Centre defends stringent terms under PMLA in Supreme Court

Section 19 empowers the director of Enforcement Directorate (ED) to arrest someone if there is “reason to believe” that the concerned person is guilty of an offence punishable under the law.

The Centre on Tuesday stressed on the need for stringent bail conditions in money laundering cases, as it told the Supreme Court that people involved in such offences, which pose a grave threat to the economic health of the country, are influential, intelligent and resourceful.

The petitions claimed that the maximum punishment under PMLA is seven years and that such harsh bail terms violated one’s fundamental right to liberty under Article 21.

Defending the stringent provisions for arrest and bail contained in Sections 19 and 45 of the Prevention of Money Laundering Act (PMLA), the Centre, through Solicitor General Tushar Mehta, said, “The legislative policy of the country has consistently treated money laundering as a serious threat to the macro-economic strength of the country and thereby sought to provide stringent regime for dealing with the same.”

The two sections have been challenged in at least 240 petitions before the top court.

Section 19 empowers the director of Enforcement Directorate (ED) to arrest someone if there is “reason to believe” that the concerned person is guilty of an offence punishable under the law. Even if the accused seeks an anticipatory bail, Section 45, which imposes twin conditions to be fulfilled for the special PMLA court to grant bail, will apply, Mehta said. These conditions suggest that bail cannot be granted without first hearing the public prosecutor and the judge should be convinced that the person accused is not guilty of offence or is not likely to commit an offence while on bail, he added.

The petitions claimed that the maximum punishment under PMLA is seven years and that such harsh bail terms violated one’s fundamental right to liberty under Article 21.