ED has no Power to Arrest when Special Court takes Cognizance under PMLA: Patna HC [Read Order]
The court relied on the decision of Supreme Court in the case of Tarsem Lal vs. the Directorate of Enforcement, Jalandhar Zonal Office
Patna High Court – PMLA – special court – taxscan
Patna High Court – PMLA – special court – taxscan
The Patna High Court has held that the Enforcement Directorate ( ED ) loses the power to arrest when special court takes cognizance under Prevention of Money Laundering Act ( PMLA ), 2002.
The single bench of Justice Satyavrat Verma viewed that in the case of Tarsem Lal vs. the Directorate of Enforcement, Jalandhar Zonal Office , it was held that once an ECIR is filed and the accused is not arrested during the course of investigation and thereafter cognizance is taken based on the complaint filed by the ED in that event, the ED loses its power to arrest the accused without seeking permission of the Special Court.
In the petition, the applicant requested anticipatory bail. In 2013, a formal complaint was filed on the predicate offenses, in which the petitioner was also named as an accused party. After an ECIR was established in 2016, it is then argued that the ED entered the picture.
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During the investigation, the ED phoned the petitioner, and the petitioner cooperated with the ED throughout the entire process. In other words, the petitioner collaborated with the ED from 2016 until 2022, when the complaint was filed.
Throughout the inquiry, the ED never found the necessity to make the petitioner an arrest. It is then argued that since the ED never felt the need to arrest the petitioner during the course of the investigation, it would be right to place the petitioner in jail based on the cognizance that was reached based on the complaint that the ED filed following the investigation in 2022.
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The petitioner argued that the predicate offense for which the current ECIR was filed also resulted in a FIR, and that throughout the investigation, the petitioner consistently assisted the ED. The petitioner fears that he will be arrested, so he has petitioned this court for anticipatory release. The ED never saw the need to arrest him, and after the complaint was made, cognizance was taken.
In deciding the anticipatory bail application, the court determined that the ED never felt the need to arrest the petitioner during the course of the investigation and that, once the offense punishable under Section 4 of the PMLA is recognized based on a complaint under Section 44(1)(b) of the PMLA, the ED and its officers are not authorized to use Section 19 of the PMLA to arrest an individual listed as an accused in the complaint.
To Read the full text of the Order CLICK HERE
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