On 1 July 2026, Justice Vikram D. Chauhan of the Allahabad High Court granted bail in a money-laundering case linked to alleged illegal mining (Criminal Misc. Bail Application No. 38900 of 2025). The ED alleged that proceeds of mining at a stone crusher in Himachal Pradesh were partly used to buy a stone crusher in Saharanpur, Uttar Pradesh, for Rs 4.70 crore. The applicant held a 9% partnership in the Saharanpur firm. He was not named in any of the six Himachal Pradesh FIRs and had been in custody since 18 November 2024.
What was decided
The Court noted that closure reports had been filed in all six predicate FIRs, and four had already been accepted when the ECIR was registered. It held that “the foundation of ECIR being schedule offence was not in existence on the date when the ECIR was registered”. A UP FIR registered on 7 November 2024 was added later as a scheduled offence.
Since no scheduled offence was found in the Himachal FIRs, the mining income could not automatically be treated as proceeds of crime. The ED had not identified specific assets as proceeds attributable to the applicant, and no assets had been attached. The Court said that unexplained assets alone do not justify a presumption that they are proceeds of crime. Considering more than 18 months in custody, a complete investigation, a filed complaint, a long trial ahead and bail already granted to a co-accused, and relying on K.A. Najeeb and Manish Sisodia, it granted bail on conditions.
Why it matters
Mining, crusher and mineral-transport businesses in western UP and the Bundelkhand region often face FIRs under mining laws and the BNS, and ED investigations sometimes follow. This order is a reminder that a PMLA case has to identify a scheduled offence that actually exists and proceeds of crime linked to the particular accused.
It also shows that a later FIR added to an ECIR does not automatically cure the absence of a scheduled offence when the ECIR was first registered.
Practical points
- Get the final status of every predicate FIR: closure report filed, accepted or challenged.
- Separate the business’s lawful income and partnership share from the specific amounts the ED calls proceeds of crime.
- Note whether any property has been attached or specifically linked to the accused.
- The stage of the trial, bail to co-accused and time in custody remain central at the bail stage.
Sources: Allahabad High Court order of 1 Jul 2026 (copy via LiveLaw).
For a confidential discussion on ED/PMLA matters, see ED and PMLA Defence.
General legal information only; not legal advice or solicitation.
