ED Can't Be Vindictive, Grounds Of Arrest Must Be Furnished In Writing To The Accused : Supreme Court

In a significant judgment pronounced on Tuesday (October 3), the Supreme Court held that the Directorate of Enforcement (ED) should furnish the grounds of arrest to the accused in writing.

"We hold that 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." pronounced a bench comprising Justices AS Bopanna and Sanjay Kumar while setting aside the arrest of Pankaj Bansal and Basant Bansal in the money laundering case against the real estate group M3M.

The Court came down heavily on the central agency for its approach taken in the instant case by which the grounds of arrest were not furnished to the accused in written form. Noticing that the ED officer merely read out the grounds of arrest, the Court held that such a conduct will not fulfil the mandate of Article 22(1) of the Constitution and Section 19(1) of the Prevention of Money Laundering Act.

Declaring the arrest to be illegal, the bench ordered the immediate release of the accused. Criticising the ED's approach in the instant case, the bench observed, "This chronology of events speaks volumes and reflects rather poorly, if not negatively, on the ED's style of functioning".

The bench categorically stated that the ED has to be transparent, above board and conform to pristine standards of fairness and probity and not be vindictive in its stand. It further said that the mere passing of an order of remand would not be sufficient to validate the grounds of arrest.

The Court went to the extent of stating that the ED's conduct "reeks of arbitrariness" and directed the immediate release of both the accused.

"Being a premier investigating agency charged with the onerous responsibility of curbing debilitating economic offence of money laundering in our country, every action of the ED in the course of such exercise is expected to be transparent, above board and conforming to the pristine standards of fair play in action. The ED mantled with far-reaching powers under the stringent Act of 2002, is not expected to be vindictive in its conduct and must be seen to be acting with utmost probity and with the highest degree of dispassion and fairness", the judgment read.

The judgment was delivered in the petitions filed by the Bansals against the judgment delivered by a division bench of the Punjab and Haryana High Court on July 14 dismissing their petition challenging their arrest. Noting that the petitioners were remanded to custody through judicial orders, the High Court refused to examine the validity of their initial detention.

The High Court further noted that petitioners are also facing allegations of bribing a judicial officers for undue favours. Terming it a "serious matter", the High Court held that the plea for petitioners' release cannot be accepted.

Other reports about the judgment can be read here.

Case Title  : Pankaj Bansal v. Union of India  SLP(Crl) No. 9220-9221/2023, Basant Bansal v. Union of India SLP(Crl) No. 9275-9276/2023

Citation : 2023 LiveLaw (SC) 844

Click here to read the judgment