Date of judgment:
7th October 2021
Bench:
Justice Sanjay Kishan Kaul
Justice M.M Sundresh
Parties:
Appellant – Satender Kumar Antil
Respondent – Central Bureau of Investigation
Subject
In the instant case, the Supreme Court clarified that the twin bail conditions provided under section 45 of the Prevention of Money Laundering (PMLA) Act have been struck down. Furthermore, the Apex Court laid down guidelines for the grant of bail to ease the procedure of bail as the lower courts are hesitant to grant bail even after the cooperation of the accused.
Legal Provisions
Section 45 of PMLA Act – Non-cognizable and non-bailable offences.
Section 19 of PMLA Act- the power to arrest.
Section 88 of CrPC – the power to take bond for appearance.
Overview
- In this instant case, the accused had applied for anticipatory bail after the chargesheet was filed against him. However, because of his absence in the Court during the proceedings, the application was rejected and non-bailable warrants were issued.
- Resultantly, a Special Leave Petition was filed before the Supreme Court where the accused was questioned about his absence before the Court and about the filing of anticipatory bail application.
- An application was also filed regarding clarification of section 45 of the PMLA Act, which was struck down in 2018 in the case of Nikesh Tarach and Shah v Union of India. In this case, the Supreme Court had categorized the offences into 4 groups: A,B,C and D.
- The counsel submitted thatthere were some inconsistencies with respect to the categories. For example- other than being a special statute, category D covers economic offenses. However, theft, which is punishable for 3 years, is an economic offence and should come under category A or B.
- Mr. Raju stated that section 45 has been amended even though it was struck down and the amendment has been subsequently challenged.
- The bench stated that Section 45 (original provision) has been struck down. By striking down section 45, the Court’s intention was to ease the procedure of bail. The Court further asked the parties to decide collectively about the clarification they sought from the Court.
- Talking about the irresponsibility of the lower courts in granting bail, the Court said that the Supreme Court has been converted into a bail court with 40% cases of anticipatory bail. The Court said that in economic cases, the motive is to get the amount and not everyone should be put behind the bars with the investigation continuing indefinitely.
- Mr. Siddhart Agrawal stated that the order dated 7th Oct 2021, did not create fetters on grant of bail. To this, the bench replied, “we will say that the order no way imposes additional fetters but it is in furtherance of the line of judicial thinking to enlarge the scope of bail”.
- Mr. N. Hariharan submitted that even if the person was not arrested but then brought before the Court, an odd situation would be created as section 19 of PMLA Act did not contemplate arrest. Furthermore, Section 45 would not come into play if Section 19 does not come into play. He further stated that clarification should be given regarding section 45 PMLA.
- The bench replied to this and said, “[W]e have already stated that if the Investigating Agency does not need to arrest at the time of investigation, then we have discouraged.”
- Mr. Hariharan further said that even if the accused was not arrested under PMLA by the agency, and was produced along with the complaint, he should be given benefit available with respect to other cases.
- This suggestion by Mr Hariharan was disagreed by Mr Raju as he stated that such guidelines could not be issued as in some cases, the investigating officer can be corrupt and he will not arrest the accused. To this the bench replied, “[I]f during the course of investigation, there is no cause to arrest the accused, merely because chargesheet is filed, would not be an ipso facto cause”
- The bench pointed that the mindset of lower courts is such that they tend to reject bail and any order passed by the Supreme Court would not change such mindset.
- Mr. Amit Desai stated that in Bombay, the Trial Court interprets the guidelines as a judgment and ignores the law on grant of bail.
- Another point was stated by Mr Mukul Rohtagi that when a person, who meets the conditions set in order of 7th Oct, “appears on summons, then such a person has the recourse of Section 88 of Cr.PC, whereby he ought to apply for bond and not bail.”It was requested by him to specify in the order that recourse of section 88 is available with the accused.
- Mr Desai stated that people have to apply for bail even in complaint cases. The Court remarked that bail matters should not be heard for more than 15 to 20 minutes, but usually the hearing goes for hours.All the time which the Courts should devote to the prosecution of a case is spent on hearing bail matters.
- Mr. Desai also stated that because of this there is overcrowding in jail as the undertrials are sitting there. Mr Raju stated that hospitals are occupied by 90 percent of offenders.
Issue
- A clarification on the Supreme Court’s order striking down section 45 of the PMLA Act was demanded.
Judgment Analysis
- These were the conditions laid down by the Supreme Court for the guidelines to be applicable-
i. During the investigation, there was no arrest of the accused.
ii. There was cooperation from the side of the accused which includes appearing before the court as well as paying the amount asked.
The Court has differentiated the offences in 4 categories.
- Category A, General offences- Not an economic offence; offences which are punishable for 7 years or less than that;offenses which are not punishable with death, life imprisonment or imprisonment for 7 years or more.
- Category B,Heinous Offences- offenses which are punishable with imprisonment for 7 or more years, death penalty or life imprisonment.
- Category C, Special Offences- offences that are punishable under Special Acts,.. For example- section 37 of NDPS Act, section 45 of PMLA Act, UAPA Act section 43D(5), and Companies Act section 212(6).
- Category D, Economic offences – offences not covered by any special Act.
SC has laid down specific guidelines as per the category.
- Category A- after filing of chargesheet,
i. The Court will issue an ordinary summon.
ii. After that, if the accused doesn’t appear, then warrant will be issued for physical appearance.
iii. If he still does not appear then a non-bailable warrant will be issued.
iv. The Court can cancel the non-bailable warrant or convert it into a bailable warrant, with no insistence on the accused’s physical appearance,provided the accused files an application before the non-bailable warrant is executed and promises that he will be present physically on the next date of hearing.
v. The Court can decide bail application of the accused in his presence without taking him in custody or he may also be granted interim bail before bail application is decided.
- Category B & D- if the accused appears in Court during any proceedings, the bail application will be decided on merits.
- Category C- “the conditionsare same as in category B and D, along with compliance of specific provisions of bail which are provided under the Special Act.
Non-Cooperation of Accused-
The guidelines listed above will not be of any benefit if the following situation occurs-
i. Accused did not cooperate; did not answer summons; was not present before investigating officers.
ii. Where Court feels that further investigation is required or judicial custody is necessary.
Interim Bail
By taking into consideration the circumstances the circumstances of the case, the Court can grant interim bail to the accused where his arrest was not warranted. But the ultimate bail application has to be considered by taking note of the guidelines issued.
Conclusion
In the case of Sanjay Chandra vs SBI, the Court held that economic offences are not excluded from the Court's considerations for granting bail and that the only factor that the court must examine is the seriousness of the accusation and the harshness of the sentence.
The rules provided much-needed guidance for subordinate courts, which are often hesitant to grant bail but rapid to order the detention of the accused persons, even when they have cooperated during the inquiry.”
