Mumbai, Oct. 29 -- The Enforcement Directorate has suffered a significant procedural setback in its money laundering case involving OctaFX India Private Limited, now Tauga Private Limited, after the Bombay High Court quashed the Special PMLA Court's cognisance order and granted consequential protection to the company against steps relating to Non-Bailable Warrants and Red Corner Notices.
In an order passed on October 26, 2026, Justice Milind N. Jadhav held that the Special Court's order dated December 24, 2024, was legally unsustainable for failing to comply with the mandatory procedure governing the taking of cognisance.
The ruling came in a writ petition filed by Tauga Private Limited, challenging the initiation of judicial proceedings without granting the accused an opportunity of hearing under the Bharatiya Nagarik Suraksha Sanhita, 2023.
The High Court made it clear that the statutory procedure must be followed before cognisance is taken, requiring the Special Court to consider the prosecution's response and hear the accused persons before passing an appropriate order.
In a particularly important direction, the High Court also quashed any consequential steps taken by the prosecution concerning the issuance of Red Corner Notices or Non-Bailable Warrants against the petitioner in the present case.
The relief is significant in the context of ED's recent move before the PMLA Special Court seeking Non-Bailable Warrants against the company and other accused persons.
The High Court further directed ED to ensure that the other accused persons are properly served in accordance with law. In the company's case, fresh service of summons and notice under Section 223(1) was waived.
Senior Advocate Aabad Ponda, along with the Khaitan & Co. legal team, appeared for the company and successfully challenged the validity of the cognisance order.
With the earlier order now set aside, the Special PMLA Court will have to hear the objections of the accused and reconsider the question of cognisance in accordance with the statutory procedure.
The next hearing before the Special Court is scheduled for November 18, 2026.
The judgment represents a substantial procedural victory for OctaFX, reinforcing the principle that even proceedings under stringent financial crime legislation must adhere to mandatory safeguards protecting the rights of accused persons.
While the ruling does not adjudicate upon the substantive money laundering allegations, it requires the prosecution to proceed through the legally prescribed process before the Special Court can take cognisance afresh.
Published by HT Digital Content Services with permission from Millennium Post.