ED Not Precluded From Carrying Out Investigation, Interrogation; Section 167 CrPC Applies To PMLA Cases Also: SG Tushar Mehta To Madras High Court

Opposing the argument that the Enforcement Directorate does not have the powers of police and thus could not have sought custody of Tamil Nadu Minister Senthil Balaji, Solicitor General Tushar Mehta on Wednesday told the Madras High Court that absence of such power does not take away ED’s right to investigate or interrogate.Mehta today made the submissions before the bench of Justice CV Karthikeyan during the resumed hearing of the habeas corpus plea filed by Balaji's wife Megala against his arrest by the ED. A division bench had given a split verdict in the matter last week."It cannot be said that PMLA is only regulatory just because somewhere, in a different context, the SC said we're not police officers. Even if we're not police officers, it does not take away our power to investigate. There was no occasion for the legislature to give us powers of a SHO because the Act talks about only one offence of money laundering and one punishment which is not bailable. So only the court can give bail," Mehta argued.He added: “Your honour, if the police register a corruption case which is a predicate offence and I initiate PMLA proceedings, I'm prevented from investigating the corruption angle and the police is prevented from investigating PMLA. It is in that context the court said we're not police officers”.Senior Counsels Kapil Sibal and NR Elango on Tuesday had argued that the PMLA is regulatory and the ED only has the powers to inquire, not investigate. Sibal also argued that ED is behaving like an authority investigating the predicate offence. SG Mehta, representing the ED, today argued that investigation is an inbuilt part of PMLA and that investigation and inquiry have been used interchangeably in the enactment. Taking the court through Section 44 of PMLA, Mehta also submitted that the Act provides a proviso where the investigation agency may file a closure report if no offence is made out. He submitted that if it was to be taken as if the ED could not investigate further after arrest as it already had materials in its possession while making arrest under S.19 of PMLA, then such a proviso would not have existed in the Act. “If their argument is accepted that I already have materials to arrest under Section 19 and thus don't need 15 days custody, then why did the law provide a proviso that if no offence of money laundering is made out, the authority may file a closure report. Even after filing of complaint, investigation continues and there can be a further charge in supplementary chargesheet. Investigation is an inbuilt part of the Act,” Mehta said. He also argued that the reason why legislature did not confer powers of a police officer on ED officials was because, unlike other special enactments, PMLA deals with only one offence of money laundering which is non-bailable and therefore, only a court can grant bail. On the question of ED moving for custody despite the order of High Court saying that Balaji will continue in judicial custody, SG Mehta argued that the observation was only with respect to the question of bail and that the court did not restrict the ED from seeking custody or the Sessions Judge from granting custody. “The argument by petitioner was when there was judicial order of remand, he should have continued in judicial custody and ED should not have sought custody. I say that the division bench said that he shall continue to be in judicial custody only on the question of enlarging him on bail. The court's emphasis was only that he should not be enlarged on bail. There was no restriction on us seeking custody or the Sessions Judge granting custody,” Mehta said. Mehta also contended that ED’s application for custody came from a legal compulsion that emerged from the judgment of Kulkarni which says that application should be made within 15 days. “The question is whether my application for custody was to overreach a judicial direction or a compulsion out of provisions of law. Anupam Kulkarni tells me I get only 15 days and if I don't apply I won't even get exclusion. So I had to apply. What I did was due to compulsion of statute and that cannot be held against me,” Mehta submitted. Mehta also argued that Section 167 CrPC applies to the PMLA proceedings and it gives powers to the Special Judge to send a person to such custody as it thinks fit. He argued that this power cannot be taken away by a judicial order saying that the person should be kept in judicial custody. When asked why ED never took custody even when an order was made by the Sessions Court, Mehta submitted that the conditions imposed therein made it impossible for the ED to interrogate and that those conditions were already challenged in the Supreme Court. “We had already challenged those conditions. We have to assume about his medical condition. How will we interrogate him? Who will be answerable if something happens to him. So we had already challenged the ...

ED Not Precluded From Carrying Out Investigation, Interrogation; Section 167 CrPC Applies To PMLA Cases Also: SG Tushar Mehta To Madras High Court

Upasana Sajeev

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