The Enforcement Directorate (ED) has no jurisdiction to initiate a probe in cases of income tax evasions as no provision of the Income Tax Act is declared as a “scheduled offence’ under the Prevention of Money Laundering (PML) Act, it was argued on behalf of Water Resources Minister D. K. Shivakumar before the Karnataka High Court on Monday.
Senior counsel Kapil Sibal, appearing for Mr. Shivakumar, contended that the ED could not have initiated the probe of alleged money laundering merely because of Section 120B (criminal conspiracy) of the Indian Penal Code (IPC), which is a scheduled offence under the PML Act, was invoked against him by the I-T Department when the provisions of the I-T Act are not “predicate offence” under PML Act.
The I-T Department had invoked Section 120B of the IPC against Mr. Shivakumar and four other accused in its charge sheet filed before the special court for allegedly indulging in criminal conspiracy for evasion of income tax and transporting unaccounted money through hawala transactions.
Claiming that the provisions of the I-T Act are “consciously” not brought under the purview of the PML Act by the law makers as it would have made I-T assessees to stand before the ED in every case of income tax evasion, Mr. Sibal contended that the ED gets jurisdiction to initiate probe only when Section 120B of the IPC is invoked, along with a predicate offences under the IPC or other scheduled offences under the PML Act.
