The Delhi High Court on Thursday observed that the Enforcement Directorate (ED) had all the power to issue summons to a person under Section 50 of the Prevention of Money Laundering Act (PMLA), however, the power to arrest was ‘conspicuously absent’ from the same and therefore, the national agency could not arrest anyone under it.
The single-judge Bench of Justice Anup Jairam Bhambhani noted that the power under Section 50 of PMLA to issue summons to a person and to require the production of documents and record statements wss akin to the powers of a civil court. Howver, it was different and distinct from the power under Section 19 to arrest a person.
It said though Section 19 of PMLA empowered designated officers of ED to arrest any person, subject to satisfying the conditions mentioned in that provision, it was clear that the power to arrest neither resided in Section 50, nor it arose as a natural corollary of summons issued under Section 50.
The High Court further said that Section 19 and 50 of PMLA were two separate and distinct provisions and the exercise of powers under one could not be restrained on the apprehension that it could lead to the exercise of powers under the other.
As per the Bench, if this was permitted, any and every person summoned under Section 50 of the PMLA to produce documents or give a statement on oath, could resist such summons, expressing apprehension that he may face arrest at the hands of ED, in exercise of the powers under Section 19 of PMLA.
While dismissing a petition filed by one Ashish Mittal seeking quashing of an ECIR registered by ED in 2020, Justice Bhambhani said that such a position would be antithetic to the statutory scheme.. Mittal further sought stay on all proceedings emanating from the said ECIR.
The accused was issued summons requiring him to appear before the ED on August 21. His counsel argued that he had a strong apprehension that Mittal would be illegally detained or arrested and made a scapegoat.
The counsel submitted that the petitioner was not supplied with a copy of the ECIR. Noting that the ECIR was not before the court nor the petitioner was entitled as per law to be given a copy of the same, Justice Bhambhani said that there was obviously no way that the grounds on which quashing was sought could be assessed and evaluated.
The High Court said based on the provisions and precedents referred-to above; on a bare perusal of Section 50 of PMLA under which summons have been issued to the petitioner, along with the fact that the petitioner was not an accused in the proceeding under PMLA, this court was not persuaded to agree with the petitioner‟s apprehension that he may be subject to coercive measures.
Justice Bhambhani said that in case it was true that the petitioner was remediless in relation to his grievance, a writ petition invoking the extraordinary plenary jurisdiction under Article 226 of the Constitution of India would always lie.