The Supreme Court on Thursday indicated that it would take a final call in April 2025 on whether its 2022 ruling, which upheld the Enforcement Directorate’s extensive powers under the Prevention of Money Laundering Act, requires reconsideration.
Judicial Procedural Concerns
A bench comprising Justices Surya Kant and N. Kotiswar Singh noted that the matter was erroneously listed before a two-judge bench instead of a three-judge bench, as initially intended. Solicitor General Tushar Mehta, representing the Central government, concurred with the bench and proposed scheduling the hearing for late April or early May.
Senior Advocate Kapil Sibal, appearing for the petitioners, urged the court to expedite the hearing, emphasizing the urgency of the matter. Justice Surya Kant, however, clarified that the case would not be taken up before the end of April and assured that a specific date would be assigned accordingly.
Background
On July 27, 2022, a three-judge bench of the Supreme Court upheld key provisions of the PMLA, 2002, reinforcing the ED’s authority to arrest individuals, attach properties, conduct searches, and seize assets suspected of being linked to money laundering activities.
However, in August 2022, the Supreme Court agreed to hear review petitions challenging the ruling. It observed that two crucial aspects—
The absence of an obligation to furnish an Enforcement Case Information Report (ECIR) to the accused, and the reversal of the presumption of innocence under the law warranted reconsideration.
Despite acknowledging concerns, the court previously upheld the constitutional validity of the PMLA, emphasizing that money laundering poses a serious threat to the global financial system and is not an “ordinary offence.” The bench also clarified that officials under the PMLA are not equivalent to police officers under the Criminal Procedure Code and that an ECIR is not akin to an FIR. It ruled that while supplying a copy of the ECIR to the accused is not mandatory, the ED must disclose the grounds of arrest at the time of detention.
Political & Legal Ramifications
The 2022 judgment was delivered in response to over 200 petitions challenging various provisions of the PMLA, a statute that the opposition has repeatedly alleged is being misused by the government to target political rivals. The verdict also upheld Section 45 of the PMLA, which classifies money laundering as a cognizable and non-bailable offence and imposes stringent conditions for securing bail, ruling that these provisions were reasonable and not arbitrary.
As the Court now prepares to deliberate on whether aspects of its earlier ruling require reconsideration, the outcome is poised to have significant legal and political implications.
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