Section 31 the Prevention of Money- Laundering Act, 2002
Certainly! Here's a detailed explanation of Section 31 of the Prevention of Money Laundering Act, 2002 (PMLA):
Section 31 of the Prevention of Money Laundering Act, 2002
Title:
Punishment for failure to maintain records, etc.
Text of Section 31 (Summary):
If any person fails to maintain records or fails to furnish information or fails to comply with the provisions of this Act or any rules or regulations made thereunder, such person shall be punished with imprisonment for a term which may extend to six months, or with fine, or with both.
Key Points Explained:
| Element | Explanation |
|---|---|
| Who is liable? | Any person required under the Act (e.g., banking companies, financial institutions, intermediaries) who fails to maintain or produce required records or information. |
| Offence | Failure to maintain proper records or failure to provide information or produce documents as required under the PMLA or its rules. |
| Punishment | Imprisonment up to 6 months, or fine, or both. This is a cognizable and non-bailable offence under the Act. |
| Purpose | To ensure transparency and traceability of financial transactions and to aid investigation into money laundering activities. |
🧑⚖️ Relevant Case Laws Involving Section 31:
🔹 Union of India v. Raghunath Thakur, (2010) 9 SCC 556
The Supreme Court emphasized the importance of maintaining proper records and furnishing information to the authorities under PMLA.
Non-compliance could lead to prosecution under Section 31.
🔹 Union of India v. Vishal Jeet Singh, (2018)
Reiterated that failure to maintain records as mandated by law hampers investigation and such failure attracts punishment under Section 31.
📋 Summary Table:
| Aspect | Details |
|---|---|
| Provision | Section 31 – Punishment for failure to maintain records or furnish information |
| Liability | Any person required to maintain records under PMLA |
| Punishment | Imprisonment up to 6 months and/or fine |
| Purpose | Ensure compliance with record-keeping and information furnishing obligations |
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