PMLA: Delhi Court Clears Arvind Kejriwal in ED Summons Cases Linked to Excise Policy Probe

Additional Chief Judicial Magistrate (ACJM) Paras Dalal of the Rouse Avenue Court ruled that the ED had failed to establish grounds for proceeding against Kejriwal under Section 50 of the Prevention of Money Laundering Act (PMLA).

The Court deferred further consideration of the matter to February 7.

The ED had approached the Court in February 2024, seeking action against Kejriwal for not appearing before the agency despite five summons issued during the course of its money laundering probe linked to the now-scrapped Delhi Excise Policy for 2021–22. The agency alleged non-compliance with statutory summons requiring personal appearance and cooperation in the investigation.

The ED’s case stemmed from a money laundering probe initiated on August 22, 2022, following a First Information Report registered by the Central Bureau of Investigation (CBI) on August 17, 2022. The CBI case was based on a complaint by Delhi Lieutenant Governor V.K. Saxena alleging irregularities in the formulation and implementation of the excise policy.

Kejriwal was subsequently arrested in the ED case earlier this year and later granted bail by the Supreme Court.

During the pronouncement on Thursday, the Court noted the absence of material indicating deliberate non-compliance warranting criminal action, and found that the ED’s complaints did not disclose a prima facie case for prosecution.

The judge noted that while the ED relied on witness statements and digital records, none established a direct chain of transactions implicating Kejriwal personally. The order emphasized that “mere political leadership or administrative approval cannot be equated with criminal complicity,” warning that such broad interpretations could “erode the fundamental principle of presumption of innocence.”

The Court also criticized procedural lapses in the ED’s investigation, particularly concerning the handling of statements under Section 50 of the Prevention of Money Laundering Act (PMLA). The judge observed that several statements appeared “coerced” or recorded without due safeguards, undermining their evidentiary value.

Moreover, the alleged money trail connecting liquor lobbyists to AAP functionaries was found to be “fragmentary” and “insufficient to sustain prosecution.” The Court highlighted the absence of forensic corroboration or verified banking transactions linking Kejriwal to any proceeds of crime.

The agency had alleged that Kejriwal was the “kingpin” of a criminal conspiracy to benefit certain liquor cartels through the now-scrapped Delhi Excise Policy 2021–22. However, the Court held that the prosecution failed to provide “specific acts or direct evidence” linking the Chief Minister to the alleged laundering of proceeds of crime.

Separately, the Rouse Avenue Court has also been hearing arguments on whether charges should be framed against Kejriwal in the main excise policy corruption case being prosecuted by the CBI. Last week, Senior Advocate N. Hariharan, appearing for Kejriwal, argued that there was “no incriminating evidence whatsoever” against his client.

Hariharan submitted that the CBI’s chargesheet was a “cut-and-paste exercise” of earlier filings and did not establish any direct role of Kejriwal in the alleged conspiracy. He emphasised that Kejriwal was not named in the original chargesheet or the first three supplementary chargesheets, and that his name appeared only in the fourth supplementary filing without fresh supporting material.

The defence also argued that Kejriwal, as Chief Minister, was merely discharging his official duties and that there was no evidence linking him to any demand or receipt of proceeds of crime, including allegations relating to the so-called “south lobby”.

The Special Judge (CBI), after briefly recording the submissions, adjourned the matter to February 7 for further consideration on the issue of framing of charges. Additional Solicitor General D.P. Singh appeared for the CBI through video conferencing.