LI Network
Published on: 8 August 2023 at 11:51 IST
The Supreme Court dismissed Tamil Nadu Minister Senthil Balaji’s petition challenging his custody by the Enforcement Directorate in a money laundering case V. Senthil Balaji V. The State represented by deputy directors and ors.
The Court held that Section 41A of the Code of Criminal Procedure, 1973 (CrPC), which pertains to a notice of appearance before a police officer, would not be relevant to arrests made under the Prevention of Money Laundering Act, 2002 (PMLA).
The Court unequivocally stated, “Section 41A of the CrPC, 1973 has no applicability to an arrest made under the PMLA 2002.”
Section 41A of CrPC mandates that an individual be served with a notice by the police before being arrested for offenses that carry a punishment of less than 7 years of imprisonment. This section was introduced as a procedural safeguard against unlawful arrest, designed to protect the rights of the accused. Notably, the maximum sentence under the PMLA is 7 years.
A division bench comprising Justice A S Bopanna and Justice M M Sundresh highlighted that the PMLA itself outlines a comprehensive procedure for summons, searches, and seizures. Applying Section 41A of CrPC, which demands prior notice by the police before arrest, would conflict with the purpose of the PMLA legislation:
“In the absence of a mandate, one cannot compel the Authorized Officer to adhere to the procedures of Section 41A of the CrPC, 1973, particularly when a clear, different, and distinct methodology is available under the PMLA, 2002. Enforcing Section 41A of the CrPC, 1973 for a PMLA, 2002 arrest would undermine the investigation under the PMLA, 2002. Until a person receives a summons, they are not expected to be aware. Any additional advance notice, beyond what the PMLA, 1973 mandates, could seriously impede the ongoing investigation,” ruled the Supreme Court.
Court referred to the decision in Vijay Madanlal Choudhary v. Union of India, noting that an Authorized Officer under the PMLA is not obligated to adhere to the procedure outlined in Section 41A of CrPC while following the mandate of Section 19 of the PMLA.
This is because the PMLA already contains sufficient safeguards against arrests, as recognized by the Apex Court.
The PMLA, 2002 being sui generis legislation, has its own mechanism in dealing with arrests in light of its objectives. The concern of the PMLA, 2002, is to prevent money laundering, facilitate recovery, and penalize offenders.
This is why a comprehensive procedure for summons, searches, seizures, etc., is clearly stipulated under Chapter V of the PMLA, 2002. Arrests are only made after complying with the relevant provisions, including Section 19 of the PMLA, 2002.
Hence, there is no need to resort to Section 41A of CrPC, 1973, especially given Section 65 of the PMLA, 2002.
Additionally, the Supreme Court observed that Section 41A of CrPC was established to safeguard an individual’s liberty, as interpreted in the case of Arnesh Kumar v. State of Bihar (2014) 8 SCC 273 and other rulings.
The Court referred to the 177th Report of the Law Commission, emphasizing the need to focus police efforts on major and economic offenses rather than minor ones.
The intent behind introducing Section 41A was to curtail the practice of detaining individuals for minor offenses and keeping them in jail for extended periods.
Therefore, the Court concluded that Section 41A should apply to minor offenses under the Indian Penal Code, 1860, rather than economic offenses.
