Bail Under PMLA and the Intricacies Involved
Introduction
That section 45 of Prevention of Money Laundering Act (“PMLA”) states that no person can be given a bail until and unless a public prosecutor, hired by the state, gets an opportunity to defend that the bail shall not be given. If the public prosecutor is doing so, then the accused needs to convince the court that he was not guilty of the crime and also they will not commit any crime while they are released on bail.
Judicial Development
The above-mentioned condition of bail under section 45 has previously been set aside in November, 2017, by the Hon’ble Supreme Court of India on the ground of being unconstitutional. (Nikesh Tranchand Shah Vs. Union of India & Anr.,2018)
Now, The Hon’ble Supreme Court of India also clarified that the bail conditions under Section 45 PMLA applicable to anticipatory bail applications for money laundering offence. (Directorate of Enforcement Vs. M.Gopal Reddy & Anr.,2023)
Legal Implications
That section 45(1) has been amended, now it prescribes an invariable application of bail conditions, rather than only for those offences which are listed in its schedule, which attract more than 3 years of sentence. Additionally, a threshold of Rs. 1 crore or $1,40,200 involved in the crime would enable a more lenient application of bail provisions in less serious matters under the PMLA, by the courts. Section 45 of Prevention of Money Laundering Act, 2002 has been adjusted to make it harder for people accused with money-laundering to get out on bail if their offence cognizable, this rule also empowers the investigating agency to arrest without a warrant if all the conditions mentioned in the section are satisfied. The exact change brought by the amendment is mentioned below: –
“[It] is clarified that the expression ‘offences’ to be cognizable and non-bailable shall mean to have always meant that all offences under the Act shall be cognizable notwithstanding anything to the contrary contained in the Code of Criminal Procedure.”
Conclusion
On a concluding note, it is pertinent to mention that in addition to the amendment mentioned above, the government has also added a new sub-section, i.e. Is section 66(2), this section makes it compulsory for the Enforcement Directorate to give the related information with other concerned authorities, to make sure that there is effective sharing of information which complies with the recommendations of the FATF. There is a suggestion that an inter-agency task force shall be instituted to tackle and prevent money-laundering and terror funding. The other recommendation is to include the section 447 of the Companies Act, 2013 in the list of the scheduled offences under the PMLA, as this will enable the Registrar of Companies to report cases to the Enforcement Directorate for launching a money-laundering probe.
