Judicial officers assigned to Special PMLA courts have been cautioned by the Punjab and Haryana high Court not to act as an ‘extended arm’ of the Central Investigating Agency, the Enforcement Directorate(ED), after they passed remand orders against a suspect as a matter of course. Noting thus, Justice Mahabir Singh Sindhu in his order set aside the ‘routine order’ of a special court that granted ED custody for custodial interrogation of an accused Balwant Singh in a PMLA case.

The court made observations during the ongoing hearing on a plea under Article 226 of the constitution read along with section 528 of the Bharatiya Suraksha Sanhita, 2023, seeking quashing of remand order and an order directing judicial custody of Balwant Singh alleged accused under PMLA.

The instant case relates to an alleged loan facility of an amount of Rs 46 crore that was fraudulently availed by M/s Tara Corporation Limited by showing bogus share capital and sham turnovers. It was ED’s submission that the amount was not used ever for the intended purposes, rather, re-routed to accounts of other sister and shell companies with an intention to misuse the loan amount. The accused Balwant Singh and other co-accused were apprehended and booked in the matter.

ED then filed a complaint under section 44 of PMLA against 7 co-accused including the petitioner Balwant Singh, Kulwant Singh and Tejinder Singh, M/s TCL, M/s THFL and M/s Tara Sales Limited.

Matter adjourned And Treated like Civil Dispute

Upon examination of submissions, the court observed that Singh’s ED custody was to end on 9.10.2024, however on that day, the Special Judge went on a short leave and consequently, Singh was produced before the Judge on duty, who posted the matter for the next day, treating it ‘like a civil dispute’. Neither was the remand extended by the judge on duty nor was he apprehended to judicial custody and the fall out of this was that Singh continued to remain in ED custody on the 5th day as well.

Sindhu then highlighted that, yet again after this, without any justification, Singh remained in judicial custody until 23.10.2024 under orders of the Special court. Custody was again extended twice until 20.11.2024 without reasons or justification. Noting that the impugned remand orders were passed at a post-cognizance stage, the court brought to notice, Section 309 CrPc, which constitutes “Power to postpone or adjourn proceedings.” Section 309(2)Explanation of the code entails that an accused can be remanded to custody subject to the fulfillment of two pre-conditions : (1) the accused is in custody; and (2) sufficient evidence has been obtained to raise a suspicion that the accused may have committed an offense and it appears likely that further evidence may be obtained by a remand stated the court.

After due deliberation, the court observed that, “however, in the present case, none of the above conditions had been satisfied on 5.10.2024, for the simple reason that neither the petitioner was in custody; nor was there was sufficient evidence obtained by the ED to the effect that he has committed an offense of money-laundering as no order in terms of Section 19 of the PMLA is passed by the competent authority till date.” Calling the orders of ‘custodial interrogation and ‘remand to judicial custody’ passed by the Special court, ‘indefensible in law’’ the Judge voiced his disapproval of the same stating that it was ‘without application of judicial mind’.

" There would be no hesitation to observe that…(remand)order is neither coherent; not any reason(s) is/are discernible to sustain the custodial interrogation of petitioner for 04 days on mere asking of the E.D’’. The court also expressed its disapproval over the way the Special court accepted ED’s prayer in a routine manner and authorized Singh’s custodial interrogation ‘while negating the salutary protection emanating from Article 21 of the Constitution’.

Consequently, the petition was allowed, the court requested the Registrar (Vigilance) to verify when the detailed order of 05.10.2024 was uploaded online by the Special court with noting of the date and time of the order to be mentioned as well. ‘Directions that a report is to be filed within two months, for further action, if required’.

Petitioner is ordered to be released from judicial custody, forthwith. The impugned order dated 05.10.2024, passed by the Special court as well as all successive orders, thereby remanding the petitioner to judicial custody, was quashed and set-aside.

Case Details: Balwant Singh v/s Directorate of Enforcement

Advocates for Petitioner: Mr. Vikram Choudhri, Mr Keshavam Choudhari, Ms. Hargun Sandhu and Mr Gorav Katrhuria.

Advocates for Respondent : ASG Mr. Satya Pal Jain, Ms Meghna Malik.