Supreme Court Affirms Swift Trials as Essential in PMLA Cases Amidst Growing AI-Enhanced Money Laundering Threats

In a pivotal decision, the Supreme Court stressed the imperative for expeditious trials when the detention of the accused is extended, asserting the right to a speedy trial enshrined in Article 21 of the Constitution. The bench, comprised of Justices Aniruddha Bose and Bela M Trivedi, rejected a bail plea in a money laundering case, underscoring concerns over the escalating menace of financial crimes, particularly with the proliferation of Artificial Intelligence.

The court, grappling with the complexities posed by technology, highlighted the formidable challenges faced by investigative agencies in detecting and comprehending the intricate nature of transactions involved in money laundering. Emphasizing the need for meticulous scrutiny to prevent wrongful accusations and ensure that offenders do not evade legal consequences, the bench acknowledged the profound impact of technology on economic offenses.

Delving into a case brought before it, where the appellant sought relief under the Prevention of Money Laundering Act, the court referenced the Vijay Madanlal Chaudhary v. Union of India case from 2022. It underscored the mandatory nature of the conditions specified in Section 45 of the PMLA, asserting its overriding effect over other statutes, in line with Section 71.

Addressing a crucial aspect, the court clarified that the offense of money laundering is not contingent upon the date of the scheduled offense but hinges on the date when an individual engages in activities related to the proceeds of crime. It referenced the judgment in Vijay Madanlal Choudhary’s case, establishing the autonomy of money laundering as an offense concerning processes linked to the proceeds of crime.

Dismissing the appellant’s argument regarding the admissibility of witness statements recorded under Section 50 of the PMLA Act, the court referred to the precedent set in the Rohit Tandon v. Directorate of Enforcement case. It affirmed that both witness and accused statements are admissible, and in the present case, substantial material, including witness statements and documents, pointed to the appellant’s active involvement in money laundering activities.

The court reiterated the mandatory adherence to the conditions specified in Section 45 of the PMLA Act, even in the context of a bail application under Section 439 of the Criminal Procedure Code. It emphasized the court’s responsibility to consider the nature of the accusation, evidence, severity of prescribed punishment, characteristics of the accused, and other relevant factors while adjudicating bail applications.

Highlighting the statutory presumption in Section 24 of the Act, the court emphasized that the court is entitled to presume the involvement of proceeds of crime in money laundering proceedings, especially when a person is charged under Section 3.

Responding to concerns about prolonged trial periods, the court dismissed the appellant’s claim, citing Section 436A of the Criminal Procedure Code as a beneficial provision to ensure a speedy trial. However, it underscored the discretionary power of the court in applying this provision.

In conclusion, the court rejected the appeal, asserting the burden of proof on the accused to demonstrate their innocence in line with the conditions specified in Section 45. Senior Advocate Siddharth Luthra represented the appellant, while Additional Solicitor General SV Raju appeared for the Enforcement Directorate in the case of Tarun Kumar v. Assistant Director Directorate of Enforcement.