The Bombay High Court has unequivocally dismissed the habeas corpus petition filed by Naresh Goyal, the founder of Jet Airways, challenging his arrest by the Enforcement Directorate (ED) under the Prevention of Money Laundering Act (PMLA), which he described as “unwarranted, arbitrary, and illegal.” The arrest is linked to a case of alleged money laundering involving a purported fraud of Rs 538 crore at Canara Bank.
A bench led by Justice Revati Mohite Dere and Justice Gauri Godse, in their judgment, stated,
“In the present case, it cannot be said that the remand orders are absolutely mechanical or suffer from the vice of lack of jurisdiction, warranting our interference in this writ petition, which seeks a writ of habeas corpus.”
The bench further clarified that Goyal is at liberty to seek other legal remedies.
Representing Goyal, senior counsel Amit Desai argued that the PMLA has in-built safeguards to prevent its abuse and unwarranted arrest, suggesting that these were not adhered to in Goyal’s case. Desai emphasized the importance of these safeguards by quoting a Supreme Court judgment,
“The safeguards provided in the 2002 Act and the preconditions to be fulfilled by the authorized officer before effecting arrest, as contained in Section 19 of the 2002 Act, are equally stringent and of a higher standard.”
However, the ED’s counsel, H S Venegaonkar, opposed the plea, asserting the legality of the arrest. He stated,
“The arrest was made at 10.50 pm on September 1 and he was produced before the Special Court the next day at 1.30 pm which granted the ED custody for nine days and second remand to ED was for four days before Goyal was sent to judicial custody.”
Venegaonkar argued that the established legal principles do not support the claim of illegal custody when a person is under judicial orders from a competent judge.
The Court, in its 35-page order, further elaborated,
“We are of the view that the petition in the facts, cannot be entertained and dismiss the petition. Needless to state, it is always open for the petitioner to avail of other statutory remedies, as permissible in law to him, vis-a-vis other prayers raised in this petition.”
Goyal had approached the High Court challenging his arrest and the subsequent custody orders, alleging that the ED failed to establish grounds for arrest and that there was no reasonable belief that he committed money laundering. The former Jet Airways promoter also contended that any action taken by Canara Bank pursuant to the master directions of the RBI was stayed by the High Court, hence no further action could be taken.
The ED countered Goyal’s claims, stating that his arrest was a result of his non-cooperation, which they claimed slowed down the investigation, indicating a malafide intention to defraud banks. The agency also maintained that the remand orders were not without judicial application of mind and that they were required to be challenged under a statutory provision, not by invoking the extraordinary jurisdiction of the High Court.
The Court noted that none of the grounds raised by Goyal, such as the non-handing over of a copy of the grounds of arrest or the legality of his arrest, were ever raised at the time of the first or second remand. The Court’s decision thus reaffirms the legal process and the avenues available for recourse in cases of arrest under the PMLA. Goyal’s solicitor, Ameet Naik, has indicated that they will review the judgment before deciding on their next move.
