Kerala High Court Allows ED Probe Into CMRL Payments

In a significant legal ruling, the Kerala High Court has cleared the way for the Enforcement Directorate to continue its money laundering investigation into financial transactions between Cochin Minerals and Rutile Limited and Exalogic Solutions, a company owned by Veena Vijayan, daughter of former Kerala Chief Minister Pinarayi Vijayan. The court dismissed an appeal by CMRL challenging the probe.

A Division Bench of the High Court held that the existence of a formally registered predicate offence is not a prerequisite for the ED to initiate an inquiry under the Prevention of Money Laundering Act. The court distinguished between the agency's power to conduct inquiries and its power to prosecute, stating that an inquiry can begin based on material suggesting the existence of proceeds of crime. Prosecution, however, requires the registration of a scheduled offence as a foundational step.

The investigation centers on allegations that CMRL made payments to Exalogic Solutions without receiving corresponding services, as initially identified by the Serious Fraud Investigation Office. The ED registered a case and has conducted raids at approximately a dozen locations linked to CMRL and...