Violation Of Section 19 PMLA Will Vitiate Arrest; Magistrate Should Ensure That ED Followed Arrest Procedure : Supreme Court

The Supreme Court on Monday held that any non-compliance of the mandate of Section 19 (Power To Arrest) of the Prevention Of Money Laundering Act, 2002, would vitiate the very arrest itself. A division bench of Justice A S Bopanna and Justice M M Sundresh while dismissing Tamil Nadu Minister Senthil Balaji's plea challenging custody by Enforcement Directorate in the money laundering case, observed that: “Any non-compliance of the mandate of Section 19 of the PMLA, 2002 would enure to the benefit of the person arrested. For such non-compliance, the Competent Court shall have the power to initiate action under Section 62 of the PMLA, 2002.” Section 19(1) gives authorized officials, such as the Director, Deputy Director, or Assistant Director, the power to arrest persons suspected of committing offenses under PMLA if they have sufficient reason to believe that the individual has committed an offense. The reasons for arrest must be recorded in writing and once arrested, the person must be informed of the grounds of their arrest. Under Section 19(2), after the arrest, the official who made the arrest must forward a copy of the order and relevant material, to the Adjudicating Authority in a sealed envelope and such authority must preserve the order and material for the specified period. Under Section 19(3) any person arrested under Section 19, must be be brought before a Special Court, Judicial Magistrate, or Metropolitan Magistrate within twenty-four hours of arrest. The Apex made it clear that non-compliance with the mandate under the aforesaid sections, would vitiate the arrest itself: "To effect an arrest, an officer authorised has to assess and evaluate the materials in his possession. Through such materials, he is expected to form a reason to believe that a person has been guilty of an offence punishable under the PMLA, 2002. Thereafter, he is at liberty to arrest, while performing his mandatory duty of recording the reasons. The said exercise has to be followed by way of an information being served on the arrestee of the grounds of arrest. Any non-compliance of the mandate of Section 19(1) of the PMLA, 2002 would vitiate the very arrest itself. Under sub-section (2), the Authorised Officer shall immediately, after the arrest, forward a copy of the order as mandated under sub-section (1) together with the materials in his custody, forming the basis of his belief, to the Adjudicating Authority, in a sealed envelope. Needless to state, compliance of sub-section (2) is also a solemn function of the arresting authority which brooks no exception." The Court also held that, it is the duty of the Magistrate to ensure that the mandate under Section 19 is duly complied with: "Such a Magistrate has a distinct role to play when a remand is made of an accused person to an authority under the PMLA, 2002. It is his bounden duty to see to it that Section 19 of the PMLA, 2002 is duly complied with and any failure would entitle the arrestee to get released. The Magistrate shall also peruse the order passed by the authority under Section 19(1) of the PMLA, 2002. Section 167 of the CrPC, 1973 is also meant to give effect to Section 19 of the PMLA, 2002 and therefore it is for the Magistrate to satisfy himself of its due compliance. Upon such satisfaction, he can consider the request for custody in favour of an authority, as Section 62 of the PMLA, 2002, does not speak about the authority which is to take action for non- compliance of the mandate of Section 19 of the PMLA, 2002. A remand being made by the Magistrate upon a person being produced before him, being an independent entity, it is well open to him to invoke the said provision in a given case. To put it otherwise, the Magistrate concerned is the appropriate authority who has to be satisfied about the compliance of safeguards as mandated under Section 19 of the PMLA, 2002."Report about other aspects of the judgment can be read here.Case Title: V. SENTHIL BALAJI V. THE STATE REPRESENTED BY DEPUTY DIRECTOR AND ORS., CRIMINAL APPEAL NOS. 2284-2285 of 2023Citation : 2023 LiveLaw (SC) 611Click Here To Read/Download Judgment

Violation Of Section 19 PMLA Will Vitiate Arrest; Magistrate Should Ensure That ED Followed Arrest Procedure : Supreme Court

Sheryl Sebastian

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