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Synopsis

Yesterday, while making his submissions in the plea challenging the judgment of Vijay Madanlal Chaudhary and Ors. vs. Union of India and Ors. wherein the constitutional validity of various provisions of the Prevention of Money Laundering Act, 2002 were upheld, Senior Advocate Kapil Sibal said that in his 35 years of being a legislator her had not seen such a law.

To this statement by Sibal, Justice Bela Trivedi, part of the special 3-judge bench hearing the review asked, "Were you in opposition in 2002?"

Notably, Sibal said that the judge's question was unfair as the Act had been amended later to introduce the impugned provisions.

"We never envisioned it would be enforced in this way. What my ladyship is asking is moot," Sibal added.

"Only asking if you were in Opposition that year..." Justice Trivedi went on to clarify.

PMLA was passed by the Parliament in 2002, but was brought into force in 2005, when the Congress-led United Progressive Alliance was in power.

The Central Government yesterday also opposed the general approach of the petitions challenging the PMLA saying, ""They cannot argue on a wide canvas. Challenge to Sections 50 and 63 is fine..but other than that we will oppose..".

When Solicitor General Tushar Mehta told a bench of Justices SK Kaul, Sanjiv Khanna and Bela Trivedi that PMLA is a very important legislation for the nation, Sibal had responded saying, "If government lawyers will make such arguments then where are we headed..".

"Government lawyers cannot give interviews on a issue and then argue in court..", SG Mehta had replied.

Earlier, the Supreme Court had refused to postpone the review hearing in the pleas. Solicitor General Tushar Mehta had informed the court that the Financial Action Task Force (FATF) evaluation was commencing from November 4, and court questioning the legislation at this stage would have a serious implication on the national interest.

In August 2022, the Supreme Court had issued notice in the review petition filed by Karti Chidambaram against the PMLA judgment on limited purview.

Earlier, Court had also allowed a plea seeking an open court hearing in the review petition. On August 22, 2022 the Court had agreed to hear a review petition challenging its judgment.

A Justice AM Khanwilkar led bench of the top court on July 27, 2022 had upheld the constitutional validity of various provisions of the Prevention of Money Laundering Act, 2002. The bench, also consisting of Justices Dinesh Maheshwari and CT Ravikumar however held that the challenge to the passage of amendments to the Act in 2019 as a money bill will be considered by a larger bench. 

Over 200 petitions were filed challenging the provisions of the Act. It was argued before the court that the powers of the Enforcement Directorate to arrest, force confessions, and seize property were unbridled.

In its 545-page judgment, the Court answered 12 questions of law formulated in the batch of petitions. A comprehensive look at the same can be found here.

Case Title: KARTI P. CHIDAMBARAM vs. THE DIRECTORATE OF ENFORCEMENT