Justice Girish Kathpalia highlights issues with evidence and prolonged incarceration without trial under PMLA provisions.
In a significant development, the Delhi High Court, under the adjudication of Justice Girish Kathpalia, has granted bail to Pravez Khan and other accused involved in a high-profile Prevention of Money Laundering Act (PMLA) case. The case concerns allegations of manufacturing and selling spurious cancer drugs, which purportedly generated proceeds of crime.
The accused, including Pravez Khan, were arrested following raids by the Directorate of Enforcement (ED) in connection with the predicate offence of dealing with spurious cancer drugs. The allegations indicated that the accused were part of a syndicate involved in the preparation and sale of these drugs, leading to financial transactions deemed as proceeds of crime under PMLA.
The judgment comes after an exhaustive analysis of the evidentiary issues and procedural lapses in the prosecution's case. Justice Kathpalia emphasized the inadmissibility of self-incriminating statements made under Section 50 PMLA while the accused were in custody. He noted that such statements lack voluntariness and are hit by Section 25 of the Indian Evidence Act, rendering them unsafe for use as evidence.
The court further scrutinized the foundational facts required to establish the connection between the alleged proceeds of crime and the predicate offence, as mandated by Sections 23 and 24 PMLA. Justice Kathpalia observed that the prosecution had failed to establish these foundational facts convincingly, as there was a lack of credible evidence linking the accused to the alleged spurious drugs or proceeds of crime.
Moreover, the judgment highlighted the selective arrest policy adopted by the ED, pointing out the fairness concerns when individuals with similar or graver allegations were not arrested. This aspect was deemed significant in light of the prolonged detention faced by the accused, some of whom have been in custody for over two years without trial commencement.
Justice Kathpalia also addressed the issue of prolonged pretrial detention, citing Article 21 of the Constitution of India, which guarantees the right to life and liberty. The court held that prolonged incarceration without trial amounts to punitive detention, which cannot be justified under the guise of statutory restrictions for economic offences under PMLA.
Consequently, the court directed the release of the accused on bail, subject to personal bonds and surety. The judgment underscores the necessity for a fair trial and proper evidentiary support in cases involving serious allegations under PMLA, reinforcing the principle that the right to liberty should not be overshadowed by procedural lapses and inadequate prosecution.
Bottom line:-
In cases under the Prevention of Money Laundering Act (PMLA), statements recorded under Section 50 of PMLA while an accused is in custody are inadmissible as evidence if they are self-incriminating, as such statements lack voluntariness.
Statutory provision(s): Prevention of Money Laundering Act, 2002 - Sections 3, 4, 45, 50; Indian Evidence Act - Section 25; Constitution of India - Article 21
Pravez Khan v. Directorate of Enforcement, (Delhi) : Law Finder Doc id # 2892845
