Sibal highlighted that ED officers were not police officers in charge of a police station and hence could not avail custody of accused.
The Enforcement Directorate arrested V Senthil Balaji on 14 June.
Pointing to the misuse and abuse of the anti-money laundering law, the Supreme Court on Thursday, 27 July, was told that an accused under the Prevention of Money Laundering Act (PMLA), upon being produced before a magistrate, can’t be mandatorily remanded to the custody of the Enforcement Directorate (ED) up to 15 days and can only be sent to judicial custody.
Stating that on being produced before a magistrate court by the ED, the accused can’t be remanded to its (ED) custody, senior advocate Kapil Sibal told a bench of Justice AS Bopanna and Justice MM Sundresh that there had been, “Enough use and abuse of this (PMLA).”
Solicitor General Tushar Mehta, appearing for the ED, asked Sibal to “confine to the facts and not attribute motives and politicise it”.
Getting back, Sibal said that governments had been toppled and asked the solicitor general to name the people who had been arrested under the PMLA, suggesting that only the leaders of the Opposition parties were targeted under the anti-money laundering law.
These arguments were made during the hearing of two petitions by Tamil Nadu Minister V Senthil Balaji and his wife Megala.
The petitions challenge the Madras High Court’s decision to uphold Balaji’s arrest in the “cash-for-jobs” scam and the ED’s request to determine the date for taking custody of Balaji and shifting him from the hospital, where he had undergone coronary bypass surgery.
Appearing for both Balaji and his wife Megala, Sibal highlighted that ED officers were not police officers in charge of a police station and, therefore, do not possess the powers available to police officers under the Criminal Procedure Code, the CrPC.
In posers from the bench whether custody of a person accused of allegedly being involved in money laundering cannot be given to the ED for further investigation, Sibal explained that in cases involving the PMLA, a suspect is first investigated, and upon satisfaction of their involvement in money laundering, they are arrested.
Sibal clarified that when an accused person is produced before a magistrate for offences under the PMLA, they can only be sent to judicial custody, not remanded to the custody of the ED.
To buttress his point, Sibal cited various previous judgements of the Supreme Court, including one delivered by a three-judge bench on 27 July, 2022, which upheld the stringent provisions of the amended PMLA.
These provisions pertain to the denial of an Enforcement Case Information Report (ECIR) by the ED during the arrest of an accused and the presumption of innocence of an accused until proven guilty.
He took the court through the provisions of the Foreign Exchange Regulation Act, (now replaced by Foreign Exchange Management Act), the Customs Act 1962, the PMLA and the powers of the police under the CrPC to drive home the point that the ED officers do not possess the power, even under the provisions of the PMLA, to secure custody of an accused for up to 15 days, as they were seeking in Balaji’s case.
Sibal will continue his arguments on next Tuesday (1 August).
The high court order upholding the arrest of the minister, and also holding valid his subsequent remand in judicial custody came following the decision of a third judge, Justice CV Karthikeyan holding that the accused had no right to frustrate the investigation.
The matter travelled to Justice Karthikeyan — the third judge — following a split verdict on 4 July, by a division bench of the Madras High Court comprising Justice Nisha Banu and Justice D Bharatha Chakravarthy.
Justice Banu held that the Habeas Corpus plea filed (by Balaji’s wife Megala) for Balaji’s release was maintainable and should be allowed. Justice Banu further said ED was not entitled to get custody of Balaji.
However, Justice Chakravarthy said the habeas corpus plea was not maintainable after the remand order had been passed.
He said that no case was made out to show that Balaji’s remand was illegal. Justice Chakaravarthy also said that the period of Balaji’s stay at the hospital should be excluded from the ED’s custody period.
Balaji was arrested by the ED on 14 June in an alleged “cash for job” scam that took place when he was the transport minister (2011-2015) in the government of late chief minister J Jayalalithaa.
Balaji, who was in the AIADMK, later crossed over to the ruling DMK in 2018.
The high court had permitted Balaji to be shifted to a private hospital for heart surgery and restricted his interrogation in the hospital.
He was operated for the blockages of three coronary arteries at a local private hospital in Chennai.
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![[Left] File photo of BJP MLA Harish Poonja, who has been booked, and [right] Poonja sitting for a protest in front of Belthangady Police Station in the early hours of Sunday, 19 May, 2024.](https://s3.ap-south-1.amazonaws.com/media.thesouthfirst.com/wp-content/uploads/2024/05/Harish-Poonja-and-Belthangady.jpg "Harish Poonja and Belthangady")
