The Supreme Court on Friday raised concerns over dichotomies in data furnished by the Enforcement Directorate on arrests, searches and enforcement case information reports (ECIRs), wondering whether the agency had a uniform policy on when to arrest an accused.

The bench of Justice Sanjiv Khanna and Justice Dipankar Datta flagged that the number of arrests made by the ED was much lower than the number of cases registered and chargesheets (prosecution complaints) filed.

“As per the data available on the website of the DoE (directorate of enforcement), as on 31.01.2023, 5,906 ECIRs (equivalent to the FIRs registered by police) were recorded,” the bench said.

“However, search was conducted in 531 ECIRs by issue of 4,954 search warrants. The total number of ECIRs recorded against ex-MPs, MLAs and MLCs was 176. The number of persons arrested is 513. Whereas the number of prosecution complaints filed is 1,142.

“The data raises a number of questions, including the question whether the DoE has formulated a policy (about) when they should arrest a person involved in offences committed under the PML (Prevention of Money Laundering) Act.”

The comments came in a judgment relating to the ED’s arrest of Delhi chief minister Arvind Kejriwal in a money-laundering case.

“We are conscious that the principle of parity or equality enshrined under Article 14 (right to equality) of the Constitution cannot be invoked for repeating or multiplying irregularity or illegality,” the judgment, authored by Justice Khanna, said.

“If any advantage or benefit has been wrongly given, another person cannot claim the same advantage as a matter of right on account of the error or mistake.

“However, this principle may not apply where two or more courses are available to the authorities. The doctrine of need and necessity to arrest possibly accepts the said principle.”

The judgment added: “Section 45 (of the PML Act) gives primacy to the opinion of the DoE when it comes to grant of bail. DoE should act uniformly, consistent in conduct, confirming one rule for all.”

The ED must record the “reasons to believe” (the guilt of the accused) before an arrest, else the arrest becomes “illegal and invalid”, the bench said.

Citing the apex court’s earlier judgments in the Vijay Madanlal Choudhary, Prabir Purkayastha and Pankaj Bansal cases, it said Section 19 of the PML Act, which empowers the ED to arrest an accused, has several inbuilt safeguards.

While the legislature has empowered the director, deputy director, assistant director or an authorised officer to make an arrest, the power has been fenced with preconditions and requirements, the court said. The conditions are:

◘ The officer must have material in his possession, on the basis of which he or she should record in writing the “reasons to believe” that the person to be arrested is guilty of an offence punishable under the PML Act.

◘ The person arrested should as soon as possible be informed of the grounds of the arrest.

“These preconditions act as stringent safeguards to protect life and liberty of individuals. Power to arrest a person without a warrant from the court and without instituting a criminal case is a drastic and extreme power,” the judgment said.

“Therefore, the legislature has prescribed safeguards in the form of exacting conditions as to how and when the power is exercisable. The conditions are salutary and serve as a check against the exercise of an otherwise harsh and pernicious power.”

Judicial review

The apex court rejected the ED’s argument that the power of arrest conferred on the agency is not amenable to judicial review.

“We hold that the power of judicial review shall prevail, and the court/ magistrate is required to examine that the exercise of the power to arrest meets the statutory conditions,” the bench said.

“The legislature, while imposing strict conditions as preconditions to arrest, was aware that the arrest may be before or prior to initiation of the criminal proceedings/ prosecution complaint. The legislature, neither explicitly nor impliedly, excludes the court surveillance and examination of the preconditions of Section 19(1) of the PML Act being satisfied in a particular case.”

‘Reasons to believe’

Citing the earlier judgments, the court said: “…Failure to record ‘reasons to believe’ in writing will result in the arrest being rendered illegal and invalid.”

It added: “It would be incongruous, if not wrong, to hold that the accused can be denied and not furnished a copy of the ‘reasons to believe’. In reality, this would effectively prevent the accused from challenging their arrest, questioning the ‘reasons to believe’.”