HYDERABAD: The Telangana High Court reserved judgment on petitions filed by the Enforcement Directorate (ED), challenging the decision of the ED special court, which rejected the remand of Madhucon Group director Kamma Srinivasa Rao, who is allegedly involved in defrauding banks of huge amounts, and Kancharla Srihari Babu, who is allegedly involved in the Insurance Medical Services (IMS) scam.
The special court had rejected the remand on the ground that the accused had not been served the Section 41A Criminal Procedure Code (CrPC) notices before they were taken into custody by the ED officials.
As the issue in the two matters was similar, the ED objected to it before the High Court stating that it was not required to follow the CrPC. It argued that the Prevention of Money Laundering Act (PMLA) was a different statute. The PMLA provisions would apply, and not those of the CrPC.
The ED also contended that the power of arrest was vested in the ED authorities as mentioned in Section 19 of the PMLA and not subject to the procedure prescribed in the CrPC. It also submitted that the authorities under the PMLA were not police officers, and the statements recorded by them were, therefore, admissible in evidence. Counsel for the ED argued that with the decision of the special court, the accused persons went scot free.
Whereas, the accused persons argued that the principles laid down by the Supreme Court in Arnesh Kumar Vs. State of Bihar would apply in respect of the power of arrest in any case and on any investigating authority.
The decision in Arnesh Kumar has been rendered in the context of the power of arrest without a warrant by the police under Section 41 of the Cr PC. Principles laid down by the Supreme Court are to be of universal application, and should be applied even while deciding whether or not to arrest a person under Section 19 of the PMLA.
