The Bombay High Court has quashed an Enforcement Directorate arrest, citing lack of new evidence and procedural irregularities in invoking prosecution under PMLA.
The Bombay High Court has set aside the arrest of a businessperson by the Enforcement Directorate (ED) in a money laundering case, ruling that the arrest was based on evidence already in the possession of the investigating agency at the time of summons.
The Court observed that the ED had issued a notice under Section 41A of the CrPC (now Section 35(3) BNSS) and subsequently arrested the individual without demonstrating any fresh evidence or material necessitating custody. Relying on Supreme Court precedents, the Bench held that arrest must be justified by post-summons developments, failure or refusal to comply, or risk of evidence tampering—none of which were established here.
"Arrest cannot be used as a tool of coercion when the person has complied with the notice to appear and no new incriminating material has emerged."
Implications for Practitioners
This order reinforces the right against arbitrary arrest under PMLA and underscores procedural compliance by enforcement agencies. Defence counsel may invoke this precedent to challenge unlawful detentions and seek discharge or quashing where ED relies solely on pre-existing information.
