PANKAJ BANSAL versus UNION OF INDIA & ORS.

Citation: [2023] 12 S.C.R. 714 · Decided: 03-10-2023 · Supreme Court of India · Bench: A.S. BOPANNA · Disposal: Appeal(s) allowed
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Judgment (excerpt)

[2023] 12 S.C.R. 714 : 2023 INSC 866
714
CASE DETAILS
PANKAJ BANSAL
v.
UNION OF INDIA & ORS.
(Criminal Appeal Nos. 3051-3052 of 2023)
OCTOBER 03, 2023
[A. S. BOPANNA AND SANJAY KUMAR, JJ.]
HEADNOTES
Issue for consideration: Whether the arrest of the appellants u/s. 19 
of the Prevention of Money Laundering Act, 2002 was valid; whether there 
was proper compliance with s.19(1) of the Act of 2002 and as to whether the 
Vacation Judge/Additional Sessions Judge correctly considered that issue 
while passing the remand orders; what is the importance of informing the 
arrested person of the grounds for his/her arrest.
Prevention of Money Laundering Act, 2002 – Compliance of s.19 
of the Act – Proper or not:
Held: The remand order dated 15.06.2023 passed by the Vacation 
Judge/Additional Sessions Judge reflects total failure on his part in 
discharging his duty as per the expected standard – The Judge did not even 
record a ﬁ nding that he perused the grounds of arrest to ascertain whether 
the ED had recorded reasons to believe that the appellants were guilty of an 
oﬀ ence under the Act of 2002 and that there was proper compliance with the 
mandate of s.19 of the Act of 2002 – He merely stated that, keeping in view 
the seriousness of the oﬀ ences and the stage of the investigation, he was 
convinced that custodial interrogation of the accused persons was required 
in the present case and remanded them to the custody of the ED – Analyzing 
the arrest of the appellants, neither of the appellants was shown as accused 
in the ﬁ rst ECIR registered by the ED – Both the appellants secured interim 
protection by way of anticipatory bail from the High Court – However, 
both the appellants were summoned on 14.06.2023 for interrogation in 
connection with the ﬁ rst ECIR and summons were served on 13.06.2023 – 
Signiﬁ cantly, second ECIR was recorded on 13.06.2023 in connection with 
715
FIR No.0006 which was registered on 17.04.2023 – Therein also, neither 
of the appellants were shown as accused and only one ‘RB’ was shown 
as accused – Both appellants had presented themselves at the ED’s oﬃ  ce 
– Thereafter, both appellants were arrested in connection with the second 
ECIR, were in exercise of power u/s. 19(1) of the Act of 2002 – It was alleged 
that both appellants failed to respond to the questions put by ED – Mere 
non-cooperation of a witness in response to the summons issued u/s. 50 of 
the Act of 2002 would not be enough to render him/her liable to be arrested 
u/s. 19 – In any event, it is not open to the ED to expect an admission of 
guilt from the person summoned for interrogation and assert that anything 
short of such admission would be an ‘evasive reply’ – Also, it is the admitted 
position is that the ED’s Investigating Oﬃ  cer merely read out or permitted 
reading of the grounds of arrest of the appellants and left it at that, which 
is also disputed by the appellants – As this form of communication is not 
found to be adequate to fulﬁ l compliance with the mandate of Art. 22(1) of 
the Constitution and s.19(1) of the Act of 2002 – Thus, there is no hesitation 
in holding that their arrest was not in keeping with the provisions of s.19(1) 
of the Act of 2002. [Paras 18, 19, 25, 35]
Constitution of India – Art. 22 – Prevention of Money Laundering 
Act, 2002 – Informing the arrested person of the grounds for his/her 
arrest – Importance of:
Held: Article 22(1) of the Constitution provides, inter alia, that no 
person who is arrested shall be detained in custody without being informed, 
as soon as may be, of the grounds for such arrest – It may be noted that 
s.45 of the Act of 2002 enables the person arrested u/s. 19 thereof to seek 
release on bail but it postulates that unless the twin conditions prescribed 
thereunder are satisﬁ ed, such a person would not be entitled to grant of bail 
– The twin conditions set out in the provision are that, ﬁ rstly, the Court must 
be satisﬁ ed, after giving an opportunity to the public prosecutor to oppose 
the application for release, that there are reasonable grounds to believe that 
the arrested person is not guilty of the oﬀ ence and, secondly, that he is not 
likely to commit any oﬀ ence while on bail – To meet this requirement, it 
would be essential for the arrested person to be aware of the grounds on 
which the authorized oﬃ  cer arrested him/her u/s.19 and the basis for the 
oﬃ  cer’s ‘reason to believe’ that he/she is guilty of an oﬀ ence punishable 
PANKAJ BANSAL v
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