M/S Nestle India Ltd v. Food Safety and Standards Authority of India, WP(L) No. 1688 of 2015

Facts: The Food Safety and Standards Authority of India (FSSAI) banned Maggi Noodles after tests detected excessive lead levels and declared MSG present, contrary to Nestle’s “no added MSG” labeling. Nestle challenged the ban.

Issue: (i) Whether FSSAI had legal authority to issue a nationwide ban; (ii) Whether the ban was procedurally valid.

Held: The Bombay High Court held that the nationwide ban by FSSAI was illegal — it had exceeded its statutory powers. However, the court did not exonerate Nestle completely; it allowed fresh testing. Ultimately Maggi was reintroduced after passing tests by accredited labs.

Legal Significance: Illustrates the interface between white-collar crime, food adulteration law (FSSAI Act 2006), and regulatory power. Misbranding (false “no MSG” claim) and adulteration (excessive lead) are white-collar crimes under food safety law. Key provisions: S. 89 FSSAI Act (penalty up to ₹5 lakh + imprisonment); FSSAI cannot impose nationwide ban without following due procedure.

Principle: Regulatory bodies must follow statutory procedures even in cases involving consumer safety. Corporate liability for food fraud extends to civil and criminal penalties under FSSAI Act.

Kanwarjit Singh Kakkar v. State of Punjab, (2011) 6 SCR 895

Facts: A former police official was prosecuted under the PC Act. The question was whether sanction under S. 19 was required when the accused no longer held the post in which the alleged misconduct occurred.

Held: SC affirmed the position established in R.S. Nayak v. A.R. Antulay — if the public servant at the time of cognizance is not holding the same post in which the offence was allegedly committed, no sanction is required. The sanction protection is office-specific, not person-specific. The principle of stare decisis (stare decisis et non quieta movere) requires following settled law.

Principle: S. 19 sanction is required only when the accused is still a public servant holding the same office in which the offence was committed at the time cognizance is taken.

Abhay Singh Chautala v. CBI, (2011) 7 SCC 141

Facts: Abhay Singh Chautala (former Chief Minister’s son and state minister) was accused of obtaining land for his benefit through abuse of official position. CBI investigated. Questions arose about sanction requirement and scope of investigation.

Held: The SC reiterated the need to follow the principle established in Antulay’s case — sanction is not required where the accused is not currently holding the office in which the offence was committed. The SC also held that courts should not interfere with CBI investigations at an early stage — CBI has the discretion to investigate and courts should be slow to quash such investigations.

Principle: Strong public interest in investigating corruption by elected representatives; sanction requirements cannot be used to shelter former office-holders from investigation.

Kalicharan Mahapatra v. State of Orissa, AIR 1998 SC 2595

Facts: A public servant was convicted under the Prevention of Corruption Act. The question was whether the presumption under S. 4 of the PCA 1947 (equivalent to S. 20 of PCA 1988) applied where money was recovered from the accused but the demand was not directly proved.

Held: The SC held that when the recovery of bribe money from the possession of the accused public servant is established, the presumption under S. 20 operates — it is presumed that the acceptance was as a bribe. The accused must then prove the contrary. It is not necessary to separately prove each element of the offence once the recovery is established.

Principle: Recovery of tainted money from the possession of a public servant is sufficient to raise the presumption under S. 20 — the accused then bears the reverse burden of proving the money was not a bribe.

K. Shanthamma v. State of Telangana, SLP (Crl.) No. 7182 of 2019

Facts: K. Shanthamma, a government employee, was accused of demanding and accepting a bribe for performing her official duties. She argued that the demand was not proved beyond reasonable doubt.

Held: The SC analysed the requirements for conviction under S. 7 PC Act — demand and acceptance must both be proved. The presumption under S. 20 operates once acceptance is proved, but demand cannot be presumed. However, circumstantial evidence (trap evidence, recovery of marked currency, conduct of the accused) can collectively prove demand. The conviction was upheld.

Principle: For conviction under S. 7 PC Act, both demand and acceptance of bribe must be established; the presumption under S. 20 helps once acceptance is proved but does not substitute proof of demand.

CBI, Bank Securities and Fraud Cell v. Ramesh Gelli, (2016) 3 SCC 788

Facts: Ramesh Gelli was the Chairman and Managing Director of a Global Trust Bank, which subsequently merged with Oriental Bank of Commerce. The CBI sought to prosecute him under the PC Act alleging that as a bank Chairman, he was a public servant. The question was whether a Chairman/MD of a private bank is a “public servant” under S. 2(c) PC Act.

Held: SC held that a Chairman/MD of a private scheduled bank is NOT automatically a “public servant” under S. 2(c) PC Act. However, the bank employees may be covered by special provisions. The court carefully analysed S. 2(c)(viii) — persons in positions of trust in cooperative societies — and found it did not apply to commercial banks per se. This does not exempt them from other laws (IPC, banking laws).

Principle: The definition of “public servant” under PC Act must be read carefully — not every person in a position of trust or authority is automatically covered. However, private sector corruption is increasingly addressed through PMLA, IPC cheating, and Companies Act provisions.

Ram Jethmalani & Ors. v. Union of India, (2011) 9 SCC 761 (Black Money / Hassan Ali Khan Case)

Facts: Ram Jethmalani and other petitioners filed a writ petition under Art. 32 alleging that the Union of India had failed to investigate and recover billions of dollars of black money stashed by Indian nationals in foreign banks (particularly UBS Zurich). The case involved Hassan Ali Khan, against whom the Income Tax department had a ₹40,000 crore demand, and allegations of links to international arms dealing.

Held: The Supreme Court (Bench: Sudershan Reddy and Nijjar JJ) directed:

1. The High Level Committee constituted by Government be converted into a Special Investigation Team (SIT) headed by two retired Supreme Court Judges (Justice B.P. Jeevan Reddy as Chairman; Justice M.B. Shah as Vice-Chairman)
2. SIT given broad powers to investigate, initiate proceedings, and prosecute all cases of unaccounted foreign bank account money
3. The SIT shall report directly to the Supreme Court; all government agencies shall cooperate
4. Regarding disclosure — names of individuals whose investigations are pending need not be disclosed; those against whom show-cause notices have been issued may be disclosed

Significance: Landmark case establishing court-supervised investigation of money laundering/black money. The SC analysed the concept of “soft state” (Myrdal) — India’s failure to aggressively pursue black money is an indicia of the nexus between law-makers, law-keepers, and law-breakers. The SIT was subsequently reactivated and in 2014 made broader investigations in the post-Black Money Act 2015 context.

Principle: Supreme Court can exercise constitutional jurisdiction under Art. 32 to supervise investigations into corruption and money laundering when government has failed to act. Right to honest governance is a fundamental right under Articles 14 and 21.

Binod Kumar v. State of Jharkhand & Ors, (2011) 11 SCC 463

Facts: Madhu Koda (former CM of Jharkhand) and others including Binod Kumar were alleged to have amassed hundreds of crores through corruption while in office and invested them across India and abroad. The High Court directed CBI to investigate. Binod Kumar challenged the CBI’s jurisdiction arguing that money laundering offences under PMLA 2002 are exclusively in the domain of the Enforcement Directorate.

Issue: Whether the CBI has authority to investigate offences that may involve money laundering when the primary offences are under IPC and PC Act.

Held: SC upheld the High Court’s direction to CBI. The PMLA makes ED the exclusive investigator for the offence of money laundering (S. 3 PMLA), but CBI retains jurisdiction to investigate the scheduled offences (IPC, PC Act). The two investigations are parallel and independent — ED investigates the money laundering; CBI investigates the predicate/scheduled offence. The two are not mutually exclusive.

Principle: CBI jurisdiction to investigate IPC and PC Act offences is unaffected by PMLA. ED and CBI may investigate the same matter in parallel — ED for money laundering; CBI for predicate offences. This coordination is key to effective prosecution of complex corruption cases.

Vijay Madanlal Choudhary & Ors. v. Union of India & Ors., SLP (Crl.) No. 4634 of 2014

Facts: Comprehensive constitutional challenge to multiple provisions of PMLA 2002, including: the definition of “proceeds of crime”; powers of arrest (S. 19); Adjudicating Authority proceedings (S. 8); reverse burden of proof (S. 24); twin conditions for bail (S. 45); jurisdiction of ED; retroactivity. Multiple petitions consolidated before a three-judge bench of the SC.

Held [2022 — 3-judge bench]: The SC upheld virtually all challenged provisions of PMLA as constitutionally valid:

• PMLA is special legislation enacted pursuant to international obligations (FATF, UN conventions) — stringent provisions are justified
• Twin conditions for bail under S. 45 (must show prime facie not guilty AND unlikely to commit offence if released) — upheld as reasonable restriction under Art. 21
• Reverse burden under S. 24 — constitutionally valid; accused must explain legitimacy of property
• ED’s power to arrest (S. 19) — valid; ECIR (ED’s FIR equivalent) need not be supplied to accused before arrest
• Definition of “proceeds of crime” — valid even if extended to properties of persons not themselves charged with the scheduled offence, as long as the property is linked to the crime

Significance: The most comprehensive judicial endorsement of PMLA’s broad powers. Critics argued the SC gave excessive powers to ED. The decision significantly strengthened the ED’s investigative and prosecution machinery.

Principle: PMLA’s broad provisions — including twin bail conditions, reverse burden of proof, and wide definition of proceeds of crime — are constitutionally valid as reasonable restrictions necessary to combat the scourge of money laundering.

Parvathi Kollur & Anr. v. State by Directorate of Enforcement, SLP (Crl.) No. 4258 of 2021

Facts: Parvathi Kollur challenged the attachment of her property by ED under PMLA, arguing that she had no connection with any scheduled offence and was an innocent third party whose property was sought to be confiscated because it was allegedly purchased with proceeds of crime by her husband.

Issue: Whether property of an innocent third party (not accused of scheduled offence) can be attached under PMLA.

Held: SC held that the PMLA provisions do permit attachment of property held by third parties if the property is linked to proceeds of crime. However, the third party must be given an opportunity to prove that they acquired the property legitimately and without knowledge of its criminal taint. The burden remains on the accused (and on connected persons claiming the property is untainted) to prove legitimacy.

Principle: PMLA’s attachment provisions can extend to third parties’ property if it constitutes proceeds of crime; innocent third parties must be given opportunity to prove legitimate acquisition.