Denying custody is taking away ED's duty to investigate: Tushar Mehta

CHENNAI: Money laundering cases affecting the global community, denying the custodial interrogation to the Enforcement Directorate (ED) is taking away its duty to investigate the Solicitor General of India Tushar Mehta argued defending the ED in the Habeas Corpus Petition (HCP) case filed by Senthilbalaji's wife Megala. The Madras High Court has posted the matter to July 14 for further hearing.

Solicitor General (SG) Tushar Mehta advanced his arguments before the third judge CV Karthikeyan, who was named to hear the HCP case after the split verdict. SG commenced his arguments by saying that money laundering cases are not only affecting one country but it also affects the global community.

Various countries were grappling with money laundering cases till the year 2000, so the United Nations came up with a convention to constitute a Financial Action Task Force (FATF) to take stringent action against money laundering.

FATF periodically reviews all the countries whether they are in compliance with principles and how they are dealing with money laundering cases. The FATF put every country on a different list, Pakistan was on the grey list and it is sinking into the black list. A country to get any funds from the world bank and other international financial institutions would depend upon compliance with the stringent statutory, said SG.

The SG advanced his arguments on the grounds that this HCP is not maintainable, the ED entrusted with SHO power and to exempt the hospitalized period of Senthilbalaji from custody period. After filing of HCP, a judicial order of remand is passed then it cannot be said to be in illegal custody at all. The HCP would not lie because the person would be under a judicial order, contended SG.

Justice Banu also agreed, that once a person was arrested, Section 167 applies but cannot be given to ED custody for interrogation. The interpretation takes away my duty to investigate. ED never uses the expression its power to investigate, it always uses the expression its duty to investigate when thousands of people have lost their money, said SG. Denial of custodial interrogation denies the duty of investigation, he added.

SG contended that inquiry and investigation are used interchangeable in PMLA cases under Section 19 the satisfaction of the investigation officer with respect to the guilt of the accused is only prima facie. Therefore, we can move forward and investigate, he added.

The Investigating Officer (IO) has to put the written reasons in a sealed cover and handover to the adjudicating authority. there is a provision included that the IO can be prosecuted for a wrongful arrest. The adjudicating authority is a completely independent body that double seals the material said the SG. The ED has returned approximately Rs.18,000 to Rs.19,000 crore from the bank frauds, with their efforts.

Section 19 is scrupulously followed that No officer can come under pressure to arrest somebody unless he has the material to believe that a person is guilty of money laundering. Therefore, ED cannot arrest anyone at the drop of a hat, contended SG.

In the interim order, MHC said that Senthilbalaji will continue to be in judicial custody; the division bench said he shall continue to be in judicial custody, that is for the purpose of denying bail. It is not to say that ED cannot take him for custodial interrogation, he added.

Justice asked why the ED sent a memo stating that it is impossible to interrogate Senthilbalaji in hospitalized condition.

Justice intervened and asked what are conditions for the custodial interrogation imposed by the session judge were. The sessions judge wants us to take into consideration of Senthilbalaji's ailments. What do we do, If we take custody and he complains of chest pain, who will take responsibility? SG questioned. He added, that, The 15 days is the maximum period for which ED can take an accused into its custody and that 15 days of maximum period can be used at any point in time, said SG.

After the submissions, the Justice posted the matter to July 14 for further arguments.