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Vijay Madanlal Chaudhary v/s Union of India, 2022: Money Laundering Laws and the Ideologies of Indian Society and Judiciary

"People are eyes, judges are voice of the society". Crime and law is everywhere but the true identity of a society is determined by the ideologies and perspective of people regarding the crime and laws made in order to prevent crime. One of such example is case of "Vijay Madanlal Chaudhary vs Union of India". In this case the advocates and judges express their concerns regarding crime of money laundering and laws preventing them. The aim of this blog to analyse arguments of the advocates and Obita Dicta of judges to understand ideology of current Indian society and judiciary.

Case All About [Vijay Madanlal Chaudhary v/s UOI]:

The writ petition was filed concerning validity and interpretation of certain provisions of the Prevention of Money-Laundering Act, 2002 and the procedure and power of Enforcement Directorate during investigation under the PMLA, that alleges violation of the fundamental rights. Parliament amended Section 45 of the 2002 Act vide Act 13 of 2018, so as to remove the defect noted in the said decision and to revive the effect of twin conditions specified in Section 45 to offences under the 2002 Act. At the same time, separate writ petitions have been filed to challenge several other provisions of the 2002 Act and all those cases alleges overlapping issues.

Arguments of Private Parties:

  • It was argued by learned council that ED can arrest an individual on the basis of an ECIR without informing him about his guilt, which is arbitrary and a violation of the fundamental rights of an accused.
  • Thus, there must be at least a prima facie quantification to ensure that the threshold of the PMLA is met, and it cannot be urged that the ECIR is an internal document.
  • Learned counsel has also challenged the aspect of the Schedule being overbroad and inconsistent with the PMLA and the predicate offences.

Arguments of Union of India:

  • The government compared the Indian standards for money laundering with levels at the international level.
  • The development of international consensus towards the offence of money laundering has been highlighted.
  • Total cases registered by police are higher than actual matters that are investigated by ED.

Observations of the Court:

  • Judgment in Seaford Court Estates ld., which states, "It would certainly save the judges trouble if Acts of Parliament were drafted with divine prescience and perfect clarity."
  • It is the duty of the State to secure social, economic, and political justice and minimize income inequalities.
  • Money-laundering is one of the heinous crimes, which not only affects the social and economic fabric of the nation but also tends to promote other heinous offences.

Till now we are more oriented towards protection of fundamental rights. Even if the violation of individual is for betterment and protection of large. It is argued by private parties that an accused can either directly or indirectly commit money-laundering if he is connected by any such actions. In such a case arrest of a person without informing him is better for whole society .

it was suggested by the learned council that the investigation may shed some light on such alleged proceeds of crime, for which, facts must first be collected and there should be a definitive determination whether such proceeds of crime have actually been generated from the scheduled offence. Detention and arrest of such person by ED under section 45 of PMLA helps them to collect information for the large nexus involves in money laundering. It is also argued that the Parliament has over widen the scope of Prevention of Money Laundering Act through amendment. It totally depends on case to case basis.

The union of India compared the situation at international level. The Parliament aims to improve the standards of investigation in economic offences for which they entrusted ED.Judiciary on the other hand entrust Parliament to minimize inequalities. As stated in this case "It is the duty of the State to secure social, economic and political justice and minimize income". Inequalities".

Money laundering is the back bone of all organized crimes. It affects the social and economic fabric of the nation and tends to promote other heinous offences, such as terrorism, offences related to NDPS Act, etc. The Judiciary knows the importance of bail in matters of economic offences. Hence, apex court directed the lower courts to have strict approach while granting Anticipatory Bail and ordinary Bail in such cases.

The Indian law concerns fundamental right. Sometimes these rights become barrier in attaining Justice. Specially the social economic offences where the smart offenders find their ways to hamper the society with legal loopholes. It is important to adopt international standards and techniques even if they are violating rights of individual because by this Parliament can protect Rights of other people.

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