Strengthening constitutional protections: The Supreme Court's pivotal verdict on written grounds for arrest under PMLA

In a recent landmark decision, the Supreme Court, in the case of Pankaj Bansal v. Union of India and Ors, has delivered a significant ruling with far-reaching implications in cases falling under the Prevention of Money Laundering Act, 2002 (PMLA).

This judgment, rooted in Section 19 of the PMLA, not only upholds the constitutional mandate of Article 22, but also reshapes the landscape of arrest procedures. The Supreme Court's unequivocal stance is clear: providing grounds for arrest in a written format is an absolute necessity, rendering oral explanations or casual notifications insufficient.

Furthermore, the Court goes a step further by holding that failure to furnish a copy of the grounds for arrest renders the arrest itself illegal and mandates its nullification. This ruling underscores the fundamental importance of due process and accountability in the realm of criminal justice, setting a precedent that reverberates through the corridors of legal jurisprudence.

The factual background in the case relates to criminal appeals filed by father-son duo Basant and Pankaj Bansal before the Supreme Court while contesting the Enforcement Directorate's actions on charges against them of having committed offendes under the PMLA, as well as their subsequent detention orders issued by Sessions Judge, Panchkula.

To comprehend the significance of this judgment, it is imperative to contextualize it within the backdrop of the contentious 2022 Supreme Court ruling in the matter of Vijay Madanlal Choudhary v. Union of India, which, among other things, reaffirmed the Enforcement Directorate's substantial authority in matters pertaining to arrests under the PMLA.

While the legislation under Section 19 of the PMLA empowers officers of the Enforcement Directorate to apprehend individuals suspected of engaging in money laundering, it contains an ambiguous provision that stipulates that the accused should be 'informed' of the grounds for their arrest.

Preceding judgments rendered by the Supreme Court in the cases of Vijay Madanlal Choudhary and V Senthil Balaji v. The State and Ors do not provide explicit guidance on the method by which the arrested person is to be 'informed' of the grounds of arrest. On the other hand, the Delhi and Bombay High Courts have interpreted the provisions of Section 19 of the PMLA to hold that grounds for arrest ought not to be informed to the arrestee in writing.

In the case of Moin Akhtar Qureshi v. Union of India and others, the Delhi High Court observed that Section 19 of the Act of 2002 employs the terminology 'informed of the grounds of such arrest' and does not employ the phrase 'communicate the grounds of such arrest.' As a result, the duty imposed upon the authorized officer under Section 19(1) is solely to apprise the arrestee of the grounds of arrest, and this provision does not impose an obligation on the authority to furnish the grounds for such arrest in written form to the arrestee.

Furthermore, a division bench of the Bombay High Court, in the case of Chhagan Chandrakant Bhujbal v. Union of India and others, determined that the grounds of arrest must be conveyed to the person arrested, signifying that they should be communicated expeditiously. However, it was held that there exists no statutory requirement for the grounds of arrest to be communicated in a written format.

In this context, the Supreme Court was presented with the question of how the Enforcement Directorate is mandated to 'inform' the arrested individual about the reasons for their arrest. Seizing this opportunity, the Supreme Court underscored the accused's fundamental right, as enshrined in Article 22(1) of the Constitution, to be promptly apprised of the grounds for their arrest. The Court ruled that the Enforcement Directorate is obligated to convey the grounds of arrest to the accused in written form at the time of arrest. Mere oral communication of the grounds is deemed insufficient.

The Court's discerning approach lies in its recognition that the mode of conveying information must align with the objective of safeguarding the fundamental right enshrined Article 22 of the Constitution. Article 22 stipulates that an arrested individual must be promptly informed of the reasons for their arrest. Therefore, the method of conveying the grounds of arrest must inherently possess significance to fulfil its intended purpose effectively.

It was emphasized that potential disputes could arise if the grounds of arrest are orally communicated or read by the arrested person without further documentation. In such cases, it may become a matter of conflicting accounts between the arrested individual and the authorized officer regarding compliance. To prevent such precarious situations, the Court recommended a straightforward solution i.e. providing the written grounds of arrest, as recorded by the authorized officer in accordance with Section 19(1) of the Act of 2002, to the arrested person with proper acknowledgment. The other rationale for advocating this approach is rooted in the fact that this communication will serve as a dual purpose: firstly, to inform the arrested individual about the grounds for their arrest, and secondly, to enable them to access legal counsel should they opt to seek release on bail under Section 45 of PMLA.

Furthermore, the Court also addressed another pivotal aspect, namely, the safeguarding of an individual's right against self-incrimination. The Court deemed it unjustifiably broad to arrest individuals solely for their non-cooperation with the Enforcement Directorate during questioning. Characterizing individuals as evasive or uncooperative did not warrant arrest, the Court asserted.

This was a much needed affirmation to come from the apex court, as the current trend is leading to a situation where any response other than an outright confession was perceived as non-cooperation by the Enforcement Directorate, in direct contradiction of the fundamental right of an individual against compelled self-incrimination.

While this judgment pertains to the context of PMLA, it should be considered within the broader framework of general criminal law jurisprudence, in light of its alignment with the mandate under Article 22 of the Constitution of India. This interpretation by the Supreme Court is expected to restrain arbitrary exercise of arrest powers and facilitate the robust safeguarding of the fundamental right to liberty. The remarkable aspect of this judgment is that the Supreme Court did not find it necessary to engage in complex interpretations of statutory texts in order to reach this conclusion. Expecting the enforcement agencies to convey the grounds of arrest in a “meaningful” manner to serve the intended purpose, the Supreme Court has thereby ensured that the balance of power remains equitable and does not unduly favor the state.

In the midst of mounting concerns over the potential politicization of the Enforcement Directorate, the recent judgment in the case of Vijay Madanlal Choudhary stands as a critical milestone. This ruling not only affirms the Enforcement Directorate's formidable authority in matters of arrest, seizure, presumption of guilt and imposition of stringent bail conditions, but it also sends a resounding message of accountability. It serves as a resolute reminder that the Enforcement Directorate operates within the confines of a well-established legal framework and statutory provisions, firmly dispelling any notion of exemption from legal oversight. This judgment, therefore, arrives as a breath of fresh air and injecting transparency into an agency often subject to scrutiny and speculation.

Mantul Bajpai is a practising Advocate associated with the Dispute Resolution team of the law firm M/s Crawford Bayley & Co.