Pankaj Bansal vs Union of India & Ors.

Held: The remand order dated 15.06.2023 passed by the Vacation Judge/Additional Sessions Judge reflects total failure on his part in discharging his duty as per the expected standard – The Judge did not even record a finding that he perused the grounds of arrest to ascertain whether the ED had recorded reasons to believe that the appellants were guilty of an offence under the Act of 2002 and that there was proper compliance with the mandate of s.19 of the Act of 2002 – He merely stated that, keeping in view the seriousness of the offences and the stage of the investigation, he was convinced that custodial interrogation of the accused persons was required in the present case and remanded them to the custody of the ED – Analyzing the arrest of the appellants, neither of the appellants was shown as accused in the first ECIR registered by the ED – Both the appellants secured interim protection by way of anticipatory bail from the High Court – However, both the appellants were summoned on 14.06.2023 for interrogation in connection with the first ECIR and summons were served on 13.06.2023 – Significantly, second ECIR was recorded on 13.06.2023 in connection with FIR No.0006 which was registered on 17.04.2023 – Therein also, neither of the appellants were shown as accused and only one ‘RB’ was shown as accused – Both appellants had presented themselves at the ED’s office – Thereafter, both appellants were arrested in connection with the second ECIR, were in exercise of power u/s. 19(1) of the Act of 2002 – It was alleged that both appellants failed to respond to the questions put by ED – Mere non-cooperation of a witness in response to the summons issued u/s. 50 of the Act of 2002 would not be enough to render him/her liable to be arrested u/s. 19 – In any event, it is not open to the ED to expect an admission of guilt from the person summoned for interrogation and assert that anything short of such admission would be an ‘evasive reply’ – Also, it is the admitted position is that the ED’s Investigating Officer merely read out or permitted reading of the grounds of arrest of the appellants and left it at that, which is also disputed by the appellants – As this form of communication is not found to be adequate to fulfil compliance with the mandate of Art. 22(1) of the Constitution and s.19(1) of the Act of 2002 – Thus, there is no hesitation in holding that their arrest was not in keeping with the provisions of s.19(1) of the Act of 2002. [Paras 18, 19, 25, 35]

Constitution of India – Art. 22 – Prevention of Money Laundering Act, 2002 – Informing the arrested person of the grounds for his/her arrest – Importance of:

Held: Article 22(1) of the Constitution provides, inter alia, that no person who is arrested shall be detained in custody without being informed, as soon as may be, of the grounds for such arrest – It may be noted that s.45 of the Act of 2002 enables the person arrested u/s. 19 thereof to seek release on bail but it postulates that unless the twin conditions prescribed thereunder are satisfied, such a person would not be entitled to grant of bail – The twin conditions set out in the provision are that, firstly, the Court must be satisfied, after giving an opportunity to the public prosecutor to oppose the application for release, that there are reasonable grounds to believe that the arrested person is not guilty of the offence and, secondly, that he is not likely to commit any offence while on bail – To meet this requirement, it would be essential for the arrested person to be aware of the grounds on which the authorized officer arrested him/her u/s.19 and the basis for the officer’s ‘reason to believe’ that he/she is guilty of an offence punishable under the Act of 2002 – It is only if the arrested person has knowledge of these facts that he/she would be in a position to plead and prove before the Special Court that there are grounds to believe that he/she is not guilty of such offence, so as to avail the relief of bail – Therefore, communication of the grounds of arrest, as mandated by Art. 22(1) of the Constitution and s.19 of the Act of 2002, is meant to serve this higher purpose and must be given due importance. [Para 29]

Prevention of Money Laundering Act, 2002 – Furnishing the written grounds of arrest to arrested person:

Held: There is no valid reason as to why a copy of such written grounds of arrest should not be furnished to the arrested person as a matter of course and without exception – There are two primary reasons as to why this would be the advisable course of action to be followed as a matter of principle – Firstly, in the event such grounds of arrest are orally read out to the arrested person or read by such person with nothing further and this fact is disputed in a given case, it may boil down to the word of the arrested person against the word of the authorized officer as to whether or not there is due and proper compliance in this regard – Such a precarious situation is easily avoided and the consequence thereof can be obviated very simply by furnishing the written grounds of arrest, as recorded by the authorized officer in terms of s.19(1) of the Act of 2002, to the arrested person under due acknowledgment, instead of leaving it to the debatable ipse dixit of the authorized officer – Secondly, conveyance of this information is not only to apprise the arrested person of why he/she is being arrested but also to enable such person to seek legal counsel and, thereafter, present a case before the Court u/s. 45 to seek release on bail, if he/she so chooses. [Paras 32, 33] Prevention of Money Laundering Act, 2002 – Non-compliance of mandate under Art.22 of Constitution and s.19 of the 2002 Act – Arbitrary exercise of power by ED:

Held: In the case on hand, the admitted position is that the ED’s Investigating Officer merely read out or permitted reading of the grounds of arrest of the appellants and left it at that, which is also disputed by the appellants – As this form of communication is not found to be adequate to fulfil compliance with the mandate of Art. 22(1) of the Constitution and s.19(1) of the Act of 2002, there is no hesitation in holding that their arrest was not in keeping with the provisions of s.19(1) of the Act of 2002 – Further, the clandestine conduct of the ED in proceeding against the appellants, by recording the second ECIR immediately after they secured interim protection in relation to the first ECIR, does not commend acceptance as it reeks of arbitrary exercise of power – In effect, the arrest of the appellants and, in consequence, their remand to the custody of the ED and, thereafter, to judicial custody, cannot be sustained. [Para 35]

LIST OF CITATIONS AND OTHER REFERENCES

State of Punjab v. Gurdial Singh (1980) 2 SCC 471 : [1980] 1 SCR 1071; Collector (District Magistrate), Allahabad and another v. Raja Ram Jaiswal (1985) 3 SCC 1 : [1985] 3 SCR 995; Ravi Yashwant Bhoir v. Collector (2012) 4 SCC 407 : [2012] 3 SCR 775 – relied on. Moin Akhtar Qureshi v. Union of India and Others 2017 SCC OnLine Del 12108; Chhagan Chandrakant Bhujbal v. Union of India and Others 02017 Cri LJ (NOC 301) 89 : 2017 (1) AIR Bom R (Cri) 929 – held not correct law.

Vijay Madanlal Choudhary and others v. Union of India and Others 2022 (10) SCALE 577; V. Senthil Balaji v. The State represented by Deputy Director and Others Criminal Appeal Nos. 2284-2285 of 2023, decided on 07.08.2023; Madhu Limaye and Others (1969) 1 SCC 292 : [1969] 3 SCR 154; Devinder Singh v. State of Punjab (2008) 1 SCC 728 : [2007] 11 SCR 475; Santosh S/o Dwarkadas Fafat v. State of Maharashtra (2017) 9 SCC

714 : [2017] 10 SCR 129 – referred to.

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