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CS Executive · Economic, Commercial and Intellectual Property Laws · Prevention of Money Laundering

Arjun is tried under Section 3 for laundering. The prosecution shows that one of three inter-connected transactions involved proceeds of crime. Arjun claims the other two are legitimate. Which view best reflects Sections 23 and 24 of the PMLA?

Once one inter-connected transaction is proved to involve money-laundering, the remaining ones are presumed to form part of them unless otherwise proved. Also, for a person charged under Section 3, the court must presume the proceeds are involved in money-laundering unless the contrary is proved by him.

  1. AThe two other transactions must be separately proved by the prosecution before any presumption arises
  2. BUnless otherwise proved to the satisfaction of the Special Court, the remaining transactions are presumed to form part of the inter-connected transactions, and as an accused charged under Section 3 he must prove the contrary on the proceeds being involved in money-launderingCorrect
  3. CThe presumption under Section 24 applies only to persons not charged under Section 3
  4. DNo presumption can be drawn in a criminal trial under the Act

Explanation

Section 23 presumes that remaining inter-connected transactions form part of them once one is proved to be involved, unless otherwise proved. Section 24(a) requires the court, for a person charged under Section 3, to presume the proceeds are involved in money-laundering unless the contrary is proved. Option C reverses this, since 'may presume' applies to other persons.

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