Section 223 BNSS Applies to PMLA Complaints After July 1, 2024; Accused Must Be Heard Before Cognizance: Supreme Court

Introduction: A Landmark Procedural Reset

In a landmark Supreme Court judgment, the Supreme Court has held that BNSS Section 223 of the new Bhartiya Nagrik Suraksha Sanhita, 2023, would be attracted to all such complaints under PMLA which are made after 1 July 2024. The judgment is a procedural history change, wherein no cognizance of offence under the Prevention of Money Laundering Act, 2002 (PMLA) shall be taken unless an opportunity is given to the accused of being heard.

This decision puts the intersection of special laws such as PMLA with general criminal procedure codes into sharp focus, particularly in light of India's shift from CrPC to BNSS.

BNSS Section 223 in PMLA Cases

Case Summary: A Procedural Filing Mistake of Constitutional Significance

The Supreme Court has put on hold an order made by a Special Court which had proceeded against a complaint filed under Section 44(1) (b) of the PMLA without providing an opportunity to the accused to be heard in advance. The complaint filed on or after 1 July 2024 was one under BNSS Section 223, for which it has to provide such a hearing. 

A Division Bench composed of Justice Abhay S. Oka and Justice Ujjal Bhuyan heard the case and ruled:

"While due to the grievance having been lodged after 1st July, 2024, Section 223 of the BNSS will be attracted to the current grievance… The impugned order is being quashed solely on the ground of non-compliance of the proviso to sub-section (1) of Section 223."

This creates a binding precedent process for compliance with PMLA in all future cases.

Understanding Section 223 BNSS: A New Safeguard for the Accused

Bharatiya Nagarik Suraksha Sanhita (BNSS) Chapter XVI enacts sections 223 to 226, almost substituting sections 200 to 204 of the previous CrPC in the post-complaint process.

Significantly, BNSS Section 223(1) provides:

"No Magistrate shall take cognizance of an offence without giving the accused an opportunity to be heard."

This amendment essentially accords pre-cognizance representation rights to the accused, a stupendous leap in the direction of safeguarding constitutional protection under Article 21 (right to life and liberty) and Article 14 (equality before law).

The Conflict: Special Statutes vs. General Law

At the heart of the case was a question of law, which was of quintessential character: Whether provisions of a general procedural law (BNSS) can ever be made applicable to complaints under a special law such as the PMLA, keeping in mind in specific strict and largely restrictive paradigms in money laundering laws?

Citing precedent judgments such as Yash Tuteja v Union of India (2024) and Tarsem Lal v Enforcement Directorate (2024), the Supreme Court judgment provides that common law procedural fairness does extend to complaints under PMLA-most importantly, complaints made after July 2024.

Arguments Raised and Judicial Response

1. Argument: Limited Scope of BNSS Hearing

ASG Suryaprakash V. Raju, on behalf of the government, sought that hearing under BNSS Section 223 be restricted to test if a prima facie case is made out and not merits of complaint.

2. Argument: Future Supplementary Complaints

Raju asked again that if cognizance is already taken to such an extent of due procedures of the BNSS, the court is not bound to take cognizance again on supplementary complaints.

Judicial Response: Premature to Decide

The Bench felt that questions like these did not arise in the case at hand and left them to be addressed at a proper forum, especially in light of the Special Court. This restrictive approach avoids premature judicial discretion but leaves open the possibility of more nuanced procedural jurisprudence.

The Practical Impact of the Ruling

1. Immediate Consequences

The 20 November 2024 order remained suspended. The Court ordered the accused-appellant to appear before the Special Court on 14 July 2025, and ordered the court to conduct a hearing under BNSS Section 223.

No notice will now be issued, as ordered by the Bench.

2. Long-Term Implications

All PMLA complaints received after 1 July 2024 will be in terms of BNSS Section 223 Special Judges can take cognizance only after holding this initial hearing first Not doing so would hence be reason for questioning orders of cognizance. The procedural space of BNSS will have space even in special legislations unless short-circuited

BNSS: India's New Criminal Procedure Framework

The Bharatiya Nagarik Suraksha Sanhita, 2023, was brought into effect on 1 July 2024 and repealed the Criminal Procedure Code (CrPC). Chapter XVI of the BNSS imposed organizational reforms for enhancing judicial effectiveness and protecting the rights of the accused.

Most contentious among the amendments is the insertion of Section 223 of BNSS, which provides a pre-cognizance hearing right to an accused-a departure from existing practice hitherto where the court was proceeding on the basis of prosecution inputs alone.

This Supreme Court of India ruling safeguards the status of BNSS Section 223 as a procedural requirement-even in the PMLA cases, which are otherwise high-pressure prosecution cases.

Why It Matters: Due Process in Special Offences

Money laundering is a complex investigation of top-level suspected individuals. PMLA situates the Enforcement Directorate (ED) with broad powers such as arrest, freezing of assets, and strict bail conditions.

In such a perspective, denial of hearing prior to pre-cognizance would be procedurally unjust to the advantage of the prosecution - possibly prejudicing the accused right to a fair trial. Apex Court's approach is congruent with the soul of the Constitution so that observance of PMLA shall not involve denial of freedom of the individual.

Role of the Bar and Legal Community

This ruling also imposes an obligation on defense attorneys to push courts to adhere to BNSS Section 223 prior to taking cognizance. Legal professionals now have an obligation to:

• Raise preliminary objections where no such hearing was ordered

•  Right to be heard at pre-cognizance stage

• Seek cancellation of orders passed without such hearings

Judicial orientation courses should include this procedural requirement too, particularly for Special Judges dealing with economic crimes and PMLA cases.

Challenges Ahead: What Remains Unsettled

While the Supreme Court judgment resolves one key issue, there remain certain issues pending in the balance:

• Whether BNSS Section 223 would extend to PMLA supplementary complaints?

• Whether hearing at the pre-cognizance stage is likely to lead to issues of evidence?

• Whether the same procedural safeguards would apply to other special law such as UAPA or NDPS?

The Court's refusal to rule on these matters is intentional-later Benches can evolve the law on a case-by-case basis.

Conclusion: A Judicial Step Towards Procedural Integrity

In upholding BNSS Section 223 of PMLA complaints, India's Supreme Court acted on principle on due process, impartiality, and criminal justice responsibility.

The judgment is a victory of constitutionalism, and it marks the shift from CrPC to BNSS not merely symbolic but actual. It restores procedural integrity to a sphere where third-degree techniques and unchannelized discretion are a routine source of distress.

As India goes about reformulating its criminal laws for the 21st century, such decisions are a good reminder that justice is not merely about results-but processes we undertake to reach the same.

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