A) ABSTRACT / HEADNOTE

The Supreme Court dealt with the application of the proviso to Section 45(1) of the Prevention of Money Laundering Act, 2002 (PMLA) in the context of a bail plea by a woman accused of serious economic offenses. The appellant, a prominent political figure, challenged the denial of bail by the Delhi High Court. The Court ruled that the statutory special treatment provided to women under the proviso applies irrespective of educational background or societal status. The High Court’s interpretation that only “vulnerable women” could benefit was deemed erroneous. Consequently, the appellant was granted bail, emphasizing the principle that prolonged pretrial incarceration violates the fundamental right to liberty under Article 21 of the Constitution of India.

Keywords: Proviso to Section 45 PMLA, Bail for Women, Fundamental Right to Liberty, Prolonged Incarceration, Article 21.

B) CASE DETAILS

• i) Judgment Cause Title: Kalvakuntla Kavitha v. Directorate of Enforcement
• ii) Case Number: Criminal Appeal No. 3522 of 2024
• iii) Judgment Date: 27 August 2024
• iv) Court: Supreme Court of India
• v) Quorum: Hon’ble Justice B.R. Gavai and Hon’ble Justice K.V. Viswanathan
• vi) Author: Justice B.R. Gavai
• vii) Citation: [2024] 8 S.C.R. 717 : 2024 INSC 632
• viii) Legal Provisions Involved:
  • Prevention of Money Laundering Act, 2002, Section 45(1) Proviso
  • Code of Criminal Procedure, 1973, Section 164
  • Constitution of India, Article 21
• ix) Judgments Overruled by the Case: N/A
• x) Case is Related to: Criminal Law, Economic Offenses, Bail Laws

C) INTRODUCTION AND BACKGROUND OF JUDGMENT

This case arose from the denial of bail to Kalvakuntla Kavitha, a politician and former Member of Parliament, under the PMLA. The allegations involved conspiracy, tampering of evidence, and complicity in an excise policy scam. The High Court interpreted the proviso to Section 45(1) restrictively, allowing its application only to “vulnerable women.” The Supreme Court reconsidered the statutory interpretation of the proviso in light of the Constitution’s guarantees under Article 21.

D) FACTS OF THE CASE

1. The appellant was implicated in an excise policy scam involving alleged money laundering under the PMLA.
2. The Directorate of Enforcement (ED) filed a complaint citing her role as a conspirator in the policy’s formulation and implementation.
3. The appellant had been in custody for over five months, and the trial involved 493 witnesses and voluminous documents.
4. The prosecution alleged tampering of evidence, including the formatting of mobile devices, and influencing witnesses.
5. The High Court denied bail, asserting that the appellant did not qualify as a “vulnerable woman.”

E) LEGAL ISSUES RAISED

• i) Does the proviso to Section 45(1) of the PMLA grant bail to all women irrespective of vulnerability?
• ii) Is prolonged incarceration without trial violative of Article 21 of the Constitution?

F) PETITIONER/APPELLANT’S ARGUMENTS

1. Statutory Entitlement Under Proviso: The appellant argued that Section 45(1) explicitly allows bail to women, irrespective of their socio-economic status.
2. No Further Custody Required: Investigation was complete, and charge sheets were filed in both the CBI and ED cases.
3. Fundamental Rights: Prolonged incarceration amounts to punishment without trial, violating Article 21 of the Constitution.
4. Precedents: Relying on Manish Sisodia v. Directorate of Enforcement and Saumya Chaurasia v. Directorate of Enforcement, the appellant contended that bail is the rule, refusal the exception.

G) RESPONDENT’S ARGUMENTS

1. Serious Allegations: The ED emphasized the appellant’s alleged role as the “kingpin” in the conspiracy and tampering with evidence.
2. Misuse of Proviso: The respondent contended that the proviso should benefit only vulnerable women, not influential individuals.
3. Public Interest: Denying bail was necessary to prevent the appellant from influencing witnesses or destroying evidence.

H) JUDGMENT

a. Ratio Decidendi:

1. The proviso to Section 45(1) applies equally to all women, irrespective of vulnerability.
2. Prolonged pretrial detention undermines the fundamental right to liberty under Article 21.
3. Denial of the statutory benefit must be based on specific reasons.

b. Obiter Dicta:

Courts must interpret statutory provisions judiciously, ensuring fundamental rights are prioritized.

c. Guidelines:

1. The proviso to Section 45(1) grants special consideration to women accused of money laundering.
2. High Courts must avoid restrictive interpretations that dilute statutory rights.

I) CONCLUSION & COMMENTS

The Supreme Court’s judgment reinforces the constitutional balance between statutory provisions and fundamental rights. The decision corrects the High Court’s misinterpretation, ensuring that statutory benefits under the PMLA are not denied based on societal perceptions of vulnerability.

J) REFERENCES

a. Important Cases Referred:

1. Manish Sisodia v. Directorate of Enforcement, 2024 SCC OnLine SC 1920
2. Saumya Chaurasia v. Directorate of Enforcement, [2023] 15 SCR 848

b. Important Statutes Referred:

1. Prevention of Money Laundering Act, 2002, Section 45(1)
2. Code of Criminal Procedure, 1973, Section 164
3. Constitution of India, Article 21