PMLA | Uncovering New Duties for CA/CS/CMA

Table of Contents

1. Brief Contours of PMLA
2. Peculiar & Unique Architecture of PMLA
3. Reasons why it is creating Jurisprudential Mayhem
4. Overview of PMLA Notification-03.05.2023
5. Understanding Role & Relevance of CA, CS, CMA
6. Way Forward

1. Brief Contours of PMLA

2. Peculiar & Unique Architecture of PMLA

1. Subject to ED’s Benevolence certifying “I have Reasons to believe”.

(a) “EVERYTHING” (Without Territory) on earth & beyond is “Proceeds of Crime” &

(b) “EVERYONE” (Beyond Time) is a “Money Launderer”.

2. “Transcends Time & Territory” (TTT).

3. “Anything” & “Everything” can be“EVIDENCE”.

4. “Anyone” can be FORCED (under threat of Prosecution) to give“Evidence”.

5. Inversion of “PRESUMPTION OF INNOCENCE”.

3. Reasons why it is creating Jurisprudential Mayhem

1. “Rules of Interpretation” & “Rules of Construction”.
2. Old Judgements/Precedents.
3. Old Jurisprudence.
4. Legal Education.
5. Lack of Research & Development (R&D).

4. Overview of PMLA Notification-03.05.2023

1. “Addition” of “Financial Transaction carried out by CA/CS/CWA & its Firms on behalf of Client in the course of Profession in relation to Designated Activities” in definition of “Person carrying on designated Business/Profession” u/2(1)(sa)-PMLA, 2002.
2. “Designated Activities” are:

(a) Buying & Selling of any Immovable Property;

(b) Managing of client Money/Securities/Other Assets;

(c) Management of Bank/Savings/Securities Accounts;

(d) Organisation of Contributions for Creation/Operation/Management of Cos;

(e) Creation/Operation/Management of Companies/LLP/Trusts, & Buying & Selling of Business Entities.

5. Understanding Role & Relevance of CA, CS, CMA

1. Freedom to practice Profession u/Part-III (Fundamental Right) of Constitution of India vis avis Statutory Practice (Duties) u/Companies, Income Tax Act etc.

2. Statutory Obligation u/Ch-4 (Obligation of Banking Companies, Financial Institutions & Intermediaries)” of PMLA, 2002 (S.12-15):

a. “Intermediary”, “Person carrying on Designated Business & Profession”, “Reporting Entities”, “Specified Transaction”, “Suspicious Transaction” u/PMLA.

b. “Verifying Clients’ identity”, “Maintenance of Information & Records”, “Furnishing of Information”, “Enhanced Due-Diligence”.

3. Engaging only through Professional Duties without non-Professional Interest.

 6. Way Forward

1. Removing “Doubts” as an ongoing exercise.
2. Getting trained & engaging the “Society” on clarity path
3. Understanding the meaning of “Law”.
4. Developing “new Jurisprudence” of Mathematical scale.
5. Errorless “Assistance” to Institutions (Parliaments, Executives & Courts).