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Supreme Court says ED can't arrest accused after special court takes cognizance of PMLA complaint
The Supreme Court said if the ED wants custody of such an accused, then it would have to apply to the special court.
The Supreme Court, in a landmark judgment, on Thursday, May 16, held that the Enforcement Directorate (ED) and its officers cannot arrest an accused under Section 19 of the Prevention of Money Laundering Act (PMLA) after the Special Court has taken cognizance of the complaint of money laundering.
The bench of Justices Abhay S Oka and Ujjal Bhuyan added that if the ED wants custody of such an accused, then it would have to apply to the special court, Live Law reported.
“After cognizance 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. 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,” Live Law quoted the bench as saying.
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 cognizance of the offense, Bar and Bench reported.
The Supreme Court, having reserved its judgment on April 30, examined whether an accused, not arrested during the investigation under PMLA, would still be subject to the law's bail conditions upon appearing before the court after the trial court acknowledges the ED complaint and summons the individual.
The apex court 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 remarked that the ED cannot arrest a person once the complaint is filed.
The legal issues before the Supreme Court stemmed from a Punjab and Haryana high court ruling that denied pre-arrest bail to several 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.
