If PMLA Is Misused, Nation Will Suffer; Negative Perceptions May Arise About ED : SC Judge Justice Ujjal Bhuyan

Supreme Court judge Justice Ujjal Bhuyan spoke on the need to judiciously use the powers under the Prevention of Money Laundering Act (PMLA) and cautioned that if the law is misused, negative perceptions may rise against the Enforcement Directorate. The nation will suffer if the law is misused, he stressed.

Justice Bhuyan appealed to all stakeholders to apply the PMLA in its true spirit, having regard to the objective of the legislation and keeping in mind the overarching constitutional mandate of Article 21 of the Constitution of India.

Speaking at the recent launch event of the book ' Treatise on PMLA – Law and Practice' by advocate Mr. Akhilesh Dubey, Justice Bhuyan stressed the importance of ensuring that the PMLA (Prevention of Money Laundering Act) is not misused by the authorities. 

Justice Bhuyan expressed, “PMLA is a potent weapon in the fight against crime-tainted money. It is very much necessary to fight the menace of money laundering. But we all know that a weapon loses its potential if it is overexposed or overapplied or even misused. If that happens there will be a negative perception about the actions of the Enforcement Directorate and by extension the PMLA. If this happens it is the community and by extension the Nation which will suffer.”

Highlighting the strict scrutiny adopted by Courts in applying the stringent procedural provisions of an Act like that of the PMLA, Justice Bhuyan ringed a word of caution that it was essential to ensure that no innocent faces injustice in the said process.  He called upon all the concerned stakeholders under the PMLA to be mindful of every citizen's fundamental right promised under Article 21- the promise to uphold one's life and protect one's personal liberty.

It is a well-accepted principle in law that the stiffer the procedure, the higher will be the level of judicial scrutiny. There is nothing wrong in that…the objective is always to ensure that in the process of prosecuting and punishing the guilty, the innocent person should not suffer. If he has suffered, the sufferance should be minimised to the extent possible, that's the objective of legal intervention of the constitutional course. We hope and trust that all the stakeholders will apply the law in its true spirit, having regard to the objective of the legislation and keeping in mind the overarching constitutional mandate of Article 21 of the Constitution of India.

Buttressing the need to use the powers under PMLA with transparency and objectivity, Justice Bhuyan opined :

The law on PMLA is evolving. The last word is yet to be spoken…..in the meanwhile all that we can hope and pray is that the Law would be applied judiciously. A number of benches of the Supreme Court, I can recall the benches of Justice SK Kaul and Justice Sudhanshu Dhulia on one particular occasion…then a bench of Justice Surya Kant and Justice VK Viswanathan on another occasion, they observed during the course of hearings that there is a need for restraint and transparency.

Justice Bhuyan referring to the recent observations made by a bench comprising Justices Surya Kant and KV Viswanathan while hearing a writ petition filed by the ED seeking to transfer the investigation of the bribery case against ED officer Ankit Tiwari from the Tamil Nadu Directorate of Vigilance and Anti-Corruption to the Central Bureau of Investigation (CBI). The bench observed that while offenders should not go scot-free, vindictive arrests and mala-fide witch-hunting should also not take place. It also stressed for a need to have guidelines ensuring transparency. 

"There may be genuine cases where ED may have to go in, there may be cases where they are brought into mala fide. Some kind of best practices we want. There has to be a mechanism where when a central agency…particularly when the ruling party is different between the Centre and the State. Something has to be evolved so that while genuine cases don't go scot-free merely because it is being handled by the central agency, at the same time there is no mala fide witch-hunting," the bench had observed.

Similarly, last year in August, a bench comprising Justices Sanjay Kishan Kaul and Sudhanshu Dhulia observed that ED cannot be a law unto itself. This remark came while extending the interim protection from coercive action to certain Chhattisgarh government officials in the UP Police FIR over alleged making of duplicate holograms in connection with the liquor scam case.

Justice Kaul remarked “ED (Directorate of Enforcement) cannot be a law unto itself.” and recorded the following in the order: “Learned counsel for the petitioners very fairly states on our query that the aspect has come to the notice of the ED prior in time. Thus, interim order dated 07.08.2023 to continue.”

The video of the event can be watched here.