Supreme Court rejects V Senthil Balaji plea seeking release in money laundering case; grants ED 5-day custody

The Supreme Court on Monday dismissed the pleas moved for the release of Dravida Munnetra Kazhagam (DMK) minister V Senthil Balaji who was arrested last June in a money laundering case being probed by the Enforcement Directorate. [V Senthil Balaji vs State Represented by Deputy Director and ors].A bench of Justices AS Bopanna and MM Sundresh also granted the Enforcement Directorate (ED) custody of Balaji for five days until August 12..The Court also clarified that the period spent by Balaji for medical treatment at a hospital after his arrest cannot be included in the period of ED custody. "Admittedly, physical custody has not been given to the respondents (ED) ... An investigating agency is expected to be given a reasonable freedom to do its part. To say that the respondents ought to have examined the appellant in the hospital, and that too with the permission of the doctors, can never be termed as an adequate compliance," the Court held..The order was passed on two pleas moved by Balaji and his wife. A connected plea moved by the ED was also heard along with the pleas for Balaji's release. The Madras High Court had earlier ruled against releasing the minister prompting Balaji and his wife, S Megala to move the apex court.Meanwhile, the ED had also moved the top court contending that the High Court had erred in even entertaining a habeas corpus petition filed by Balaji's wife after his remand. The ED's plea was heard along with the pleas filed by Balaji and his wife..The Supreme Court ruled that there was no cause for filing the Habeas Corpus petition since, by that time, Balaji had been duly produced before a Sessions Judge in compliance with Section 19 of the Prevention of Money Laundering Act (PMLA) of 2002. "Despite additional grounds having been raised, they being an afterthought, we have no hesitation in holding that the only remedy open to the appellant is to approach the appropriate Court under the Statute. This was obviously not done. We may also note that the appellant was very conscious about his rights and that is the reason why, by way of an application he even opposed the remand," the Court added. .The Court proceeded to rule against the release of Senthil Balaji. The Court further summarised its conclusions as follows:i. When an arrestee is forwarded to the jurisdictional Magistrate under Section 19(3) of the PMLA, 2002 no writ of Habeas Corpus would lie. Any plea of illegal arrest is to be made before such Magistrate since custody becomes judicial.ii. Any non-compliance of the mandate of Section 19 of the PMLA, 2002 would enure to the benefit of the person arrested. For such noncompliance, the Competent Court shall have the power to initiate action under Section 62 of the PMLA, 2002.iii. An order of remand has to be challenged only before a higher forum as provided under the CrPC, 1973 when it depicts a due application of mind both on merit and compliance of Section 167(2) of the CrPC, 1973 read with Section 19 of the PMLA 2002.iv. Section 41A of the CrPC, 1973 has got no application to an arrest made under the PMLA 2002.v. The maximum period of 15 days of police custody is meant to be applied to the entire period of investigation – 60 or 90 days, as a whole.vi. The words “such custody” occurring in Section 167(2) of the CrPC, 1973 would include not only a police custody but also that of other investigating agencies.vii. The word “custody” under Section 167(2) of the CrPC, 1973 shall mean actual custody.viii. Curtailment of 15 days of police custody by any extraneous circumstances, act of God, an order of Court not being the handy work of investigating agency would not act as a restriction.ix. Section 167 of the CrPC, 1973 is a bridge between liberty and investigation performing a fine balancing act.x. The decision of this Court in Anupam J. Kulkarni (supra), as followed subsequently requires reconsideration by a reference to a larger Bench..The case against Balaji stems from alleged irregularities in the appointment of bus conductors in the Tamil Nadu transport department, as well as the appointment of drivers and junior engineers.These appointments were made during Balaji's tenure as the Transport Minister in the All India Anna Dravida Munnetra Kazhagam (AIADMK) government between 2011 and 2015. Balaji later joined the DMK in 2018.Following his remand by a sessions court, Balaji was placed under judicial custody. However, instead of being sent to prison, he was eventually transferred to a private hospital where he underwent bypass surgery.Meanwhile, his wife filed a habeas corpus petition before the High Court seeking his release. After a division bench of the High Court delivered a split verdict on this plea, a third judge was appointed to decide on the matter. The third judge eventually ruled against Balaji's release..Solicitor General Tushar Mehta appeared for the ED before the Supreme Court.Balaji and his wife were represented by Senior Counsel Kapil Sibal and Mukul Rohatgi and advocate Misha Rohatgi..[Read Judgment]