Madras High Court slammed the ED for overstepping its authority under PMLA during a search operation. The court questioned the legal basis of restricting entry to locked premises with pasted notices.
Chennai: Today, on June 17, while hearing a case involving the Enforcement Directorate (ED) and two individuals linked to the Tamil film industry, Justice M.S. Ramesh of the Madras High Court made strong observations regarding the increasing use of power by ED officials under the Prevention of Money Laundering Act (PMLA), 2002.
He commented that, although the PMLA is referred to as evolving law, it seems that ED officers are the ones who are “evolving day by day by expanding their powers” while implementing the Act.
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Justice Ramesh was presiding over a Division Bench along with Justice V. Lakshminarayanan. They were hearing three writ petitions filed by film producer Akash Baskaran and his associate Vikram Ravindran.
The core issue discussed was whether the ED has the authority to seal a house or office when it is locked during a search operation.
Mr. Ravindran, who is the director at Akash Baskaran Creative Studios Private Limited, filed two writ petitions claiming that ED officials had “sealed” his office located in Semmenchery and his rented flat in Poes Garden, Chennai.
According to him, both places were locked during an attempted search on May 16, and he wasn’t present at the time. He alleged that the officials sealed both properties.
ED’s Special Public Prosecutor (SPP), N. Ramesh, denied these allegations in court and said the ED officers had not sealed the premises but had only pasted notices on the doors asking the petitioner to contact them.
He clarified the notices were only meant to request cooperation from the petitioners in an ongoing money laundering investigation.
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However, the Bench did not find the explanation convincing. Justice Ramesh pointed out that the notice pasted on the doors clearly stated that the premises
“should not be opened without the permission of the ED officials.”
This wording, according to the judge, indirectly acts as a restriction or sealing of the premises.
Justice Lakshminarayanan supported this view and raised an important legal question, saying,
“Even assuming the words found in the notice would not amount to sealing, from where do you get the power to prevent an individual from entering his home or office?”
He added that
“no sane person would dare to ignore the notice stuck by a public official on his/her door and enter the premises without the fear of being prosecuted for having defied the orders passed by the officer.”
To defend the actions of the ED, SPP N. Ramesh submitted that Section 17 of the PMLA empowers the ED to carry out search and seizure operations, including breaking open locks if needed.
He said,
“we did not want to take the drastic step of breaking open the locks and so we stuck the notices.”
He added that the ED officials were willing to remove the notices right away if the court allowed them to do so.
He further clarified that neither Akash Baskaran nor Vikram Ravindran had been made accused in the ongoing TASMAC money laundering case so far.
He said that the ED only wanted to search the premises because they had received credible information that some materials related to the case might be in their possession.
He requested the court to ensure that the petitioners cooperate with the investigation.
“The petitioners must cooperate with the probe,”
he insisted.
After hearing the submissions in detail, the Division Bench gave time to the ED till Wednesday, June 18, to submit the documents related to the ongoing investigation for the court’s review.
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