LI Network
Published on: November 24, 2023 at 00:50 IST
A three-judge bench of the Supreme Court has decided to transfer the case questioning the validity of provisions in the Prevention of Money Laundering Act (PMLA) to another bench. The decision comes after two days of hearings, during which petitioners challenged the PMLA’s validity.
Justices Sanjay Kishan Kaul, Sanjiv Khanna, and Bela M Trivedi expressed their inability to draft a judgment within the given timeframe.
The Central government sought additional time to prepare and present its arguments, and Justice Kaul is scheduled to retire on December 25.
The bench, acknowledging the circumstances, allowed the amendment application and granted four weeks for filing a counter-affidavit, with an additional four weeks for rejoinders if necessary. Due to Justice Kaul’s impending retirement, the Chief Justice of India will reconstitute the bench.
Petitioners in the case had sought a reconsideration of the Court’s previous decision in Vijay Madanlal Choudhary v. Union of India, which upheld the validity of PMLA provisions.
The Court had earlier declined to defer the hearing despite the ongoing Financial Action Task Force (FATF) review of the country’s anti-money laundering and terror financing laws.
During the recent hearings, the Court suggested that the Enforcement Directorate cannot invoke the PMLA for tax evasion cases, emphasizing that offenses under the Income Tax Act are not scheduled offenses under the PMLA.
The Central government expressed the need for more time, citing amendments made by the petitioners that broadened the challenge to encompass the entire PMLA. Solicitor General Tushar Mehta requested to commence arguments in December, to which the Court responded by stating that some deliberation is required.
Senior Counsel Abhishek Manu Singhvi criticized the Central government’s approach as a ‘distressing’ technique to avoid the hearing.
Senior Advocate Kapil Sibal, representing another petitioner, suggested that if the matter were referred to a larger bench, a detailed judgment from the current three-judge bench might not be necessary. However, the Court disagreed, emphasizing the need for careful consideration.
Despite allowing the petitioners’ amendment application, the Court decided to transfer the case to another bench due to the Central government’s request for additional time and Justice Kaul’s impending retirement.