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ED Faces SC Ire For Keeping Accused In Custody Without Trial In Money Laundering Cases

A bench of Justices Sanjiv Khanna and Dipankar Datta took exception to the ED filing four supplementary chargesheets, the latest on March 1, 2024, in a money laundering case arising from alleged illegal mining in Jharkhand.

Supreme Court
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Keeping an accused in custody without trial is akin to detention which hampers liberty, the Supreme Court said on Wednesday while deprecating the Enforcement Directorate's (ED) practice of filing supplementary chargesheets in money laundering cases to defeat the accused's right of getting default bail.

A bench of Justices Sanjiv Khanna and Dipankar Datta took exception to the ED filing four supplementary chargesheets, the latest on March 1, 2024, in a money laundering case arising from alleged illegal mining in Jharkhand.

The top court was hearing the default bail plea of Prem Prakash, an alleged associate of former Jharkhand chief minister Hemant Soren. Prakash was arrested in August, 2022 after raids during which two AK-47 rifles, 60 live rounds and two magazines were claimed to have been found at his home in Ranchi. He was booked for the offences of money laundering and under the Arms Act.

The bench told Additional Solicitor General SV Raju, appearing for the ED, about the investigation in the case still continuing despite four supplementary chargesheets having been filed.

"We are putting you (ED) on notice. (Under the law) You cannot arrest a person without the investigation in the case being complete. A person cannot be put in custody without the commencement of trial. It is akin to detention and affects the liberty of an individual. In some cases, we have to settle this issue," the bench told Raju.

Justice Khanna said an accused cannot be denied the benefit of default bail by filing supplementary chargesheets. 

"The whole object of default bail is that you do not arrest until investigation is complete. You cannot say that a trial will not commence unless the investigation in the case is complete. You cannot keep on filing supplementary chargesheets and keep the person in jail without trial," he said.

Justice Khanna said the petitioner has been behind bars for 18 months and supplementary chargesheets are being filed one after the other, which is eventually delaying the trial. 

"This is what is bothering us. Trial has to begin when you arrest an accused. You cannot deny the benefit of default bail for delayed commencement of trial. Default bail is a right of the accused and it cannot be denied by filing supplementary chargesheet," Justice Khanna said.

He said even section 45 of PMLA does not bar the grant of bail on grounds of long incarceration.  

"We have held this in the Manish Sisodia case (Delhi excise policy scam case), if there is long incarceration and undue delay in commencement of trial, the court can grant bail. Section 45 does not bar grant of bail because this right flows from Article 21 (protection of life and personal liberty) of the Constitution," Justice Khanna said.

The bench posed various questions to Raju, who sought a month's time to respond to the queries, saying the accused is an influential person, and if released on bail, he may influence the witnesses and tamper with the evidence.

The top court asked Raju to respond to all questions put forth by the bench within a month and posted the matter for further hearing on April 29. 

Advocate Siddharth Agarwal, appearing for Prakash, said when the initial FIR was lodged, his client's name was not there and no transaction had been found between him and the co-accused.

He said the statements of two crucial witnesses do not directly implicate him.

The top court directed the special PMLA court, where Prakash is being tried, to expedite the hearing.

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