The
Supreme Court said on Thursday the Enforcement Directorate (ED cannot arrest an
accused under Section 19 of the Prevention of Money Laundering Act (PMLA)
after a special court has taken cognisance of the complaint of money
laundering,
A
bench of Justices Abhay S Oka and Ujjal Bhuyan said that if the ED wants
custody of an accused, then it would have to apply to the special court.
“After cognisance is taken of the offence punishable
under Section 4 of the PMLA based on a complaint under Section 44, the ED and
its officers are powerless to exercise powers under Section 19 to arrest the
person shown as accused in the complaint. If the ED wants custody of the
accused who appears after service of summons for conducting further investigation
of the same offence, ED will have to seek custody of the accused by applying to
the Special Court," said the bench.
"After
hearing the accused, the Special Court must pass an order on the application
after recording brief reasons. While hearing the application, the Court may
permit custody only if it is satisfied that custodial interrogation is required
even though the accused was never arrested under Section 19,” it said.
The
verdict was delivered in a case addressing whether an accused in a money
laundering case has to meet the stringent twin-test for bail, even when the
Special Court takes cognisance of the offence.
The
Supreme Court, having reserved its judgment on April 30, examined whether an
accused, not arrested during the PMLA investigation, would still be subject to
the bail conditions upon appearing before the court after the trial court
acknowledges the ED complaint and summons the individual.
The
Supreme Court also questioned whether the accused could seek bail under the
regular provisions of the Code of Criminal Procedure (CrPC) upon appearing
pursuant to the summons issued by the special court under the PMLA.
In
a hearing, Justice Oka noted that the ED cannot arrest a person once the
complaint is filed.
The
legal issues presented to the Supreme Court arose from a Punjab and Haryana
High Court decision that denied pre-arrest bail to multiple accused in a money
laundering case linked to an alleged land scam involving revenue officials.
In
January, the Supreme Court granted interim protection to the accused.
In November 2017, the Supreme Court invalidated Section 45(1) of the
PMLA because it imposed two additional conditions for granting bail to money
laundering accused. However, the Centre later reinstated the provision after
amending the PMLA.