With reference to the Directorate of Enforcement (ED) and the PMLA, consider the following statements: 1. The Karnataka High Court ruled that the ED's powers under the PMLA are derivative in nature. 2. The court held that the ED can act as a super cop by filing private complaints to initiate probes. 3. The ED is required to share information with competent agencies when a predicate offence is dismissed. Which of the statements given above is/are correct?

Karnataka High Court rules ED is not a "super cop" for money-laundering probes

GS3Economy · S&T · Environment · Security· Money laundering & organised crime· Prelims + Mains· 7 November 2026

Institutional autonomy vs derivative powers: a GS3 Internal Security and Judiciary case study.

Why in news

The Karnataka High Court ruled that the Directorate of Enforcement (ED) cannot act as a 'super cop' by filing private complaints to initiate money-laundering probes.

Background

The court held that the ED's powers under the Prevention of Money-Laundering Act (PMLA) are derivative. It ruled that the ED must share information with competent agencies rather than investigating independently when a predicate offence is dismissed.

Facts for Prelims

Act / BillPMLA: Prevention of Money-Laundering Act governs the ED's investigative powers
FactThe court ruled that ED's powers are derivative, requiring information sharing with competent agencies

Prelims practice question

With reference to the Directorate of Enforcement (ED) and the PMLA, consider the following statements:

The Karnataka High Court ruled that the ED's powers under the PMLA are derivative in nature.
The court held that the ED can act as a super cop by filing private complaints to initiate probes.
The ED is required to share information with competent agencies when a predicate offence is dismissed.

Which of the statements given above is/are correct?

(a)1 only
(b)1 and 3 only
(c)2 and 3 only
(d)1, 2 and 3

Show answer

Answer: (b) 1 and 3 only — Statements 1 and 3 are correct. Statement 2 is incorrect: The court ruled that the ED cannot act as a super cop.

For Mains

Q. Discuss the constitutional and legal implications of the 'derivative' nature of the ED's powers under the PMLA in ensuring a balanced investigative framework.

Dimensions to cover in your answer

Jurisdictional overlap: Conflict between independent investigative mandates and the requirement for shared intelligence
Judicial oversight: Balancing the need for swift money-laundering action against the protection of individual rights against arbitrary probes

Keywords: Derivative powers · Predicate offence · Judicial oversight · Institutional autonomy · Money laundering

Read the full news →Report a mistake in this note How notes are made Source: The Hindu ↗Also: GS2 · Judiciary & landmark judgments

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