Recent Issue over Section 45(1) of Prevention of Money Laundering Act (PMLA), 2002

Section 45(1) of Prevention of Money Laundering Act,(PMLA) 2002 lays down that, notwithstanding anything contained in the Code of Criminal Procedure, no person accused of an offence punishable for a term of imprisonment of more than three years under Part A of the Schedule shall be released on bail or on his own bond unless—

• the Public Prosecutor has been given an opportunity to oppose the application for such release; and
• where the Public Prosecutor opposes the application, the court is satisfied that there are reasonable grounds for believing that he is not guilty of such offence and that he is not likely to commit any offence while on bail: Provided that a person who is under the age of sixteen years or is a woman or is sick or infirm, may be released on bail, if the special court so directs: Provided further that the Special Court shall not take cognizance of any offence punishable under section 4 except upon a complaint in writing made by—
  • the Director; or
  • any officer of the Central Government or State Government authorised in writing in this behalf by the Central Government by a general or a special order made in this behalf by that Government.

Recently, the Supreme Court struck off this section from the PMLA, 2002 that provided for denying bail to an accused till the time the court was convinced that he was not guilty. The court also ordered a fresh trial in all cases where bail under such provisions had been denied to the accused. Initially this section 45 applied only to those who were charged for money laundering as well as scheduled offences under part A of the Act which including cases of waging war against the Government of India and offences under the Narcotic Drugs and Psychotropic Substances (NDPS) Act. It was through the amendment of 2013, the government widened the scope of this Act by bringing Part B of the Act also under the section’s ambit which further enhanced the scope of this section, making it difficult to get bail even for those who were accused under comparatively minor offences.

The SC based its judgement on the reasoning that such provision is unnecessarily stringent and stood in violation of Article 21, the right to life, liberty and security of a person and Article 14, the right to equality. Yet, the PMLA in totality is a very stringent Act. Moreover, the Act not only affected the bail of a person but also had a very tough provisions related to the attachment of property, the recording of statements and arrest and prosecution etc.