The decision of the Supreme Court to form a special bench and start hearing the review petition challenging its last year’s judgment upholding the stringent provisions of the Prevention of Money Laundering Act (PMLA), 2002, with respect to the definition of proceeds of crime, power of arrest, search and seizure, attachment of properties and the twin bail conditions is welcome for several reasons.
There may not be many laws which challenged the basic tenets of a democratic constitution and its principles of jurisprudence such as the PMLA, 2002, especially Section 45 which imposes conditions for grant of bail to an accused. It mandates that a court can enlarge a person accused of an offence and incarcerated on bail only if it is satisfied that “there are reasonable grounds for believing that he is not guilty of such offence and that he is not likely to commit any offence while on bail”. The burden of proof is on the accused who has no right even to get a copy of the charges against him listed in the Enforcement Case Information report (ECIR).
The Supreme Court had in 2017 held that “Section 45 is a drastic provision which turns on its head the presumption of innocence which is fundamental to a person accused of any offence” and declared it unconstitutional as it violated Articles 14 and 21 of the Constitution. The Union government, however, amended Section 45 in 2018 and the Supreme Court, in its 2022 judgment, found the law to be “reasonable and does not suffer from the vice of arbitrariness or unreasonableness”, reviving the twin conditions for bail.
It is true that most democracies have instituted special laws with stringent provisions to deal with financial crimes. The courts also often take a tough stand as there are hardly any mitigating factors in white collar crimes, which have the potential to undermine economies. The 2022 judgment of the court reasoned its stand as “it is a proven fact that international criminal network that support home-grown extremist groups relies on transfer of unaccounted money across nation states”.
Despite the fact that the law has been in existence since 2002, and such testimonials by the top court, the Enforcement Directorate has been able to complete the trial of only 25 of the 5,906 cases for which it has filed ECIR as on January 31, 2023. As it stands today, the law is a powerful tool in the hands of the Enforcement Directorate, and by extension, of the Union government, to get people jailed for months and years even when the agency makes little or no progress in the cases against them. While the apex court puts its imprimatur on the law finding it an effective tool to take on international terror rackets, its use on the ground does not share that confidence.
It is time the apex court reviewed the demands of the state against the basic rights of the citizen-accused and ensured that “such provision furthers a compelling state interest for tackling serious crime”, as the Supreme Court observed in 2017.
