ED Can’t Arrest Accused If Special Court Takes Cognisance: Supreme Court

The Supreme Court on Thursday ordered that the Enforcement Directorate (ED) cannot directly arrest the person under the Prevention of Money Laundering Act (PMLA), 2002 once a special court takes cognisance of the complaint. The apex court also ordered that the probe agency will have to approach the special court to acquire the custody. 

In the significant judgement, the court further declared that if one booked under money laundering case appear before the special court pursuant to summons issued, they need not have to satisfy the stringent twin test for bail under Section 45 of the PMLA. 

The bench comprising Justices AS Oka and Ujjal Bhuyen said that if the accused appears before the court by summons, it will not be treated that he is in custody. 

The bench further clarified that if ED seeks custody of an accused who appears after being summoned, it must apply to the concerned court. 

“If the ED wants custody of the accused after the person appears following summons, the ED can get custody after application to the special court. The court will only grant custody with reasons satisfying that custodial interrogation is needed,” Justice Oka said.

This recent verdict arose from a case questioning whether an accused in a money laundering case must meet the stringent twin-test for bail when the special court has taken cognisance of the offense. 

The judgment has been reserved for April 30. The court also dealt with the issue of whether an accused not arrested during the investigation period under the PMLA would be required to meet the stringent bail conditions if they appear before the court after the trail court summons them. 

The legal question in the case came from the Punjab and Haryana High Court order which denied pre-arrest bail to several accused in a money laundering case linked to a land scam that involved revenue officials.