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Judgment on property possession under PMLA may be arbitrarily applied, says SC
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A bench headed by Chief Justice NV Ramana said the ratio concerning Section 8(4) laid down by the PMLA judgement — which gives power to the ED to take possession of the attached property — needs further explanation.
FILE IMAGE : PTI
The Supreme Court on Tuesday, August 23, said its judgement on the Enforcement Directorate’s powers under the Prevention of Money Laundering Act (PMLA) to take possession of a property before trial in exceptional cases, leaves scope for arbitrary application. A bench headed by Chief Justice NV Ramana said the ratio concerning Section 8(4) laid down by the PMLA judgement — which gives power to the ED to take possession of the attached property — needs further explanation.
The apex court, in its PMLA judgement delivered on July 27, had said that direction under Section 8(4), for taking possession of the property in question before a formal order of confiscation is passed, should be an exception and not a rule. “In Vijay Madanlal Choudary & Ors v. Union of India, this court dealt with confiscation proceedings under Section 8 of the Prevention of Money Laundering Act, 2002 (PMLA) and limited the application of Section 8(4) of PMLA concerning interim possession by the authority before the conclusion of the final trial to exceptional cases.
“The court distinguished the earlier cases in view of the unique scheme under the impugned legislation therein. Having perused the said judgment, we are of the opinion that the aforesaid ratio requires further expounding in an appropriate case, without which, much scope is left for arbitrary application,” the bench, also comprising Justice Krishna Murari and Justice Hima Kohli, said.
The observations came in a judgement in which the top court held that Benami Transactions (Prohibition) Amendment Act, 2016, does not have retrospective application, and that the authorities cannot initiate or continue criminal prosecution or confiscation proceedings for transactions that were entered before the legislation was in place. In its judgment, the Supreme Court upheld the power of arrest, attachment and search seizure of the ED, as provided by the PMLA. However, Chief Justice NV Ramana later said that the ratio of the PMLA required further deliberation, and heard the objection to the July 27 judgment filed by Congress MP Karti Chidambaram on August 23.
The apex court, in its PMLA judgement delivered on July 27, had said that direction under Section 8(4), for taking possession of the property in question before a formal order of confiscation is passed, should be an exception and not a rule. “In Vijay Madanlal Choudary & Ors v. Union of India, this court dealt with confiscation proceedings under Section 8 of the Prevention of Money Laundering Act, 2002 (PMLA) and limited the application of Section 8(4) of PMLA concerning interim possession by the authority before the conclusion of the final trial to exceptional cases.
“The court distinguished the earlier cases in view of the unique scheme under the impugned legislation therein. Having perused the said judgment, we are of the opinion that the aforesaid ratio requires further expounding in an appropriate case, without which, much scope is left for arbitrary application,” the bench, also comprising Justice Krishna Murari and Justice Hima Kohli, said.
The observations came in a judgement in which the top court held that Benami Transactions (Prohibition) Amendment Act, 2016, does not have retrospective application, and that the authorities cannot initiate or continue criminal prosecution or confiscation proceedings for transactions that were entered before the legislation was in place. In its judgment, the Supreme Court upheld the power of arrest, attachment and search seizure of the ED, as provided by the PMLA. However, Chief Justice NV Ramana later said that the ratio of the PMLA required further deliberation, and heard the objection to the July 27 judgment filed by Congress MP Karti Chidambaram on August 23.