New Delhi, August 07, 2024: The Supreme Court, on Wednesday, highlighted the low conviction rates in money laundering cases. They urged the Enforcement Directorate (ED) to enhance the quality of its prosecution efforts. The comments were made during the hearing of a bail petition filed by Sunil Kumar Agarwal. He is a businessman from Chhattisgarh, who was arrested for money laundering related to coal transportation.
The bench comprised justices Surya Kant, Dipankar Datta, and Ujjal Bhuyan. They took note of the dismal conviction statistics under the Prevention of Money Laundering Act (PMLA). Justice Bhuyan referenced data provided by Union Minister of State for Home Nityanand Rai. Thus, noting that out of over 5000 cases registered since a recent amendment, only 40 had resulted in convictions. This was over the past decade.
Justice Kant emphasised the need for the ED to focus on prosecutorial quality and evidence. “It’s essential to improve the quality of prosecution and evidence in cases where there is a prima facie case. Relying solely on statements or affidavits can be problematic if those individuals do not support their statements during cross-examination. Scientific investigation methods should be prioritised,” he remarked.
During trial
In response, Additional Solicitor General (ASG) SV Raju argued that statements under Section 50 of the PMLA are treated as evidence, unlike statements under Section 161 of the CrPC. However, Justice Dipankar Datta pointed out that under Section 19 of the PMLA, the arresting officer must provide “reasons to believe” to the accused. He questioned whether the arrest order in Agarwal’s case met this requirement.
Justice Datta also highlighted the importance of compliance with Section 19 before invoking Section 45 of the PMLA, which imposes stringent conditions for bail. He stated, “The arresting officer must be convinced of the accused’s guilt as per the law. If this requirement is not met, it weakens the case for the prosecution.”
Senior Advocate Mukul Rohatgi, representing the petitioner, referenced a recent judgement involving Delhi CM Arvind Kejriwal, asserting that both reasons for belief and grounds for arrest must be communicated to the accused. He also stressed that the necessity for arrest should be based on concrete evidence.
Agarwal was granted interim bail by the Supreme Court on May 17, as the chargesheet in the predicate case did not establish a scheduled offence against him. On Wednesday, the court confirmed the interim bail order and disposed of the Special Leave Petition (SLP).
The Supreme Court’s ruling calls for a critical reassessment of the ED’s approach to prosecuting money laundering cases, with an emphasis on strengthening evidence and ensuring procedural compliance.
