ED has the authority to take the property, conduct searches, and make arrests: SC
On July 27, 2022, the Supreme Court confirmed the legality of powers provided to the Enforcement Directorate (ED) under the Prevention of Money Laundering Act (PMLA), 2002.
The highest court maintained the ED’s rights under the PMLA to arrest, attach property, search and seize, call persons for interrogation, and conduct operations without prior authorisation from a court, stating that the statute is not arbitrary.
The Supreme Court maintained the constitutionality of numerous PLLA clauses in its 545-page decision. The ED is the executive entity in charge of enforcing the PMLA.
The Supreme Court’s decision on a batch of over 200 petitions submitted by many people facing PMLA procedures is sure to upset both political parties and companies that expected the top court to curb the ED’s powers, which have frequently been criticised for being “unbridled” and “arbitrary.” Congress MP Karti Chidambaram and former J&K CM Mehbooba Mufti, former Ranbaxy vice-chairman Shivinder Mohan Singh, Zoom Developer’s promoter Vijay M Choudhary, Delhi businessman Gagan Dhawan, former Bhushan Steel promoter and MD Neeraj Singal, and alleged hawala operator Farooq Mohammed Hanif Sheikh were among the petitioners.
“Money laundering is one of the horrible crimes that not only undermines the economical and social fabric of the nation, but also promotes additional heinous crimes, including such terrorism, NDPS Act violations, and so on.” It is well known that the worldwide crime syndicate that supports domestic extremist organizations depends on the passage of undeclared money across national borders… “It is essential for the State to enact such a tough rule that not only punishes the perpetrator proportionally but also aids in preventing the offence and establishing a deterrent impact,” the Supreme Court stated in its judgement.
The ED has attached properties owned by various errant real estate developers, including Unitech, Supertech, Patliputra Builders, and others, under the PMLA in recent years.
“The provisions in the 2002 Act are not only to investigate money-laundering offences but also to prevent money-laundering and to allow for the seizure of property relating to money laundering and things associated with and incidental thereto,” the Supreme Court noted.
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