In a recent hearing at the Madras High Court, Senior Advocate Kapil Sibal argued that the sessions court had made a mistake in granting custody of Tamil Nadu Minister V Senthil Balaji to the Enforcement Directorate (ED). Sibal, representing Balaji’s wife S Megala, made this submission before Justice CV Karthikeyan.
Sibal’s argument hinged on the interpretation of Section 19 of the Prevention of Money Laundering Act (PMLA). He contended that while the PMLA allows the ED to arrest an accused after its inquiry, the agency does not have the power to seek custodial interrogation of such an accused person. He stated,
“The PMLA falls into another category altogether. It has to be interpreted in the context of its unique provisions. PMLA is a unique Act. It is a complete statute on its own. The Supreme Court said that ED officers are not police officers and PMLA is a regulatory statute. They have no powers of investigation other than Section 15, and Section 15 has been interpreted by the Court that there is no investigation…The order of custodial interrogation is bad in law. It can’t be ordered at any stage.”
However, the court raised the question of the viability of the habeas corpus plea, given that Balaji was currently in judicial custody.
Justice Karthikeyan asked,
“I am asking how can he be released today when he is as on date in judicial custody? How can a direction be issued to produce the body of the person? Can ED tell the Sessions Judge you have no power, bring him here and set him at liberty?”
Sibal responded by reiterating that the PMLA only empowers the ED to conduct an inquiry and to arrest an accused if it believes it has adequate reason for such arrest. He argued that the ED does not have the power to investigate the accused by taking him into police custody. He stated,
“This is not an arrest under the CrPC. There is no question of custody and subsequent investigation by ED. And as far as the issue of custody is concerned, all they have to do is go and remove their security (from the private hospital where Balaji is currently recuperating).”
The court will hear arguments from Solicitor General Tushar Mehta on behalf of the ED on Wednesday, July 12.
The case stems from a split verdict in the High Court on the petition filed for the release of Balaji, who was arrested by the ED in a money laundering case. While the two judges on the Bench – Justices Nisha Banu and D Bharatha Chakravarthy – agreed on the aspect of maintainability, they differed on the issue of the powers of the ED to seek custody of an arrested person. The matter was then placed before the Chief Justice for further orders.