PMLA

Anticipatory Bail under PMLA

Under Indian criminal law, anticipatory bail is defined under Section 438 of Criminal Procedure Code, 1973. The provisions of anticipatory bail grants permission to the accused to seek bail in anticipation of an arrest for a non-bailable offence. This right of anticipatory bail/ bail preserves the person’s right to life and personal liberty granted under Article 21 of the Indian Constitution. The 41st Law Commission of India report states the need to grant Anticipatory Bail to the accused, as the sole purpose of enacting this provision was that no person be confined in jail until pronounced guilty.

While granting pre-arrest bail to the applicant for economic offences, the court must ensure that the accused must always be available for questioning and cooperate with the investigating authorities (CBI, ED, etc.) while on bail. The Hon’ble Supreme Court has ruled and made a distinction between the regular bail and the anticipatory bail in the case Gurbaksh Singh Sibia v. State of Punjab, where ordinary bail is granted after the arrest and allows the release from the custody of the police and the latter in anticipation of the arrest.

Cases on Anticipatory Bail under PMLA

Nikesh Tarachand Shah VS Union of India & ANR, 2017

The Hon’ble Supreme Court held that the difference was created between the conditions for granting anticipatory bail and regular bail to the accused under the PMLA^[1] as twin conditions of bail are not applied on anticipatory bail for granting bail under the Section 45(1) of PMLA is discriminatory. 

The two conditions provided under the said section are:

1. the Public Prosecutor has been allowed to oppose the application for bail;
2. the court must be satisfied that the grounds argued before the courts are beyond reasonable doubts and that he is not guilty of such an offence and that he is not likely to commit any offence or influence the witness while on bail.

P. Chidambaram V. Directorate of Enforcement, 2019

Supreme Court laid down some significant points for granting or rejecting the plea of anticipatory bail under PMLA by the accused as follows:

• the court should grant the privilege of pre-arrest bail in exceptional cases;
• Anticipatory bail has to be granted when the court is convinced that exceptional circumstances exist to resort to that extraordinary remedy.

State of M.P. V. Ram Kishan Balothia (1995)

SC held that the right of anticipatory bail is not a part of Article 21 of the Constitution of India, as it is essentially a statutory right conferred long after the coming into force of the Constitution and cannot be granted as a matter of right.

• The legislative intent behind the introduction of S.438 CrPC is to safeguard the right of individual’s liberty and protect him from possible arrest and unnecessary police custody. However, the court must also remember that a criminal offence is not just against an individual; a more significant societal interest is at stake.
• The object of S. 438 Cr.P.C is to safeguard the personal liberty of an individual, striking a delicate balance between two rights that are safeguarding the personal liberty of an individual and societal interest.

Siddharam Satlingappa Mhetre V. State of Maharashtra

Held – The Court must adequately address the nature and gravity of the accusation and establish the exact role of the accused. The Court must carefully evaluate the available material evidence against the accused.The Court should also consider whether the allegations were made only with the object of injuring or humiliating the applicant by arresting them.

Jai Prakash Singh V. State of Bihar, (2012)

The Hon’ble Supreme Court held as under: The necessary parameters for granting anticipatory bail under PMLA in an economic offence are required to be taken into consideration. Secondly, while granting such Anticipatory bail under PMLA, the court must record the reasons while granting bail. The anticipatory bail can be granted in exceptional circumstances only where prima facie evidence does not make the case against the accused, and he/she would not misuse his liberty to change the status quo of the said case.

• The relief under Section 438 Cr.P.C is an extraordinary remedy, and utmost caution should be exercised, most notably in case of economic offences.

• Economic offence stands as a different class as they affect the economic fabric of the society.

Shibamoy Dutta & Ors. V Manoj Kumar, Assistant Director, Eastern Region, Directorate of Enforcement, 2017

In this case Hon’ble Gujarat High Court held that Section 71 of the PMLA has an overriding effect over any other statute.

From the cases stated above, it is clear that the relief of Anticipatory bail is available under CrPC, 1973 and the same provision shall be applied under PMLA in the absence of any conflict. The same has been taken into consideration for granting anticipatory bail to the accused by various subordinate courts. The applicability of the provisions of Criminal Procedure Code, 1973 has been settled by the various Hon’ble High courts and Supreme Court, as there is no explicit provision for granting Anticipatory bail under PMLA, hence provisions of CrPC shall be applied in letter and spirit.

Conclusion

There is a strong need to review the stringent bail provision under the PMLA as the Act empowers the Enforcement Directorate with unfettered powers to investigate and make arrests which often violates the core fundamental principles of the Indian Constitution. The provision of anticipatory bail is enacted to allow the accused to defend the allegation made against her/him at the nascent stage without hampering the investigation process.

Read our Article: Allahabad HC Rejects Plea for Anticipatory Bail: PMLA