Supreme Court’s decision on the authority of ED, said – arrest under money laundering is not arbitrary. Supreme Court’s decision on the authority of ED, said – arrest under money laundering is not arbitrary

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Supreme Court

Highlights

  • Supreme Court upholds ED’s powers
  • Congress urged to decide on PMLA
  • Nothing in the provision comes under the ambit of arbitrariness – Supreme Court

Money Laundering: The Supreme Court on Wednesday backed the Enforcement Directorate (ED)’s powers under the Prevention of Money Laundering Act (PMLA), saying the right to arrest under Section 19 is not arbitrary. Justice A.M. A bench of Justice Khanwilkar, Justice Dinesh Maheshwari and Justice CT Ravi Kumar upheld the validity of certain provisions of the PMLA, holding that attachment of property of persons involved in money laundering is constitutionally valid under Section 5. The top court said that ECIR (Enforcement Case Information Report) is not mandatory in every case. ED’s ECIR is at par with the police’s FIR. The bench said if the ED discloses his grounds at the time of arrest, it is sufficient. Rejecting the challenge to the constitutional validity of section 19 of the PMLA Act, 2002, the court said, “The challenge to the constitutional validity of section 19 of the 2002 Act is also dismissed. Stringent safeguards have been given in Section 19. Nothing in the provision comes under the ambit of arbitrariness.

Article 5 is constitutionally valid

The bench said that when the arrested person is produced before the special court, it can go through the relevant records produced by the ED and it will take a decision on the continued detention of the person in connection with the alleged offense of money laundering. While pronouncing the verdict, the bench said, “Section 5 is constitutionally valid. It provides a balancing act to safeguard the interests of the individual and also ensure that the offense is dealt with in the manner provided under the Act.” This decision was given during the hearing. During the hearing, the apex court also stressed on balancing the rights of the accused along with Section-45 of the Act as well as Section-436A of the Code of Criminal Procedure (CRPC). Section-45 of PMLA deals with cognizable and non-bailable offences, while Section-436A of CrPC deals with the maximum period of detention of an undertrial prisoner.

4,850 cases investigated under PMLA in 17 years

The top court also heard arguments on Section 19 of the PMLA related to arrest and also on Section 3 related to the definition of money laundering offence. The Center had earlier told the apex court that in the last 17 years, 4,850 cases were investigated under the PMLA and during the investigation, Rs 98,368 crore was seized under the provisions of the law. The government told the court that these crimes were investigated under the PMLA, including 2,883 raids. Solicitor General Tushar Mehta had said that the concerned authority has already confirmed criminal proceeds of Rs 55,899 crore out of Rs 98,368 crore seized.

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