A
1 only
B
2 only
C
Both 1 and 2
D
Neither 1 nor 2
Correct answer: (a) 1 only
Explanation
Statement 1 is correct because Section 66(2) of PMLA permits the transfer of gathered evidence to state authorities for initiating predicate offence proceedings. Statement 2 is incorrect because it has nothing to do with dropping investigations arbitrarily.
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