Review Petitions Against PMLA Judgment Can't Go Beyond 2 Issues : Union Tells Supreme Court

In the review petitions filed against the Vijay Madanlal Choudhary judgement, which upheld various provisions of the Prevention of Money Laundering Act (PMLA), the Union Government told the Supreme Court on Wednesday (May 7) that the review hearing cannot go beyond the two specific issues which were orally flagged by the bench which issued notice in August 2022.

A bench of Justices Surya Kant, Ujjal Bhuyan and N Kotiswar Singh held a brief hearing of the review petitions today. 

At the outset, Solicitor General of India Tushar Mehta submitted the bench which considered the review petitions for admission in August 2022 issued notice only on two limited aspects - regarding the supply of the ECIR to the accused and the reversal of burden of proof (S.24 PMLA. However, the bench did not expressly state so in its order. Therefore, to avoid any future controversy, the SG said that the Union filed an affidavit the next day after the issuance of notice stating the issues identified by the Court for review. The SG pointed out that the petitioners have not disputed the contemporaneous affidavit till now. Hence, he argued that the review petitions, assuming they are maintainable, cannot go beyond these two specific issues. He added that the review petitions are not maintainable as well, since they are essentially appeals in disguise.

Senior Advocate Kapil Sibal, for the petitioners, said that the order issuing notice must be accepted for what is written there. "The order must be taken for what it is...It can't be that the Government of India's affidavit will override the Court's order," he said. Regarding the ECIR issue, Sibal said that there is a judgment of Justice Oka regarding the right of the accused to get documents.

Justice Kant expressed dissatisfaction with the draft issues framed by the petitioners and said that the assisting counsel need to do "better homework."

Posting the matter to August 6 and 7, the bench directed the parties to circulate the draft issues.

"We have requested the review Petitioners and the learned SG to formulate the proposed issues and circulate among them so that questions which require to be determined can be formulated. All the petitions are directed to be listed on August 6, and if need be the matter shall be further heard in August 7,"the bench observed in the order.

When Sibal requested for a procedural listing before the hearing date to formulate the questions, the bench directed the listing on 16 July at 2.30 PM for the purpose of formulation of issues.

Background

The VMC judgment was delivered on July 27, 2022 by a bench comprising Justices AM Khanwilkar, Dinesh Maheshwari and CT Ravikumar. Vide this judgment, certain provisions of the Prevention of Money Laundering Act, 2002 (PMLA) were upheld. These included -

(i) Sections 5, 8(4), 15, 17 and 19 of PMLA, relating to Enforcement Directorate's power of arrest, attachment, search and seizure;

(ii) Section 24 of PMLA, relating to reverse burden of proof (in this regard, the Court said the provision had "reasonable nexus" with the objects of the Act);

(iii) Section 45 of PMLA, which provides "twin-conditions" for bail (in this regard, it was said that the Parliament was competent to amend the provision in 2018 even after the Supreme Court's judgment in Nikesh Tarachand Shah, which struck down the conditions).

Subsequent to this decision, the instant review petitions (8 in number) were filed. With the retirement of Justice Khanwilkar, then CJI NV Ramana presided over the bench to consider the petitions.

While issuing notice on August 25, 2022, CJI Ramana-led bench orally observed that at least two conclusions of the judgment required relook - first, that the copy of the Enforcement Case Information Report (ECIR; equivalent of FIR in money laundering cases) need not be given to the accused, and second, the upholding of the reversal of presumption of innocence.

Thereafter, the Court allowed an application for open court hearing of the review petitions. Since issuance of notice, the petitions were listed for hearing for the first time on August 7. On this date, the matter had to be adjourned at request of Solicitor General Tushar Mehta, who sought some time to prepare and argue. Subsequently, pursuant to a mentioning, the matter was listed on September 18 but got re-listed for October 16. On the said date, it could not be taken up as Justice Kant was on leave.

Case Title : Karti P Chidambaram v. The Directorate of Enforcement | RP(Crl) 219/2022 (and connected cases) 

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