Madras High Court sets aside cognisance order in Jaffer Sadiq money-laundering case

The Madras High Court has set aside a Chennai sessions court order that took cognisance of a money-laundering complaint against drug-smuggling accused Jaffer Sadiq without giving him an opportunity to be heard. A Division Bench comprising Chief Justice Sushrut Arvind Dharmadhikari and Justice G. Arul Murugan restored the complaint, however, and directed the sessions court to proceed in accordance with Section 223(1) of the Bharatiya Nagarik Suraksha Sanhita (BNSS).

That provision requires an opportunity of hearing before a court takes cognisance, according to the material before the court. The High Court passed the orders while partly allowing Mr. Sadiq’s petition seeking to quash proceedings under the Prevention of Money Laundering Act.

The Enforcement Directorate had registered an Enforcement Case Information Report against Mr. Sadiq and others on March 11, 2024. The agency relied on three drug cases as alleged predicate offences for invoking the money-laundering law.

Those cases involved seizures of 50.070 kg of pseudoephedrine by the Narcotics Control Bureau in New Delhi in 2024, 38.867 kg of ketamine by the Mumbai Customs’ Special Intelligence and Investigation Branch in 2019, and 50 kg of pseudoephedrine by Chennai Customs in 2015. Mr. Sadiq argued that he had not been named as an accused or served notice in the 2015 case.

He also told the court that the Bombay High Court had discharged him from the 2019 case on August 13, 2026, leaving the 2024 case as the only prosecution pending against him before a special court in New Delhi. He challenged the Chennai sessions court’s decision to take cognisance of the ED complaint on October 18, 2024, saying it had been made without the hearing required under the BNSS, which came into force on July 1, 2024. The petitioner relied on a Supreme Court judgment dated May 25, 2025, in Kushal Kumar Agarwal versus Directorate of Enforcement.

The ED opposed quashing the entire case. The High Court’s order means the complaint will return to the lower court for proceedings consistent with the hearing requirement.