Introduction
The recent judgment by the Hon’ble Madras High Court in the case of Jaffer Sadiq v. The Assistant Director, Director of Enforcement[i] discusses the interplay between s. 19 of the Prevention of Money Laundering Act, 2002 (‘PMLA’) and s. 167 of the Code of Criminal Procedure (‘CrPC’). Jaffer Sadiq (‘Petitioner’), who was already in judicial custody under a separate case, challenged the formal arrest under PMLA for not being produced before the Special Court within 24 hours. This decision not only highlights the specific procedural requirements under the PMLA but also delineates the boundaries of formal arrest when an individual is already in custody.
Brief Facts
The Directorate of Enforcement (‘ED’) initiated proceedings against the Petitioner under the PMLA and passed an order for his arrest on 26.06.2024. At the time of passing this order, the Petitioner was already lodged in Tihar Jail, Delhi, under judicial custody for an unrelated Narcotic Drugs and Psychotropic Substances Act, 1985 (‘NDPS Act’).
Despite being under judicial custody, the ED executed a formal arrest, and the Petitioner was remanded to judicial custody on 15.07.2024.
The Petitioner filed the criminal original petition under s. 482 of the CrPC before the High Court challenging that the formal arrest violated s. 19(3) of the PMLA as the Petitioner was not produced before the Special Court or Magistrate’s Court within 24 hours of arrest.
The counsel for the ED argued that since the petitioner was already in judicial custody for a different case, the necessity of production within 24 hours did not arise, as physical custody was never assumed by the ED post-arrest.
Held
The High Court observed that s. 19(3) of the PMLA mandates the production of an arrested individual before the Special Court or Magistrate’s Court within 24 hours. The High Court also noted that s. 65 of the PMLA allows Cr.P.C. provisions to apply only when inconsistent with the PMLA.
The High Court referenced upon the precedents from the Hon’ble Supreme Court, including Vijay Madanlal Choudhary v. Union of India[ii] and V. Senthil Balaji v. State Represented by the Deputy Director and others[iii] and observed that formal arrest procedures are distinct from regular arrests and do not necessitate immediate production if the individual is in judicial custody.
The High Court also relied upon the case of State of Inspector of Police, Anti Land Grabbing Special Cell, City Crime Branch, Trichy v. K. N. Nehru and Others[iv], wherein the Madurai bench of the High Court clarified that formal arrest in prison does not require the detainee to be brought before the Magistrate for remand in the new case.
The High Court dismissed the petition, stating that the requirements under s. 19 of the PMLA were fulfilled, and the arrest and subsequent actions by the ED were in compliance with the law.
Our Analysis
In this case, the High Court’s decision reiterates the laid down principle that PMLA, being a special law, overrides inconsistent provisions of the CrPC. The Court distinguished between the requirements for regular arrests and formal arrests, especially when the individual is already under judicial custody. This ruling reinforces that formal arrests do not necessitate immediate production before a Magistrate as per s. 19(3), provided that physical custody is not assumed. The Court’s reliance on the various decisions highlights the judiciary’s cautious approach in balancing the statutory rights against procedural compliances. The case will also serve as a reminder for ED and other enforcement agencies to document their procedural compliance, especially in cases which involve formal arrest.
End Notes
[i] Jaffer Sadiq v. The Assistant Director, Director of Enforcement Crl. O.P. No. 16117 of 2024.
[ii] Vijay Madanlal Choudhary v. Union of India 2022 SCC OnLine SC 929.
[iii] V. Senthil Balaji v. State Represented by Deputy Director and others (2024) 3 SCC 51.
[iv] State of Inspector of Police, Anti Land Grabbing Special Cell, City Crime Branch, Trichy v. K. N. Nehru and Others 2012 (1) MWN (Cr.) 4 (DB).
Authored by Jitin Bharadwaj, Advocate at Metalegal Advocates. The views expressed are personal and do not constitute legal opinions.