ED must give grounds of arrest in writing to accused: SC

The judgement came on a plea by Pankaj Bansal and Basant Bansal, Directors of M3M real estate group, who had challenged an order of the Punjab and Haryana High Court which declined to set aside their arrest by the ED under the Prevention of Money Laundering Act (PMLA).

Noting that the grounds of arrest were only read to the accused and had not been given to them in writing, the bench said it “reeks of arbitrariness”.

Expressing its disapproval, the bench said the “chronology of events speaks volumes and reflects rather poorly, if not negatively, on the ED’s style of functioning”.

Holding the arrest illegal, the bench said the investigating officer reading out the reasons for arrest to the accused does not fulfil the mandate of Article 22 (1) of Constitution and Section 19 (1) of the PMLA.

On the need for the agency to be transparent and fair, the bench said, “Being a premier investigating agency charged with the onerous responsibility of curbing debilitating economic offence of money laundering in our country, every action of the ED in the course of such exercise is expected to be transparent, above board and conforming to the pristine standards of fair play in action. The ED, mantled with far-reaching powers under the stringent Act of 2002, is not expected to be vindictive in its conduct and must be seen to be acting with utmost probity and with the highest degree of dispassion and fairness.”