Armed with SC judgement, ED can catch big fish now

In its judgement, the apex Court has underlined the powers of the Directorate to hold inquiries, arrest people and attach property in the cases it deems appropriate.

The Supreme Court's recent judgement upholding the constitutional validity of the provisions of the Prevention of Money Laundering Act (PMLA, 2002) indicates it shares a national consensus to curb the evil of money-laundering that has come to infect our Republic over the years.

Knowledgeable sources say the judgement would help India meet its obligations under international conventions on curbing criminal activities, such as drug-trafficking and international terrorism.

Most importantly, the judgement will help the Directorate of Enforcement to take appropriate steps aimed at curbing the menace of money-laundering across the country. The PMLA includes dealing with corruption and cheating that give rise to tainted money.

In its judgement, the apex Court has underlined the powers of the Directorate to hold inquiries, arrest people and attach property in the cases it deems appropriate. The apex Court has ruled the Enforcement Case Information Report (ECIR) is "an internal document." On its basis, ED is competent to "commence inquiry/investigation for initiating civil action of provisional attachment of property." The Court has clarified money laundering "process or activity can be in any form - be it one of concealment, possession, acquisition, use of proceeds of crime."

Armed with this judgement, the ED could now be expected to proceed more appropriately against the elements, big or small, who have long been involved in the dangerous game of money-laundering in the country. The ED is currently investigating the charges of money laundering against many big fish in the country. The agency could be more confident in exercising its legitimate authority to do justice in the matter.

Regrettably, a section of public opinion are being critical of the apex Court's judgement on the PMLA. They seem to apprehend it might lead the ED to function in an arbitrary fashion. Such criticism makes little sense.

There are reasonable safeguards in the ED's process of survey, search, seizure and arrest. The law requires its officers responsible to record reasons for their actions in writing at every stage. The PMLA has a provision for the grant of bail if the court is satisfied there are reasonable grounds to believe the accused is not guilty of an offence or if it is satisfied the accused is not likely to commit any offence while on bail. Moreover, if a person is discharged or acquitted in respect of the original offence, or gets the case quashed through a competent court, there can be no case of money-laundering.

(Jagdish N. Singh is a senior journalist based in New Delhi. He is also Senior Distinguished Fellow at the Gatestone Institute, New York)

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