When Detention Of Accused Is Continued By Court, Trial Must Be Completed In A Reasonable Time : Supreme Court

"When the detention of the accused is continued by the Court, the courts are also expected to conclude the trials within a reasonable time, further ensuring the right of speedy trial guaranteed by Article 21 of the Constitution," said the Supreme Court while rejecting the bail application in a money laundering case.

The bench comprising Justices Aniruddha Bose and Bela M Trivedi also expressed concerns about the growing threat of the offence of money laundering, especially with the advent of Artificial Intelligence.

"With the advancement of technology and Artificial Intelligence, the economic offences like money laundering have become a real threat to the functioning of the financial system of the country and have become a great challenge for the investigating agencies to detect and comprehend the intricate nature of transactions, as also the role of the persons involved therein. Lot of minute exercise is expected to be undertaken by the Investigating Agency to see that no innocent person is wrongly booked and that no culprit escapes from the clutches of the law".

The bench was hearing an appeal against a judgment of the Delhi High Court dismissing the appellant's bail application under the Prevention of Money Laundering Act.

Referring to the Vijay Madanlal Chaudhary v. Union of India case 2022 LiveLaw (SC) 633, the Court held that the conditions specified in Section 45 of the PMLA are mandatory and must be adhered to since Section 71 gives it an overriding effect over other Acts.

Money laundering not contingent upon the date of scheduled offence

The Court at the outset clarified that the offence of money laundering is not contingent upon the date of the scheduled offence but depends on the date when an individual engages in processes or activities related to the proceeds of crime.

With regard to the interpretation of Section 3 of the said Act, it referred to Vijay Madanlal Choudhary's judgment, which held that “the offence of money-laundering is an independent offence regarding the process or activity connected with the proceeds of crime which had been derived or obtained as a result of criminal activity relating to or in relation to a scheduled offence. Thus, involvement in any one of such process or activity connected with the proceeds of crime would constitute offence of money-laundering”.

Statement of witnesses admissible in evidence under Section 50, PMLA

The Court refuted the appellant’s contention that he was not named in the FIR and he has been implicated only based on the statements of witnesses recorded under section 50 of the Act.

Citing the precedent set by the three-judge Bench in the case of Rohit Tandon v. Directorate of Enforcement 2018) 11 SCC 46, the court affirmed that statements of witnesses and accused are admissible in evidence under Section 50 of the PMLA Act.

In the present case, the court noted that besides the statements of witnesses recorded under Section 50 of the PMLA Act, substantial material in the form of documents has been collected. This material, prima facie, demonstrates how the appellant was not only knowingly a party but actively involved in processes and activities linked to the proceeds of crime.

Conditions for bail under section 45, PMLA to be adhered to mandatorily

The court reiterated that these conditions specified in Section 45 of the PML Act must be adhered to, even in the context of a bail application under Section 439 of the Criminal Procedure Code (Cr.P.C).

It observed, “It is trite that the court while considering an application seeking bail, is not required to weigh the evidence collected by the investigating agency meticulously, nonetheless, the court should keep in mind the nature of accusation, the nature of evidence collected in support thereof, the severity of the punishment prescribed for the alleged offences, the character of the accused, circumstances which are peculiar to the accused, reasonable possibility of securing the presence of the accused at the trial, reasonable apprehension of the witness being tampered with, the larger interests of the public/State etc.”

Further, it underlined the statutory presumption in Section 24 of the Act, where the court is entitled to presume, unless proven otherwise, that proceeds of crime in proceedings related to the Act are involved in money laundering, especially when a person is charged under Section 3.

Section 436A CrPC a beneficial provision to effectuate right to speedy trial, but court can exercise discretion

The court dismissed the appellant's claim that the lengthy trial period would result in indefinite incarceration. Citing relevant observations in the case of Vijay Madanlal, it quoted “Section 436A of the 1973 Code, is a wholesome beneficial provision, which is for effectuating the right of speedy trial guaranteed by Article 21 of the Constitution and which merely specifies the outer limits within which the trial is expected to be concluded, failing which, the accused ought not to be detained further. Indeed, Section 436A of the 1973 Code also contemplates that the relief under this provision cannot be granted mechanically. It is still within the discretion of the Court, unlike the default bail under Section 167 of the 1973 Code

Lastly, the court noted the appellant's failure to meet the threshold stipulations in Section 45.

The Court dismissed the appeal and concluded “It cannot be gainsaid that the burden of proof lies on the accused for the condition set out in the Section 45 that he is not guilty of such offence. Of course, such discharge of burden could be on the probabilities, nonetheless in the instant case there being sufficient material on record adduced by the respondent showing the thick involvement of the appellant in the alleged offence of money laundering under Section 3 of the said Act, the Court is not inclined to grant bail to the appellant.”

Senior Advocate Siddharth Luthra appeared for the appellant. Additional Solicitor General SV Raju appeared for the ED.

Case title: Tarun Kumar v. Assistant Director Directorate of Enforcement 

Citation: CRIMINAL APPEAL NO. OF 2023 (@ SLP (Crl.) No. 9431 of 2023)

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