'If You Start Using it as a Weapon...': What SC Told ED on Use of PMLA in Cases

The Supreme Court told the Enforcement Directorate to employ the Prevention of Money Laundering Act reasonably.

The Supreme Court on Wednesday, 15 December, pulled up the Enforcement Directorate for its 'indiscriminate' use of the Prevention of Money Laundering Act (PMLA), and observed that the Act should be used in a reasonable manner.

(Photo: The Quint)

The Supreme Court on Wednesday, 15 December, pulled up the Enforcement Directorate for its 'indiscriminate' use of the Prevention of Money Laundering Act (PMLA), and observed that the law should be used in a reasonable manner.

The bench made the remarks while hearing a plea filed by Patna-based Usha Martin Ltd. The steel company had submitted a petition against the attachment of its properties worth Rs 190 crore, on allegations of an iron ore sale scam.

Here is what the court said to the ED:

• "If you (ED) indiscriminately use the PMLA, it will lose its relevance," the Supreme Court bench headed by Chief Justice of India (CJI) NV Ramana told the central agency.

• The CJI rapped the ED for employing the harsh law, intended for use in bigger frauds, as a weapon:

"If you start using it as a weapon against a 10,000 rupees case and 100 rupees case, what will happen. You can't put all people behind bars. You have to use it reasonably."

CJI NV Ramana, as quoted by news agency IANS

• "If you want to use it in every case, it doesn't work... This is not the way it works," said the bench, which also comprised of Justices AS Bopanna and Hima Kohli.

• "You are diluting the Act. Not just this case," the top court added.

What Happened in the Case?

The petitioner, in its plea, requested the court to grant the steel company interim protection from arrest in the case. The company had challenged a Jharkhand High Court order which had denied the Usha Martin Ltd any relief over summons issued in a PMLA case.

The legal counsel of the central government, Additional Solicitor General K M Nataraj, opposed the grant of interim protection and had argued for the stay of operation of the summoning order, as per IANS.

"Taking into consideration the facts and circumstances of the case, we grant interim protection from arrest to the petitioner as also grant stay of operation of the Summoning Order dated May 20, 2021 as stated above. List the matters after four weeks," the apex court said in its order.

The top court was also simultaneously hearing an appeal filed by the CBI, challenging the Telangana High Court's order granting anticipatory bail to PMLA-accused businessman Narender Kumar Patel, reported The Indian Express. Patel had been arrested by the ED in January in relation to a bank fraud case.

(With inputs from IANS and The Indian Express)