Chhattisgarh government withdraws plea from SC challenging ED’s action in money laundering case

The money laundering case lodged in 2022 stems from an FIR registered on a complaint by the Income Tax department over allegations of illegal collection of levy on coal as well as attempts to influence public servants through corrupt means in Chhattisgarh.

New Delhi: The Chhattisgarh government on Wednesday withdrew from the Supreme Court its plea challenging on the ground of jurisdiction the Enforcement Directorate’s action against state government officials in a money laundering case.

The money laundering case lodged in 2022 stems from an FIR registered on a complaint by the Income Tax department over allegations of illegal collection of levy on coal as well as attempts to influence public servants through corrupt means in Chhattisgarh.

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The federal anti-money laundering agency claimed a “massive scam” took place between 2019 and 2021 in coal transportation in Chhattisgarh as part of which a “cartel” of politicians, officers and others was allegedly running a parallel system of extorting illegal levy.

In its plea, the Chhattisgarh government claimed the ED, on the basis of the FIR lodged in Bengaluru, registered an Enforcement Case Information Report (ECIR) in Raipur on September 29, 2022 and started an investigation against state government officials.

Chhattisgarh standing counsel Sumeer Sodhi told a bench of Justices Sanjiv Khanna and SVN Bhatti on Wednesday he has instructions to withdraw the plea.

The bench allowed the state government to withdraw the petition and recorded Sodhi’s submission.

The petition prayed the court to declare the ED’s action illegal, without jurisdiction and unconstitutional.

The Chhattisgarh government, apart from seeking quashing of the ECIR, also urged the apex court to declare all subsequent actions by the ED with regard to the probe arbitrary and unconstitutional as they interfered with the functions of the state police.

The Chhattisgarh government alleged the investigation by the ED resulted in indiscriminate surveys and raids at various departments and offices of the state government, and arrest of state officials.

The state government had earlier this year filed a suit challenging the constitutional validity of the Prevention of Money Laundering Act (PMLA) alleging that central investigating agencies are being misused to “intimidate, harass and disturb” the normal functioning of the non-BJP state government.

The Bhupesh Baghel-led Congress government filed the original suit challenging the law under Article 131 of the Constitution which empowers a state to move the Supreme Court directly in matters of dispute with the Centre or any other state.

Chhattisgarh became the first state to challenge the money laundering act. Earlier, private individuals and parties challenged the law on various grounds but its validity was upheld by a three-judge bench of the apex court last year.