PMLA accused entitled to copies of material not relied on by ED: Supreme Court

In a significant ruling, the Supreme Court on Wednesday ruled that those accused of offences under the Prevention of Money Laundering Act, 2002 (PMLA) are also entitled to copies of documents that the Enforcement Directorate (ED) does not rely on for investigation or prosecution [Sarla Gupta and anr v. Directorate of Enforcement].. A Bench of Justices AS Oka and Ujjal Bhuyan has ruled that this is part of an accused's right to a fair trial under Article 21 of the Constitution. "It is held that a copy of the list of statements, documents, materials, objects, exhibits that are not relied upon by the investigating officer must also be furnished to the accused," the Court held. .The Court added that the object is to ensure that the accused have knowledge of the documents in the custody of the investigating officer which are not relied upon, so that at an appropriate stage, the accused can apply for a copy of such material under Section 91 of the Code of Criminal Procedure (CrPC) or Section 94 of the Bharatiya Nagarik Suraksha Sanhita (BNSS).It underscored that a fair trial includes the right to defend, which in turn consists of the right to lead defence evidence by examining witnesses and producing documents. The Court explained that this right would also extend to compelling the prosecution or a third party to produce a document or thing in their possession or custody, as laid down in Section 233 of the CrPC.The Bench added that trial courts can decline requests for sharing such documents only on the limited grounds set out in Section 233 (3) of the CrPC (that is, if the request is only made to delay the proceedings, defeat the ends of justice, or for vexatious reasons)..Notably, the Court also held that the accused can also apply under Section 311 of the CrPC to recall prosecution witnesses and cross-examine them based on such documents."This right can be exercised even if evidence of both sides is closed," the Court added..The top court was dealing with an appeal against a Delhi High Court order passed in 2019. The case concerned a money laundering case registered against Lara Projects LLP, its directors and shareholders.Some of the accused claimed that a part of the document copies given to them by the ED were illegible and had certain deficiencies. They sought access to legible copies of these materials.While framing charges, a trial court held that the accused only need to be given copies of documents relied on by the ED and dismissed their application under Section 207, CrPC (supply of copy of police report and other documents to the accused).The High Court upheld the trial court’s decision, prompting the accused to move the Supreme Court for relief. The top court allowed their appeals today..In doing so, the Supreme Court also held that the accused is entitled to the following:- If property is seized, under Sections 17 and 18 of PMLA, the accused is entitled to two copies of the seizure memo.- The accused from whom records are seized in exercise of powers under the PMLA are entitled to two copies thereof.- Once cognisance is taken on the basis of a complaint under Section 44(1)(b) of the PMLA, the special judge must direct that, along with the process, a copy of the complaint and the following documents be forwarded to the accused: (a) statements recorded by the special judge of the complainant and witnesses, if any, before taking cognisance;(b) Documents including copies of the statements under Section 50 PMLA produced before the special court along with the complaint; (c) Documents perused subsequently by the ED till the date of taking cognisance;(d) Copies of the supplementary complaints and documents, if any, produced with the supplementary complaint.The Court further urged trial courts to liberally interpret Section 233 (3) of the CrPC when it comes to requests by money laundering accused for the production of documents not relied on by the ED. It explained that, as opposed to traditional criminal laws, trials under PMLA put a huge negative burden on the accused when it comes to the grant of relief. It would be difficult for the accused to rebut such negative presumptions if Section 233 CrPC is not liberally construed, the Court observed..It clarified that the ED is entitled to object to requests made by the accused under Section 91 CrPC, for the possession of documents on the ground that such disclosure of documents may prejudice the investigation.However, the trial court has to examine if the ED is justified in pressing such a ground, the top court added."Only if the court after perusing the document is satisfied that disclosure of the documents at that stage may prejudice ongoing investigation, it can deny prayer for production of that document," the Supreme Court held..A copy of the detailed judgment is awaited.