Journey of the controversial PMLA case in which Justice SK Kaul was asked to take the middle path

Former Supreme Court Justice Sanjay Kishan Kaul has made a number of startling revelations in his memoirs titled Without Fear or Favour.

In his book, he recounts a discussion called at the behest of then Chief Justice of India (CJI) DY Chandrachud and also involving Justice Sanjiv Khanna, where he was asked to take a "middle path" in the case concerning the validity of the Prevention of Money Laundering Act (PMLA) and reconsideration of the Court's 2022 judgment in Vijay Madanlal Choudhary v. Union of India.

Justice Kaul described it as an attempt to "take the case away from him" and that can "only have been done by the Chief Justice himself". This, the book states, "drove a wedge between the Chief Justice and me". As per the book,

"One morning, I was called to the CJI's chamber where Justice Khanna also happened to be present along with him and asked "whether I really wished to go on with the matter." It was then put to me that caution must be the wiser course and that perhaps I should take a middle path."

Justice Kaul, in his interview to The Wire, further said that while he does not recollect who exactly made the "middle path" suggestion, the line of discussion was whether he should continue hearing the case.

"I do not exactly recollect whether it was him (CJI Chandrachud) or Justice Khanna but that was the line of discussion - whether I would like to go on with the matter."

He added that since the petitioners in the matter had almost finished their submissions, he was confident of wrapping up the hearing.

"I thought since petitioners' hearing was almost over and I thought we could concluded the matter. I thought it would have taken maybe a day or two more. But that is not where it went," he stated.

The case Justice Kaul was referring to concerns the validity of various provisions of the PMLA. While the validity of PMLA was upheld by the top court in the case of Vijay Madanlal Choudhary v. Union of India, various review petitions came to be filed challenging the verdict.

Simultaneously, various writ petitions and criminal appeals were also filed assailing the PMLA provisions once more. Those writ petitions and appeals came up before various benches headed by Justice Kaul.

On one occasion, he directed that the matter be listed before a three-judge bench. He says that this direction was viewed as an unfavourable development by the government.

"I used to sit on both two- and three-judge benches. When the matter regarding the possibility of referring this to a larger bench came up, I happened to be on a two-judge bench. Since it was a three-judge bench matter, I thought it would be more appropriate to hear it when I was sitting as one of the three. The government viewed this simple listing as an unfavourable development. In my view, this should not have been the case. A three-judge bench could not have overruled a coordinate bench (a bench of equal strength). The most it could have potentially done is refer some questions to an even larger five-judge bench," he states in his book.

However, what followed troubled him deeply. According to Justice Kaul, while he was occupied with Constitution Bench work, the matter went unlisted and, then, without a word to him, surfaced before another bench altogether. While he does not specify which bench it was, he learnt of it from the judge before whom the matters came to be listed.

He immediately went to then CJI Chandrachud asked him how this could be done.

"He told me that some judicial order had been passed consolidating all PMLA-related work, including what was before me and before Justice Bela Trivedi’s bench. I said I did not follow how, by a judicial order, work could be taken away from the court to which it stood assigned, and I told him plainly that if he did not wish me to hear the matter, it was his prerogative as master of the roster and he had only to say so. I have never been anxious to hear any particular case. The principle was not a personal one. Cases ought not to move from one bench to another because of apprehensions about how a bench might decide," Justice Kaul states in his book.

Eventually, the CJI constituted a 3-judge bench consisting of Justices Kaul, Sanjiv Khanna and Bela Trivedi to hear all those matters.

"He realised what my view was and he constituted a three-judge bench consisting of myself, Justice Sanjiv Khanna and Justice Bela Trivedi. Those matters which were consolidated were put before this bench which began hearing the matter. Unfortunately, it did not conclude," Justice Kaul recounted in his conversation with The Wire.

The matters came up before this bench for the first time on October 18, 2023. On that date, the Court in its order set out in detail the manner in which it would proceed. As per that order, the Court said that it would only address issues relating to the PMLA. The Court also recorded the Enforcement Directorate's (ED) objection to the matter that it was only an academic exercise since the issues were already settled by the Vijay Madanlal judgment.

The ED also raised a preliminary objection that the review petitions against Vijay Madanlal are pending and that this PMLA matter should be deferred till the review petitions are heard and decided.

"We note the objection of learned Solicitor General that an academic exercise should not be carried out without there being substance and that merely because someone approaches the Court and wants the issue decided by the three Judges Bench to be revisited, should not be an occasion to revisit it. 3. The other preliminary objection raised by the respondent(s)-Enforcement of Directorate/Union of India is that in view of the order in review being Review Petition(Crl.)No.219/2022 (Karti P Chidambaram vs. The Directorate of Enforcement) in T.C.(Crl.) No. 4/2018 against the judgment in Vijay Madanlal Choudhary vs.Union of India & Ors. (2022 SCC OnLine SC 929, any further consideration should await that," the Court noted in its order.

Nevertheless, the Court decided that it will hear the matter.

"We will fix one date for hearing, giving one half session to each of the parties. Preliminary objections will also be heard with reply arguments," it added.

Final hearing in the matter started on November 22, 2023 and the matter was heard the next day as well. Justice Kaul notes in his book that hearings before the bench grew heated and he began to get the feeling that Solicitor General Tushar Mehta was not letting Senior Advocate Kapil Sibal argue.

This prompted strong intervention from Justice Kaul. As per the book,

"The hearings grew heated. On more than one occasion, I felt the solicitor general was not letting Kapil Sibal proceed, and once – for the only time I can recall in all those years – I lost my temper and brought my hand down on the desk. I told the solicitor general that I had never allowed my court to be run by anyone else and that I was not about to permit it at this stage of my life and my tenure; he would please take his seat, and we would hear him in turn."

It was at this juncture that Justice Kaul was called to the CJI's office one morning with Justice Khanna also being present. At this meeting, Justice Kaul was asked whether he would want to continue hearing the matter. In Justice Kaul's words,

"One morning, I was called to the chief justice’s chamber, where Justice Khanna also happened to be present along with him, and asked whether I really wished to go on with the matter – for there was talk among the bar members about my hearing it. ‘What difference does that make,’ I asked and added if they were suggesting I’d accepted a monetary bribe to hear it. If I had to defend myself against that absurd allegation after over 22 years on the bench, then I had clearly not done my job. It was then put to me that caution might be the wiser course, and that perhaps I should take a ‘middle path’. I responded that I had never in my career proceeded along a ‘middle path’ and that I was ready to hear it."

What happened subsequently can be gauged from the orders of the top court.

As per the order of November 23, 2023, the matter was heard for three-and-a -half hours on the first date and till 3:00 PM on the second. The order recorded that the Solicitor General (SG) sought deferment of the matter to examine the issue.

"Learned Solicitor General submits that in view of the arguments made, he requires more time to examine this issue and seeks deferment," the order said.

Since Justice Kaul was due to retire on December 25, 2023, the Bench said that it will not be in a position to complete hearing the matter and deliver judgment.

"Deferment would leave really no time for this Court to pen down the order," the order said.

Hence, it ordered that the matter be placed before the CJI for re-constituting the bench.

"The papers be placed before Hon’ble the Chief Justice of India to re-constitute the Bench as one us (Hon’ble Sanjay Kishan Kaul J.) is demitting office," the Court directed.

However, the order is not clear as to how the Bench responded to the SG's request for deferment. This has now been revealed by Justice Kaul in his interview to The Wire. The former judge said in the interview that while he was not keen on giving in to the deferment request, the other judges on bench - Justice Khanna and Justice Trivedi - were. Hence, the Bench proceeded to release the matter.

"I told him (SG) to proceed (with the arguments) because you have been party to the earlier hearings and decisions and, therefore, it should not require a time and knowing that I was running against time. We (judges) discussed amongst ourselves and since the inclination of the other judges (on the bench) was we should give them time, I realised that it was not possible for me to conclude the hearing in this matter and that is the stage at which we said this has to to before another bench and that is where it ended," Justice Kaul told Karan Thapar.

"I don't know whether it has seen the light of the day after that," he added.

True to his words, the matter, which was part heard, was not heard finally after that. Various connected matters came up after that, in which the Court issued notice and tagged them with the main matter. The Supreme Court website shows that the main matter was last heard on March 19, 2024.

Meanwhile, even the review petitions challenging the Vijay Madanlal verdict are yet to be heard. The matter was slated to be heard by a Bench of CJI Surya Kant and Justices Ujjal Bhuyan and NK Singh.

However, in August this year, the Court decided to change the bench, citing that listing the case before the original bench would lead to breaking three other benches, since Justice Bhuyan and Singh are now sitting as part of other benches.

"If we list it before the original Bench, then three Benches will have to be broken. I have only listed this matter so that your consent can be recorded for the bench allocation," the CJI said.

SG Mehta and Sibal, representing one of the review petitioners, consented to the same. Hence, the matter will now be heard by a Bench of CJI Surya Kant and Justices Joymalya Bagchi and V Mohana.

Four years have passed since Vijay Madanlal. Both the review petitions and the writ petitions continue to remain pending before the Supreme Court. Meanwhile, the PMLA rolls on and the ED files cases unopposed.