Day 2 Hearing – Interim Relief

Challenges to the Prevention of Money Laundering Act

On October 25th 2021, a two-judge Bench comprising Justices Khanwilkar and Ravikumar heard two intervention applications among a group of petitions challenging several provisions of the Prevention of Money Laundering Act, 2002 (PMLA).

 

The petitioners challenging PMLA argue that the Enforcement Directorate (ED) under the PMLA exercises police powers without being bound by the rules of criminal procedure. While the Court continues to hear these arguments, Karti Chidambaram (Congress MP) and Sushil Kumar Katiyar (Labour and Construction Cooperative Federation chairman) sought interim relief from ongoing investigations against them.

 

Today, the Court granted Senior Advocate Kapil Sibal’s request for leave to travel abroad on behalf of Mr. Chidambaram, despite objections from Solicitor General Tushar Mehta. SG Mehta did not object to Mr. Sibal’s plea for protection for Mr. Katiyar because the chargesheet against him in the predicate offence had been set aside by the Supreme Court.

Mr. Chidamabaram is facing investigations from the Enforcement Directorate for his alleged involvement in money laundering activities in the INX Media case. His bail conditions require him to seek permission from the Supreme Court to travel abroad while the investigation is pending.

SG Mehta argued that Mr. Chidambaram’s request ought to be rejected since he had not been cooperating with the ED, or responding to summons adequately. Mr. Sibal stated that Mr. Chidamabram had not received any summons since January 2020. The Union had been made aware of his travel request three months ago. So, it was unfair to bring up non-compliance with summons on the day of his departure without producing the summons before the Court.

The Court noted that the issue of not responding to summons had been raised by the Union for the first time today, only when Mr. Chidambaram requested permission to travel abroad. The Court granted Mr. Chidambaram permission to travel, and stated that the question of responding to summons may be taken up after his return.

Mr. Sibal pointed out that the Court had granted Mr. Chidambaram permission to travel abroad without the payment of any deposit between 2017 to 2019. Then, in February 2020, a three-judge bench led by CJI Bobde ordered him to deposit Rs. 10 Crores to travel to the UK for a tennis tournament. In 2021, Bhushan J reduced this amount to Rs. 2 Crores while granting him leave to travel abroad. Mr. Sibal asked the Court to reconsider the deposit amount. The bench fixed the deposit amount at Rs. 1 Crore.

SG Mehta’s complaint of non-compliance in investigation will be heard on November 22nd 2021. The main challenges to the provisions of PMLA will continue to be heard tomorrow, November 26th 2021.