A lost opportunity

After considering over 200 writ petitions in a span of 21 days, the Supreme Court of India gave green signal to all the controversial provisions of the Prevention of Money Laundering Act (PMLA). The clean chit amounts to judicial approval of the overreaching powers enjoyed by the Enforcement Directorate (ED) that operates under the law. Apart from giving ED a free run, the Supreme Court verdict in the Vijay Madanlal Choudhary and Ors versus Union of India has also raised serious questions around some judicial principles and attributes. The verdict dashed the hopes of petitioners who expected a bold judicial review of the law passed by the Parliament two decades ago. The court certainly fell short of living up to their expectations, as also to the standards it has set for itself over decades. By holding the Parliament’s passing of law as a parameter of legitimacy — where the action itself was to be assessed critically — the court failed to explore the option of judicial review to its real depth. The efficient functioning of a democracy is largely incumbent upon the basic attribute of checks and balances between the three wings of the government. In the particular case in question, the judicial check over the actions of executive and legislature appears to be bleak, which may not be a good sign. Furthermore, the Supreme Court order also doesn’t sit well with the cardinal principle of “innocent until proven guilty.” When it comes to stringency, PMLA finds itself in the league of ‘draconian’ legislations like UAPA, Sedition Law and NDPS. The PMLA allows ED to make arrests without sharing a copy of the Enforcement Case Report (ECR) — which is analogous to the First Information Report (FIR) filed by police. The act also allows ED to make summons without disclosing the grounds of arrest to the accused. Moreover, the PMLA unduly places the burden of proving innocence on the shoulders of accused in the course of securing a bail. This is in contradiction with the basic principle of the justice delivery system in India, which requires the state to prove the guilt/innocence of an accused. Another privilege granted to the ED under the PMLA is that whatever the accused say before the investigation agency will be treated as evidence before court. In case of normal crimes, the statement made before police is not admissible as evidence unless the accused themselves confess in front of the magistrate. Essentially, these provisions of the PMLA place money laundering as an exclusive crime which needs to be dealt in an altogether different and stringent fashion. The Judiciary has now put its approval stamp on the crime’s exclusiveness. The Supreme Court, in its order, frequently reiterated India’s ‘international commitments’ towards preventing money laundering. In doing so, what appeared was a blatant disregard of personal rights — ignoring the larger socio-political realities prevailing in the country. Since when laws and judicial orders in sovereign India are dictated so profoundly by international considerations! The Enforcement Directorate, the grounds of which were laid in the early 1950s, acquired strong teeth after the passing of the Foreign Exchange Management Act (FEMA) in 1999 and PMLA in 2002. The ED has grown into a powerful investigation agency — leaving behind the CBI, apparently. As things stand today, the agency is facing heavy criticism from opposition parties and other quarters for allegedly acting under the political influence of the ruling dispensation. In the past couple of years, it has summoned many tall leaders from the opposition-ruled states — the list including Karti Chidambaram, Abhishek Banerjee, Sonia Gandhi, Rahul Gandhi, Sanjay Raut etc., is indeed long. In general, according to data shared by Minister of State for Finance Pankaj Chaudhary to the Lok Sabha on Monday, till March 31, 2022, the ED had registered 5,422 cases under PMLA since 2002, of which 65.66 per cent were filed in the last eight years. The number of cases registered under the PMLA has gone up exponentially in the last three years. It was time that the Supreme Court took stock of the situation through judicial review to ensure that the PMLA is not being misused by the ruling dispensation at the Centre. The apex court, it appears, has lost an opportunity to place safeguards against the potential or prevailing misuse of the PMLA.