Deliberations in SC on provisions related to arrest under PMLA

Prabhat Nigam

18 Feb, 2022

The Supreme Court of India (SC) is hearing a batch of petitions wherein plea has been taken by the petitioners questioning the constitutionality of the provisions relating to arrest under PMLA. The SC deliberated on how the doctrine of harmonious construction can be invoked in the given scheme of Prevention of Money Laundering Act, 2002 (PMLA) to ensure that the person who has been arrested under PMLA gets to know the requisite information about the reasons of arrest for violating the anti-money laundering law.

What is the doctrine of harmonious construction?

As the name suggests, the doctrine of harmonious construction is a doctrine that is adopted by the court at the time of interpreting seemingly contradicting provisions so that the provision of one section is not used to defeat the provisions of other section and effort is made to reconcile the differences and reach to a interpretation where neither provision is rendered redundant. The court tries its best so that effect is given to each provision without rendering any one section fruitless unless it is impossible to do so.       

Objections raised by the Petitioners against the provisions of arrest under PMLA

The court asked the respondents to show them how the doctrine of Harmonious Construction can be given effect where the accused who has been arrested gets information about the reasons of his arrest so that he can effectively defend himself under the given scheme of arrest under PMLA.

The bench asked the petitioners what kind of information must be shared with the person who has been arrested under PMLA for the alleged acts of money laundering. The bench said that the focus of the hearing must be on deciding the extent of information that should be shared with both the concerned court as well the person under arrest under PMLA.

The bench also stressed on the need to make the provisions of arrest under PMLA harmonious and compatible with Article 21 which is related to protection of life and personal liberty.

The petitioners while referring to Article 19 of the Constitution which deals with power of arrest questioned if the accused who has been arrested is not informed about the materials on the basis of which he has been arrested, then how will the accused be able to protect himself from the provisions of arrest under PMLA.

The petitioners stressed on the need that the arrested person under PMLA must be shared Enforcement Case Information Report (ECIR) otherwise not having access to the basis of charges, the accused person would not be able to defend itself from the provisions of arrest under PMLA. On what material basis will the accused be able to seek bail if he is not aware of the material which has been used as a basis for his arrest under PMLA. The petitioners asked the apex court to devise some methodology to take care of this problem.

The petitioners demand procedural restraint in the process of arrest under PMLA. The Apex Court said that it will decide the matter later.

Questions were also raised regarding the validity of section 50 of the PMLA relating to the power of authorities under PMLA to summons, production of documents and to give evidence. The apex court taking into account the submissions made regarding section 50, said that a holistic approach needs to be taken while interpreting the contentious provisions of PMLA.

In previous cases before the Supreme Court^[1], questions have been raised questioning the existence of a due procedure where a criminal proceeding can be initiated against a person without informing the accused the basis of his arrest.

The Solicitor General had earlier submitted before the bench that over 200 petitions have been pending and interim stays have been granted in some of the serious cases which are hampering the investigation process.

Conclusion

It is very much a concern for any legal system where criminal proceedings are initiated against an accused where the arrested person is deprived of the opportunity to know the reasons for his arrest and the consequent denial of the material basis on which his arrest has been made. This concern has been raised in the apex court by a host of petitioners against the provisions of arrest under PMLA which deny such opportunity to an accused who has been arrested. Though these concerns are genuine but it must not be forgotten that special offences require special procedure to counter new age crimes. This is the reason why the apex court has said that a holistic approach needs to be taken to give due consideration to both the aspects and harmoniously construct the seemingly conflicting provisions.

Read our Article:Applicability of PMLA cases throughout India including J&K