Herald View: PMLA amendments upheld by SC a telling blow to personal liberty

In the run-up to the highly choreographed, heaving celebrations — grandly named ‘Azadi Ka Amrit Mahotsav’ — to mark the 75th anniversary of our Independence, we are witnessing an almost surreal alternative reality. In that parallel universe a lot of us occupy, it appears that all the hard-won freedoms we celebrate on the day and the personal liberties we long took for granted are slipping out of our grasp.

Another telling blow to those liberties was delivered by the highest court of the land on July 27, when the Supreme Court of India upheld the latest amendments to the Prevention of Money Laundering Act (PMLA). The amendments grant the Enforcement Directorate, the central investigating agency policing that domain, untrammelled powers to search, seize, arrest, without even sharing the ECIR (enforcement case information report) with the accused. It’s an ‘internal document’, the court ruled, which cannot be equated with an FIR (first information report).

In effect, as an accused, you wouldn’t know the charges against you — and yet the onus would be on you to prove your innocence. How does that square with the principle of ‘presumption of innocence’?

The court argued that ‘money laundering’ is as repugnant as terrorism justifying the state’s heavy hand in dealing with it. The amendments give sweeping powers to the ED to investigate suspected cases of money laundering without a show cause, without preliminary findings and without filing a First Information Report (FIR).

It does not require any sanction from an (overseeing) competent authority before prosecuting public servants, legislators and members of Parliament. It can arrest a suspected accused without telling him why. It can retrospectively look into past crimes.

The definition of ‘money laundering’ in the PMLA is such that the agency and its lawyers are left free to interpret what constitutes a crime or the ‘proceeds of crime’. Not concealing the transaction and declaring it to the authorities is not a mitigating factor, held the court.

In the National Herald case, money laundering is alleged when there has been no monetary transaction. The Shiv Sena’s Rajya Sabha MP Sanjay Raut has been arrested allegedly for having received one crore rupees from a real estate deal over a decade ago, with the amount declared both in income tax returns and election affidavits.

Since most of these transactions are old and documented, there is little the accused can do to manipulate evidence, but the law still makes them extremely vulnerable to the whims of the Directorate and their political masters, who will use it to target political opponents. As many as 126 sitting and former opposition legislators and MPs are reportedly being investigated.

PMLA 2002, like money laundering acts in other countries, came into existence in the wake of the so-called ‘war on terror’, following the Al-Qaeda attack on the Twin Towers in New York on September 11, 2001. But how successful has it been in putting a lid on crimes it supposedly polices? As per data presented in Parliament, of the 5,422 money laundering cases filed since PMLA came into force in July 2005, only 23 people have been convicted—which is a conviction rate of less than 0.5 per cent! As Justice Madan Lokur said to Karan Thapar in an interview for The Wire, that statistic is a telling statement on both the quality of cases the ED has filed and the quality of its investigation.

The ED boasts of confiscating property worth Rs 1 lakh crore in the past 17 years, which is really a pittance given, for perspective, that a single drug haul at Mundra Port in Gujarat last year was valued at Rs 21,000 crore.

Poor investigation is being substituted with draconian laws, which, to paraphrase some other learned judges of the Supreme Court, effectively makes the process itself the punishment.

(This article was first published in National Herald on Sunday.)