After Madras HC Rap, ED Admits it Doesn't Have Power to Seal Locked Premises During Search

New Delhi: The Enforcement Directorate (ED) on Tuesday (June 17) told the Madras high court that it did not have the power to seal premises if the same was locked at the time of making a search as per Section 17 of the Prevention of Money Laundering Act.

The ED’s admission came after the high court had remarked that its officials are “evolving day by day by expanding their powers."

"ED does not have power to seal. The lordship is right in that aspect. Under Section 17, the ED has powers to break open the lock. But we did not want to escalate the situation," additional solicitor general S.V. Raju told the court, reported LiveLaw.

Raju made the submissions before a division bench of Justices M.S. Ramesh and Justice V. Lakshminarayanan that was hearing a batch of three writ petitions filed by film producer Akash Baskaran and his friend Vikram Ravindran.

Raju told the court that the ED was ready to withdraw the notices and would permit the petitioners to access their office and residence.

The bench interjected and said that when the agency says the ED would "permit" the petitioners, there would be a presumption that the ED had power to prohibit the petitioners also.

Earlier, Justice Ramesh had remarked that while courts often term the Prevention of Money Laundering Act (PMLA) of 2002 as an “evolving legislation” which throws up new legal questions, but it is actually the "officials of the Enforcement Directorate (ED) who are evolving day by day by expanding their powers."

Justice Ramesh’s remarks came as he wondered which provision of the PMLA empowers the ED officials to seal a residential/business premises if it was found to be locked when the officials go over there for a search and seizure operation, reported The Hindu.

The petitioner had accused the ED officials of having “sealed” his office premises at Semmenchery and also a rented residential flat at Poes Garden in Chennai since they were locked and he was not present over there when the agency attempted a search operation on May 16.

ED Special Public Prosecutor N. Ramesh denied the charge of having sealed the two premises and said that the officials had merely stuck notices on the doors asking the petitioner to get in touch with them to cooperate with a money laundering investigation.

But Justice Ramesh pointed out the notices had clearly stated the premises should not be opened without the permission of the ED officials.

“Even assuming the words found in the notice would not amount to sealing, from where do you get the power to prevent an individual from entering his home or office, asked Justice Lakshminarayanan.

He added that “no sane person” would dare to ignore the notice stuck by a public official on his/her door and enter the premises without the fear of being prosecuted for having defied the orders passed by the officer.

On May 23, a Supreme Court bench led by Chief Justice of India B.R. Gavai had rapped the Enforcement Directorate (ED), “The ED is crossing all limits…you are totally violating the federal structure of the country.”

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