SC fixes final hearing of PMLA review petitions in October

The Supreme Court on Wednesday scheduled the final hearing of review petitions challenging its 2022 judgment in the Vijay Madanlal Choudhary case, which upheld several controversial provisions of the Prevention of Money Laundering Act (PMLA), for October 16 and 17.
A bench, led by justice Surya Kant, assigned the dates for the final hearing in the case that was listed on Wednesday but could not be taken up due to the absence of one of the judges on the bench – justice CT Ravikumar. The third member of this special bench is justice Ujjal Bhuyan.
Congress MP Karti Chidambaram has filed the lead review petition in this matter.
The Supreme Court had issued notice on Chidambaram’s petition on August 25, 2022, but since then, the matter has not progressed to an effective hearing.
The 2022 judgment had sparked intense legal and political debate due to its far-reaching impact on the powers granted to the Enforcement Directorate (ED) under the PMLA.
The 2022 ruling in Vijay Madanlal Choudhary affirmed the wide-ranging powers of ED, which include summoning individuals, conducting arrests, raiding properties and attaching assets of those suspected of money laundering. These powers, the top court had reasoned, were crucial for combating money laundering and protecting India’s financial stability. The judgment dismissed over 200 petitions that had challenged the provisions of the PMLA, with the petitioners arguing that the law bestowed unchecked and arbitrary authority on ED, violating fundamental rights such as liberty, property and protection against self-incrimination.
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Despite these concerns, the top court upheld the stringent measures, emphasising that money laundering offenders form a distinct class and require specialised legal provisions. One of the most controversial aspects of the ruling was its decision that the Enforcement Case Information Report (ECIR), an internal document of ED, did not need to be shared with the accused. The court held that it was sufficient for ED to inform the accused of the grounds for their arrest.
Another contentious element was the court’s endorsement of the reverse burden of proof in PMLA cases, which requires the accused to prove their innocence, even during bail proceedings – a stark departure from the usual legal presumption of innocence until proven guilty.
On August 25, 2022, the Supreme Court issued notice to the Union government in response to Chidambaram’s review petition against the July 27, 2022 judgment. The court had at the time indicated that only the two issues related to the supply of ECIR and the reverse onus of guilt would be reconsidered, with the rest of the judgment not up for review.
To be sure, a separate bench comprising justices Sanjiv Khanna, MM Sundresh and Bela M. Trivedi is hearing petitions challenging the validity of PMLA sections 50 and 63, which empower the ED to summon witnesses, extract confessions, and prosecute individuals for providing false information.
The 2022 PMLA judgment has faced widespread criticism for eroding constitutional safeguards, particularly in the context of an increase in ED actions against Opposition leaders. Critics argue that the ruling has allowed the ED to function with excessive autonomy, raising concerns about the politicisation of the federal financial crime agency.
During the last hearing on August 7, there was a noticeable divergence between the petitioners and the ED regarding the scope of the review. While the petitioners, represented by senior counsel Kapil Sibal, Abhishek Manu Singhvi and Vikram Chaudhary, argued for a comprehensive review of the 2022 judgment, ED, represented by solicitor general Tushar Mehta and additional solicitor general SV Raju, contended that the review was confined to just the two issues identified earlier.
The bench, while acknowledging the disagreement, reminded the parties that a review petition is not an appeal and deferred its decision on whether the review could extend beyond the two specific issues.
The proceedings are being closely watched, particularly in light of recent Supreme Court judgments dismantling barriers to bail in cases governed by stringent laws such as the PMLA and the Unlawful Activities Prevention Act (UAPA). In recent decisions, the court has consistently asserted the primacy of individual liberty, affirming that constitutional principles dictate liberty – not incarceration – as the default position.
For instance, in a landmark ruling on September 9, the court held that a person already in custody for one offence could still seek anticipatory bail for a different offence. The judgment underscored that Article 21 of the Constitution, which guarantees personal liberty, must be upheld unless specifically restricted by law. On the same day, the court also reaffirmed that an accused is entitled to a fair and speedy trial, cautioning against allowing legal processes to devolve into punitive measures.
The upcoming hearings in October are expected to be pivotal in determining whether the 2022 PMLA judgment can withstand scrutiny or whether it requires modification in light of the recent verdicts of the Supreme Court and broader constitutional principles.