PMLA | SC Judgment In 'Pankaj Bansal' On Informing Grounds Of Arrest In Writing Applies Retrospectively: Punjab & Haryana High Court

The Punjab & Haryana High Court on Tuesday set aside the arrest of real estate group M3M Director, Roop Bansal in money laundering case observing that there was non compliance of the provisions of Section 19 of the PMLA in view of Supreme Court's recent landmark judgement on checking the powers of ED in Pankaj Bansal case.The Supreme Court, while setting aside the arrest of other Directors of M3M Pankaj Bansal and Basant Bansal, had said,"...it would be necessary, henceforth, that a copy of written grounds of arrest is furnished to the arrested person as a matter of course and without exception."A Division bench of Justice Arun Palli and Justice Vikram Aggarwal while quashing the arrest said that the decision of Apex Court will be applicable retrospectively."No doubt, the Hon’ble Apex Court held that the grounds of arrest would “henceforth” be furnished in writing to the accused but at the same time, it declared the arrest and the consequential remand of Pankaj Bansal and Basant Bansal to be illegal. Had the intention been to make the condition only prospective, the Hon’ble Apex Court would not have declared the arrest of Pankaj Bansal and Basant Bansal to be illegal."The Court was hearing the plea to quash the arrest and remand of Roop Bansal who was booked under Sections 7, 8, 11 and 13 of the Prevention of Corruption Act, 1988 read with Section 120-B IPC by the ED. Since the offences under IPC are scheduled offences under PMLA, ED recorded an ECIR.It was alleged that one IREO group which was accused of money laundering Rs.1,376 crore had further diverted its funds of more than Rs.400 crores through M3M Group of Companies.Referring to Pankaj Bansal's case, the Court said, "...the Hon'ble Apex Court noted that the mode of conveying information of the grounds of arrest must necessarily be meaningful so as to serve the intended purpose. Reference was made to Section 45 of the PMLA which enables the arrested person to seek release on bail. It was noticed that Section 45 prescribes twin conditions which are required to be satisfied in the absence of which, the arrested person would not be entitled to bail.""It was held that the communication of the grounds of arrest, as mandated by Article 22 (1) of the Constitution and Section 19 of the PMLA, is, therefore, meant to serve this higher purpose and must be given due importance," it added.The Court noted that in the present case the mode of conveying the grounds is same as Pankaj Bansal wherein the the grounds of arrest had been read over to him and as per the own case of the Enforcement Directorate, he had appended his signatures on the same."...In so far as Pankaj Bansal and the present petitioner are concerned, both had signed the grounds of arrest apart from two other witnesses but admittedly, the grounds of arrest had not been supplied to them in writing. This would, therefore, not be sufficient compliance of the provisions of Section 19 of the PMLA and Article 22 of the Constitution of India in view of the ratio laid down by the Hon'ble Apex Court in Pankaj Bansal Versus Union of India and others's case (supra), though apart from this, there was due compliance of the provisions of Section 19 of the PMLA," observed the bench.Appearance: Abhishek Manu Singhvi, Senior Advocate, Randeep S. Rai, Senior Advocate,Chetan Mittal, Senior Advocate, Aashish Chopra, Senior AdvocateAdvocates Kunal Dawar, Rubina Virmani, Vipul Sharma, Arjun S.Rai and Varun Arjun Sharma, Varun Aryan Sharma, Sajal Bansal, Hargun Sandhu and Viren Sibal for the petitionerCitation: 2023 LiveLaw (PH) 219Title: Roop Bansal v. Union of India and anotherClick here to read/download the order.

PMLA | SC Judgment In 'Pankaj Bansal' On Informing Grounds Of Arrest In Writing Applies Retrospectively: Punjab & Haryana High Court

Aiman J. Chishti

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