The Supreme Court showed its willingness to entertain the prospect of granting interim bail to Delhi CM Arvind Kejriwal during the Lok Sabha Elections 2024. The court instructed the ED counsel to prepare arguments for May 7, suggesting a possibility of considering Kejriwal’s release.
NEW DELHI: Today (3rd May): The Supreme Court considers its willingness to consider granting interim bail to Delhi Chief Minister Arvind Kejriwal during the Lok Sabha elections. The court made this observation during a hearing on Kejriwal’s plea challenging his arrest by the Enforcement Directorate (ED) in connection with the Delhi excise policy case.
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During the hearing of the plea filed by Kejriwal challenging his arrest by the Enforcement Directorate (ED) in the Delhi excise policy case, Justices Sanjiv Khanna and Dipankar Datta indicated that the proceedings might extend over a considerable period. They hinted at the possibility of considering interim bail due to the upcoming elections but clarified that no final decision had been made yet.
While the court has not made a final decision on the matter, it has informed all parties that it may consider granting interim relief if the hearing is likely to be prolonged. The next hearing is scheduled for May 7.
On Friday, the Court orally remarked that
the matter might have a prolonged duration, and if that were the case, they would contemplate the issue of interim bail, especially in light of the upcoming elections. They urged both sides to approach the matter with consideration.
The Bench emphasized that it hadn’t reached a final decision yet and was simply alerting all counsels that interim relief, such as granting bail, might be considered if the hearing prolongs.
“Please also seek guidance – we are not definitively stating anything (regarding bail). We are contemplating the possibility of granting interim bail due to the elections. Dr. Singhvi (Kejriwal’s counsel), refrain from assuming outcomes prematurely – we may grant or deny bail. We are here to listen to your arguments. It’s crucial for us to remain impartial, ensuring neither party is caught off guard. Additionally, considering your position, Mr. Kejriwal, should you continue signing files? We’re being transparent, so please refrain from making assumptions… There’s no definitive stance from us,” Justice Khanna clarified.
Senior Advocate AM Singhvi, representing Kejriwal, questioned the rationale behind arresting the Aam Aadmi Party (AAP) leader on March 21, especially considering his scheduled appearance before the Enforcement Directorate (ED) on March 25 following a summons issued on March 16.
“I (Kejriwal) was not accused till March 16… What is it that changed drastically? I am on the verge of arrest. The counter of ED has a money trail, which is the replica as in the Manish Sisodia case. Thus, nothing has changed. Therefore, in this evidence, all remains the same,” Singhvi argued.
Singhvi argued that even if the AAP was accused under Section 70 of the Prevention of Money Laundering Act (PMLA), Kejriwal could not be arrested. He contended that Section 70, which deals with “offences by companies,” was not intended to cover political parties.
However, the Court countered by stating that if the AAP was treated as a juristic person or a company and made an accused, the principle of vicarious liability would apply. This would imply that Kejriwal, as the person at the forefront of the political party, could be held liable.
“The person in charge of and responsible is also deemed to be culpable, and then the onus shifts on you to show that it (any offence by the company) was done without your knowledge. You are wrong here, Mr. Singhvi,”
the bench said.
Singhvi, however, replied that Section 70 of PMLA (which deals with “companies”) was never intended to cover a political party.
“Merely mentioning a company cannot lead to the arrest of its Managing Director, unless you show something. Same thing with AAP,”
the senior counsel added.
Representing the ED, Additional Solicitor General (ASG) SV Raju submitted that Kejriwal’s counsel is only making general statements instead of addressing how the AAP leader cannot be incriminated.
“He (Singhvi) must point out from the statement on the confession, non-incriminating statement, etc. This is all the general things that he is saying.”
ASG Raju said. “You cannot decide my sequence of arguments,” Singhvi replied, before continuing to make his submissions.
As ASG Raju began submissions for the ED, the Court asked him to address whether the ED is bound to disclose only a part of the material collected against the accused.
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Apart from “reason to believe” that an accused may be guilty, another basis on which an investigating officer may arrest a person is based on the “possession of material,” the Court noted.
Against this backdrop, the Court asked whether the ED is bound to disclose “the entire material” collected during the investigation or only a part of such material.
“I am just looking at this hypothetically. I am not going by just this particular case. One view is that the arresting officer has to apply mind to all material in possession, record reasons in writing, and come to the conclusion that the accused is guilty. Because when the court decides, it considers the entire material in his possession—whatever has been collected. Is that correct?” Justice Khanna asked.
ASG Raju replied that it would not be practical to expect a probe agency to record all material collected during a probe, as it may run to thousands of pages and bog down the ED officers. If there is some material to incriminate an accused, the arresting officer can make an arrest. The officer is not required to consider other material if there is other material, the ASG said.
“If we record everything in writing, it would be voluminous. That is not what is expected. It is not necessary that irrelevant material be reflected. The other chargesheet cannot be filed within 60 days at all. Writing will run into thousands of pages, even if one or two lines are about each material. Investigating officers would be bogged down,”
ASG Raju said.
The Court discussed the threshold for making an arrest under the Prevention of Money Laundering Act (PMLA), emphasizing that “reasons to believe” should exceed mere suspicion. Justices Khanna and Datta highlighted that the threshold for arrest under the PMLA is higher, as confirmed in the Vijay Madanlal case, where Section 45 of the PMLA was upheld.
The ED asserted that there was sufficient material against Kejriwal to justify his arrest, emphasizing that the court needed to assess whether the arresting officer’s decision was arbitrary and based on evidence. ASG Raju pointed out that Kejriwal had been denied relief multiple times before, indicating that judicial scrutiny had been applied to the case.
The Bench observed that “reasons to believe” is generally viewed as something beyond mere suspicion. “Vijay Madanlal (judgment) also said threshold (for arrest under PMLA) is higher,” Justice Khanna said.
“Arrest under PMLA is not based on the lowest threshold. Here, the investigating officer has the power to arrest on the basis of ‘reasons to believe’ that the accused is involved (in money laundering) on the basis of material with him. That is why the threshold is much higher, and Section 45 (of PMLA) was upheld (in the Vijay Madanlal case)!”
ED The Bench today also posed questions on how a court could examine whether an arresting officer had rightly concluded that an arrest has to be made
“The court has to see if there is material. This is not a case where there is no material. The court has two options to reject arrest if the actions of the arresting officers are arbitrary and there is no material. Otherwise, the jurisdiction is very limited. This court has delegated power to the trial court,”
ASG Raju replied.
He added that Kejriwal was denied relief at least three times before when he challenged the ED’s actions. A judicial mind was applied on all these occasions, the ASG contended.
“The decision is not only of the IO but fortified by the special judge, who is a seasoned judge. There is a concurrent finding in the impugned High Court judgment. Before he was arrested, he moved a Division Bench of the High Court. Most of the grounds have been raised before the High Court, and the High Court perused documents and said there was no need for interference. Only thereafter has the arrest been made. He (Kejriwal) could have moved a Section 438 (anticipatory bail) application, but he did not.” “He wasn’t expecting to get arrested.”
Justice Khanna replied. “We (ED) called him nine times!”
ASG Raju pointed out. “He has defended it, saying that cannot be grounds for arrest. And I think one judgment does support him.”
Justice Khanna observed.
“Evasive answers cannot be grounds for arrest, yes. But cumulatively, we can take that into consideration,”
the ASG responded.
Background:
Arvind Kejriwal, the leader of the Aam Aadmi Party (AAP), has challenged his arrest and remand by the ED in a money laundering case related to alleged irregularities in the framing of the Delhi excise policy for 2021-2022. The ED’s investigation stems from a case registered by the Central Bureau of Investigation (CBI) in 2022 based on a complaint filed by Delhi Lieutenant Governor VK Saxena.
It is alleged that AAP leaders, including Kejriwal and former Deputy Chief Minister Manish Sisodia, conspired to create loopholes in the excise policy to favor certain liquor sellers. Kejriwal was arrested on March 21 and is currently in Tihar Jail.
During the hearing, the Supreme Court questioned the timing of Kejriwal’s arrest, particularly in light of the upcoming Lok Sabha elections in 2024. The court emphasized that it may consider granting interim bail due to the elections but clarified that no final decision had been made. The court urged both sides to be considerate and not make assumptions about the outcome. It also raised concerns about whether Kejriwal, as the Chief Minister, should be signing any files while in custody.
The court discussed the possibility of booking the AAP under the Prevention of Money Laundering Act (PMLA) and the potential liability of Kejriwal as the person in charge of the political party. The court stated that if the AAP is viewed as a juristic person or a company and accused, the principle of vicarious liability would apply, making Kejriwal potentially liable. However, Kejriwal’s counsel argued that Section 70 of the PMLA, which deals with “companies,” was not intended to cover political parties.
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The court also deliberated on whether the ED is required to disclose the entire material collected during its investigation or only a part of it. The ED argued that recording all the material in writing would be impractical and burdensome for the investigating officers. The court sought clarification on the threshold for arresting an accused under the PMLA, noting that “reasons to believe” should go beyond mere suspicion.
Case Title: Arvind Kejriwal v. Directorate of Enforcement
