A Delhi court on Friday ordered the commencement of trial against jailed Kashmiri separatist leader Yasin Malik, Baramulla MP Sheikh Abdul Rashid, alias Engineer Rashid, and five others in an alleged ₹8.94 crore terror-funding and money laundering case linked to Pakistan-based hawala channels.
Special Judge Prashant Sharma of Rouse Avenue courts, formally framing charges against the accused, directed that the recording of prosecution evidence will begin on November 19.
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The development came after the court on September 9 ordered framing of charges against the accused, observing that there was sufficient prima facie material on record to raise a "strong suspicion" regarding the involvement of the accused in generating, receiving, and laundering proceeds of crime to fund secessionist activities in Jammu and Kashmir.
Yasin Malik pleaded ‘not guilty’
The proceedings were conducted in an in-camera hearing. Appearing through video conferencing from Tihar Jail, Jammu and Kashmir Liberation Front (JKLF) chief Yasin Malik pleaded not guilty to the charges under the Prevention of Money Laundering Act (PMLA) and stated that he would contest the case.
The court had in September held that sufficient material existed to raise a “strong suspicion” against all seven accused for an offence under Section 3 of the Prevention of Money Laundering Act (PMLA).
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“I conclude that prima facie, there is sufficient material on record based upon which strong suspicion is raised against all seven accused persons,” the special judge had said.
The accused in the case are Malik, Zahoor Ahmad Shah Watali, Abdul Rashid Sheikh, Shabir Ahmad Shah, Masarat Alam, Naval Kishore Kapoor and Trison Farms and Constructions Pvt Ltd.
What the Enforcement Directorate said
According to ED, the criminal activities under investigation generated proceeds of crime totalling ₹8.94 crore. The agency alleged that the money was subsequently received, transferred, concealed, possessed, acquired and used by the accused through different channels.
ED alleged that funds were allegedly moved through cash couriers from the Pakistan High Commission in New Delhi to members of the Hurriyat leadership, including Malik, to promote the secessionist agenda and support subversive activities.
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The agency also relied on material recovered from Ghulam Mohd Bhat, an accountant-cum-cashier working with Watali. The documents allegedly showed that Malik, Shabir Shah and Masarat Alam received foreign contributions through Watali during the 2015-16 financial year.
The investigation further uncovered emails associated with Malik which, according to ED, indicated that he had developed a network to raise funds abroad for terrorist, secessionist and unlawful activities in J&K in the name of a “freedom struggle”. The agency alleged these funds were used to sustain the JKLF and intensify secessionist violence.
ED had further alleged that Malik received another ₹15 lakh through Watali during 2015-16, bringing the total amount allegedly received by Malik to ₹30.75 lakh.
Malik received ₹15 lakh from Saudi in 2013
The National Investigation Agency (NIA), in its second supplementary charge sheet, alleged that Malik had received ₹15.75 lakh from Saudi Arabia in 2013.
ED treated these amounts as proceeds of crime allegedly derived from criminal activity connected with the scheduled offences.
The money laundering proceedings are linked to an NIA case registered in 2017 over an alleged larger conspiracy involving terrorist and secessionist activities in J&K.
NIA invoked provisions including criminal conspiracy, 121 (waging war against the government) and 121A (criminal conspiracy against the state) of the Indian Penal Code (IPC) and sections of the Unlawful Activities (Prevention) Act.
ED registered its case on June 14, 2017, to investigate the alleged laundering of proceeds generated through those criminal activities. Its main prosecution complaint was filed in 2020, while a supplementary complaint in January 2023 arraigned Malik as an accused.
NIA had alleged that Malik was involved in terrorist and subversive activities in the Valley and in raising and receiving funds through illegal channels, including Hawala. The underlying NIA case ultimately resulted in Malik’s conviction in 2022.