The Enforcement Directorate (ED) has intensified its anti-corruption drive under the Modi government, seizing Rs. 1.45 lakh crore under PMLA. The Supreme Court has issued key rulings on bail conditions, procedural safeguards, and prolonged detention. It is necessary to take a look on the ED’s rising convictions, judicial interpretations, and the evolving legal landscape of financial crime enforcement in India.
NEW DELHI : The Enforcement Directorate (ED) has significantly intensified its crackdown on corruption and money laundering under the Modi government, leveraging the stringent provisions of the Prevention of Money Laundering Act (PMLA), 2002. With 95% of all assets seized under PMLA occurring during Modi’s tenure, the agency has attached properties worth ₹1.45 lakh crore, reinforcing its role as India’s primary financial crime investigator.
The Supreme Court has played a crucial role in shaping the enforcement of PMLA, delivering landmark rulings on bail conditions, procedural safeguards, and the necessity of written arrest grounds. From Vijay Madanlal Choudhary v. Union of India (2022) to Prem Prakash v. Union of India (2024), judicial interpretations continue to impact how ED functions and how individuals accused under PMLA seek legal remedies.
ACTION AGAINST CORRUPTION
Under the Modi government, the Enforcement Directorate (ED) has taken strong action against corruption. Since 2014, ED has seized assets worth thousands of crores that were earned through corruption.
In many cases, the money was returned to victims or government agencies that were cheated. ED has also had major success in getting convictions under the money laundering law in recent years. Some important statistics have come out related to this.
“95% property seized under the PMLA act was during Modi government’s tenure”
According to a report by media , ED has attached properties worth Rs. 1.45 lakh crore under the Prevention of Money Laundering Act (PMLA), which was implemented in 2005. In the year 2024 alone, the agency has seized properties worth more than Rs. 21,000 crore.
Out of the total Rs. 1.45 lakh crore, Rs. 1.40 lakh crore was attached during the Modi government’s rule. This means that “95% of the proceeds of corruption have been seized during the Modi government.” Under the PMLA, ED has not only seized properties but also taken strict action against those involved in corruption and financial crimes.
“ED has convicted 100 people in 44 cases under PMLA so far. This action has gained momentum in the last one year. Out of 100, 36 people have been convicted in the first 9 months of Financial Year 2024-25. ED has arrested 911 people so far since the inception of the law.”
ENFORCEMENT DIRECTORATE UNDER THE PMLA ACT
ED, which investigates financial crimes, has arrested many big politicians, hawala operators, and even senior government officials in the last few years. The agency’s working capacity has increased significantly, and it has received new officers and employees. ED has even requested that its staff strength be increased three times more to handle the growing number of cases.
“PMLA was implemented during the Congress government, but has been properly used by the Modi government.”
The PMLA law was originally introduced by the NDA-I government under the leadership of BJP veteran Atal Bihari Vajpayee. Parliament passed the law in 2002. It was created to stop money laundering, recover properties obtained from illegal money, and bring criminals to justice.
This law has very strict provisions, making it difficult for accused individuals to escape punishment. Getting bail under this law is also very tough. Before PMLA, there was no clear law to deal with money earned through corruption, and people used to find loopholes in different laws to avoid punishment.
However, after the PMLA was introduced, ED received more powers to act against corruption. The Congress government officially implemented the law in 2005 and later amended it twice. Even though some action was taken under Congress, it did not make a big impact in reducing corruption. But under the Modi government, ED has used the law effectively and taken strong action against corrupt individuals and financial crimes.
The way ED has handled cases under the Modi government shows a significant difference compared to previous years. With stronger enforcement, increased staff, and stricter action, ED has become a powerful agency in the fight against corruption and money laundering in India.
PMLA AND THE SUPREME COURT- A TIMELINE
Vijay Madanlal Choudhary v. Union of India (27 July 2022)
A Division Bench led by Justice A.M. Khanwilkar upheld the stringent bail conditions under the Prevention of Money Laundering Act, 2002 (PMLA). The Court emphasized that special legislations like the PMLA were necessary due to the transnational impact of money laundering on financial systems, sovereignty, and national integrity, categorizing it as an aggravated offense. It cited other legislations, such as the Terrorist and Disruptive Activities (Prevention) Act, 1987, and the Maharashtra Control of Organised Crime Act, 1999, which impose similarly strict bail conditions. The Court clarified that:
“Bail decisions under the PMLA do not require meticulous examination of evidence but should be based on broad probabilities. While acknowledging that these conditions restrict the right to bail, the Court held that they do not impose an absolute bar on bail, making them reasonable”
V. Senthil Balaji v. State (7 August 2023)
A Division Bench comprising Justices A.S. Bopanna and M.M. Sundresh ruled that arrests made by the Enforcement Directorate (ED) under the PMLA must strictly adhere to Section 19 of the Act. This section mandates that the authorized officer must record written reasons for the arrest and serve these grounds to the accused. The Court held that
“failure to comply with these requirements renders the arrest invalid. It further clarified that non-compliance with Section 19 attracts penalties under Section 62 of the PMLA, which prescribes up to two years of imprisonment for officers who conduct searches, seizures, or arrests without recorded reasons”
Pankaj Bansal v. Union of India (3 October 2023)
A Division Bench of Justices A.S. Bopanna and Sanjay Kumar reinforced the necessity of providing written grounds of arrest to the accused under the PMLA. The Court reasoned that a written record enables the accused to seek legal assistance and effectively present their case for bail. It held that
“If the grounds of arrest are only conveyed verbally, the accused may struggle to recall the details, thereby hindering their legal defense. Consequently, failure to provide written grounds of arrest entitles the accused to be released from custody”
Arvind Kejriwal v. Directorate of Enforcement (12 July 2024)
A Division Bench of Justices Sanjiv Khanna and Dipankar Datta granted interim bail to Delhi Chief Minister Arvind Kejriwal in a PMLA case but refrained from ruling on the legality of his arrest. The Court referred to a larger bench the issue of
“whether an ED arrest can be challenged solely on the grounds of “need and necessity” and whether such necessity must be established through case facts. “
In granting bail, the Court emphasized the prolonged period of Kejriwal’s incarceration—90 days—and highlighted that the “right to life and liberty is sacrosanct.”
Manish Sisodia v. Directorate of Enforcement (9 August 2024)
A Division Bench of Justices B.R. Gavai and K.V. Viswanathan granted bail to former Delhi Deputy Chief Minister Manish Sisodia in connection with the PMLA proceedings related to the Delhi liquor policy case. Sisodia had been in custody since February 2023, and despite the Supreme Court expressing concerns over his prolonged incarceration in October 2023, no trial had commenced. Citing the excessive delay, the Court ruled that
“Prolonged detention should be a significant factor when considering bail under Section 45 of the PMLA. The Court reaffirmed the principle that “bail is the rule, jail is the exception” and emphasized that indefinite incarceration would violate Sisodia’s fundamental rights”
Prem Prakash v. Union of India (28 August 2024)
A Division Bench of Justices Gavai and Viswanathan granted bail to Prem Prakash, an aide to Jharkhand Chief Minister Hemant Soren, in a PMLA case. The Court reaffirmed its earlier ruling in Sisodia v. Directorate of Enforcement, stating that the principle of “bail is the rule, jail is the exception” applies equally to PMLA cases. It further held that
“Article 21 of the Constitution, which guarantees the right to life and personal liberty, serves as an additional safeguard against unjustified prolonged detention under the PMLA’s stringent bail conditions”
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