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In the said case, writ petition and appeals were filed challenging the constitutional validity of twin conditions for granting bail u/s Section 45 of the Prevention of Money Laundering Act, 2002. Section 45(1) imposes ‘two conditions’ for grant of bail where an offence punishable for a term of imprisonment of more than 3 years under ‘Part A of the Schedule’ to the Act is involved. The conditions are that the:-(i) Public Prosecutor must be given an opportunity to oppose any application for release on bail and the Court must be satisfied (ii) where the Public Prosecutor opposes the application, that there are reasonable grounds for believing that the accused is not guilty of such offence, and that he is not likely to commit any offence while on bail.
Whether the aforesaid twin conditions are manifestly arbitrary, discriminatory and violative of fundamental rights enshrined under Article 14 and 21 of the Constitution?
According to Senior Advocate and Former Attorney General for India Mr. Mukul Rohtagi, putting ‘Part B offences’ together with heinous offences in ‘Part A’ would amount to treating unequals equally and would be discriminatory, arbitrary and thus violative of Article 14 and 21 of the Constitution. A person will be punished for an offence contained under the PML Act, 2002, but will be denied bail because of a predicate offence which is contained in Part A of the schedule rendering Section 45(1) as manifestly arbitrary and unreasonable. The threshold of three years and above stipulated as a condition in Section 45(1) of the PML Act is discriminatory and manifestly arbitrary and therefore violative of Article 14 of the Constitution of India. Such classification resulted in anomalous situations where a person was being prosecuted for an offence under the PMLA, but he was being denied bail because of the Impugned Conditions.
Furthermore, a person accused of such Scheduled Offence could on one hand be enlarged on anticipatory bail in case of charges under the Indian Penal Code 1860 but a person arrested for such Scheduled Offence pursuant to a charge under the PMLA could only secure bail subject to the satisfaction of the Impugned Conditions. The twin conditions are unfair, unjust and against Article 21 of the Constitution on India (i.e. the right to life and personal liberty), inasmuch as they required the accused to disclose their defence at the stage of arrest itself.
The Supreme Court struck down the aforesaid twin on the ground that it violated Article 14 and Article 21 of the Constitution of India, i.e. provisions which protect the constitutional right to equality and the right to life and personal liberty, and it directed all the petitions (arising from bail applications) to be remanded to the respective courts to be heard and decided on merits, without the application of the additional conditions contained in Section 45(1) of the PMLA.
The judgment of the Hon’ble Supreme Court in the aforesaid Case on the aspect of constitutional validity of twin conditions for granting bail raises questions on similar provisions which exists in other statutes particularly dealing with economic offences. While the judgment in the present case is very significant. The inconsistencies in the scope and applicability of the pre-bail conditions under the PMLA made out a very strong case for striking down such Conditions. Given the (mis)scheme of the Scheduled Offences under the PML Act, it was palpable that the Supreme Court could not have arrived at any other conclusion. Whether an economic offence, such as money laundering, demanded stringent/drastic conditions such as the Impugned Conditions and whether the rights of an individual could be curtailed by the state in the case of such economic offence, still remains to be answered. Therefore, the justiciability of the pre-bail conditions such as the Impugned Conditions, in the case of economic offences, has not been addressed by the Supreme Court in the aforesaid Case. Section 212(6), provides restrictions similar to the Impugned Conditions, in case of persons accused of fraud with respect to the affairs of a company. If the constitutional validity was to be tested only on the ground that they are inherently ‘arbitrary’ and ‘unreasonable’, it is most unlikely that such a challenge would be upheld by the Apex Court, given the fact that it has already been acknowledged by the Supreme Court in the case of Rohit Tondon v. Enforcement Directorate that the “economic offences need to be viewed seriously and considered as grave offences affecting the economy of the country and thereby posing serious threat to the financial health of the country”.
Therefore, the legality and justifiability of the pre-bail conditions (similar to the Conditions given under PMLA) in the case of economic offences is still ‘elusive’ and awaits judicial clarification.
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