In order granting bail to BRS’s Kavitha, SC lays down red line on PMLA bail exception for women

Delhi HC had on 1 July denied bail to Kavitha, noting that PMLA exception is not applicable as she is an ‘accomplished, well-educated woman’. But SC termed it ‘erroneously observation’.

File photo of BRS leader K. Kavitha | Commons

New Delhi: In granting bail to Bharat Rashtra Samithi (BRS) leader K. Kavitha in the Delhi excise policy case, the Supreme Court Tuesday cited an exception for women under the bail provision of the Prevention of Money Laundering Act (PMLA), 2002.

Under PMLA bail provisions, certain categories of accused, including women, can be granted bail in money laundering cases without adhering to the stringent conditions of bail under the law. 

The Delhi High Court had earlier on 1 July denied bail to Kavitha. Justice Swarana Kanta Sharma of the high court had noted that the exception is not applicable to her because Kavitha is an “accomplished and well-educated woman,” and that she doesn’t fall in the category of “vulnerable women” to whom the exception may apply. 

However, the bench, comprising Justices B.R. Gavai and K.V. Viswanathan, now opined that the high court “erroneously observed” that the exception is applicable only to a “vulnerable woman”.

The court also referred to the Supreme Court verdict granting bail to Manish Sisodia.

In that judgment, the same bench, comprising Justices Gavai and Viswanathan, emphasised speedy trial as a fundamental right under Article 21 (right to life and personal liberty) of the Constitution, and opined that “on account of a long period of incarceration running for around 17 months and the trial even not having been commenced, the appellant has been deprived of his right to speedy trial”.

Referring to such observations in Sisodia’s case, the court noted that Kavitha had been behind bars for the last five months. Reiterating its observations in Sisodia’s case, it asserted that the likelihood of Kavitha’s trial being concluded in the near future is impossible, since there are 493 witnesses and about 50,000 pages of documents to be considered. 

The court, therefore, granted her bail in the Central Bureau of Investigation (CBI) and Enforcement Directorate (ED) cases against her, setting aside the Delhi High Court’s 1 July order that had denied her bail. 

What does the exception say and why did the Supreme Court set aside the Delhi high court verdict? ThePrint explains. 

What Section 45 of PMLA says

Section 45 of the PMLA lays down two strict conditions of bail under PMLA. These conditions make getting bail under the money laundering law extremely difficult.

It says that bail can be granted to an accused in a money laundering case only if two conditions are satisfied—there should be prima facie satisfaction that the accused has not committed the offence and that the accused is not likely to commit any offence while on bail. This reserves the burden on the accused to demonstrate innocence.

However, a proviso of Section 45 permits certain categories of accused, including women, to be released on bail, without the twin requirement under Section 45 of the PMLA to be satisfied. It grants this exception to “a person, who is under the age of sixteen years or is a woman or is sick or infirm or is accused either on his own or along with other co-accused of money-laundering a sum of less than one crore rupees”.

Opposing her bail application, Additional Solicitor General S.V. Raju submitted that the statements of various witnesses and Delhi CM Arvind Kejriwal, a co-accused, show that Kavitha acted as a ‘kingpin’ in arranging the deal between the AAP chief and the so-called ‘South Lobby’.

He had objected to this exception being granted to her, alleging that she indulged in evidence tampering and witness influencing. He also alleged that Kavitha formatted her mobile to destroy the evidence against her. 

‘Not a vulnerable woman’

In its 1 July judgment, the Delhi High Court had refused to apply the exception for women under PMLA to Kavitha.

It had relied on an October 2023 Supreme Court verdict, which had said: “No doubt the courts need to be more sensitive and sympathetic towards the category of persons included in the first proviso to Section 45 and similar provisions in the other Acts, as the persons of tender age and women who are likely to be more vulnerable, may sometimes be misused by the unscrupulous elements and made scapegoats for committing such Crimes, nonetheless, the courts also should not be oblivious to the fact that nowadays the educated and well placed women in the society engage themselves in the commercial ventures and enterprises, and advertently or inadvertently engage themselves in the illegal activities.”

The verdict added: “In essence, the courts should exercise the discretion judiciously using their prudence, while granting the benefit of the first proviso to Section 45 PMLA to the category of persons mentioned therein.”

The high court interpreted these observations to mean that the Supreme Court has ruled that though courts should be sensitive and sympathetic to vulnerable groups such as women, it must also recognise that educated and well-placed women may engage themselves in illegal activities.

It then opined that Kavitha is not entitled to the benefit of the exception, since she “cannot be equated to a vulnerable woman who may have been misused to commit an offence, which is the class of women for whom the proviso to Section 45 of PMLA has been incorporated”. 

‘Misapplied SC verdict’

However, the Supreme Court now set aside the high court’s decision to deny the application of the exception for women in Section 45 to Kavitha’s case.

The court accepted that the accused, even if she is a woman, would not automatically be entitled to the benefit under the proviso, and that it would depend on the facts and circumstances of each case.

However, it asserted that when a law provides special treatment for a certain category of accused, courts have to give specific reasons for denying the benefit. 

The court further pointed out that the prosecution often argues that no accused should be given special treatment, merely because he or she is an MP or an MLA. However, in this case, the Delhi High Court had denied the benefit to Kavitha after concluding that she is highly qualified and a well-accomplished person. 

The Supreme Court now felt that the high court judge had “misapplied” the 2023 judgment of the apex court.

It also said that the 2023 verdict “does not say that merely because a woman is highly educated or sophisticated or a Member of Parliament or a Member of Legislative Assembly, she is not entitled to the benefit of the proviso to Section 45(1) of the PMLA”.

(Edited by Radifah Kabir)