News Excerpt:
Recently, the Supreme Court ruled that when an accused responds to a summons and appears before the court, the Enforcement Directorate must seek the court's permission to take the accused into custody.
More in the news - The SC Bench held that “If the accused appears before the special court pursuant to a summons, it cannot be treated that he is in custody. Therefore, it is not necessary for the accused to apply for bail.”
The judgement stemmed from an appeal filed by Tarsem Lal against the ED, contesting a decision by the Punjab and Haryana High Court that denied him anticipatory bail.
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What is the PMLA? The anti-money laundering legislation was passed by the National Democratic Alliance government in 2002, and came into force on July 1, 2005. The PMLA was showcased as India’s commitment to the Vienna Convention on combating money laundering, drug trafficking, and countering the financing of terror (CFT). The law was aimed at curbing the process of converting illegally earned money into legal cash. The Act empowered the Enforcement Directorate (ED) to control money laundering, confiscate property, and punish offenders. Stringent Bail Conditions and Arrest Procedures under PMLA 1. Stringent Bail Conditions
2. Arrest Without Written Grounds
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About the Judgement
- The judgement restricts the power of arrest by the ED once a special court has taken cognizance of a case. According to the judgement, the ED must separately apply for custody of a person who appears in court, demonstrating specific grounds necessitating custody.
- The judgement further states that an accused who appears in a special court following its summons may be exempted from future personal appearances.
- Conversely, if an accused fails to appear after being summoned, the special court may
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- first issue a bailable warrant
- followed by a non-bailable one
- The judges also emphasised that if the ED seeks custody after an individual appears in response to summons, it must apply to the special court. Custody will only be granted if the court is satisfied that custodial interrogation is necessary, thus protecting the right to liberty.
- However, if the ED wishes to conduct further investigation into the same offence, it may arrest a person not named as an accused in the complaint filed under Section 44(1)(b) of the PMLA, provided that the requirements of Section 19 (procedures of arrest) under the Act are met.
Further insights of the judgement
- The judges emphasised that the ED needs to demonstrate specific grounds necessitating custodial interrogation. However, the special court has the authority to direct the accused to furnish bonds under Section 88 of the Code of Criminal Procedure.
- It was also clarified that a bond furnished under Section 88 CrPC is merely an undertaking and does not constitute bail. Therefore, the conditions outlined in Section 45 of the (PMLA) do not apply to it.
Way Forward
The recent judgement marks a significant step towards safeguarding the right to personal liberty of individuals accused under the Prevention of Money Laundering Act (PMLA), particularly in light of the stringent conditions for bail. Additionally, it will serve to shield individuals from arbitrary arrest.
