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SC Declares Money Laundering Bail Provision Unconstitutional

This can be seen as a setback for the Modi government, which had defended the provision on an argument that it was an effective tool in black money cases.

Utkarsh Anand | CNN-News18

Updated:November 23, 2017, 1:02 PM IST
SC Declares Money Laundering Bail Provision Unconstitutional
(Image: Network18 Creatives)

New Delhi: The Supreme Court on Thursday declared as unconstitutional a provision in the Prevention of Money Laundering Act (PMLA) in laying down exceptionally stringent bail conditions.

This can be seen as a setback for the Modi government, which had defended the provision on an argument that it was an effective tool in black money cases.

A bench led by Justice Rohinton F Nariman struck down Section 45 in the PMLA to the extent that it refuses bail to the accused on the basis of twin conditions.

The first condition says that no bail can be given without giving the public prosecutor an opportunity to oppose the bail plea. The second condition stipulated that the bail can be given only when the concerned court is prima facie satisfied that the accused is not guilty of the offence alleged against him.

These two conditions made grant of bail virtually impossible in money laundering cases and the maxim tend to be shifted from “bail is rule and jail an exception” to “jail is rule and bail an exception”.

A clutch of petitions challenged the validity of Section 45 to the extent that it made bail an exception, contrary to legal principles and a body of Supreme Court judgments.

The top court accepted the petitioners' contentions and held that Section 45, in so far as it laid down the two stringent and unreasonable conditions, is bad in law and cannot be sustained.

The bench set aside all orders in which bail had been denied after relying on the conditions in Section 45 and directed the trial courts to hear the bail plea afresh.

Since all such accused are languishing in jail and their personal liberty is involved, the court said, their bail applications will be taken up and decided as early as possible, without resorting to the previous conditions.

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