Satyendar Jain’s Bail Application in PMLA case: Supreme Court Reserves Judgment
Satyendar Jain’s Bail Application in PMLA case: Supreme Court Reserves Judgment
Why is it exceedingly difficult to get regular bail in PMLA cases? Our analysis.
Reporting the gist of Court proceedings…
In a significant development, the Supreme Court of India today (January 17) concluded the hearing on the bail plea of Aam Aadmi Party (AAP) leader Satyendar Jain in a money laundering case. Jain, who had been arrested by the Enforcement Directorate (ED) in May 2022, was subsequently granted interim bail on medical grounds. The case was heard by a bench comprising Justice Bela Trivedi and Justice Pankaj Mithal.
The hearing witnessed intensive arguments from both sides. The Additional Solicitor General (ASG) SV Raju, representing the prosecution, emphasized that the concurrent findings of fact in the trial court and the Delhi High Court, leading to the dismissal of Jain’s bail pleas, should not be interfered with by the Apex Court.
On the other hand, the petitioner, Satyendar Jain, who is currently out on interim bail on medical grounds, was represented by a legal team led by Senior Advocate Dr. AM Singhvi and Senior Advocate N. Hariharan. They tried to convince the Court that there were prima facie no “proceeds of crime”, whether actual, notional or constructive, in the hands of the petitioner Satyendar Jain, linked to the predicate offences in the CBI chargeseheet, a case in which Jain has already been granted regular bail.
The Supreme Court also announced that it would hear the Special Leave Petitions (SLPs) of Ankush Jain and Vaibhav Jain, the other two co-accused, on January 24, 2024, and subsequently, the decision on all these matters would be pronounced together.
Provisions of law on bail…
The objective of this piece is not to provide a detailed summary of the proceedings, which interested readers can follow through reputable law portals. Instead, we aim to shed light on the stringent provisions of the Prevention of Money Laundering Act, 2002 (PMLA) that make it challenging to obtain regular bail during the pendency of the investigation or trial.
Bail provisions under PMLA and CrPC (Code of Criminal Procedure):
Bail under the CrPC, which deals with ordinary criminal cases, is relatively straightforward. In most cases, an accused person is entitled to bail unless there are compelling reasons to believe they may abscond, tamper with evidence or intimidate the witnesses. Bail can be granted by the police during the investigation or by the court, depending on the stage of the case.
However, bail provisions under PMLA, a specialized law addressing money laundering offenses, are notably different. Under Section 45 of the PMLA, there exists a presumption against bail. It states that no person accused of an offense under PMLA shall be released on bail or on their own bond unless the public prosecutor provides an opportunity for a hearing. The court must be satisfied that there are reasonable grounds to believe that the accused is not guilty and is not likely to commit an offense while on bail.
Onerous twin conditions to be satisfied…
The crux of the matter lies in the twin conditions set forth by Section 45 of the PMLA:
There must be reasonable grounds to believe that the accused is not guilty.
The accused is not likely to commit an offense while on bail.
Constitutional validity… In Vijay Madanlal Choudhary case…
The constitutional validity of these twin conditions at the bail stage in PMLA cases has been upheld by a 3-Judge constitutional bench of the Supreme Court of India, in the case of Vijay Madanlal Choudhary. While a plea to review this highly debated judgement is under consideration of the Apex Court, it remains the law of the land in the meanwhile.
Relevance to Sisodia and Sanjay Singh cases…
It is noteworthy that the Supreme Court had rejected the regular bail application of Manish Sisodia, another prominent AAP leader on October 30, 2023. The rejection came following an assurance from the prosecution that the trial would be completed within about six to eight months. Sisodia would be entitled to apply for bail afresh after three moths in case the pace of the trial was tardy, the Court ruled. Additionally, the bail application of AAP leader and Rajya Sabha MP, Sanjay Singh, is also currently under consideration by the Apex Court.
However, it's crucial to recognize that the outcome in the case of Satyendar Jain may not directly impact these two cases. Sisodia and Singh have been implicated in the Delhi Liquor Scam case, which involves distinct questions of law and fact. Therefore, the legal developments in these cases may follow a separate trajectory from that of Satyendar Jain's case.
Why Courts are unable to satisfy themselves about the twin conditions…
The Burden of Proof in PMLA Cases
One might wonder why bail applications are frequently denied in PMLA cases. The primary reason behind this lies in the fact that the burden of proof to establish the accused's innocence is placed squarely on their shoulders. The court must be satisfied that the accused is "prima facie NOT guilty," a level of satisfaction that is inherently challenging to reach and formally record. Now, when the matter is still under the inquiry or investigation of the Enforcement Directorate (ED), and the collection of evidence is an ongoing process, it becomes a formidable task for any reasonable court to arrive at the conclusion that "there are reasonable grounds to believe that the accused is not guilty."
Challenges When the Investigation Is Ongoing
On the other hand, where the investigation or inquiry of ED stands completed, a formal criminal complaint stands filed in the Trial Court (equivalent to the CBI chargesheet), and the Court takes cognizance of the same, how can any court considering a bail application reach the prima facie conclusion that "there are reasonable grounds to believe that the accused is not guilty"? This holds true regardless of whether the Special PMLA Court has framed charges or not. Any such decision would amount to overreaching or outreaching the trial court's verdict, which can only come at the conclusion of the entire trial, which may take years.
Difficulties When the ED's Investigation Is Complete
Similarly, it is virtually impossible for any Court to record satisfaction that the accused shall not commit an offense of money laundering while on bail. This reverse burden of proof has raised legal questions about whether this "procedure established by law" is fair, just, and reasonable within the framework of Fundamental Rights, especially Article 21 of the Constitution of India. But for now, these provisions are considered good law in view of the Vijay Madanlal Choudhary’s case.
Summing up… should such stringent conditions be permitted in a democratic polity?
In conclusion, while upholding the due process of law is essential, the stringency of bail conditions in PMLA cases has led to extended periods of incarceration for many accused individuals, who under the law are still presumed to be innocent. Whether such onerous conditions are suitable for the alleged PMLA offences in a mature democracy is a question that merits thoughtful consideration by every informed reader and citizen, as well as all stakeholders, given the low conviction rate under PMLA. Be that as it may, the precedents set in these cases will have far-reaching implications for similarly placed cases all across the country.
Let’s wait and see.
