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We May Consider Question Of Interim Bail For Arvind

Kejriwal Because Of Elections : Supreme Court Tells ED
Debby Jain
(/debby-jain)
3 May 2024 4:20 PM

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While hearing Delhi Chief Minister Arvind Kejriwal's plea challenging his arrest by the
Enforcement Directorate in the Delhi Liquor Policy case, the Supreme Court on Friday
(May 3) expressed that it might consider the question of interim bail for the purposes
of Lok Sabha Elections if the hearing gets delayed.

The bench of Justices Sanjiv Khanna and Dipankar Datta heard the arguments this
afternoon for about two hours and adjourned further hearing till next Tuesday(May 7).

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"It appears we can't complete today. We will post it on Tuesday morning itself. Mr
Raju one more thing. If it is going to take time, it does appear it may take time, we
may then consider the question of interim bail because of the elections. We may hear
on that part because of elections," Justice Khanna told Additional Solicitor General
SV Raju while winding up today's arguments.

Raju then asked the Court to take note of the statements made by AAP MP Sanjay
Singh after getting bail from the Supreme Court. "Look at the kind of statements he is
making," he said.

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Justice Khanna clarified that the Court is merely putting the ED on notice about the
intention to consider the plea for interim bail and is not expressing any opinion. "We
are not commenting on it either way, we may or may not grant," the judge said.

"Just one thing more. Please also take instructions. Because of the position he holds,
whether he should be signing official files," Justice Khanna added.

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During the hearing, Justice Khanna also asked about the dates of elections in Delhi
and was informed that they are scheduled on May 23.

Today's hearing saw Senior Advocate Dr Abhishek Manu Singhvi continuing his
submissions from the previous day (https://www.livelaw.in/top-stories/supreme-
court-arvind-kejriwal-arrest-singhvi-says-ed-withheld-exculpatory-material-256595)
for Kejriwal. During the latter half of the hearing, ASG SV Raju started arguments for
the ED.

A brief account of the hearing is given below.

Kejriwal was not an accused till arrest : Singhvi

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Singhvi stated that it was the stand of the ED itself that a person summoned under
Section 50 of the Prevention of Money Laundering Act (PMLA) does not assume the
character of an accused automatically.

Even as per the summons issued by the ED on March 16, Kejriwal was not an
accused. "So it is clear that I'm not in a position of accused till 16 March. What
changed drastically(when he was arrested on March 21?," Singhvi exclaimed. To
buttress this argument, he stated that ED had no new material in its possession and
that all the documents/statements it relied upon were from 2023.

"As per their own understanding, till 16 March, I was not an accused. How do they
show the necessity to arrest on 21 March to a court? All evidence on which I am
arrested is pre-2023 end. Every material is as on July, 2023," he submitted.
He relied on the Supreme Court's judgment in the Senthil Balaji
(https://www.livelaw.in/top-stories/non-compliance-of-mandate-of-section-19-of-
pmla-will-vitiate-the-arrest-supreme-court-234640)case (https://www.livelaw.in/top-
stories/non-compliance-of-mandate-of-section-19-of-pmla-will-vitiate-the-arrest-
supreme-court-234640)which held that non-compliance with the provisions of
Section 19 PMLA will vitiate the arrest. He also reiterated the submission
(https://www.livelaw.in/top-stories/supreme-court-arvind-kejriwal-arrest-singhvi-says-
ed-withheld-exculpatory-material-256595) that the ED has concealed statements
which exculpated Kejriwal.

Bench doubts the argument that political party is not covered under Section 70
PMLA

Apart from implicating Kejriwal for assisting the formulation of Delhi liquor policy -
which allegedly enabled liquor companies to recoup bribes as profits - in his capacity
as the Chief Minister, the ED has also alleged that he is vicariously liable as the chief
of the Aam Aadmi Party, to which a part of the proceeds of the crime was allegedly
diverted. ED relied on Section 70 of the PMLA to implicate the political party.

Singhvi contended that a political party will not come under Section 70 PMLA as it
specifically mentions "company". Company is defined in the section to mean "any
body corporate and includes a firm or other association of individuals". He argued
that Section 70 was intended to deal with corporates and a political party cannot be
regarded as an "association of individuals."

However, the bench expressed difficulty in accepting this argument. "It is a little
difficult...a society is also an association of individuals. Can it be said that a society
won't come under the provision?" Justice Khanna said.

Observations in Manish Sisodia case judgment applicable to Kejriwal : Singhvi

Responding to a query raised by the bench (https://www.livelaw.in/top-
stories/supreme-court-to-question-ed-arvind-kejriwal-arrest-delhi-liquor-policy-case-
256562) last day, Singhvi submitted that his case is covered by the favourable
findings made by the Supreme Court in the judgment which denied bail to Delhi
Deputy Chief Minister Manish Sisodia (https://www.livelaw.in/top-stories/supreme-
court-manish-sisodia-aap-bail-delhi-excise-policy-241147). Last day, Justice Khanna
had pointed out that in the Manish Sisodia judgment, the Court had made certain
favourable comments as well as adverse findings and asked which would cover
Kejriwal.

Singhvi stated that the comments made by the Court in paragraph 15 of the Manish
Sisodia case judgment is applicable to Kejriwal. In that paragraph, the Court had
observed :

"Prima facie, there is lack of clarity, as specific allegation on the involvement of the
appellant – Manish Sisodia, direct or indirect, in the transfer of Rs. 45,00,00,000
(rupees forty five crores only) to AAP for the Goa elections is missing."

Court asks ED about the threshold for arrest

The Court pointed out to the Additional Solicitor General SV Raju that as per the Vijay
Madanlal Choudhary (https://www.livelaw.in/top-stories/supreme-court-upholds-eds-
powers-of-arrest-attachment-search-seizure-and-twin-conditions-for-bail-says-pmla-
has-stringent-safegaurds-204915) judgment, there is a higher threshold for arrest as
per Section 19 PMLA.

"Vijay Madanlal Choudhary says that the threshold for arrest under Section 19 is even
higher than the Customs Act," Justice Khanna said. Raju said that the investigating
officer need not consider every material and need only consider the relevant
materials to form the "reasons to believe" that the person is guilty for excercising the
power of arrest. If all materials are to be recorded, it will result in a voluminous record
making the process cumbersome, which could not be intention of the law.

"Some things are irrelevant..he does not have to consider everything.... otherwise
chargesheet cannot be filed within 60 days at all.. The writing will run into thousands
of pages even if one or two line is to be written about each material," ASG said. At this
juncture, Justice Datta asked if it would be a proper exercise of power to brush aside
materials merely because "papers will pile up". "I am saying if it is relevant to
consider, you must. But it's not for someone else to say you should have considered
this," ASG said.

Justice Khanna posed a query to the ASG regardig the argument of the petitioner that
exculpatory statements were excluded and hence the Investigating Officer did not
consider all materials.

"The objection raised is the objectivity becomes flawed when exculpatory material is
excluded," Justice Khanna said.

ASG asserted that this was not a case of "no material" or "extraneous materials." He
argued that the jurisdiction of the Court to examine if the officer properly exercised
the power of arrest is very limited. The Court cannot sit in judgment over the
materials relied upon by the Investigating Officer. The ASG stated that the view of the
investigating officer is fortified by the remand orders passed by the Special Judge
and the judgment of the Delhi High Court. Raju also highlighted that before the arrest,
the Delhi High Court, after seeing the materials, had refused
(https://www.livelaw.in/high-court/delhi-high-court/delhi-high-court-refuses-to-grant-
interim-protection-from-ed-arrest-to-cm-arvind-kejriwal-in-liquor-policy-case-
253041)to grant Kejriwal interim protection from arrest.

Court asks if Kejriwal can be prosecuted when there are no adjudication

proceedings against AAP

The bench pointed out that Kejriwal was not an accused in the predicate offence
under the Prevention of Corruption Act, which is being handled by the CBI. The bench
also noted that there were no adjudication proceedings against the Aam Aadmi Party
under Section 8 of the PMLA over the alleged proceeds of crime. So, in this backdrop,
can Kejriwal be proceeded against, the bench asked.

"He is still not being prosecuted by the CBI. He has not yet been chargesheeted by the
CBI. If the AAP party is the main accused, till adjudication proceedings are initiated
against AAP, can you proceed against him?" Justice Khanna asked.

ASG answered that it was possible and said that confiscation proceedings can be
initiated even without adjudication and confiscation can be based solely on
conviction.

Background

Kejriwal had petitioned the Supreme Court earlier this month, after his writ petition
challenging the ED arrest was dismissed by the Delhi High Court on April 9. Notice
came to be issued on his plea on April 15, with the matter being directed to be listed
in week commencing April 29. Subsequently, when the top Court website showed
next date of hearing as May 6, Singhvi mentioned the matter before a Justice
Khanna-led Bench on April 26.

After the mentioning, the matter was listed on April 29, when Senior Advocate AM
Singhvi led arguments on behalf of the AAP chief and questioned the necessity and
timing of his arrest. When the matter was heard on the next day, ie April 30, Singhvi
alleged (https://www.livelaw.in/top-stories/supreme-court-arvind-kejriwal-arrest-
singhvi-says-ed-withheld-exculpatory-material-256595)that ED withheld the material
favoring Kejriwal. During this hearing, the court posed (https://www.livelaw.in/top-
 stories/supreme-court-to-question-ed-arvind-kejriwal-arrest-delhi-liquor-policy-case-
256562)5 queries to ASG SV Raju, appearing for the agency, which were to be
answered today.

For a detailed background, click here (https://www.livelaw.in/top-stories/supreme-

court-arvind-kejriwal-delhi-liquor-policy-singhvi-questions-ed-arrest-256446).

Case Title: Arvind Kejriwal v. Directorate of Enforcement, SLP(Crl) 5154/2024

Tags Justice Sanjiv Khanna (https://www.livelaw.in/tags/justice-sanjiv-khanna)

Justice Dipankar Datta (https://www.livelaw.in/tags/justice-dipankar-datta)

Delhi CM Arvind Kejriwal (https://www.livelaw.in/tags/delhi-cm-arvind-kejriwal)

ED Arrest (https://www.livelaw.in/tags/ed-arrest)

Delhi Liquor Policy Case (https://www.livelaw.in/tags/delhi-liquor-policy-case)

ASG SV Raju (https://www.livelaw.in/tags/asg-sv-raju)

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