Background:
In the realm of law enforcement, transparency and accountability are indispensable pillars upholding the democratic values of a society. The Directorate of Enforcement (“ED”), tasked with investigating and prosecuting economic offenses, plays a vital role in maintaining financial integrity. However, concerns surrounding the lack of transparency in some of the arrests made by the ED have been raised.
One such issue that keeps rearing its ugly head every now and then relates to orally communicating the grounds of arrest. It has been the subject matter of litigation for several years now and different High Courts have divergent views on whether communicating orally the grounds of arrest is legally compliant. In some cases, the High Courts have taken the view that a defect in arrest by not providing grounds of arrest in writing is cured by the remand order passed by the magistrate/ sessions court as subsequent custody/ detention is by virtue of such order.[1] In other cases, courts have taken a contrary view.
In a recent significant case of Ram Kishor Arora vs Directorate of Enforcement,[2] (“RK Arora Case”), the Hon’ble Supreme Court of India clarified the position on the requirement for the ED to provide written grounds of arrest to the accused at the time of arrest under Section 19 of Prevention of Money Laundering Act, 2002 (“PMLA”).
In this case, the ED had handed over a document containing the grounds of arrest to the accused when he was arrested. The accused had also signed below the said grounds of arrest after making an endorsement. The legal question before the Hon’ble Court was whether the action of the ED – handing over the document containing the grounds of arrest to the arrestee and taking it back after obtaining the endorsement and not furnishing a copy thereof to the arrestee at the time of arrest – would render the arrest illegal under Section 19 of the PMLA.
The Hon’ble Court held that if a person arrested by the ED is informed or made aware orally of the grounds of arrest at the time of his arrest and is furnished a written communication about the same within 24 hours of his arrest, that would be sufficient compliance with not only Section 19 of PMLA, but also with Article 22(1) of the Constitution of India.
Some important observations that emerge from the RK Arora Case are:
- No retrospective effect of Pankaj Bansal Case on ED to disclose grounds of arrest: In the landmark Pankaj Bansal v. Union of India[3]case, the Hon’ble Supreme Court had held that the ED must furnish the reasons of arrest to the accused in writing. The Court had remarked that ‘we hold that it would be necessary, henceforth, that a copy of such written grounds of arrest is furnished to the arrested person as a matter of course and without exception’.[4] In the RK Arora Case, it has been explained that the use of the word ‘henceforth’ in the Pankaj Bansal case implied that the said requirement of furnishing grounds of arrest in writing to the arrested person as soon as after his arrest was not mandatory or obligatory till the date of the said judgment. Therefore, there cannot be a retrospective application of the Pankaj Bansal judgement.
- Clarification on the term ‘as soon as may be’ under Section 19 of PMLA: Section 19(1) of the PMLA states that‘any person has been guilty of an offence punishable under PMLA, he may arrest such person and shall, as soon as may be, inform him of the grounds for such arrest. The bench in the RK Arora Case has held that the expression ‘as soon as may be’ contained in Section 19 of PMLA is required to be construed as – ‘as early as possible without avoidable delay’ or ‘within reasonably convenient’ or ‘reasonably requisite period of time’.[5] The Hon’ble Court opined that 24 hours from the time of arrest should be reasonably convenient or reasonably requisite time to inform the arrestee of the grounds of his arrest in writing.
- Decision in the Vijay Madanlal Choudhary Case prevails over the Pankaj Bansal Case: The bench observed that the three-judge bench judgment in Vijay Madanlal Chaudhary v. Union of India[6] has analysed Section 19 and held that it is compliant with the mandate of Article 21 of the Constitution and since Vijay Madanlal Choudhary holds the field, observations made by benches on Section 19 of lesser strength cannot be binding. The bench further held that the Hon’ble Supreme Court’s judgement in the Pankaj Bansal case[7] should be considered as per incuriam, as the two-judge bench in the said case had deviated from the position of law settled by the prior three-judge bench judgment in Vijay Madanlal Choudhary with regard to compliance with Section 19 of the PMLA.
Conclusion:
In conclusion, the mandatory furnishing of written grounds of arrest within 24 hours by the ED is a crucial step towards ensuring transparency, upholding individual rights and building public trust. While challenges exist, a careful and balanced approach can strike a harmonious chord between the imperatives of law enforcement and the principles of justice. By aligning its practices with global standards, the ED can reinforce its commitment to a fair and transparent legal system, thereby contributing to a robust democracy.
For further information, please contact:
Sara Sundaram, Partner, Cyril Amarchand Mangaldas
sara.sundaram@cyrilshroff.com
[1] Megala v. State, 2023 SCC OnLine Mad 4711
[2] Ram Kishor Arora vs Directorate of Enforcement Criminal Appeal No. 3865 OF 2023 (@ SLP (Crl.) No. 12863 of 2023)
[3] Pankaj Bansal v. Union of India, 2023 SCC OnLine SC 1244
[4] Para 39, SCC OnLine SC 1244
[5] Para 21, Criminal Appeal No. 3865 OF 2023 (@ SLP (Crl.) No. 12863 of 2023)
[6] Vijay Madanlal Choudhary v. Union of India, 2022 SCC OnLine SC 929
[7] Supra Note 3
