Two years after it upheld PMLA, Supreme Court rulings rein in powers of ED by adding safeguards

However, since then, the SC has made a string of small but significant interventions — from reading a delay in completing trial into the stringent bail provisions of the PMLA; allowing the accused to have written copies of the grounds and reasons to arrest; to requiring the ED to share all case documents with the accused, even those it did not rely upon to frame charges.

On October 3, 2023, a bench of Justices A S Bopanna and P V Sanjay Kumar held that to give true meaning to the constitutional and statutory mandate of ED’s power to arrest, informing the grounds on which a person is arrested in writing “would be necessary, henceforth”. The court said that a copy be furnished to the arrested person, as a matter of course, without exception.

The two-judge bench ruling flew in the face of the Vijay Madanlal ruling, which, among other aspects, had held that the ECIR cannot be equated with an FIR. It said that supplying an ECIR in every case to the person concerned is not mandatory and “it is enough if ED, at the time of arrest, discloses the grounds of such arrest”.

The Pankaj Bansal ruling was further extended even to the UAPA, the principle anti-terror legislation.

In July, while granting bail to Delhi CM Arvind Kejriwal in the excise policy scam case, the SC further expanded the protection against arbitrary arrest by the ED. The court held that the ED official’s “reasons to believe” that a person is “guilty of the offence” in order to make an arrest that must also be given in writing to the accused. These phrases are found in Section 19(1) of the PMLA, which give the agency its powers to arrest.

The SC clarified on the interpretation of the words ‘material’, ‘reason to believe’ and ‘guilty of the offence’. It referred to the safeguards provided under the Constitution, the fundamental right to life and personal liberty, guaranteed under Article 21 and protected by Article 22, which mandate that no person who is arrested shall be detained without being informed, as soon as may be, of the grounds for such arrest.

On August 9, while granting bail to former Delhi Deputy CM Manish Sisodia, the SC held that the stringent “twin-conditions” to grant bail can be “relaxed” if the accused has undergone a long period of incarceration.

In Sisodia’s case, the Supreme Court made another key intervention on “un-relied upon documents” which strengthens the rights of an accused. “In order to avail the right to a fair trial, the accused cannot be denied the right to have inspection of the documents including ‘un-relied upon documents’,” the apex court said.

Documents that the investigative agency relies upon are often annexed in the chargesheets or remand applications but defence lawyers have claimed that the prosecution has been “putting documents exculpating the accused persons in the category of “un-relied upon documents”.