New Delhi: The central government and Enforcement Directorate (ED) Wednesday opposed a set of petitions that seek to reconsider the top court’s July 2022 judgment that upheld the stringent provisions of the Prevention of Money Laundering Act (PMLA) — a law giving the agency sweeping investigative powers.
Solicitor General Tushar Mehta and Additional Solicitor General (ASG) S.V. Raju, who represented the central government and the investigation agency, questioned the maintainability of these petitions listed before a three-judge bench led by Justice Sanjay Kishan Kaul, labelling them an “abuse of the process of law” and urging the Supreme Court to be “alert” and “alarmed”.
The court was hearing petitions seeking reconsideration of its 27 July, 2022, three-judge bench judgment on certain parameters.
In its ruling in Vijay Madanlal Choudhary versus Union of India on 27 July, 2022, the Supreme Court upheld the ED’s powers of arrest, search, seizure, and attachment of property under the PMLA. Vijay Madanlal Choudhary, director of Zoom Developers Pvt Ltd, was arrested in 2017 on charges of money laundering and bank fraud.
The arguments that Mehta and Raju made to oppose the petitions were two-fold.
First, they said that the bench was incapacitated from hearing the petitions since the 2022 judgment was also delivered by a three-judge bench. In this context, they also argued that the bench could not have taken note of them since review petitions against the July 2022 ruling are still pending before another bench and that notices on these were issued in August 2022 by a bench led by then Chief Justice of India, N.V. Ramana.
The second premise on which the law officers vehemently argued against the petitions is that they question the correctness of the SC’s July 2022 ruling, which they argued cannot be done through the filing of a fresh writ petition like in the present case.
“Can this bench sit in appeal over another coordinate bench? Can a person tomorrow bring a petition that he does not agree with the five-judge bench judgment in the same-sex marriage case and can it be referred?” Mehta asked the bench, also comprising justices Sanjiv Khanna and Bela Trivedi.
On its part, the bench did not concur with the government law officers’ stand that an earlier judgment cannot be revisited.
The bench is hearing petitions on the use of PMLA that have been bunched together for a consolidated hearing. Although most of these were filed before the Vijay Madanlal Choudhary judgment was pronounced, the court kept them in abeyance in view of the three-judge bench looking into the questions raised over the constitutional validity of the PMLA.
Four of these petitions were filed by senior officers from Chhattisgarh who are currently facing ED probes in coal and liquor scams. While hearing a petition on an alleged Rs 2,000-crore liquor scam this May, a division bench led by Justice Kaul came down heavily on ED for creating “an atmosphere of fear”.
“Even a bona fide cause becomes suspect when you behave like this,” the bench had said after the state government accused the agency of “running amok”, “threatening excise officers” and “trying to implicate the chief minister” in the scam.
It later restrained the federal agency from taking coercive action in the alleged scam case while referring these petitions to a bench of three judges.
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‘Alert, not alarmed’
In his arguments before the court, Solicitor General Tushar Mehta said the 2022 judgment in Vijay Madanlal Choudhary’s case was rendered after a lot of deliberations. “I am (talking about) the abuse of the process of law. The averment (in the petition) is that the petitioner is an enlightened citizen and he feels that Section 50 (of PMLA) was wrongly interpreted. Is that grounds to reconsider a coordinate bench’s judgment? The review is yet to be heard,” Mehta told the court.
Section 50 of the act gives powers to the ED to issue summons to people for the purpose of recording their statements. The statement so recorded is admissible as evidence.
However, the bench did not agree with these views.
“The court will show circumspection in deciding whether to look into it. But there cannot be a bar. Is it written in stone that a bench cannot look into another judgment?” Justice Kaul asked, adding further that while the bench can, after hearing parties, await the outcome of the review petition, it doesn’t bar a court from revisiting an earlier decision.
Justice Kaul also admonished Mehta and Raju for urging the court to be “alert” and “alarmed”.
“I am alert, not alarmed. And this is not the language for the court,” he told the law officers, as the bench set out the contours of how it intends to proceed with the matter.
The court will continue hearing the petitions on 24 November.
(Edited by Uttara Ramaswamy)
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