CourtKutchehry.com
← All articles

Court News

ED Complaint Filed Before BNSS? Supreme Court Says the Accused Must Still Be Heard Before Cognizance

ED Complaint Filed Before BNSS? Supreme Court Says the Accused Must Still Be Heard Before Cognizance

Case at a glance: The Supreme Court has held that Sections 223 to 228 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (the successors of Sections 200 to 205 CrPC) apply to prosecution complaints under the PMLA. The first proviso to Section 223(1) BNSS, which bars cognizance without giving the accused an opportunity of being heard, is substantive and mandatory, and cognizance taken in breach of it is void ab initio. This holds even where the ED filed its complaint before the BNSS came into force on 1 July 2024, if cognizance was taken only afterwards.

The Directorate of Enforcement registered an ECIR against Parvinder Singh on 24 July 2023 and arrested him on 27 April 2024. On 24 June 2024, within two months of the arrest, it filed a prosecution complaint under Sections 44 and 45 of the Prevention of Money Laundering Act, 2002 for the offence under Section 3 read with Section 4. On the same day the Special Court directed that the complaint be registered as a miscellaneous case and fixed it for hearing on cognizance on 28 June 2024. That date was deferred to 2 July 2024 because the Presiding Officer was on recess.

In between, the Bharatiya Nagarik Suraksha Sanhita replaced the Code of Criminal Procedure with effect from 1 July 2024. On 2 July 2024 the Special Court took cognizance of the offence in the presence of the Special Public Prosecutor and the ED's legal advisor. The appellant was produced from judicial custody and, admittedly, was not heard on the question of cognizance.

On 24 December 2024 the appellant applied to recall that order, relying on the first proviso to Section 223(1) BNSS. The Special Court dismissed the application on 22 March 2025 as a dilatory tactic and framed charges. In revision, the Uttarakhand High Court (judgment of 19 May 2025) held that Section 223 BNSS did not apply because the PMLA proceedings had begun before the BNSS commenced, and it relied on the saving clause in Section 531(2)(a) BNSS. It dismissed the challenge to the cognizance order but remitted the charge-framing order for fresh hearing. The appellant came to the Supreme Court.

The Key Question Before the Court

Does the first proviso to Section 223(1) BNSS, which requires the accused to be heard before cognizance, apply to a PMLA complaint that was filed before 1 July 2024 but on which cognizance was taken after the BNSS came into force, or does Section 531(2)(a) BNSS save the old CrPC procedure?

Why Filing a Complaint Is Not an “Inquiry”

The ED's main argument was that the PMLA is a stand-alone code, that the BNSS chapters on complaints do not govern it, and that Kushal Kumar Agarwal should be reconsidered. The Court refused. It noted that Sections 46 and 65 PMLA apply the criminal procedure code to proceedings before the Special Court save where the PMLA is inconsistent, and that nothing in the PMLA overrides the complaint procedure. It endorsed Tarsem Lal, Yash Tuteja and Kushal Kumar Agarwal, and said that accepting the ED's position would leave the Special Court without power to dismiss a complaint for want of evidence, postpone process, issue process or dispense with an accused's appearance (paras 31–33).

The harder question was timing. Section 531(2)(a) BNSS saves any appeal, application, trial, inquiry or investigation pending immediately before 1 July 2024. The ED argued that an “inquiry” had begun when the complaint was filed and numbered on 24 June 2024. The Court answered that an inquiry under Section 2(1)(k) BNSS is a judicial act requiring application of mind, reflected in the record. A “mere ministerial act” cannot be an inquiry, and taking cognizance is itself the application of judicial mind (paras 21, 34).

Relying on Hardeep Singh v. State of Punjab, the Court noted that even the stage of complying with Sections 207 to 209 CrPC is not an inquiry because no judicial mind is applied. So the order to number the complaint and list it for cognizance was not an inquiry, and cognizance, taken on 2 July 2024, fell after the BNSS had commenced (paras 35–37). The Court also characterised Section 531(2)(a) as preventing piecemeal application of the CrPC and the BNSS. A better right conferred by the BNSS operates prospectively for an accused against whom none of the saved proceedings had begun (paras 28–29).

What the Court Actually Held

  • Sections 200 to 205 CrPC (now Sections 223 to 228 BNSS) apply to proceedings under the PMLA, and the request to reconsider Kushal Kumar Agarwal was rejected (paras 31–33).
  • The first proviso to Section 223(1) BNSS is substantive, forms part of the accused's right to a fair trial under Article 21, and its word “shall” is mandatory. Cognizance taken without compliance is void ab initio (para 27).
  • Numbering a complaint and listing it for cognizance is not an “inquiry” under Section 2(1)(k) BNSS, so Section 531(2)(a) did not save the proceedings (paras 34–36).
  • Because cognizance was taken on 2 July 2024, after the BNSS commenced, the proviso applied even though the complaint was filed on 24 June 2024 (para 37).
  • The accused need not show prejudice. Non-hearing is an illegality that vitiates the proceedings, not an irregularity curable under Section 506 or 511 BNSS (para 37).
  • The Uttarakhand High Court judgment of 19 May 2025 and the Special Court's cognizance order of 2 July 2024 were set aside. The Special Court must hear the appellant and proceed from the stage of cognizance within 8 weeks of receiving the judgment (paras 39–40).

Why This Judgment Matters

  • It settles that the BNSS hearing right applies to ED prosecution complaints, not only to ordinary private complaints.
  • It fixes the relevant date as the date of cognizance, not the date of filing, when deciding whether the BNSS or the CrPC governs a complaint filed around 1 July 2024.
  • It narrows the saving clause in Section 531(2)(a) by tying “inquiry” to judicial application of mind.
  • It holds that serious allegations do not excuse a non-compliant cognizance order: the Court acknowledged the allegations were “quite serious” but still set the order aside (para 38).
  • It treats the lack of a hearing as a ground of illegality without any need to prove prejudice, which will matter in pending recall applications and revisions.

What Should Advocates Take Away From the Judgment?

For Defence Counsel

  • Check the date on which the Special Court actually took cognizance, not the date the complaint was filed. Cognizance on or after 1 July 2024 without a hearing is open to challenge.
  • Raise the first proviso to Section 223(1) BNSS at the earliest, as the appellant did by seeking recall. The Court noted he could not be faulted for delay (para 38).
  • Argue that nothing recorded before cognizance shows judicial application of mind, so Section 531(2)(a) is not engaged.
  • No prejudice needs to be pleaded. Plead the breach as an illegality.

For Prosecution and ED Counsel

  • Ensure the accused is given notice and a hearing before cognizance is taken on any complaint, including those filed before 1 July 2024 on which cognizance is still pending.
  • Expect the Special Court to exercise the powers in Sections 225 to 228 BNSS, including dismissal of the complaint and postponement of process.

Key Takeaways

  • Sections 223 to 228 BNSS apply to PMLA complaints.
  • The first proviso to Section 223(1) is mandatory, substantive, and linked to Article 21.
  • Cognizance taken without hearing the accused is void ab initio, and no prejudice need be shown.
  • The date of cognizance, not the date of filing, decides whether the BNSS applies.
  • Numbering a complaint is not an “inquiry” under Section 2(1)(k) BNSS, so Section 531(2)(a) does not apply.
  • The Special Court must complete the hearing and proceed from cognizance within 8 weeks.

Frequently Asked Questions

Does the accused have a right to be heard before cognizance in a PMLA case?

Yes. The Supreme Court held that the first proviso to Section 223(1) BNSS is mandatory and applies to complaints under the PMLA, so no cognizance can be taken without giving the accused an opportunity of being heard.

What if the ED filed the complaint before 1 July 2024?

The Court looked at the date of cognizance. In this case cognizance was taken on 2 July 2024, after the BNSS commenced, so the proviso applied even though the complaint was filed on 24 June 2024.

Why did Section 531(2)(a) BNSS not save the proceedings?

It saves an inquiry pending before 1 July 2024. The Court held that an inquiry needs judicial application of mind, and merely numbering the complaint and listing it for cognizance was not an inquiry.

Did the accused have to show prejudice?

No. The Court held that non-hearing at the cognizance stage is an illegality that vitiates the proceedings, not a mere irregularity under Section 506 or 511 BNSS.

Does this mean the PMLA case against the appellant is over?

No. The Court set aside only the cognizance order and the High Court judgment. The Special Court must hear the appellant and proceed from the stage of cognizance within 8 weeks of receiving the judgment.

Conclusion

The ruling confirms that the PMLA's special character does not displace the BNSS safeguard of a hearing before cognizance. Where the Special Court had applied no judicial mind before the BNSS came into force, the accused gets the benefit of the better right.

Practical takeaway: In any PMLA complaint, check the date of cognizance and whether the accused was heard under the first proviso to Section 223(1) BNSS. If not, the order is open to being set aside, and the stage must be redone.