The Bombay High Court imposed ₹1 lakh fine on the Enforcement Directorate (ED) for pursuing a money laundering investigation against real estate developer Rakesh Jain, stating that the investigation was started with ulterior motives, rather than being based on evidence. The court strongly criticized both the ED and the complainant, directing that central agencies must operate strictly within legal boundaries and refrain from misusing their authority to harass citizens.
Justice Milind Jadhav, who presided over the case, expressed serious concern about the way the ED handled the matter, describing their actions as "clearly malafide”. He marked the importance of law enforcement agencies conducting investigations responsibly and warned against agencies taking the law into their own hands. Justice Jadhav stated, "A strong message needs to be sent to law enforcement agencies like the ED that they must operate within the parameters of the law, apply their minds seriously, and not harass citizens."
To penalize ED, the court also imposed a ₹1 lakh fine on the complainant for filing a baseless complaint. The ED's investigation started from a police complaint lodged at the Vile Parle police station, where a property buyer accused Jain of breaching an agreement and cheating. However, the court found the complaint to lack merit and deemed the criminal proceedings unwarranted.
Justice Milind Jadhav ruled that no valid case was made against real estate developer Rakesh Jain, and thus the money laundering charges against him did not hold up. The court observed that the Enforcement Directorate (ED) and the original complainant had acted in bad faith by misusing the legal system, leading to the imposition of fines.
The court directed the ED to pay ₹1 lakh to the High Court library within four weeks. Also, the complainant and a property purchaser were ordered to pay ₹1 lakh to the Kirtikar Law Library in Mumbai.
The High Court directed that money laundering involves deliberate actions for personal financial gain, often at the expense of society and the nation. It described money laundering as a crime conducted in secrecy, but in this case, the actions were deemed an abuse of the Prevention of Money Laundering Act (PMLA) and an act of oppression.
At the request of ED advocate Shriram Shirsat, the court agreed to stay its judgment for one week to allow the agency time to appeal the decision in the Supreme Court.