the property Kansal owns is “proceeds of crime.”
Kansal said this is unfair because he was already cleared in NDPS cases. He says ED has no reason now to trouble him.
ISSUES FOR DETERMINATION
If someone is discharged in NDPS case, can ED still continue PMLA case?
Is money laundering case separate or does it depend on original crime?
Are summons issued by ED still valid after discharge?
LEGAL PROVISION
Section 2(1)(u), PMLA – defines what is “proceeds of crime.”
Section 3, PMLA – says what is considered money laundering.
Section 50, PMLA – gives ED power to call people and ask for documents.
PETITIONERS CONTENTION
ED cannot run money laundering case if no NDPS crime exists.
Without a scheduled offence, there is no crime money, so no case.
ED is just calling him without any legal reason – it’s harassment.
Supreme Court has said that money laundering must be linked to a real crime.
If trial court has already said no offence happened, then ED cannot keep pushing.
RESPONDENTS CONTENTIONS
Just because Kansal is discharged doesn’t mean ED can’t continue.
They are still checking bank records and transactions. He may not be free from crime.
Money laundering is a separate crime. Even if NDPS case is weak, ED can investigate how money was used.
There is a revision petition (Crl R No. 21/2025) filed against the discharge. So that decision is not final.
ANALYSIS
Court agreed that PMLA is different and can go on separately.
Discharge doesn’t mean ED summons are illegal.
Summons is just a step in investigation, not final proof or arrest.
Till the revision case is decided, ED can continue inquiry.
Supreme Court has already said summons are legal even if discharge happens.
JUDGMENT
Court dismissed Kansal’s petition.
Said summons are okay and ED has not done anything illegal.
Just because he is discharged doesn’t mean ED can’t do their work.
CONCLUSION
Money laundering case can continue even if original crime is discharged.
ED can send summons while investigating.
Discharge is not final if a revision is going on.
Court will not stop ED unless there is very clear misuse of power.
So Kansal’s case failed and summons will
continue.
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WRITTEN BY PRIYANKA DESHIKAN.
