Back
IN THE HIGH COURT OF DELHI AT NEW DELHI
ANISH DAYAL, J.
Arvind Dham - Petitioner
Versus
Union of India & Ors. - Respondents
W.P.(Crl) No. 2516 of 2024
Decided On : 02-12-2024
(A) Prevention of Money Laundering Act, 2002 - Section 19 - Arrest of petitioner challenged on grounds of violation of statutory safeguards - Court emphasized the necessity of recording reasons to believe and informing the accused promptly - Judicial review of arrest legality established, with emphasis on adherence to statutory conditions - Arrest upheld as compliant with legal standards. (Paras 1, 20, 59, 62)
(B) Judicial Review - Scope and limitations - Court clarified that judicial review does not equate to merits review - Grounds for arrest must be scrutinized for compliance with statutory requirements, but not for factual correctness. (Paras 39, 65)
Facts of the case:
The petitioner, a former promoter of Amtek Auto Ltd., challenged his arrest under the PMLA, alleging non-compliance with statutory provisions regarding grounds of arrest and necessity. The court examined the legality of the arrest based on the statutory framework and judicial precedents.
Findings of Court:
The court found that the arrest was conducted in accordance with Section 19 of the PMLA, with adequate grounds provided to the petitioner.
Issues: The main issues included the legality of the arrest, compliance with statutory requirements, and the necessity of arrest.
Ratio Decidendi: The court ruled that the arrest was valid as it complied with the statutory requirements of the PMLA, emphasizing the importance of judicial review in such matters.
Result: Petition dismissed.
JUDGMENT :
Anish Dayal, J.
| INDEX | |
| I. | Proceedings before this Court |
| II. | Factual Background |
| III. | Relevant Statutory Provisions |
| IV. | Judicial Precedents Cited |
| V. | Submissions on behalf of Petitioner |
| VI. | Submissions on behalf of Respondent |
| VII. | Analysis |
|
| [VII.A] Relevant Extracts from Case Laws |
|
| [VII.A.1] Grounds of Arrest |
|
| [VII.A.2] Reasons to Believe |
|
| [VII.A.3] Judicial Review |
|
| [VII.A.4] No merits review |
|
| [VII.A.5] Inclusion of exculpatory material |
|
| [VII.A.6] Need and necessity to arrest |
|
| [VII.B] Principles Culled Out |
|
| [VII.B.1] On Grounds of Arrest |
|
| [VII.B.2] Information to the Accused and Compliance |
|
| [VII.B.3] Reasons to Believe |
|
| [VII.B.4] Need and Necessity to Arrest |
|
| [VII.B.5] Relevance of Exculpatory Material |
|
| [VII.B.6] Judicial Review |
|
| [VII.B.7] Non-Cooperation of the Petitioner |
|
| [VII.B.8] Remand Orders |
|
| [VII.C] Assessment on Facts |
|
| [VII.C.1] Grounds of Arrest |
|
| [VII.C.2] The ED Investigation |
|
| [VII.C.3] Grounds of Arrest and the Remand Order |
|
| [VII.C.4] Exclusion of Exculpatory Material |
|
| [VII.C.5] Non-Cooperation of Petitioner |
|
| [VII.C.6] Need and Necessity to Arrest |
|
| [VII.C.7] No Merits Review |
| VIII. | Conclusion |
I. PROCEEDINGS BEFORE THIS COURT
1. This petition seeks quashing of Arrest Memo and Arrest Order for arrest of petitioner on 9th July 2024 and consequent remand orders.
2. The challenge pivots on alleged violation of Section 19 of Prevention of Money Laundering Act, 2002 (“PMLA”) and of constitutional safeguards against arbitrary detention.
3. Petitioner contends inter alia that exculpatory material, which exonerates petitioner, was not considered in the “grounds of arrest”; petitioner was not provided with “reasons to believe”, grounds of arrest erroneously rely on “directions to investigate” vide Supreme Court’s order dated 27th February 2024 in a public interest litigation (“PIL”) being Jaskaran Singh Chawla v. Union of India & Ors. W.P. (Crl.) 246/2022; the arrest could not be justified on the basis of lack of cooperation by petitioner which was violative of constitutional safeguard against self-incrimination; and other related grounds.
4. To provide a brief overview of proceedings before the Court - notice, in the present petition, was issued on 20th August 2024 and counsel for respondent was directed to file the reply. On the next date of hearing, opening arguments were addressed by Senior Counsel for petitioner. Based on the reply filed by respondent, time was sought to file the rejoinder. On the next date, Senior Counsel for petitioner handed up a detailed list of dates, a note of arguments, and compilation of judgements relied upon; further arguments were addressed by Senior Counsel for petitioner on two further dates; subsequently, arguments were addressed by Special Counsel for respondent who also handed up a note of arguments; on the next date, counsel for respondent handed up another note and a compilation of judgements. Yet another compilation of judgements was handed by Senior Counsel for petitioner; respondent’s counsel continued arguments; thereafter final arguments were heard from both sides and judgement was reserved.
II. FACTUAL BACKGROUND
5. Mr. Vikram Chaudhary, Senior Counsel for the petitioner, has presented a sequence of dates and events which, as per petitioner, would itself bear out that the petitioner’s arrest was illegal.
6. The petitioner is a 63-year-old former promoter of M/s Amtek Auto Ltd. (“AAL”) which, over a period of time, burgeoned into various subsidiary and sister companies, that are broadly referred to as the ‘Amtek Group’. Post global slowdown in 2008, Amtek faced liquidity
The court upheld the legality of the petitioner's arrest under the PMLA, emphasizing the necessity of compliance with statutory safeguards and the scope of judicial review.
The court upheld that arrest under the Prevention of Money Laundering Act was lawful as procedural requirements of Section 19 were sufficiently met, emphasizing limits of judicial review on subjectiv....
The necessity of providing documented 'reasons to believe' at the time of arrest under Section 19 of PMLA is a statutory requirement that must be adhered to for the arrest to be lawful.
The court upheld the legality of the arrest under the Prevention of Money Laundering Act, confirming compliance with statutory requirements, including timely communication of grounds for arrest.
(1) Legality of arrest – Power to arrest is fenced with preconditions and requirements, which must be satisfied prior to arrest of a person.(2) Legality of arrest – Delhi liquor scam – Special Court ....
Judicial review of PMLA arrests limited to procedural compliance; 'reasons to believe' under s.19 valid on prima facie material like seized assets, statements; no need for naming in predicate FIRs; o....
The court held that the applicant failed to satisfy the twin conditions for bail under Section 45 of the PMLA, 2002, due to the serious nature of the allegations and the evidence presented.
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
