The Supreme Court of India has recently underscored the pressing need for the establishment of special courts dedicated to Prevention of Money Laundering Act (PMLA) cases, emphasizing that this is crucial to expedite trials and address the burgeoning backlog of cases. The court's concern stems from the slow pace of PMLA trials, which is often attributed to delays caused by influential individuals employing various legal tactics to prolong proceedings.
During a recent hearing, a bench led by Justice Surya Kant urged the Enforcement Directorate (ED) to improve its investigative processes, pointing out the unacceptably low conviction rate in PMLA cases. The court noted that the ED has only secured convictions in less than 10% of approximately 5,000 cases over the past five years. This has raised serious questions about the effectiveness and efficiency of the agency's operations.
To address these concerns, Justice Kant suggested setting up special PMLA courts, similar to those established for cases under the Terrorist and Disruptive Activities (Prevention) Act (TADA) and the Prevention of Terrorism Act (POTA). The rationale behind this suggestion is that dedicated courts would allow for day-to-day trials, which would deter accused persons from filing frivolous applications aimed at delaying the judicial process. Furthermore, it was argued that these courts would streamline the process, ensuring quicker resolutions.
The Supreme Court also raised concerns regarding the challenges the ED faces while investigating cases involving cryptocurrencies and foreign jurisdictions, particularly those where accused individuals flee to evade legal accountability. The ED's arrest procedures, including the non-disclosure of investigation reports to the accused, also came under scrutiny. Further hearings have been scheduled to address these issues.
In addition to emphasizing the need for special courts, the Supreme Court has also stressed that the ED must operate within the bounds of the law and cannot act arbitrarily. The court has stated that the ED cannot act like a "crook" and must function strictly within legal boundaries. This observation came during a review of petitions challenging the court's 2022 ruling, which upheld the ED's powers of arrest under the PMLA. The government has argued that these petitions are disguised appeals lacking grounds of apparent error.
The establishment of special PMLA courts is expected to significantly accelerate trial proceedings in money laundering cases. The ED has stated that with the notification of special courts in various states, it will be able to address the concerns raised by constitutional courts regarding delays in trials. For instance, in Telangana, 16 special courts have been established, including two for Visakhapatnam. Rajasthan has increased the number of special courts from one to five, including one in Jodhpur. Goa has also been notified of an exclusive special court for PMLA cases in North Goa.
