New Delhi: The Supreme Court on Thursday, May 16 pronounced that if the Special Court takes cognizance of a complaint of money laundering then the Enforcement Directorate (ED) and its officers cannot arrest that accused exercising powers under Section 19 of the Prevention of Money Laundering Act (PMLA), as per a Live Law report.
The apex court bench comprising of Justices Abhay S. Oka and Ujjal Bhuyan said that in case the ED wants custody of such an accused then they will have to apply to the Special Court.
The bench was quoted as saying by Live Law: “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,” the bench added.
Notably, the Supreme Court bench underlined that if the ED wants to conduct further investigation concerning the same offence, “it may arrest a person not shown as an accused in the complaint already filed, provided the requirements of Section 19 are fulfilled,” the report mentioned.
Further, as per Live Law, the bench said that “if the accused was not arrested by the ED till the filing of the complaint, the Special Court, while taking cognizance of the complaint, as a normal rule, must issue a summons to the accused and not a warrant. Even if the accused is on bail, a summons must be issued.”
The judges also suggested that in case the accused appears before the Special Court pursuant to summons then it cannot be treated as being in custody and a bail is not required in such a case.
Moreover, the bench said if the accused does not appear, the Special Court can issue a warrant in terms of Section 70 CrPC, however, the Special Court must first issue a bailable warrant. In case it is not possible to effect service of bailable warrant, then recourse can be taken to non-bailable warrants, the report added.
The hearing pertained to a money laundering case in which the petitioner/accused had appeared before the court in compliance of the summons issued to him but the proceedings of the bond executed by the petitioner/accused under Section 88 of Cr.P.C. for securing his presence was being treated as a bail proceeding requiring the mandate of Section 45 of PMLA — which suggests that before granting bail, a court must be satisfied that there are reasonable grounds for believing that the applicant is not guilty of such an offence and is not likely to commit any offence while on bail — to be fulfilled.
The petitioner approached the Supreme Court after an anticipatory bail was rejected by the High Court. The High Court had observed that the petitioner did not satisfy the second condition under Section 45 PMLA.
The Supreme Court will hear the case next on April 30, 2024.
