ED Does Not Have Uncontrolled Authority To Arrest A Person: Delhi High Court
The Delhi High Court on Thursday ruled that the Enforcement Directorate“s power to arrest under Section 19 of the Prevention of Money Laundering Act (PMLA) is not “untrammelled,” pointing out that the authorities lack “the power to arrest on their whims and fancies.”
Justice Anup Jairam Bhambhani said that the power under Section 50 of the PMLA to issue summons to a person and to ask for the production of documents and record statements, which is similar to the powers of a civil court, is not the same as the power under Section 19 to arrest a person.
“These are two separate and distinct provisions,” the single bench judge held. The court also said that there is a threefold requirement that must be complied with before arresting a person. “Firstly, the Director must entertain a reasonable belief that the person arrested is guilty of an offence under the PMLA, and not under any other enactment; Secondly, the reasons for such belief must be recorded in writing; and thirdly, such belief must be based on material that is in the Director”s possession,” the order said.
The bench said that under Section 50 of the PMLA, ED officers can ask any person to attend for recording statements on oath, with a “mandate that any person so summoned shall be bound to attend, to answer and make statements truthfully”.
The HC said, under Section 50 of the PMLA, ED officers have the power to “enforce the attendance of any person for recording statements on oath, with a mandate that any person so summoned shall be bound to attend, to answer and make statements; to compel discovery, inspection and production of documents and records; and to impound and retain records, by giving reasons in writing.”
“To be sure, the power to arrest is conspicuously absent in Section 50 of the PMLA,” the court said in the order. With the observations, the HC, however, dismissed a plea filed by one Ashish Mittal seeking quashing of the Enforcement Case Information Report in the Educomp case.”
