Law On PMLA Arrests: A Journey From Section 19 To Vijay Madanlal Choudhary To Pankaj Bansal To Ram Kishor Arora

Section 19 of the Prevention of Money Laundering Act, 2002, which guides the procedure of arresting an accused in money laundering cases, reads as follows: Power to arrest.– (1) If the Director, Deputy Director, Assistant Director or any other officer authorised in this behalf by the Central Government by general or special order, has on the basis of material in his possession, reason to believe (the reason for such belief to be recorded in writing) that any person has been guilty of an offence punishable under this Act, he may arrest such person and shall, as soon as may be, inform him of the grounds for such arrest.”

As per Section 19, the requirements are (1) That the ED officer has reason to believe that any person has been guilty of a PMLA offence (2) This reason to believe must be on the basis of material in his possession (3) The reason for such belief to be recorded in writing (4) This ED officer has to, as soon as may be, inform the grounds for such arrest to such person.

The constitutional validity of this Section 19 was upheld by the Supreme Court (three judges bench) in Vijay Madanlal Choudhary vs. Union of India 2022 INSC 757. One of the issues raised in that case was whether it is necessary to furnish a copy of ECIR to the person concerned apprehending arrest or at least after his arrest? The court held that the supply of ECIR in every case to persons concerned is not mandatory. It is enough, if ED at the time of arrest, contemporaneously discloses the grounds of such arrest to such person, it was held.

In Pankaj Bansal vs Union of India 2023 INSC 866, the Supreme Court (two judges bench) considered the question of how the ED is required to ‘inform’ the arrested person of the grounds for his/her arrest? It was noticed that the Section 19 does not specify in clear terms as to how the arrested person is to be ‘informed’ of the grounds of arrest.  The court also noted that written copies of the grounds of arrest are furnished to arrested persons in certain parts of the country but in other areas, that practice is not followed and the grounds of arrest are either read out to them or allowed to be read by them. The court therefore directed as follows: : It would be necessary, henceforth, that a copy of such written grounds of arrest is furnished to the arrested person as a matter of course and without exception.

Pankaj Bansal vs Vijay Madanlal : Conflict Of Judgments On Arrests By ED?

Recently, in Ram Kishor Arora vs Directorate of Enforcement 2023 INSC 1082, the Supreme Court (two judges bench) noticed that the expression “as soon as may be ” in Section 19 has not been specifically explained in Vijay Madanlal Choudhary or in Pankaj Bansal case. To interpret this expression, the court referred to a Constitution Bench judgment in Abdul Jabar Butt and Another vs. State of Jammu & Kashmir AIR 1957 SC 281. The expression “as soon as may be” contained in Section 19 of PMLA is required to be construed as- “as early as possible without avoidable delay” or “within reasonably convenient” or “reasonably requisite” period of time, the court said.

The court then observed that the reasonably convenient or reasonably requisite time to inform the arrestee about the grounds of his arrest would be twenty-four hours of the arrest. “The person arrested, if he is informed or made aware orally about the grounds of arrest at the time of his arrest and is furnished a written communication about the grounds of arrest as soon as may be i.e as early as possible and within reasonably convenient and requisite time of twenty-four hours of his arrest, that would be sufficient compliance of not only Section 19 of PMLA but also of Article 22(1) of the Constitution of India”, the court held.

Section 19 does not by itself say that ‘written grounds of arrest’ should be furnished to the accused at the time of arrest. It only says that, as soon as may be, grounds for arrest have to be informed. In Vijay Madanlal Choudhary, the Court said that, it is enough, if ED at the time of arrest, contemporaneously discloses the grounds of such arrest to such person. The requirement of ‘written grounds of arrest’ came after the Court interpreted the expression ‘inform’ in Pankaj Bansal. The very purpose of constitutional and statutory protection would be rendered nugatory by permitting the authorities concerned to merely read out or permit reading of the grounds of arrest, irrespective of their length and detail, the court noted. But in Ram Kishor Arora, the Court said that at the time of arrest, such grounds of arrest can be communicated orally, but written communication has to be given within 24 hours. 

Related Posts

33 thoughts on “Law On PMLA Arrests: A Journey From Section 19 To Vijay Madanlal Choudhary To Pankaj Bansal To Ram Kishor Arora”

Leave a Comment

Your email address will not be published. Required fields are marked *