Case at a Glance
The fourth accused in a money-laundering complaint filed by the Enforcement Directorate before the Principal District and Sessions Court, Madurai, asked for copies of the documents relied on by the ED before the court decided whether to take cognizance. The Sessions Court refused on 31 August 2026, reading Sarla Gupta v. Directorate of Enforcement as confining the right to the post-cognizance stage. A Division Bench held that the pre-cognizance ‘opportunity of being heard’ under the first proviso to Section 223(1) BNSS is meaningful only if the accused knows the material against him, quashed the refusal, and directed the ED to furnish all relied-upon documents within four weeks. The Court added that this hearing is a shield, not a licence for a mini-trial.
The petitioner is the fourth accused in a complaint under the Prevention of Money Laundering Act arising from ECIR/CEZO-II/21/2020 and pending as S.R. No. 1320 of 2025 before the Principal District and Sessions Judge, Madurai. Before cognizance was taken, he filed Crl.M.P. No. 3212 of 2026 seeking copies of the documents relied on by the ED. By order dated 31 August 2026 the Sessions Court rejected the request, holding that he could have the documents only after cognizance.
Before the High Court the petitioner argued that Sarla Gupta did not deal with the first proviso to Section 223(1) BNSS, relied on Allahabad High Court decisions in Supreme Technofabs Private Limited v. Directorate of Enforcement and Anil Kumar Khemka v. Directorate of Enforcement U.P., and pointed out that the ED had supplied documents in other PMLA matters. The ED argued that Sarla Gupta governs, and relied on a Madhya Pradesh High Court decision holding that there is no vested right to documents before cognizance.
The Key Question Before the Court
Does an accused in a PMLA complaint have a right to copies of the documents and statements relied on by the Enforcement Directorate at the pre-cognizance hearing under the first proviso to Section 223(1) BNSS?
Why the Pre-Cognizance Hearing Needs the Documents
The Bench, speaking through Justice Abdul Quddhose, noted that under Parvinder Singh v. Directorate of Enforcement, (2026) 05 SC CK 0468 Section 223 BNSS applies to PMLA complaints and that cognizance taken without the pre-cognizance hearing is void. It distinguished Sarla Gupta v. Directorate of Enforcement because that case concerned an offence predating the BNSS and the post-cognizance stage. “An opportunity of hearing is not a mere empty formality,” the Court said; the hearing “should not become an empty formality by not legally entitling the accused to be furnished with copies” of the documents relied upon by the prosecution. It held that the accused “has a legal right to be furnished with copies of all documents and statements” relied upon “at the pre-cognizance stage itself.” The reverse burden under Section 24 PMLA and the application of criminal procedure through Section 65 PMLA supported a purposive reading in the accused’s favour, and the Madhya Pradesh decision was held to be per incuriam.
The Court was careful to limit the right. The pre-cognizance hearing “is not meant to turn the stage of cognizance into a roving inquiry into the merits or demerits of the case.” Relying on Sonu Gupta v. Deepak Gupta, (2015) 02 SC CK 0078 and State of Orissa v. Debendra Nath Padhi, (2004) 11 SC CK 0011, it said the court at that stage only examines whether a prima facie case exists and does not weigh defence material. In its words, “The right to be heard is a shield for the accused,” and not a sword with which to dissect the prosecution case. The Sessions Court had misconstrued Sarla Gupta.
What the Court Actually Held
- An accused in a PMLA complaint has a legal right to copies of all documents and statements relied upon by the ED at the pre-cognizance stage under the first proviso to Section 223(1) BNSS.
- Sarla Gupta v. Directorate of Enforcement was distinguished as dealing with a pre-BNSS offence and the post-cognizance stage.
- The pre-cognizance hearing is limited to whether a prima facie case exists; it is not a roving inquiry into the merits.
- The order dated 31.08.2026 was quashed and the ED was directed to furnish copies of all relied-upon documents within four weeks.
Why This Judgment Matters
- It gives practical content to the new pre-cognizance hearing introduced by Section 223 BNSS.
- PMLA accused face a reverse burden, so access to the material at the earliest stage matters.
- It also sets limits, so the hearing does not become a mini-trial before cognizance.
What Should Advocates Take Away From the Judgment?
For the Accused
- If summoned for a pre-cognizance hearing in a PMLA complaint, apply for copies of the documents and statements the ED relies on.
- A refusal can be challenged before the High Court on the strength of this ruling.
- Use the hearing to show why no prima facie case exists — not to argue a full defence.
For Counsel
- Cite Parvinder Singh v. Directorate of Enforcement for the applicability of Section 223 BNSS to PMLA complaints.
- Distinguish Sarla Gupta v. Directorate of Enforcement where the offence and complaint fall under the BNSS regime.
- Expect the court to apply Sonu Gupta v. Deepak Gupta and State of Orissa v. Debendra Nath Padhi to keep the hearing narrow.
Key Takeaways
- Pre-cognizance hearing under Section 223 BNSS includes access to relied-upon documents.
- The right exists at the pre-cognizance stage itself in PMLA complaints.
- The hearing is a shield, not a sword — only the prima facie case is examined.
- ED directed to supply documents to the petitioner within four weeks.
Frequently Asked Questions
What does the first proviso to Section 223(1) BNSS say?
It provides that no cognizance of an offence on a complaint shall be taken by the Magistrate without giving the accused an opportunity of being heard.
Does this mean the accused can argue the whole case before cognizance?
No. The Court said the hearing is not a roving inquiry into merits; the court only decides whether a prima facie case is made out, and defence material is not weighed.
Is this ruling binding on all PMLA courts?
It is a Division Bench decision of the Madras High Court and binds courts subordinate to it in Tamil Nadu and Puducherry; other courts may treat it as persuasive.
Conclusion
The Division Bench reads the BNSS pre-cognizance hearing as a real safeguard: an accused cannot answer a case he has not seen. At the same time it keeps the stage narrow, so that cognizance does not turn into a trial on the documents.
Practical takeaway: In PMLA complaints governed by the BNSS, ask for the ED’s relied-upon documents before the cognizance hearing — and frame your submissions around the absence of a prima facie case.
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