Can ED arrest an accused under PMLA after special court’s cognizance? SC says this

In a landmark judgment, the Supreme Court of India ruled on Thursday that the Enforcement Directorate and its officers cannot arrest an accused under Section 19 of the PMLA after the Special Court has taken cognizance of the complaint.

"If the ED wants custody of such an accused, it will have to apply to court for custody. Accused who appeared before the court pursuant to the summons are not required to apply for bail, and thus, the twin conditions of Section 45 of PMLA are not applicable," said a bench of Justices Abhay S Oka and Ujjal Bhuy, according to Live Law. 

Justice Oka read out the judgment in the court: "If the ED wants custody of the accused after the person appears following summons, the ED can get custody after application to the special court. The court will only grant custody with reasons satisfying that custodial interrogation is needed."

The twin conditions stated that if an accused in a money laundering case seeks bail, the court must first hear the public prosecutor. The report said bail can only be granted if the court is convinced that the accused is not guilty and is unlikely to commit a similar offence upon release.

Section 45 of the PMLA mandates that the public prosecutor should have a chance to contest the accused's bail plea. Additionally, it necessitates the court to ascertain that there are reasonable grounds to believe that the accused is innocent and unlikely to commit any offense while out on bail. These criteria typically pose a significant hurdle for individuals involved in money laundering cases to obtain bail.

In November 2017, the Supreme Court invalidated Section 45(1) of the PMLA, which concerned the imposition of two extra conditions for granting bail to money laundering accused. However, the Center subsequently reinstated this provision through amendments to the PMLA.

The top court delivered its verdict on whether an accused in a money laundering case must fulfill the rigorous twin conditions for bail, even when the special court takes cognizance of the offence.