Arvind Kejriwal vs. Directorate of Enforcement [July 12, 2024]
Citation: [2024] 7 S.C.R. 2363; 2024 INSC 512; Criminal Appeal No. 2493 of 2024
Background and Facts
This Supreme Court judgment addresses the arrest of Delhi Chief Minister Arvind Kejriwal by the Directorate of Enforcement (ED) under the Prevention of Money Laundering Act, 2002 (PMLA), in connection with the alleged Delhi liquor excise policy scam. The ED alleged that the Delhi Government, led by Kejriwal, designed the excise policy to favor certain private entities in exchange for kickbacks, which were purportedly used for Aam Aadmi Party’s election campaign in Goa, involving proceeds of crime amounting to ₹45 crores.
Kejriwal was arrested on March 21, 2024. The Delhi High Court upheld the arrest, finding sufficient material to demonstrate his involvement in concealing proceeds of crime. Kejriwal challenged this before the Supreme Court, arguing that his arrest violated Section 19(1) of the PMLA, which prescribes statutory safeguards for arrest, and also invoked constitutional protections under Article 22.
Key Legal Issues
Whether the ED complied with the statutory preconditions for arrest under Section 19(1) of the PMLA.
Whether the “need and necessity to arrest” is a distinct and judicially reviewable ground under the PMLA.
The scope of judicial review over arrests made under the PMLA, especially in light of constitutional safeguards.
Arguments
For Kejriwal:
Senior Advocate Abhishek Manu Singhvi contended that the ED lacked sufficient material for the arrest and relied on coerced or unreliable witness statements.
He argued that the “reasons to believe” required under Section 19(1) were not genuinely satisfied and that the arrest was arbitrary and disproportionate.
For the ED:
The ED submitted that it had collected material showing the policy was intended to generate bribes and that Kejriwal was actively involved in the concealment and use of proceeds of crime.
The ED argued that courts should not conduct a “mini-trial” at the stage of arrest and that the existence of statements implicating the accused sufficed for the “reasons to believe” standard.
Supreme Court’s Analysis and Findings
The Supreme Court granted interim bail to Kejriwal to allow him to campaign for the 2024 General Elections, with a direction to surrender after polling.
The Court refrained from deciding the legality of the arrest on merits, instead referring three key legal questions to a larger bench:
Whether the “need and necessity to arrest” is a separate ground to challenge an arrest under Section 19(1) of the PMLA.
Whether the legality of an arrest under Section 19(1) can be judicially reviewed while the investigation is ongoing.
The scope of judicial scrutiny over the ED’s “reasons to believe” for arrest.
The Court observed that the ED had recorded its subjective satisfaction and “reasons to believe” for the arrest, and that Kejriwal did not contest the factual basis of these reasons in court. The Court found the ED’s material sufficient to justify the arrest at this preliminary stage, but clarified that it was not adjudicating on the merits of the allegations.
The Bench emphasized that judicial review of arrests under Section 19(1) is permissible, and that a wrongful or arbitrary exercise of power can be struck down, but the court should not enter into a merits-based review at the stage of arrest.
Conclusion and Significance
The Supreme Court’s judgment is significant for clarifying the judicial review powers over arrests under the PMLA, especially regarding the “need and necessity” to arrest and the sufficiency of “reasons to believe.”
By referring the core legal questions to a larger bench, the Court has left open the broader constitutional and procedural issues regarding the limits of ED’s arrest powers under the PMLA.
The judgment underscores the balance between effective investigation of economic offences and protection of individual rights under constitutional and statutory safeguards.
In summary: The Supreme Court granted interim bail to Arvind Kejriwal and referred crucial questions about the necessity and legality of arrests under the PMLA to a larger bench, holding that judicial review is available but should not extend to a merits-based assessment at the arrest stage.
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