In a judgement on Wednesday, the Supreme Court upheld the provisions of the Prevention of Money Laundering Act (PMLA) and upheld the powers of the Enforcement Directorate (ED). The Supreme Court said that the provisions relating to arrest and bail are reasonable and directly related to the objectives of the Act. A three-judge bench comprising Justices AM Khanwilkar, Dinesh Maheshwari, and CT Ravikumar held that providing an Enforcement Case Information Report (ECIR) of the complaint to the accused was unnecessary.
The court made it clear that it was enough to tell the accused the reason for his detention. “ECIR cannot be equated with FIR, and ECIR is an internal document of ED.” Delivery of the ECIR to the accused is not mandatory and it is sufficient to communicate the reasons at the time of the arrest. “Even the ED manual should not be disclosed as it is an internal document,” the court said in its 545-page ruling. “Unlike the registration of an FIR by the jurisdictional police in respect of a cognizable offence under the general right, it is not necessary to formally register an ECIR due to the mechanism of inquiry/investigation for processing against property (created results of crime) under this Act through civil proceedings (seizure and confiscation).”
In a statement made by the ED that the ECIR is an internal document created by the department before prosecution or prosecution of a person involved in the process or activity connected with the proceeds of an offense, the bench ruled that if the person is informed of the reasons for his arrest, compliance with the mandate is sufficient in Article 22 paragraph 1 of the Constitution. “The classification or grouping of offences for consideration equally capable of constituting the offence of money laundering is a matter of legislative policy.” Parliament, in its wisdom, considers property acquired or acquired as a result of a particular criminal activity to be a criminal offence under the relevant legislation listed in the list.
On the issue of two bail conditions under the PMLA, the court held that the stringent bail conditions under the Act are statutory and not arbitrary. However, the fact that some of the offences may not be criminal offences under the relevant legislation or considered to be less serious and compound offenses, Parliament, in its wisdom, which understands the cumulative effect of the process or activity relating to the proceeds of crime, criminal activities that could threaten the economic stability, sovereignty, and integrity of the country and are therefore grouped to consider the crime of money laundering a matter of legislative policy. “It is not for the court to second-guess such a policy,” the court continued.