The Court also questioned the agency on the time gap between initiation of proceedings and the action of arrest of the Delhi CM.
The Supreme Court on Tuesday questioned the Enforcement Directorate (ED) on the timing of the arrest of Delhi Chief Minister Arvind Kejriwal ahead of the 2024 Lok Sabha elections.
A Bench of Justices Sanjiv Khanna and Dipankar Datta posed the following questions to the ED, to be answered on the next date of hearing on Friday:
1. Without there being adjudicatory proceeding, can you have criminal proceedings initiated in terms of what has been held in Pankaj Bansal v Union of India and Vijay Madanlal v. Union of India…there are no proceedings of attachment in this case so far, and if there are, then show how the petitioner is involved.
2. As far as the Manish Sisodia case is concerned, there are findings in favour and against…tell us where does the Kejriwal case lie then?
3. They think threshold of Section 19 of Prevention of Money Laundering Act (PMLA), which casts onus on prosecution and not on accused is fairly high and thus asking for regular bail does not happen as they are confronted with Section 45 and onus shifts on them. So how do we interpret it? Do we make the threshold much higher and ensure that standard is same to find the person who is guilty?
4. Then the time gap between initiation of proceedings and then the action of arrest etc…if you see Section 8, there is a limit of 365 days..though we are in bail matter…See other option is to not arrest…life and liberty is important.
5. Then the timing of arrest which is just before the general elections.
In Vijay Madanlal, the Court had upheld the provisions of the PMLA. However, that judgment is under review. Section 19 of the PMLA gives ED officers the power to arrest persons if there is “reason to believe” that an offence has been committed. Section 45 contains the grounds for granting bail in PMLA offences.
In Pankaj Bansal, the Court held that the Enforcement Directorate (ED) must supply in writing the grounds of arrest to persons accused under the Prevention of Money Laundering Act (PMLA).
The Court was told on Tuesday that there was no proof of Kejriwal’s direct involvement in the Delhi Excise Policy case being probed by the ED.
“No trace of proceeds of crime and lack of proof of direct involvement…Possession of even unaccounted property acquired by legal means will not constitute proceeds of crime,” Senior Advocate Abhishek Manu Singhvi, appearing for Kejriwal, said.
Singhvi drew the Court’s attention to the statements of Magunta Reddy, on the basis of which the Delhi CM was arrested.
“Please see the chart…the questions to Mr Magunta Reddy…it was asked when did he meet Kejriwal…it was stated he met for 5-6 minutes to discuss charity work and not the policy in question.”
He added that Magunta Reddy gave the statement five months after his son Raghav Reddy was arrested, and once the former turned approver, ED did not object to the latter getting bail.
“On September 16, no allegation against Arvind Kejriwal. Raghav says he does not know and then after 5 months he is arrested and then he makes the 4 statements…this happens after arrest and he gives the incriminating statement against kejriwal….he made 8 statements in total. No allegation (against Kejriwal) in six statements…then last two has allegations…this is a new technique of statement after arrest…then raghav gets absolute bail.”
He also pointed out how Raghav Reddy joined the Telugu Desam Party, an ally of the BJP, after he was released.
After going through the statements of another approver, Sarath Reddy, Singhvi argued,
“This is creating higher threshold of Section 45 (which provides for bail conditions under PMLA) and reading it into the predicate offence.”
The Court then told Additional Solicitor General SV Raju appearing for the ED,
“Yes, Mr Raju, we will ask you this. This was not arising in Sanjay Singh case, but here we will ask you.”
Singhvi then pointed out that AAP communications in-charge Vijay Nair was arrested in connection with the Delhi Excise Policy case in November 2022, and questioned why Kejriwal was arrested only in March 2024.
Concluding his arguments, Singhvi said that Section 50 of the PMLA, which gives the power to ED officers in respect of summons, documents and evidence, does not apply to this case. Justice Khanna observed,
“There is a discussion on “reasons to believe” in Vijay Madanlal…contours of Section 19 PMLA is discussed.”
The judge went on to pose the question,
“What I am saying is that there has to be attachment, then offence, and result of prosecution resulting in final consequence…and if you read this (para 324 of Vijay Madanlal judgment) then it appears that this was the scheme and there were direct observations regarding Section 19 PMLA…”
Towards the end of the hearing, Justice Khanna remarked,
“Initially the thought did come whether I should hear this case because I had decided the Manish Sisodia matter. But then it would be said that I am not taking difficult cases or something…”
Kejriwal had challenged his arrest and remand before the Supreme Court after the Delhi High Court dismissed his plea in the matter.
The ED’s money laundering probe against Kejriwal stems from a case registered by the CBI on August 17, 2022 in connection with alleged irregularities in the Delhi Excise Policy for 2021-22.
The CBI case was registered on a complaint made by Delhi Lieutenant Governor VK Saxena on July 20, 2022.
It has been alleged that a criminal conspiracy was hatched by AAP leaders, including Kejriwal, former Deputy Chief Minister Manish Sisodia and others.