"You Can’t Act Like A Crook": Supreme Court Tells ED While Hearing Review Petition Against 2022 PMLA Verdict

While hearing the matter, the Bench comprising Justice Surya Kant, Justice Ujjal Bhuyan, and Justice N. Kotiswar Singh expressed serious concerns over the Enforcement Directorate’s investigative practices, particularly the lack of transparency surrounding ECIRs and arrests, and remarked, "You can't act like a crook, you have to act within four corners of law. I observed in one court proceedings, you have registered about 5000 ECIRs. Conviction is less than 10… That's why we insist improve your investigation...we are talking about liberty of people. We are concerned about ED's image also…"

At the outset, Justice Kant referred to a pending interlocutory application filed by Karti P. Chidambaram, seeking a refund of 1 crore deposited as security when he was permitted to travel abroad. Passing orders, the Court noted that permission to travel had been granted with the consent of the Union Government, subject to a deposit of 1 crore. The Court recalled that in 2021, a detailed order had required deposit of 2 crores, later the same was reduced to 1 crore. The petitioner had complied with that condition.

The Court recorded that he travelled abroad in November 2022 and had since deposited his passport with the Investigating Officer. The Court directed, "Miscellaneous application is allowed and amount of Rs.1 crore deposited by him along with interest accrued thereupon is directed to be released in 1 week."

ASG Raju then sought to begin his preliminary objections on maintainability. He referred to the August 2022 order where notice was issued on the review petitions and stated, "There are a number of issues which on the face of them can't be reviewed." Justice Kant asked, "But the bench did not segregate which issues?" ASG responded, "Therefore, we filed an affidavit the next day listing out the issues, supply of copy of ECIR, and Section 24 PMLA."

He argued that the Court had limited the review to only two issues, and that was evident from the affidavit filed immediately after notice. He said, "Otherwise, the Court would not have said '2 issues' in its order." He proceeded to read from the counter-affidavit filed.

ASG Raju referred to various precedents, including the Senthil Balaji case, and pointed out that the judgment had recorded only two issues being raised. He added, "They sought expungement of remarks made in the judgment, but not of the para where Court noted about two issues."

Justice Kant expressed displeasure with delayed filings and said, "Who is the counsel who filed this? This is as bad as forum shopping, bench hunting. Filed after two years! We will dismiss on this ground only."

ASG then submitted that the first issue in the petition pertained to the classification of the PMLA as a Money Bill, and stated that the VMC judgment had not gone into this question. Justice Kant observed, "You are primarily on maintainability. Whether 1 question or 5 questions, that's not of serious consequence." ASG added, "Error apparent on face of record is the parameter. If I can show… there's a reason why Bench limited notice to 2 issues."

He explained that the Money Bill issue was pending before a seven-judge Bench, and the Vijay Madanlal Choudhary judgment had not dealt with it for that reason. "Yet they have challenged. How's review required when Court did not go into the issue?" he asked.

Continuing, he submitted, "They're wrong on conduct also. They took a chance and failed. Constitutional validity is always in my favor." He cited the Constitution Bench judgment in Roger Mathew and referred to the VMC ruling and the contents of the review petitions.

He asked rhetorically, "Can this be a ground for review?" and said that Roger Mathew adopted the same procedure as Vijay Madanlal Choudhary, so on the same logic, review should await Money Bill decision, and there's no error apparent on record warranting review.

Justice Kant queried, "Is it your argument that the 2 issues which were not identified in the 2022 order, but in your affidavit, you formulated the issues, which have been taken notice in Balaji, on those 2 issues also review can't be heard?" ASG responded, "With respect to these 2 issues, their case does not fall within parameters of review. They must demonstrate error apparent on face of record. Firstly, see their conduct."

He added, "They did not object to Balaji judgment where it was noted that challenge is to two issues." Justice N. Kotiswar Singh asked, "Will 2-judge Balaji judgment bind us?" ASG said, "I am on their conduct, factual position admitted by them. I am not on law." Justice Bhuyan asked, "Where could they object? Judgment was delivered." ASG replied, "They could file clarification application, review, could have said expunge that para, but they sought expunction of other paragraphs."

Justice Singh asked, "If one view is weightier than the other… then?" ASG submitted, "That also can't be ground for review, otherwise there will be review petitions at the drop of a hat. There will be no finality. Error apparent has to be a glaring, patent error."

He stressed that, "Review can't be there for the asking. A strong case has to be made out. Review can't be to substitute a view. Error apparent means error which is discernible on mere looking at the record without detailed analysis."

He said the petitioners were essentially asking the Court to "rewrite the VMC judgment, which is not permissible." He argued, "Review can't be allowed to be an appeal in disguise. Many accused are asking HCs and this Court to keep cases pending, saying review on PMLA provisions is pending."

Justice Bhuyan posed a query regarding the absence of an FIR and the initiation of civil action. "How do you explain this…the fact that FIR in respect of scheduled offense has not been recorded does not come in the way of the authorities referred in S.48 to commence inquiry/investigation for initiating civil action?" ASG clarified, "For criminal action, there has to be predicate offence."

Justice Kant probed further, "Suppose only some complaint has been made, there's order of pre-emptory attachment. No FIR or ECIR. Do you supply copy of attachment order?" ASG said, "Yes."

Justice Kant remarked that someone could argue that even before criminal process is initiated, civil consequences follow, and asked if such procedure was outside the statutory scheme. He said, "It is not mandatory of filing a statutory complaint for arresting a person. Suppose you have arrested, complaint is yet to be filed. You'll disclose documents when you file complaint. Suppose someone wants to challenge arrest, seek bail, how will someone know what grounds have been taken against him?"

ASG said, "This court has passed judgments now. We have to give grounds and reasons of arrest, and at time of remand, all material is placed before the court."

He maintained that ECIR is merely an internal document. "I can investigate without ECIR. There's no compulsion to register." Justice Singh asked, "Grounds of arrest can contain more details than ECIR?" ASG said, "Yes. To have safeguard, we are not disclosing." Justice Kant added, "If the Court says you will communicate grounds of arrest as soon as you arrest… I said in one of my judgments that if investigation has been completed without arrest, then S.19(1) can't be invoked."

ASG emphasised that, "FIR is not necessary even for anticipatory bail. It's a statutory document. ECIR is not a statutory document, nothing turns on this. There's nothing like an ECIR. The idea behind wanting ECIR is to find out what material is there with the agency."

He remarked, "Investigators are terribly handicapped." Justice Bhuyan responded, "You can't act like a crook, you have to act within the 4 corners of law. I observed in one court proceedings, you have registered about 5000 ECIRs. Conviction is less than 10… That's why we insist you improve your investigation, witnesses… we are talking about liberty of people. We are concerned about ED's image also. At the end of 5–6 years of judicial custody, if people are acquitted, who will pay for this?"

ASG said, "There are very few acquittals… in case of influential people." He continued that a battery of lawyers appear and applications are filed repeatedly, which forces the Investigating Officer to spend time in court rather than investigating.

The Court reiterated its earlier concern about delays and repeated that there was a need for fast-track, special courts to deal with PMLA cases. ASG then resumed going through the individual grounds in the review petitions and argued, "These can't be grounds for review. No parameter fulfilled. This is an appeal in disguise." He also pointed out that the original case had arisen out of a transfer petition related to quashing of proceedings.

The Supreme Court will resume hearing of the matter tomorrow at 2 pm.

Background

On July 31, 2025, the Court stated that it would first decide the preliminary issue of maintainability before examining any substantive grounds.

Additional Solicitor General S.V. Raju, appearing for the Enforcement Directorate, argued that the petitioners were asking the Court to "sit in appeal" and reopen settled findings. Senior Advocates Kapil Sibal and Dr. Abhishek Manu Singhvi appeared for the petitioners, with Sibal referring to the earlier August 2020 order to contend that notice was issued on more than two issues.

On July 27, 2022, a three-judge Bench comprising Justice A.M. Khanwilkar, Justice Dinesh Maheshwari, and Justice C.T. Ravikumar delivered its judgment in Vijay Madanlal Choudhary v. Union of India, upholding the constitutional validity of several provisions of the Prevention of Money Laundering Act, 2002. The Court affirmed the broad powers of the Enforcement Directorate relating to arrest, search, seizure, and attachment of property, and upheld the twin bail conditions under Section 45(1) and the reverse burden of proof under Section 24.

Multiple review petitions were filed against the judgment, including one by Congress MP Karti P. Chidambaram, arguing that the ruling contained grave errors warranting reconsideration. On August 7, 2024, the present Bench had observed that the first issue to be considered was whether the review petitions were in substance appeals. Justice Ravikumar had then remarked, “Let us see whether it is an appeal in disguise or a review…”