Supreme Court set to review PMLA verdict, reconsider two provisions

The Supreme Court on Thursday agreed to consider a plea seeking a review of its earlier judgment upholding the constitutional validity of anti-money laundering provisions, including the powers of arrest and seizure.

The court said it would re-examine two provisions of the Prevention of Money Laundering Act (PMLA), one with respect to providing a copy of the Enforcement Case Information Report (ECIR) to the accused and another related to the burden of proof on the accused regarding innocence.

A Bench headed by Chief Justice N V Ramana said prima facie the two issues, including not providing the ECIR, required reconsideration, and sought a response from the Centre on the issue. During the hearing, senior advocate Kapil Sibal, appearing for the review petitioner, MP Karti Chidambaram, said the Act could be looked into if the court was reviewing its judgment. However, Justice Ram­ana did not accede to this request.

“There is no need for an elaborate hearing. We three (Justice Dinesh Maheshwari and Justice C T Ravikumar) feel there are two aspects in the judgment that need to be looked into. We support the amendments to the Act and feel the object of (those) is noble. We are in full support of the prevention of black money. Our country cannot afford such offences,” said the Bench.

Earlier, the court had held the ECIR could not be given the same status as that of a first information report (FIR) and by that logic the accused under the PMLA Act did not have the right to get hold of the internal record.

The ECIR is a case-record document of the Enforcement Directorate (ED) and it comprised prime facie charges against the accused. The ED is the federal agency given the powers to investigate money laundering under the PMLA.

Another provision under review is Section 24 of the PMLA, dealing with the burden of proof. It states when a person is accused of having committed the offence under Section 3 (offence of money laundering), the burden of proving innocence shall be on the accused.

Experts said the provision was the bedrock of the rule of law and could be revoked only by special legislation.

Meanwhile, Solicitor General Tushar Mehta (on behalf of the Centre) said the review of the Act would send a wrong message in the international sphere.

“We are part of a larger global structure. Any deviation will be detrimental to India in terms of financial aid,” he said.

The matter was listed on Wednesday and review petitions are usually discussed in closed chambers.

However, after the deliberations, the Bench decided to conduct an open court hearing in the matter. 

Background

The July 27 judgment was delivered by a three-judge Bench of Justice AM Khanwilkar (now retired), Justice Maheshwari and Justice Ravikumar.

Justice Ramana had expressed concern about the judgment, saying it needed a further examination. 

On August 3, MP Jairam Ramesh had tweeted 17 opposition parties, including the Trinamool and Aam Aadmi Party, had signed a joint statement expressing deep apprehensions on long-term implications of the Supreme Court judgment.