Source: Supreme Court 

Why in News? 

A bench of Justice Surya Kant and Justice Ujjal Bhuyan granted bail to the accused in a money laundering case.     

• The Supreme Court held this in the case of Ramkripal Meena v. Directorate of Enforcement.  

What is the Background of Ramkripal Meena v. Directorate of Enforcement Case? 

• The petitioner was working as a Manager of the school and was appointed as Assistant to the Co-ordinator of REET exam. 
• He had access to the question paper kept in the strong room. The petitioner is alleged to have taken the copy and leaked it to other co-accused. 
• The petitioner was to receive a bribe of Rupees five crores out of which the investigating authorities are said to have successfully recovered a sum of Rs.1,77,80,000/- (Rupees One Crore Seventy Seven Lakh and Eighty Thousand) from various persons. 
• The First Information Report (FIR) was registered under Section 420, 120B and Section 4/6 of Rajasthan Public Examination (Prevention of Unfair Means) Act, 1992. 
• The second FIR was registered under Section 302, Section 365 and Section 120 B and Section 3(2)(v) of the Scheduled Castes & Scheduled Tribes (Prevention of Atrocities) Act, 1989. 
• Thereafter, an investigation was initiated by the Enforcement Directorate (ED) under the Prevention of Money Laundering Act, 2002 (PMLA) to trace out the process of crime and ascertain the role of suspected persons. 
• The bail plea before the Court in this case was with respect to the money laundering case. 

What were the Court’s Observations? 

• The Supreme Court in this case observed that the complaint case was at the stage of charge framing and 24 witnesses are proposed to be examined. 
• The conclusion of proceedings thus will take some reasonable time. Also, the petitioner had been in custody for more than a year.  
• The Court granted bail considering the following factors: 
  • The period spent in custody 
  • No likelihood of conclusion of trial within a short span 
  • The petitioner is already on bail in the predicate offence 
  • Keeping in view the peculiar facts and circumstances 
• The Supreme Court finally granted bail with the conditions that the petitioner would not attempt to contact the witnesses and would furnish list of immovable assets etc. 

What is the Provision for Bail under Prevention of Money Laundering Act, 2002 (PMLA)? 

• Section 45 of PMLA provides for bail in cases involving money laundering. 
• Section 45 of PMLA provides that no person accused of an offence shall be released on bail unless 
  • the Public Prosecutor has been given an opportunity to oppose the application for such release; and 
  • where the Public Prosecutor opposes the application, the 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 
• Further, this Section provides that following persons may be released on bail if Special Court directs: a person, who,  
  • is under the age of sixteen years, or  
  • is a woman or is sick or  
  • infirm,  
  • or is accused either on his own or along with other co-accused of money-laundering a sum of less than one crore rupees  
• Further, Section 45 (2) provides that the limitation on granting of bail specified in sub-section (1) shall be in addition to the limitations under the CrPC or any other law for the time being in force on granting of bail. 

How did Section 45 of PMLA evolve? 

• Nikesh Tarachand Shah v. Union of India (2018) 
  • The Supreme Court in this case struck down Section 45 of PMLA on the ground that it is violative of Article 14 and 21 of the Constitution. 
  • The provision was struck down on the ground that it imposed strict conditions for grant of bail in respect of offences mentioned in Part A of the Schedule to PMLA.   
• Amendments made to Section 45 by Finance Act, 2018 
  • By way of Amendment done by Finance Act, 2018 the words “Part A of the Schedule” was substituted by the expression “under this Act”. 
  • Post this the language of Section 45 of PMLA was brought at par with other special laws. 

• Vijay Madanlal Choudhary v. Union of India (2022) 
  • The Supreme Court in this case upheld the constitutional validity of Section 45 of PMLA post amendment of 2018.  
  • The Court held that post amendment of 2018 the provision in the form of Section 45 of PMLA is reasonable and has direct nexus with the purposes and object sought to be achieved by the 2002 Act and does not suffer from any vice of arbitrariness. 
  • As regards the prayer for grant of bail, irrespective of the nature of proceedings, including those under Section 438 of the 1973 Code or even upon invoking the jurisdiction of Constitutional Courts, the underlying principles and rigors of Section 45 may apply. 
  • The beneficial provision of Section 436A of the 1973 Code could be invoked by the accused arrested for offence punishable under the 2002 Act. 
• Review Petition 
  • A review petition is filed against the above judgment of Vijay Madanlal Choudhary v. Union of India (2022). 
  • There are several grounds for review. However, the ground that pertains to Section 45 of PMLA is as follows: 
    • The twin test was held to be unconstitutional by the Court in the judgment of Nikesh Tarachand Shah v. Union of India (2018). T he judgment has however overruled the findings of this judgment and reinstated the twin conditions. 
    • The argument put forward is that such conditions are mentioned in other laws as well. 
      • However, it is to be noted that all the other laws that contain such twin conditions pertain to offences that involve loss of limb or life and are usually related to terror. 
      • Moreover, in other offences the protection of provisions of CrPC is there. The same is however missing under this Act where the accused finds out the grounds of his arrest upon actual arrest. 
      • Further, the judgment has even held that in case of anticipatory bail applications as well twin test will be applicable. 
• Tarsem Lal v. Directorate of Enforcement Jalandhar Zonal Office (2024) 
  • The Court held in this case that if the accused appears before the Special Court pursuant to the summons, it cannot be treated that he is on custody. 
  • Therefore, here it is not necessary for the accused to apply for bail. 
  • The Special Court can however direct the accused to execute a bond under Section 88 of Criminal Procedure Code, 1973 (CrPC). The order accepting bond under Section 88 CrPC does not amount to grant of bail and hence the twin conditions for grant of bail are not applicable here.