SC: Tough PMLA bail conditions can't override accused's right

The Supreme Court held that stringent bail conditions under the Prevention of Money Laundering Act cannot override constitutional protections. An accused cannot be kept in custody until the trial ends if the proceedings are taking too long. The ruling protects the Article 21 rights to liberty and a speedy trial.

The court granted bail to an accused arrested in December 2024 in an alleged money-laundering case involving over Rs 6,210 crore. The trial court would need to examine thousands of pages and about 98 witnesses. The bench said continued custody during such a lengthy process would be unjustified, subject to bail bonds and other conditions.

The decision does not remove Section 45's strict requirements. It confirms that those requirements cannot permit indefinite imprisonment before conviction. Investigating and prosecuting institutions must move cases forward quickly, because the legal process must not become punishment itself.

The Prevention of Money Laundering Act, or PMLA, is the anti-money-laundering law discussed in the article. It targets alleged laundering of proceeds and gives courts unusually strict bail rules. The law’s approach matters because economic offences can affect the financial fabric of the country and create consequences across the wider economy.

Section 45 requires the prosecution to receive an opportunity to oppose bail. It also requires the court to find reasonable grounds for believing that the accused is not guilty and is unlikely to commit another offence while on bail. This makes bail difficult, especially in serious cases.

The Supreme Court accepted that large economic offences are serious, but said strictness has limits. Authorities must investigate and prosecute cases expeditiously. PMLA’s purpose cannot justify keeping an undertrial imprisoned indefinitely, because the process itself must not become punishment before conviction.

Section 45 sets two main requirements for bail under the PMLA. First, the public prosecutor must receive an opportunity to oppose the accused’s release. Second, the court must be satisfied that there are reasonable grounds to believe the accused is not guilty and is unlikely to commit an offence while on bail.

The second requirement places a heavy burden on the accused. The person seeking release must persuade the court that the case does not reasonably establish guilt and that release will not lead to another offence. These conditions make bail rare in serious PMLA matters.

The Supreme Court nevertheless held that Section 45 cannot override Article 21. Even when the normal conditions are strict, an undertrial cannot be kept in custody indefinitely while waiting for a delayed trial. Constitutional safeguards continue to apply, including liberty and the right to a speedy trial.

This case involved an alleged money-laundering amount of over Rs 6,210 crore. The scale was central to the bail decision because the trial would require the court to work through thousands of pages of documents and examine around 98 witnesses.

The accused was arrested in December 2024. The Enforcement Directorate alleged that he created 62 shell companies, used 34 dummy directors, and had 20 companies managed by relatives who contributed to the offence. These allegations made the case both serious and complex.

The bench said the trial’s likely length could not justify keeping the appellant in custody throughout. It ordered release on bail, subject to bail bonds, the trial court’s satisfaction, and other conditions. The decision shows that case complexity must be balanced against the constitutional harm caused by prolonged pre-trial detention.

When a trial is delayed and custody continues for years, an accused may effectively suffer punishment before being found guilty. The Supreme Court said prolonged incarceration violates the fundamental right to a speedy trial and threatens the liberty protected by Article 21.

The court stressed that an accused cannot be held until the trial ends simply because the allegations are serious or the case is complicated. In this matter, thousands of pages and about 98 witnesses meant that the trial would take considerable time. Continued custody during that process would impose the rigours of imprisonment before conviction.

The ruling requires courts to balance the state’s interest with the arrestee’s rights. It also places responsibility on investigative and prosecuting institutions to proceed quickly. If delay becomes excessive, bail may be appropriate despite stringent special-law conditions, because legal process cannot become punishment itself.

The Supreme Court relied on its earlier decision in Manish Sisodia vs Directorate of Enforcement. That ruling held that prolonged incarceration before an accused is pronounced guilty should not become punishment without trial. It also linked unlimited custody with the Article 21 right to liberty and a speedy trial.

Applying that principle, the bench said Section 45’s twin conditions could not override constitutional safeguards. The present case involved an alleged laundering amount above Rs 6,210 crore, but the trial would involve thousands of pages and around 98 witnesses. The expected delay therefore mattered greatly.

The earlier decision helped establish that seriousness alone does not permit indefinite detention. The court still recognised the gravity of major economic offences and the need for strict PMLA rules. However, it required the state to balance those concerns with the accused’s rights and to pursue investigations and trials expeditiously.

Article 21 protects an accused person’s liberty and fundamental right to a speedy trial. The key reason is that an undertrial has not yet been pronounced guilty. Keeping that person imprisoned for an unlimited period can turn a legal process into punishment without trial.

The court recognised that major economic offences can damage the country’s financial fabric and affect many people. Yet seriousness does not erase constitutional safeguards. In the case before it, the alleged amount exceeded Rs 6,210 crore, but the trial required thousands of pages and around 98 witnesses, creating a substantial risk of delay.

Article 21 therefore requires a balance. The state may investigate and prosecute serious allegations, and PMLA bail conditions remain strict. But institutions must act expeditiously, while courts must prevent custody from continuing indefinitely. Where delay becomes excessive, bail can protect liberty without deciding the accused’s guilt.