Cash for jobs scam: ED has no vested right to seek my custody 15 days after arrest, TN Minister Balaji tells SC

The bench posted the matter for hearing on Wednesday as Solicitor General Tushar Mehta, appearing for the ED, wanted to argue his case in one go and sought accommodation for the next day.

The court embarked on examining the legal issue as senior advocate Mukul Rohatgi, appearing for both Balaji and his wife Megala, sought reference of the legal issue to a larger bench.

The bench cited a series of judgements, including one by a three-judge bench, which had consistently ruled that an accused cannot be remanded to police custody after the expiry of 15 days from the date of arrest.

Rohatgi said that this position of law was unsettled in 2021 by a two-judge bench headed by Justice MR Shah (since retired), which ruled contrary to the position taken by the three-judge bench earlier.

He said that the 2021 judgement was contrary to the practice prevailing in Indian jurisprudence in which a two-judge bench cannot rule contrary to the position already spelt out by a three-judge bench.

Related: Stalin retaining Balaji in Cabinet out of fear, says Amit Shah

Seeks three-judge bench

Seeking reference of the issue to a larger bench for clarity, Rohatgi said that a two-judge bench cannot overrule a position taken by a coordinate bench of two judges and can refer it to a larger three-judge bench.

He said that clarity was required as, after the 2021 judgement, a number of high courts were relying on it and passing orders.

Rohatgi even questioned the legal basis of the Madras High Court judgement holding that 15 days period be excluded as Balaji was hospitalised.

However, by way of concession, Rohatgi said that while Balaji was under judicial custody and was in jail hospital, the ED could interrogate him for three days for a few hours every day.

Earlier, resuming his arguments that remained inconclusive on 27 July, senior advocate Kapil Sibal, appearing for Balaji, said, “I do not have the grounds of arrest or the ECIR. Even in preventive detention, it is given. So, my statutory and constitutional rights are affected.”

Related: PMLA accused cannot be sent to ED custody, Kapil Sibal tells SC

‘Misuse and abuse of PMLA’

In the last hearing Sibal had told the court that there was misuse and abuse of the anti-money laundering law.

He also said that, under the Prevention of Money Laundering Act (PMLA), Balaji could not be remanded to the custody of the ED for up to 15 days but only be sent to judicial custody.

The top court is hearing a challenge to the Madras High Court decision upholding the arrest of Senthil Balaji and subsequently magistrate court remanding him to judicial custody.

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.

Related: HC cancels bail of DMK men who attacked officials raiding Balaji

The case against Balaji

The case against Balaji dates back to November 2014, when the Metropolitan Transport Corporation advertised a recruitment drive to fill up various vacancies. Soon, allegations of corruption surfaced.

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 was then the transport minister in the AIADMK government. He joined the DMK only in 2018.

After his arrest, the high court 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.

‘Cash for jobs’ scam

The first complainant was one Devasagayam, who claimed in October 2015 that he gave ₹2.6 lakh to Palani, a bus conductor, who promised his son a job in the state transport corporation.

Devasagayam claimed the conductor did not fulfil the promise nor returned his money. However, Balaji’s name did not figure in the complaint.

Balaji came into the picture when another man, Gopi, filed a similar complaint in March 2016.

The complainant said he had paid ₹2.4 lakh to two individuals, reportedly related to Balaji, for a conductor’s job. Gopi later approached the high court, accusing the police of inaction.

The court ordered the Crime Branch Assistant Commissioner to probe the case. The probe report, however, implicated only the 12 individuals mentioned in Devasagayam’s complaint. The report, submitted in 2017, excluded the minister and his relatives.

Meanwhile, more people came up with complaints. Transport Department employee V Ganesh Kumar alleged that the transport minister and three others had directed him to collect ₹95 lakh from job aspirants.

After he became a minister in the DMK-led government, his personal assistant Shanmugam and another man, R Sahayarajan, approached the victims with a compromise formula. However, the compromise move was seen as an admission of bribery, which caught the ED’s attention.