2017 (3) TMI 1642 - SC - Money Laundering

Statutory bail seeked - offence under PMLA - whether the provisions of Section 167(2) Cr.P.C. are not applicable to cases arising out of PMLA Act - Held that - We do not agree with the opinion of the High Court that the provisions of Section 167(2) Cr.P.C. would not be applicable to the proceedings under PMLA Act. In the present case as no complaint was filed even after the expiry of 60 days from the date when the appellant was taken into custody he was entitled to statutory bail in view of the provisions contained in Section 167(2) Cr.P.C. This appeal is accordingly allowed and as a result thereof the appellant shall be given the benefit of statutory bail and be released forthwith subject to the conditions that may be imposed by the Trial Court.

Summary

ISSUES PRESENTED and CONSIDERED

The core legal issue considered in this judgment is whether the provisions of Section 167(2) of the Code of Criminal Procedure (Cr.P.C.) apply to cases arising under the Prevention of Money Laundering Act, 2002 (PMLA Act). Specifically, the question is whether an accused is entitled to statutory bail under Section 167(2) Cr.P.C. when no complaint is filed within the prescribed period of 60 days of judicial custody.

ISSUE-WISE DETAILED ANALYSIS

Relevant Legal Framework and Precedents

Section 167(2) of the Cr.P.C. provides for statutory bail if the investigation is not completed within a specified period, and no charge sheet is filed. The PMLA Act, which governs money laundering offenses, incorporates certain provisions of the Cr.P.C. through Sections 44 to 46 and Section 65, which explicitly states that the provisions of the Cr.P.C. apply unless inconsistent with the PMLA Act.

The Court referenced the judgment in 'Directorate of Enforcement v. Deepak Mahajan and Another', which held that Section 167(2) Cr.P.C. applies to the detention of persons arrested under special statutes like the Foreign Exchange Regulation Act (FERA) and the Customs Act.

Court's Interpretation and Reasoning

The Court disagreed with the Trial Court and High Court's view that Section 167(2) Cr.P.C. is not applicable to cases under the PMLA Act. The Court emphasized that the PMLA Act does not exclude the application of Cr.P.C. provisions; rather, it incorporates them. Section 65 of the PMLA Act reinforces this by stating that Cr.P.C. provisions apply unless inconsistent with the PMLA Act.

Key Evidence and Findings

The appellant was arrested under the PMLA Act, and no complaint was filed within 60 days of custody. The Trial Court and High Court dismissed the appellant's application for statutory bail, holding that Section 167(2) Cr.P.C. does not apply to PMLA cases. However, the Supreme Court found no provision in the PMLA Act barring the application of Section 167(2) Cr.P.C.

Application of Law to Facts

The Court applied Section 167(2) Cr.P.C. to the facts of the case, noting that since no complaint was filed within the 60-day period, the appellant was entitled to statutory bail. The Court concluded that the High Court's endorsement of the Trial Court's view was incorrect.

Treatment of Competing Arguments

The respondent's counsel did not dispute the applicability of Section 167(2) Cr.P.C. to PMLA cases. The Court noted this lack of dispute and emphasized the incorporation of Cr.P.C. provisions in the PMLA Act, which supports the appellant's entitlement to statutory bail.

Conclusions

The Court concluded that the appellant is entitled to statutory bail under Section 167(2) Cr.P.C. due to the failure to file a complaint within 60 days of custody. The appeal was allowed, and the appellant was to be released on statutory bail, subject to conditions imposed by the Trial Court.

SIGNIFICANT HOLDINGS

The Court held that the provisions of Section 167(2) Cr.P.C. are applicable to cases under the PMLA Act. This establishes the principle that statutory bail is available in PMLA cases when no complaint is filed within the prescribed period.

Core Principles Established

The judgment reinforces the applicability of Cr.P.C. provisions to special statutes like the PMLA Act, unless expressly excluded. It affirms the right to statutory bail under Section 167(2) Cr.P.C. in such cases.

Final Determinations on Each Issue

The Court determined that the appellant is entitled to statutory bail under Section 167(2) Cr.P.C. due to the non-filing of a complaint within 60 days. The appeal was allowed, and the appellant was to be released forthwith, subject to trial court conditions. The related writ petition and special leave petition were dismissed as withdrawn.