PMLA court shuts ED money laundering case against Hasan Mushrif and sons

A special court in Mumbai has closed the money laundering case against Maharashtra minister and Nationalist Congress Party (NCP) leader Hasan Mushrif and his three sons. The court, which sits under the Prevention of Money Laundering Act (PMLA), accepted a closure report from the Enforcement Directorate (ED). The central agency itself had asked for the case to be wound up.

The order is dated Tuesday, but its contents became known only on Thursday, which is when the development was widely reported. Mushrif reacted to the outcome by saying, "My Diwali has become sweet."

The case concerns the Sarsenapati Santaji Ghorpade Sugar Factory Limited in Kolhapur. Besides Mushrif and his sons, the factory's directors and the factory as a company were named as accused.

In its plea, the ED argued that the main offence behind a PMLA case, the scheduled offence, is a "sine qua non", an essential condition, for any action under the law. Once the High Court had acted, the agency said, nothing was left in the money laundering complaint. Special PMLA Judge S. V. Sahare agreed. "With the original offence quashed, the offence under the PMLA cannot be sustained," he said in the order. The court closed the Enforcement Case Information Report (ECIR) dated April 4, 2022, and told that the case papers be handed back to ED officials.

The trail began in March 2022, when the office of the Registrar of Companies (RoC) in Pune filed a complaint alleging violation of the Companies Act. In February 2023, police at Murgud in Kolhapur district registered an FIR alleging forged entries and tampering with share capital raised from farmers. The family was accused of raising money by promising farmers a stake as shareholders in the factory, and it was alleged that about 40,000 farmers were cheated.

The ED alleged that in 2013-2014 the factory took in crores of rupees as equity and preference share money from several bogus and non-existent entities, among them companies in Kolkata and firms whose registration had been cancelled. According to the agency, the financial statements showed investments of more than Rs 11.35 crore with no matching bank transaction. It also alleged that a large sum was moved into the accounts of the factory, its related limited liability partnership (LLP) entities and its directors through layered, circular transactions and cash deposits. The money was also said to have been diverted to companies linked to Mushrif.

The agency searched several locations in early 2023. In July 2024 it provisionally attached fixed deposit receipts worth Rs 2.07 crore and Rs 7.70 lakh in cash. The Adjudicating Authority in New Delhi confirmed the attachment in December 2024. The accused then went to the Bombay High Court against both of the original cases.

On November 6 last year, the High Court quashed the process issued by the Pune court on the RoC's complaint. It observed that the allegations relate to 2013-14, while the relevant amendment to the Companies Act took effect in April 2021 and applies only prospectively, so it could not be used retrospectively. The Murgud FIR was dealt with in June 2025, when the High Court disposed of the petition seeking to quash it. It noted that the investigating officer had already filed a "C-Summary" report (the case is neither true nor false) in the local court, and that the report had been accepted.

The matter may not end here. Senior lawyer Asim Sarode, writing on Twitter, said the closure of the probe into the alleged Rs 100 crore money laundering case does not settle things, and that the decision to accept the closure report can be challenged. In his view, any citizen with social sensitivity can challenge it legally, as can workers of the Congress, the Shiv Sena and the BJP. He said many people are preparing to approach the court, and that the next legal steps can be decided only after the full order is studied. Following his claim, it is being suggested that Mushrif's troubles could return.