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The Supreme Court on Thursday prima facie agreed to reconsider two aspects of the Prevention of Money Laundering Act (PMLA) upheld by its judgment on July 27, which deprives an accused a copy of the enforcement case information report (ECIR) and transfers the burden of proof of innocence onto the accused’s shoulders instead of the prosecution.
A review Bench, led by Chief Justice of India NV Ramana, clarified that its move to reconsider these two key points — non-provision of ECIR and reversal of presumption of innocence — should not be construed to mean that the court was opposing the Centre’s efforts to prevent the circulation of black money or money laundering.
“We feel that only these two aspects need to be looked into. We are in principle completely in support of the efforts to prevent black money, its circulation and money-laundering. We cannot afford such types of offences. The object is noble ... We will issue notice. Let the Government of India respond,” Chief Justice Ramana observed orally.
‘Part of global structure’
Solicitor General Tushar Mehta, for the Centre, said entertaining a review of the July judgment would entail serious repercussions. The PMLA was not a standalone law, but part of a larger global structure against the offence of money laundering. India may lose its standing and may not even get financial assistance for its fight against the offence. He said the review petition filed by Karti Chidambaram, represented by senior advocate Kapil Sibal, was “an appeal in the guise of a review”.
To this, the court said it has already acknowledged the seriousness of the offence of money laundering. “We are not opposing any of the actions taken by the government to stop money-laundering or bringing back black money from abroad... ” the Chief Justice said, while also issuing notice to the government and posting the review before an appropriate Bench after four weeks.
The court also ordered several writ petitions to be tagged along with the review petition. The July verdict had said the method of introduction of the amendments through a Money Bill would be separately examined by a larger Bench.
What the July judgment said
The July 27 judgment authored by Justice AM Khanwilkar had found no reason for the Enforcement Directorate, the prosecuting agency under the PMLA, to share the ECIR with an accused. The judgment classified the ECIR as an “internal, departmental document”. It had concluded that revealing its contents to the accused before the completion of inquiry or investigation into the proceeds of the crime would have a “deleterious impact” on the final outcome of the case.
On the issue of burden of proof resting on the accused, Justice Khanwilkar had said the provision did not suffer from the “vice of arbitrariness or unreasonableness”.
The apex court had in fact called the PMLA a law against the “scourge of money laundering” and not a hatchet wielded against rival politicians and dissenters.
The verdict had come in an extensive challenge raised against the amendments introduced to the 2002 Act by way of a Finance Act in 2019. Over 240 petitions were filed against the amendments which the challengers claimed to violate personal liberty, procedures of law and the constitutional mandate. The petitioners had claimed that the “process itself was the punishment” under the PMLA.
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