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So has the Supreme Court tightened the noose on the power of ED, understand the meaning of this decision

New Delhi: In an important decision, the Supreme Court on Thursday said that in money laundering cases, the investigating agency cannot arrest the accused after the special court takes cognizance of the ED’s complaint. Justice Abhay S. The division bench headed by Oka said that if in such cases the custody of the accused is necessary for further investigation, then the ED will have to apply for this in the special court. Ujjal Bhuiyan was also included in the bench. The top court said, ‘After hearing the side of the accused, the special court will have to give a mandatory verdict on the application giving brief reasons. After the hearing, the court will allow detention only if it is satisfied that custodial interrogation is necessary. The Supreme Court also said that the ED would have to satisfy the conditions of Section 19 of the Prevention of Money Laundering Act (PMLA), 2002, to arrest a person who has not been named as an accused in the complaint.

Mandatory requirement of double condition for bail under Section 45

Further, a person who has not been arrested during the investigation of a money laundering case, but appears before the Special Court on summons issued under the Money Laundering Act, will not be subject to the stringent double condition for bail. Under Section 45 of PMLA, dual condition is mandatory for getting bail. The first condition in this is that the court should be convinced that the accused is not guilty. The second condition is that the court has confidence that the accused will not commit any crime on bail. Justices Rohinton Nariman and S.K. Kaul’s Supreme Court division bench had in November 2017 struck down Section 45(1) of the PMLA, which added two additional conditions for bail, calling it arbitrary.

What is the matter?

However, in the Vijay Madanlal Chaudhary case, Justice A.M. Khanvilkar, Dinesh Maheshwari and C.T. Reversing that decision in July 2022, a three-judge bench of Ravikumar had upheld the 2019 amendments to the PMLA, 2002. After this, it became almost impossible to get bail in money laundering cases because instead of the onus of proving the accused guilty, the responsibility of proving himself innocent was put on the ED. The then Chief Justice of India N.V. The division bench headed by Ramana had agreed to review the provisions of the PMLA for two key reasons – first, that it does not provide for a copy of the ECIR (similar to an FIR in ordinary cases) to be given to the accused at the time of arrest, and second, that it does not require that the charges be proved. The principle of presumption of innocence has been compromised. In November last year, Justice S.K. Days before his retirement, a bench headed by Kaul had ordered the petitions challenging the ED’s powers to be placed before the Chief Justice of India so that he could hand over the hearing to a new bench.

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