Supreme Court declines to quash PMLA prosecution against JSW Steel, directs parties to pursue statutory remedies

Case Name: JSW Steel Limited and Another v. Deputy Director, Directorate of Enforcement and Others
Date of Judgment: October 07, 2025
Citation: 2025 INSC 1194, Criminal Appeal Nos. 4183–4184 of 2025 (arising out of SLP (Crl.) Nos. 7828–7829 of 2022)
Bench: Hon’ble Mr. Justice Dipankar Datta and Hon’ble Mr. Justice Augustine George Masih

Held: The Supreme Court refused to quash the prosecution initiated by the Enforcement Directorate under the Prevention of Money Laundering Act, 2002 against JSW Steel Limited and its officials. It held that since the appellants had already invoked their statutory appellate remedy under Section 26 PMLA before the Appellate Tribunal, judicial interference at this stage was unwarranted. The Court emphasized that PMLA provides a self-contained adjudicatory mechanism and that constitutional or appellate jurisdiction should not ordinarily be exercised when an efficacious alternative remedy exists.

Summary: JSW Steel Limited had entered into agreements with Obulapuram Mining Company in 2009 for supply of iron ore, but due to disputes and failure of supply, arbitration proceedings were initiated and an award passed in JSW’s favour. Meanwhile, CBI investigated illegal mining and export activities of the group concerns of G. Janardhan Reddy and filed charge sheets, though JSW was eventually dropped from the prosecution. The Enforcement Directorate nonetheless registered ECIR/09/BZ/2012 under PMLA against Reddy and others and issued provisional attachment orders attaching over ₹33.80 crore from JSW’s accounts, alleging that unpaid consideration for iron ore constituted proceeds of crime.

JSW challenged these attachment orders through multiple writ petitions before the Karnataka High Court, which were dismissed. When the Special Court took cognizance of an ED complaint in 2022 and issued summons to JSW and its officials, fresh writ petitions were filed but rejected by the High Court. Before the Supreme Court, JSW argued that since it was discharged in the predicate offence by CBI, no offence under PMLA could stand. It also contended that withdrawals from cash credit accounts could not amount to money laundering, and that ED’s prosecution amounted to parallel proceedings despite pending appeals before the Tribunal. The ED opposed, arguing that JSW frustrated attachments and continued to possess ₹16.55 crore of proceeds of crime.

Decision: The Supreme Court held that the issues raised by JSW Steel fall squarely within the jurisdiction of the Appellate Tribunal under PMLA and that premature interference would prejudge matters pending adjudication. It noted that although JSW was not named as an accused in the predicate offence, the ED’s allegations pertained specifically to attached amounts and their dissipation. The Court concluded that the prosecution cannot be quashed at this stage and directed the appellants to pursue their pending statutory appeals. The criminal appeals were accordingly disposed of with no order as to costs.