Supreme Court: When Records Of Property Title Are Seized Along With Property Under PMLA, Accused Is Entitled To True Copies Thereof
The Supreme Court allowed a batch of two Criminal Appeals filed against the Judgment of the Delhi High Court in a Writ Petition.
Justice Abhay S. Oka, Justice Ahsanuddin Amanullah, Justice Augustine George Masih, Supreme Court
The Supreme Court held that when records, instruments or documents of title of the property are seized along with the property under Sections 17 and 18 of the Prevention of Money Laundering Act, 2002 (PMLA) the accused from whom the same are seized is entitled to true copies thereof.
The Court held thus in a batch of two Criminal Appeals filed against the Judgment of the Delhi High Court in a Writ Petition.
The three-Judge Bench comprising Justice Abhay S. Oka, Justice Ahsanuddin Amanullah, and Justice Augustine George Masih observed, “When records, instruments or documents of title of the property are seized along with the property under Sections 17 and 18 of the PMLA, the accused from whom the same are seized is entitled to true copies thereof.”
The Bench said that once cognizance is taken on the basis of a Complaint under Section 44(1)(b) of the PMLA, the Special Judge must direct that along with the process, a copy of the Complaint and the following documents be provided to the accused –
(i) Statements recorded by the learned Special Judge of the complainant and the witnesses, if any, before taking cognizance;
(ii) The documents including the copies of the Statements under Section 50 of the PMLA produced before the Special Court, along with the complaint, and the documents produced subsequently by the ED till the date of taking cognizance; and
(iii) Copies of the supplementary complaints and the documents, if any, produced with supplementary complaints.
Senior Advocates R. Basanth, Shekhar G Devasa, R. Basant, and Gopal Sankaranarayanan represented the Appellants while Solicitor General Tushar Mehta represented the Respondent.
Case Background
In July 2017, the Central Bureau of Investigation (CBI) registered an FIR against the Appellants for the offences punishable under Section 120-B read with Section 420 of the Indian Penal Code, 1860 (IPC) and Section 13(1)(d) of the Prevention of Corruption Act, 1988 (PC Act). Based on that, an Enforcement Case Information Report (ECIR) was registered by the Directorate of Enforcement (ED). A Complaint under Section 44(1)(b) of the PMLA was filed before the Special Court and the Appellants were shown as accused in the same. The allegation in the Complaint was of the commission of the offence under Section 3 of the PMLA, which is punishable under Section 4 of the PMLA. The Special Judge took cognizance of the offence and the Appellants were supplied copies of the complaint and some documents relied upon by the prosecution.
An application was made by the Appellants to the Special Court for the grant of copies of the following categories of documents: (a) documents relied upon in the complaint but not supplied; (b) documents supplied which were not legible; and (c) documents collected during the investigation which were suppressed. The ED contested the said application and the Special Court rejected the same by holding that the prosecution is under an obligation to supply only those documents which are referred to and relied upon in the complaint/chargesheet and it is under no obligation to supply the documents which were collected during the investigation which were not relied upon. The Appellants filed a Writ Petition which was dismissed by the High Court and hence, the Appellants were before the Apex Court.
Reasoning
The Supreme Court in the above regard noted, “… at the time of hearing for framing of charge, reliance can be placed only on the documents forming part of the chargesheet. In case of the PMLA, at the time of framing charge, reliance can be placed only on those documents which are produced along with the complaint or supplementary complaint. Though the accused will be entitled to the list of documents, objects, exhibits etc. that are not relied upon by the ED at the stage of framing of charge, in ordinary course, the accused is not entitled to seek copies of the said documents at the stage of framing of charge.”
The Court enunciated that the accused can be released on bail only when the Special Court is satisfied that there are reasonable grounds for believing that he is not guilty of such offence and that he is not likely to commit any offence while on bail and, therefore, at the time of hearing of a bail application, there is a burden on the accused to satisfy the Special Court that there are reasonable grounds for believing that he may not be guilty of the offence under Section 3 of the PMLA.
“This is an extraordinary and standalone provision which puts the burden on the accused at the stage of seeking bail. Therefore, the question is whether, at the stage of considering the prayer for bail, the accused, by invoking Section 91 of the CrPC (Section 94 of the BNSS), can apply to get the documents produced. If a narrow view is taken, by denying this opportunity to the accused, he will not be in a position to discharge the burden on him, and therefore, it will affect his right to liberty as he may be denied bail”, it added.
The Court further clarified that the Court can, for reasons recorded, deny production of documents only if it is satisfied that the disclosure of the documents may prejudice the ongoing investigation and that the ED cannot raise such an objection after the investigation is complete.
“Provisions like Section 45(1)(ii) or Section 24 of the PMLA are very drastic provisions. Very few penal statutes contain such provisions. Under the said provisions, the accused has a very heavy burden to discharge. Perhaps, the enactment of PMLA was due to the drastic changes in the world we have seen in the 21st century. The presence of modern technology has brought about new categories of crimes. This law has been enacted taking into consideration the changing needs”, it remarked.
Moreover, the Court emphasised that when the Legislature has felt a need to bring out a legislation like the PMLA, it is the duty of the Court to interpret Article 21 in such a way that the right of a fair trial available to the accused is not affected.
“The object of the provisions of Section 24 or 45(1)(ii) is not to take away the fundamental right of fair trial conferred on the accused. These provisions are different in the sense that they put a burden on the accused. When such a burden is put on the accused, it is all the more necessary that the right of fair trial guaranteed under Article 21 to the accused is protected by permitting the accused to lead defence evidence by seeking the production of witnesses and documents not relied upon by the prosecution”, it added.
The Court said that for discharging the burden under Section 45(1)(ii), the accused has the right to invoke Section 91 of CrPC (Section 94 of the BNSS) for seeking production of documents at the stage of hearing of bail application.
Conclusion
The Court, therefore, concluded the following important points –
• A copy of the list of statements, documents, material objects and exhibits that are not relied upon by the investigating officer must also be furnished to the accused.
• At the time of hearing for framing of charge, reliance can be placed only on the documents forming part of the chargesheet.
• At the stage of entering upon defence, an accused can apply for the issue of process for the production of any document or thing in accordance with Section 233(3) of the CrPC (Section 256(3) of the BNSS).
• When at the stage of defence evidence of the accused, documents are produced on the prayer of the accused and the accused desires to cross-examine any of the prosecution witnesses based on the said documents, it is always open for the accused to apply under Section 311 of the CrPC (Section 348 of the BNSS) to recall a prosecution witness already examined for further cross-examination.
• As compared to traditional penal statutes, at the time of trial of the offence under the PMLA, there is a huge negative burden put on the accused.
• At the time of hearing of an application for bail governed by Section 45(1)(ii) in connection with the offences under Section 3 of the PMLA, an accused is entitled to invoke Section 91 of the CrPC (Section 94 of the BNSS) seeking production of unrelied upon documents.
Accordingly, the Apex Court allowed the Appeals, quashed the impugned Judgment, and directed the ED to supply true copies of the seized documents.
Cause Title- Sarla Gupta & Another v. Directorate of Enforcement (Neutral Citation: 2025 INSC 645)
Appearance:
Appellants: Senior Advocates R. Basanth, Shekhar G Devasa, Gopal Sankaranarayanan, AOR Yoginder Handoo, Advocates Manish Tiwari, Thashmitha Muthanna, Prashanth R. Dixit, R.K. Handoo, Ashwin Kataria, Garvit Solanki, Raunak, Vishal Sinha, Tushar Srivastava, and Trisha Chandran.
Respondent: SG Tushar Mehta, AORs Arvind Kumar Sharma, Advocates Zoheb Hussain, Kanu Agrawal, Arkaj Kumar, Yuvraj Sharma, Madhav Sinhal, Ishaan Sharma, Vivek Gurnani, Annam Venkatesh, Kartik Sabharwal, Hitharth Raja, Pranjal Tripathi, Samrat Goswami, Aditi Singh, Akshita Choubey, Anand Kirti, Bhawna Gandhi, Sidharth Kuhar, Anushka Gupta, Aakriti Mishra, Divya S. Rao, Shyam Bhageria, Prakhar Bharadwaj, Sweety Chauhan, Gaurav Saini, and Nidhi Singh.
