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Cost and Management Audit · Anti-Money Laundering

Inter-ministerial Co-ordination Committee under Section 72A PMLA

Updated 11 October 2026 · Fact-checked

Section 72A of the Prevention of Money-Laundering Act, 2002 lets the Central Government, by notification, set up an Inter-ministerial Co-ordination Committee. Its job is inter-departmental and inter-agency co-ordination on anti money-laundering and countering the financing of terrorism (AML/CFT). To answer exam questions, list the enabling power and the five purposes (a) to (e).

Understand Inter-ministerial Co-ordination Committee under Section 72A

Money-laundering cases cut across many bodies. The Government, investigating agencies, the Financial Intelligence Unit, India (FIU-IND) and sector regulators each hold a piece of the picture. If they work in silos, criminals exploit the gaps.

Section 72A addresses this. It says the Central Government may, by notification, constitute an Inter-ministerial Co-ordination Committee. The word is "may": the Act empowers the Government to set it up; it does not fix the members in the section text. The notification decides the committee's constitution.

The section states the purposes for which the committee is formed. They are: (a) operational co-operation between the Government, law enforcement agencies, FIU-IND and regulators or supervisors; (b) policy co-operation and co-ordination across all relevant or competent authorities; (c) consultation among the concerned authorities, the financial sector and other sectors, related to AML/CFT laws, regulations and guidelines; (d) developing and implementing AML/CFT policies; and (e) any other matter the Central Government specifies by notification.

The section was inserted by Act 23 of 2019, with effect from 1 August 2019. It deals with co-ordination only. The offence is in Section 3 and the punishment in Section 4. Do not mix these up.

For your Paper 17 exam, think of 72A as the "institutional glue" of the AML framework. Operational (day-to-day work), policy (rules and direction) and consultation (talking with industry) are the three levels to remember.

Key rules to remember

Enabling power
Central Government + notification → Inter-ministerial Co-ordination Committee
The Act says "may". Constitution is by notification, not by the section text itself.
Purposes under Section 72A
(a) operational co-operation; (b) policy co-operation and co-ordination; (c) consultation with authorities, financial sector and other sectors; (d) developing and implementing AML/CFT policies; (e) any other matter notified
Five purposes. Memory aid: Operational, Policy, Consultation, Development, Other.
Parties in purpose (a)
Government, law enforcement agencies, FIU-IND, regulators or supervisors
These are the bodies whose operational co-operation the committee promotes.
Insertion
Inserted by Act 23 of 2019, w.e.f. 1-8-2019
Useful as a one-line fact. Do not confuse it with the 2013 amendments.

How to solve Inter-ministerial Co-ordination Committee under Section 72A questions

Use this method for any question on the committee under Section 72A.

  1. 1Name the section and the Act: Section 72A, Prevention of Money-Laundering Act, 2002.
  2. 2State who may constitute the committee and how: the Central Government, by notification.
  3. 3Say what the committee is for: inter-departmental and inter-agency co-ordination on AML/CFT.
  4. 4List the purposes (a) to (e) in the Act's order, in your own words.
  5. 5Link each purpose to the facts in the case: operational, policy, consultation or policy-making.
  6. 6Close with a short conclusion that answers the exact question asked, such as whether a given activity falls within the committee's purposes.

Quickest way: The 5-purpose scan

When to use it: Use it for MCQs and short notes when you have a minute or two.

  1. Read the question and spot the keyword: operational, policy, consultation, development or other.
  2. Match it to the purpose (a) to (e).
  3. Check the power: Central Government, by notification, "may".
  4. Reject options that give the committee an offence, punishment or attachment power. Those sit in other sections.
  5. Choose the option closest to the Act's wording.

Common mistakes in Inter-ministerial Co-ordination Committee under Section 72A

  • Saying the Act fixes the list of members of the committee.

    Students assume a committee always has named members in the statute.

    Fix: Remember that Section 72A only empowers the Central Government to constitute the committee by notification. Do not name members unless the question supplies them.

  • Writing that the Government "shall" constitute the committee.

    Students treat all AML machinery as compulsory.

    Fix: The section says "may". It is an enabling provision.

  • Giving the committee powers of attachment, arrest or punishment.

    Students confuse it with the Director, the Adjudicating Authority or the Special Court.

    Fix: The committee co-ordinates. Attachment and confiscation are dealt with elsewhere in the Act; the offence is in Section 3 and punishment in Section 4.

  • Omitting purpose (c), the consultation with the financial sector and other sectors.

    Students focus on government bodies only.

    Fix: Include consultation with the financial sector and other sectors on AML/CFT laws, regulations and guidelines.

  • Leaving out FIU-IND and regulators or supervisors from purpose (a).

    Students write only "law enforcement agencies".

    Fix: Learn the full list: Government, law enforcement agencies, FIU-IND, regulators or supervisors.

  • Mixing up Section 72A with Section 23 or Section 60.

    All are short sections with similar-sounding procedural content.

    Fix: Tie each to one idea: 72A is co-ordination, 23 is presumption in inter-connected transactions, 60 is attachment or confiscation involving a contracting State.

Worked examples

Example 1

Under the Prevention of Money-Laundering Act, 2002, who may constitute the Inter-ministerial Co-ordination Committee, and for what purposes? Answer in a few points.

Show the solution
  1. Identify the provision: Section 72A of the Act.
  2. Power: the Central Government may constitute the committee by notification.
  3. General aim: inter-departmental and inter-agency co-ordination.
  4. Purposes: (a) operational co-operation between the Government, law enforcement agencies, FIU-IND and regulators or supervisors; (b) policy co-operation and co-ordination across relevant or competent authorities; (c) consultation among authorities, the financial sector and other sectors on AML/CFT laws, regulations and guidelines; (d) developing and implementing AML/CFT policies; (e) any other matter notified by the Central Government.

Answer: The Central Government may, by notification, constitute the committee under Section 72A. It exists for inter-agency co-ordination on AML/CFT through the five purposes (a) to (e) listed above.

Example 2

A multi-agency task team finds that a bank regulator and an investigating agency are working on the same layering case without sharing information. A manager says the Inter-ministerial Co-ordination Committee can punish the officials who failed to share. Evaluate this statement.

Show the solution
  1. Recall the role: Section 72A creates a body for co-ordination, not for punishment.
  2. Link to the facts: sharing information between a regulator and a law enforcement agency is operational co-operation under purpose (a).
  3. Check the power: the section gives no power to punish officials. The offence of money-laundering is in Section 3 and its punishment in Section 4, and they apply to persons who commit that offence.
  4. Conclude: the statement is wrong, but the committee is the right forum to improve co-operation.

Answer: The statement is incorrect. The committee exists to promote operational and policy co-operation between bodies such as regulators and law enforcement agencies under Section 72A. It has no punitive power under that section.

Exam tips

  • Expect a short note or MCQ asking for the purposes of the committee. Learn all five in order.
  • Use the Act's own words: "inter-departmental and inter-agency coordination" and "by notification".
  • In case scenarios, match each fact to operational, policy or consultation co-ordination before choosing an option.
  • Avoid stating the committee's membership as fact; the section text does not list members.
  • Tie it to the wider chapter: Section 3 defines the offence, Section 4 the punishment, and Section 72A the co-ordination machinery.

Practice questions from Anti-Money Laundering

Inter-ministerial Co-ordination Committee under Section 72A in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Inter-ministerial Co-ordination Committee under Section 72A: frequently asked questions

What is Section 72A of PMLA?

It empowers the Central Government to constitute, by notification, an Inter-ministerial Co-ordination Committee. The committee supports co-ordination among departments and agencies on anti money-laundering and countering the financing of terrorism.

Who are the members of the Inter-ministerial Co-ordination Committee?

Section 72A does not list members. The Central Government constitutes the committee by notification, and the notification decides its composition. For the exam, focus on the purposes the section lists.

Is the committee mandatory under PMLA?

The section says the Central Government "may" constitute it, so it is an enabling power. Write it that way in your answer.

When was Section 72A added to PMLA?

It was inserted by Act 23 of 2019, with effect from 1 August 2019.