HC Quashes ED Money Laundering Case Against Salgaocar Mining Entities and Lakshmi Salgaocar

The High Court has quashed the Enforcement Case Information Report (ECIR) registered against Salgaocar Mining Industries Pvt. Ltd., its allied firms, and Mrs. Lakshmi Anil Salgaocar, holding that money laundering proceedings cannot survive once the underlying predicate offence is extinguished.

The case traces back to the report submitted on September 7, 2012, by the Justice M. B. Shah Commission, which inquired into alleged illegal mining of iron ore and manganese in Goa. Following the report, the High Court, on March 22, 2013, issued an omnibus direction to register First Information Reports (FIRs) against the entities and individuals identified therein.

Pursuant to these directions, the Crime Branch Police Station, CID, Goa Police, registered an FIR on August 12, 2013, under multiple provisions of the Indian Penal Code, the Prevention of Corruption Act, and the Mines and Minerals (Development and Regulation) Act.

Relying entirely on this FIR as the predicate offence, the Enforcement Directorate (ED) initiated proceedings and registered an ECIR on June 9, 2014, under the Prevention of Money Laundering Act (PMLA).

Although Goa’s Special Investigation Team (SIT) filed a chargesheet against 17 persons in February 2018, the petitioners were not named in it. On February 10, 2025, the Special Court, North Goa, Panaji, discharged all accused persons named in the chargesheet—an order the State chose not to challenge after the Directorate of Prosecution advised against filing an appeal.

On July 16, 2026, the High Court quashed the FIR qua the petitioners, noting that they had never been arrayed as accused, that the investigation had remained stalled for over a decade without a chargesheet being filed against them, and that the named accused had already been discharged.

Following the quashing of the FIR, the petitioners approached the High Court seeking quashing of the ED’s ECIR. Advocate Yogesh Nadkarni, appearing for the petitioners, argued that an ECIR cannot legally survive in the absence of a subsisting predicate offence, citing landmark Supreme Court precedents.

The ED opposed the plea through Retainer Advocate Siddharth Samant, contending that the ECIR involved several other entities and that the agency could continue proceedings independently.

Rejecting the ED’s contentions, the High Court reiterated the settled legal position that authorities under the PMLA cannot prosecute individuals on a notional basis or on the mere assumption that proceeds of crime exist.

The High Court observed that “In the absence of a subsisting predicate offence, an ECIR becomes legally incomprehensible, and the Enforcement Directorate cannot exercise its jurisdiction… Once the predicate offence ceases to exist by reason of discharge, acquittal, acceptance of a closure report, or quashing of the FIR, the Enforcement Directorate cannot proceed further." 

The High Court accordingly made the Rule absolute and quashed the ECIR in relation to Salgaocar Mining Industries Pvt. Ltd., Salitho Ores Pvt. Ltd., Marzook & Cadar Pvt. Ltd., Shantilal Khushaldas & Brothers Pvt. Ltd., S. Kantilal & Company Pvt. Ltd., M/s SOVA, M/s Mineira Nacional Limitada, and Mrs. Lakshmi Anil Salgaocar, Administratrix of the Estate of the Late Anil Vassudeva Salgaocar.