PMLA- No Stay In Trial Or Investigation Where No Coercive Simpliciter Has Been Ordered: Supreme Court

While directing the petitioners to cooperate with the investigation and granting them liberty to take recourse of remedies available under law, the Full Bench of Justices AM Khanwilkar, Krishna Murari and V Ramasubramanian in their order said,

"With regards to the order passed by this court, it related to no coercive steps. This order does not result in staying the trial or investigation. That will proceed in accordance with law. Petitioners in the concerned cases can take remedies in accordance with law."

The Top Court also permitted the Investigating Agency to insist for depositing the passport or complying with any other condition imposed by the agency irrespective of order for no coercive simpliciter.

"Mr SG has given a list of cases where the Investigating Agency may insist for depositing the passport or to be complied with any other condition despite the order of no coercive action be passed. Let this be permitted," Court said in its order.

Listing down the sequence in which the Top Court would start considering the batch of pleas, Justice Khanwilkar in today's hearing said,

"We're likely to first hear the matters seeking for no coercive action & then we'll have to consider the cases wherein the interim orders have been passed & wherein additional conditions need to be added. we'll consider as to where orders for no coercive action has been passed, can additional conditions be imposed on them or not."

Litigious Chain

On the last date of hearing the Court had agreed to revisit the orders where an interim relief of no coercive action had been granted after the Solicitor General had commended the Top Court that it was time that even those orders needed reconsideration and had relied on order passed by three judge bench of the Top Court to rebut his submission.

"As that order has already been passed in few number of cases, which are coming up for hearing on 03.08.2021, it would be appropriate to list these matter(s) along with those cases so that similar orders are passed in all cases with regard to interim relief of no coercive steps, as prayed.

Accordingly, these petitions be listed on 03.08.2021 along with SLP(Crl.)No.4634/2014 and connected cases, on which date, the request to grant ad-interim relief, at least of no coercive steps be taken against the petitioners as granted in the other cases, will be considered," the Court had ordered.

The Court had also had taken note of the fact that in pleas that challenged the constitutional validity of the relevant provision(s) of the PMLA Act, sought for quashing of proceedings, grant of interim relief of staying further proceedings related to issuance of summons under section 50 of the Prevention of Money Laundering Act, 2002 during the pendency of pleas and directing no coercive steps to be taken in connection with the issuance of summons, not even a single order had been brought to court's notice granting similar reliefs and said that the petitioners were relying on orders passed in other connected cases.

Background

The larger issue surrounding the batch of pleas among 200 others is concerned with the interpretation of the Prevention of Money Laundering Act which has been pending since 2014 before the Supreme Court.

The Top Court on July 19, 2021 after interacting with the counsels had noted that, "It is agreed that the Central Agency will prepare list of cases enactment-wise and also propositions or questions of law to be decided group-wise."

Solicitor General had thereafter formulated the following questions of law to be considered with regards to the PMLA:

1. Whether the offence under PMLA is cognizable or non-cognizable offence, particularly in view of the explanation inserted in 2019?

2. Whether the procedure contemplated under all provisions of Chapter 12 of the Criminal Procedure Code 1973 is required to be followed while commencing and continuing investigation under the prevention of money laundering act, 2002?

3. Whether the twin conditions for grant of bail as provided for in section 45 of the PMLA as it stands amended is unconstitutional? Whether the amendment takes away the basis of the judgment in 2018 and revives the twin conditions for the grant of bail?

4. In case it is held that the twin conditions stand revived, whether the judgment in 2018 holding that the twin conditions cannot apply to anticipatory bail, lays down the correct proposition of Law?

5. Whether the provisions concerning the burden of proof under PMLA violate fundamental rights of the accused person?

6. What are the contours of the offence under Section 3 of the PMLA? Does the explanation to Section 3 of PMLA (added by amendment in 2019) expand the meaning of the offence under Section 3, and if so is it permissible to do so?

7. Whether the filing of a chargesheet/complaint/FIR in the predicate offence is a prerequisite for an exercise of power of arrest under the PMLA? Can money laundering not be a standalone offence in the context of section 3 read with section 2(u) of PMLA?

8. Whether reliance on the statement recorded by the officers of the Enforcement Directorate during the investigation in judicial proceedings, violate article 20(3) of the Constitution and are inadmissible in light of Section 25 of Evidence Act?

9. Whether the provisions concerning attachment of property under the PMLA violates the right to property under article 300A

10. Whether the PMLA can be applied to acts that occurred prior to the addition of the offence under the Schedule to the Act?

11. Whether a Writ Court can grant blanket 'no coercive steps' order without any factual foundation being pleaded/examined merely because the constitutional validity of certain provisions has been challenged?

12. Whether Sections 17 and 18 of PMLA as amended, relating to search and seizure are unconstitutional and void?

13. Is the power of arrest conferred under section 19 PMLA violative of articles 14 and 21 of the Constitution?

14. Whether the offence of Money laundering can continue after the predicate offence has taken place? Can the offence of money laundering be committed even if the predicate or scheduled offence was not a scheduled offence on the date when the scheduled offence was committed?

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