Supreme Court adjourns review of 2022 PMLA judgment
The Supreme Court on Wednesday postponed the hearing on a series of petitions seeking a review of its 2022 judgment in the Vijay Madanlal Choudhary case, which upheld several contentious provisions of the Prevention of Money Laundering Act (PMLA). These provisions include those related to arrest, search, seizure, bail and other related procedures.
The Supreme Court on Wednesday postponed the hearing on a series of petitions seeking a review of its 2022 judgment in the Vijay Madanlal Choudhary case, which upheld several contentious provisions of the Prevention of Money Laundering Act (PMLA). These provisions include those related to arrest, search, seizure, bail and other related procedures.
The hearing, which will now take place on August 28, witnessed a divergence in views between the petitioners and the Enforcement Directorate (ED) regarding the scope of the review proceedings.
During the hearing, the petitioners contended that they seek a comprehensive review of several aspects of the 2022 judgment. In contrast, the ED maintained that the review was confined to only two specific issues — the non-provision of the Enforcement Case Information Report (ECIR) to the accused and the principle of reverse burden of proof. The ED argued that the court had previously clarified that only these two aspects were under reconsideration.
The bench, comprising justices Surya Kant, CT Ravikumar and Ujjal Bhuyan, acknowledged the disagreement but pointed out that a review petition should not transform into an appeal. The court, however, deferred its decision on whether the review could extend beyond the two specified issues, stating that it would consider the matter during the next hearing, after considering further arguments from both sides.
The agency was represented through solicitor general Tushar Mehta and additional solicitor general SV Raju while senior counsel Kapil Sibal, Abhishek Manu Singhvi and Vikram Chaudhary appeared for the petitioners.
The lead review petition has been filed by Congress MP Karti Chidambaram. This was the first time the review petitions were heard after notice was issued in the matter on August 25, 2022.
The 2022 judgment has been a focal point of legal and political debate. The Supreme Court’s ruling in the Vijay Madanlal Choudhary case affirmed the extensive powers granted to the ED under the PMLA. These powers include the authority to summon individuals, conduct arrests, carry out raids and attach properties of suspects. The court justified these provisions by emphasising the need for robust tools to combat money laundering and protect the nation’s financial integrity.
The judgment had dismissed over 200 petitions challenging the PMLA, with petitioners arguing that the law granted unchecked and arbitrary powers to the ED, infringing on fundamental constitutional rights such as liberty, property, and protection against self-incrimination. Despite these concerns, the court upheld the stringent measures, noting the necessity for the state to categorise PMLA offenders as a distinct class requiring specialised legal provisions.
One of the most controversial aspects of the 2022 judgment was its ruling that the ECIR, an internal document of the ED, need not be provided to the accused. The Supreme Court maintained that it was sufficient for the ED to inform the accused of the grounds for their arrest. Additionally, the judgment supported the PMLA’s provisions that impose a reverse burden of proof, requiring courts to presume the accused’s involvement in money laundering unless proven otherwise, even during bail proceedings.
On August 25, 2022, the Supreme Court issued notice to the Union government in response to Chidambaram’s review petition against the July 27, 2022 judgment. The court had at the time indicated that only the two issues related to the supply of ECIR and the reverse onus of guilt would be reconsidered, with the rest of the judgment not up for review. Since then, the review petition has not progressed to an effective hearing, while a separate three-judge bench continues to evaluate whether the 2022 judgment requires re-examination.
Notably, a separate bench, including justices Sanjiv Khanna, MM Sundresh and Bela M Trivedi, is also hearing petitions challenging the validity of sections 50 and 63 of the PMLA. These sections relate to the Enforcement Directorate’s (ED) powers to summon witnesses, extract confessions and prosecute for providing false information. In these proceedings, there has been a persistent demand for the reconsideration of the Vijay Madanlal Choudhary judgment.
The 2022 PMLA judgment has faced criticism for eroding safeguards related to the rights to life, liberty, property, and protection against self-incrimination, particularly in the context of a surge in ED raids and actions against opposition leaders, raising concerns about the politicisation of the federal financial crime agency.
The Supreme Court’s eventual decision on the review petitions, whether to expand the scope or limit it to the two issues initially identified, will have far-reaching implications for the interpretation and application of the PMLA, as well as for the ongoing discourse on judicial oversight of executive and policing powers in India’s financial regulatory framework.