Today, On 26th September, The Supreme Court ruled that the Enforcement Directorate (ED) cannot use Section 45 of the Prevention of Money Laundering Act (PMLA) to imprison individuals without trial. This statement was made by a bench comprising Justices Abhay S Oka and Augustine George Masih, while granting bail to former Tamil Nadu minister V Senthil Balaji.
New Delhi: The Supreme Court on Thursday ruled that constitutional courts cannot permit the Enforcement Directorate (ED) to use provisions like Section 45 of the Prevention of Money Laundering Act (PMLA) to keep accused individuals in custody as undertrials for extended periods without trial.
Section 45 of the PMLA outlines two conditions that must be met for an accused to be granted bail in money laundering cases.
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While granting bail to former Tamil Nadu minister V Senthil Balaji, who was arrested in June 2023 for money laundering, a division bench comprising Justice Abhay S Oka and Justice Augustine George Masih emphasized that failure to exercise judicial authority in such cases could undermine the rights of undertrials under Article 21 of the Indian Constitution.
The Court stated,
“Constitutional courts must keep in mind that, except in a few exceptional cases, the maximum sentence under the PMLA is seven years. It further noted that provisions like Section 45(1)(ii) should not be used by the ED as tools to prolong incarceration when there is little chance of the scheduled offense and PMLA offense being tried and concluded within a reasonable time.”
The Court also stressed that cases under statutes like the PMLA, which impose stricter conditions for granting bail, require the expeditious disposal of trials.
The Court observed,
“The requirement for the swift conclusion of cases must be incorporated into these statutes. An inordinate delay in trial and a stricter threshold for granting bail cannot coexist. It is a well-established principle of our criminal jurisprudence that ‘bail is the rule, and jail is the exception.’ Stringent bail provisions, such as Section 45(1)(iii) of the PMLA, should not be used as a tool to incarcerate the accused without trial for an excessively long period,”
The Court raised concerns regarding Balaji’s prolonged incarceration of 15 months, noting that further detention would violate his right to a speedy trial under Article 21, as the trial for the PMLA case or scheduled offence might not conclude for several years.
The Court stated,
“The appellant has been incarcerated for 15 months or more for the offence punishable under the PMLA. In the facts of the case, the trial of the scheduled offences and, consequently, the PMLA offence is not likely to be completed in three to four years or even more. If the appellant’s detention is continued, it will amount to an infringement of his fundamental right under Article 21 of the Constitution of India of speedy trial,”
The Court further clarified that if delays in the trial are caused by the accused, constitutional courts may refuse to exercise their jurisdiction.
Balaji sought bail from the Supreme Court after the Madras High Court denied his bail application on February 28.
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The DMK leader arrested by the Enforcement Directorate (ED) on June 14, 2023, in connection with a money laundering investigation. The charges are linked to alleged irregularities in the recruitment of bus conductors, drivers, and junior engineers within the Tamil Nadu transport department, dating back to his tenure as transport minister in the AIADMK government between 2011 and 2015.
Before this, his bail application had been rejected three times by a sessions court in Chennai.
Senior Advocates Mukul Rohatgi and Sidharth Luthra represented Balaji, while Solicitor General Tushar Mehta and special counsel Zoheb Hossain appeared on behalf of the ED.
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