Amending PMLA through Finance Acts “cloak” to bypass Rajya Sabha, Jairam Ramesh moves Delhi HC

Congress Leader and Rajya Sabha MP, Jairam Ramesh has moved the Delhi High Court challenging the amendments to the Prevention of Money Laundering Act, 2002 (PMLA) through Finance Acts of 2015, 2016 and 2018..The amendments were brought via Sections 145 to 151 of the Finance Act 2015, Section 232 of the Finance Act 2016 and Section 208 of the Finance Act 2018..Jairam Ramesh has asserted that amendments are in violation of Article 110 (1) of the Constitution of India as they have absolutely no nexus to money bill provisions..The plea which is in the nature of public interest litigation was listed for hearing today before a Division Bench of Chief Justice Rajendra Menon and V Kameswar Rao..Senior Advocate P Chidambaram, appearing on behalf of the Jairam Ramesh, informed the Court that amendments to the PMLA were passed as ‘ordinary bills’ from 2005 till 2013. However, subsequently, PMLA was amended thrice using the Finance Act as a ‘cloak’..Since the amendments do not qualify as money bill in terms of Article 110 (1), portions of the Finance Act which incorporate them, are unconstitutional, he argued. He also relied upon the Supreme Court’s Aadhaar judgement to argue that provisions of Finance Act are subject to judicial review..Replying to the Bench’s query on delay in challenging the validity of the Finance Acts, Chidambaram argued that there could no limitation in challenging the vires of any statute..“He (the Petitioner) is not a lawyer. He had no occasion to examine.. (It was ) After the Aadhaar when misuse of money bill was highlighted.. Anyway there is no limitation.”, he said..The Petition was strongly opposed by the Central Government. Additional Solicitor General Maninder Acharya raised objections with respect to the locus of the Petitioner..Since the Petitioner is personally not affected by the amendments, the plea would be “an academic discussion in a vacuum”, she said. It was thus contended that the vires of an Act could only be challenged by an affected party.. After hearing the parties, the Bench deferred issuing notice in the plea..“We’ll consider”, Chief Justice Menon said as the Court rose for the day..Through the 2015 Finance Act, the definition of “proceeds of crime” was expanded and the Deputy Director was further empowered to attach property. Power of Adjudicating Authority was also replaced with Special Court..Through the 2016 Finance Act, the Appellate Tribunal established under Section 25 of PMLA was replaced by the Appellate Tribunal constituted under the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976, and structure of the Appellate Authority was also modified..The 2018 Finance Act also brought in amendments to the criminal procedures under the PMLA to enhance its effectiveness..The Petition filed through Advocates Muhammad Khan, Abishek Jebraj and Vikramaditya Singh alleges that the passage of the amendments through Finance Acts illegally stripped the Rajya Sabha of its constitutional legislative authority..“The passage of the impugned provisions in the Finance Acts of 2015, 2016 and 2018 illegally stripped the Rajya Sabha of its constitutional legislative authority over effecting amendments in or refusing to pass the impugned provisions. The passage of the impugned provisions is hence a serious affront on constitutional federalism, since the Rajya Sabha, also known as the council of states, is crucial to the constitution’s federal balance of power.”