– Hardik Kuldeep and Nishtha Chopra
INTRODUCTION
The question of whether the Enforcement Case Information Report [“ECIR”] should be mandatorily supplied to the accused has come up before the Supreme Court on numerous occasions. In Vijay Madanlal Choudhary v. Union of India, the apex court had ruled that not only the non-supply of ECIR but also not registering the same, cannot be regarded as being a violation of Article 22 of the Constitution of India and the rights of the accused to undergo a fair trial. This position underwent a substantial change in the case of Pankaj Bansal v. Union of India, where a two-judge bench of the apex court critiqued the finding of Vijay Madanlal regarding the non- supply of ECIR. It held it to be necessary that the written grounds of arrest and ECIR be supplied to the accused with necessary omissions, as the same is needed by the accused to prepare a defence in bail proceedings and is necessary to uphold the constitutional values. As assuring as the judgment in the Pankaj Bansal case sounds, the same has been substantially diluted by the decision in Ram Kishore Arora v. Directorate of Enforcement which observed that the two-judge bench of Pankaj Bansal cannot overrule the three-judge bench in Vijay Madanlal as the same is against the doctrine of precedent and thus Vijay Madanlal “holds the field” as of date. Thus, it not only held the judgment in Pankaj Bansal to be per incuriam but also went on to apply Pankaj Bansal’s ruling in its own judgment. This has led to a conundrum where the current state of the question has been left unanswered.
Regardless of that, ECIR continues to be one of the most important documents formulated by the Enforcement Directorate [“ED”], since it is recorded only after the ED finds enough evidence to commence an investigation. Through this article, we wish to stress the notion that giving such detailed information and evidence as contained in the ECIR, is necessary for the accused’s right to a fair trial, specifically the right to prepare a defence. In order to make the argument, we have relied on a variety of literature on how the offences of money laundering are being dealt with in other countries following the FATF framework. Additionally, we have looked into human rights obligations under international treaties, which should be followed in order to ensure that the rights of the accused are protected.
INTERNATIONAL PERSPECTIVE
Domestic policies or parts of them are often borrowed from foreign jurisdictions for various benefits, one of them being the ability to foresee the effects of the policy. If there exists a different legal perspective on an issue, many factors must be taken into consideration before adopting them. However, it is difficult to deviate from principles with an international consensus. The Statement of Objects and Reasons of the PMLA states that the FATF framework on money laundering is the basis on which the act has been formulated. FATF has asked, in various instances, for its recommendations to be implemented in accordance with domestic policies and fundamental rights to ensure due process and procedural rights. Moreover, the Indian government in various instances has stated in the court, about its obligations and global responsibility to adhere to international law while combating money laundering. Thus, it becomes necessary to take a look at how different jurisdictions have interpreted their policies and rights which are based on the same underlying principles as India’s. Most international legal jurisdictions seem to be following the same path on the “right to a free and fair trial”, provided through the right of the accused to know the charges against them, in criminal procedure related to money laundering or proceeds of crimes. Moreover, the FATF has emphasized how measures taken to combat money laundering should be in consonance with a country’s obligations under international human rights law.
CRIMINAL PROCEDURE IN DIFFERENT COUNTRIES
Indian courts have taken inspiration from other common law jurisdictions, borrowing from the courts of the United Kingdom, United States of America and Australia. These countries have been considered similar enough by the courts to take legal guidance and also are among the top countries in the fight against money laundering according to the FATF. As all of these countries seem to be implementing the treaty, their legislations hold some persuasive value to be learnt from.
The United States of America
Title 18 of the United States Code, the American federal criminal code, criminalises money laundering under sections 1956 and 1957. There is no special legislation which grants special procedural powers to the investigating authorities. The accused has a right to be informed of the nature and cause of the accusation guaranteeing adequate notice of the charges against them, so as to aid the preparation of a defence. The disclosure of evidence was also held necessary to allow the defendant to exercise the right to test whether the government’s evidence was lawfully obtained. The Brady rule was given in the case of Brady v. Maryland, which allowed the defence to ask for required evidence to build their case, but later the Supreme Court did away with the need to make a request, stating that the prosecution must disclose all material or exculpatory information gathered through investigation. Some federal courts allow the exercise of the Brady rule even before the plea bargaining stage, which is comparable to a remand hearing in India. A criminal case regarding money laundering is treated as any other criminal case and the accused can exercise the rights listed above which necessitate for the prosecution to publish all relevant documents and evidence, unlike in India.
Australia
Money laundering has been criminalised under the Australian criminal code, Division 400. While talking about specific procedures related to disclosure of evidence and information to the accused, we primarily consider the Australian Capital Territory, Western Australia and New South Wales, as these states have a higher human development index score than the national average. In these jurisdictions, as early as the committal proceedings, a brief of evidence is provided. The brief of evidence is provided in a manner such that it includes all evidentiary material and copies of material which form the basis of the prosecution’s case and material reasonably relevant to the case. A general obligation to disclose such evidence before the trial has been reiterated in guidelines given under different jurisdictions (Tasmania, South Australia, West Australia, Queensland). As mentioned above, contrary to the Indian procedure, treating money laundering as any other criminal offence, Australia provides the accused with the right to disclosure of evidence against them, so that the accused can prepare a defence in furtherance of fair trial.
The United Kingdom
The Proceeds of Crimes Act, 2002 does not provide for arrests to be made under it, however, it does allow for detention while a person is searched. Guidelines suggest that such a detention must not take longer than necessary and the detention cannot be made to identify grounds for search. A search record is to be created with relevant information like the grounds for conducting the search, the reason for not obtaining judicial approval for the search (in case it has not been obtained), and the outcome of the search. Such records are made available to be scrutinised by the public. Disclosure is made to the accused before the first hearing or the plea hearing. It provides copies of all material from the investigation capable of assisting the defence, which may include any evidence relied upon by the prosecution, records made by the investigator containing relevant information, custody records and search records.
INTERNATIONAL HUMAN RIGHTS
When the right of the accused to be granted an ECIR in a money-laundering investigation is seen in light of the international human rights framework, the basis of the argument involves the doctrine of “equality of arms”. This procedural doctrine, even though not expressly stated in international statutes, means that the accused should be promptly informed of the charges against him along with giving him adequate time and facilities to make a fair defence. The doctrine finds its place in the provisions of the International Covenant on Civil and Political Rights [“ICCPR”] and the European Convention on Human Rights [“ECHR”].
ICCPR
India ratified the ICCPR on April 10, 1979, which means that it has an obligation to follow the provisions of the statute. Article 9(2) of ICCPR makes it mandatory that an arrested person shall be informed, at the time of arrest, of the reasons for his arrest and of any charge against him, including its cause and nature. In Campbell v. Jamaica, it was stated that the reason Article 9 should be ensured by state parties is to enable the arrested person to seek release if they believe that the reasons given are invalid or unfounded. This information regarding the charges and reasons for arrest cannot be vague and casual in nature. In Ilombe and Shandwe v. Democratic Republic of Congo, it was observed that the reasons must include the general basis of the arrest along with factual specifics, such as the wrongful act and identity of an alleged victim. Thus, intimations which are not detailed in nature or furnishing of anything short of a detailed ECIR won’t be considered an appropriate way of ensuring that the accused is guaranteed the right to a fair trial.
ECHR
Even though India is not a ratified member of the ECHR, provisions and decisions relating to it have been substantially used for not only doctrinal borrowing but its decisions have also been referred in many courts, by African and Asian legal systems.
Article 6(3) states that an accused has the minimum right to be informed promptly and in detail of the nature and cause of the accusation against him. Additionally, the Article states that he should have been given adequate time and facilities for preparation of his defence. The ‘facilities’ has been interpreted to mean that the accused should have access to documents and evidence which is reasonably needed in the preparation of the case, such as the witness statements and police memoranda. In Pelissier and Sassi v. France, ECHR threw light on what exactly constituted ‘being informed of the nature and cause of the accusation’. While taking a liberal and expansive view, the court held that in addition to the nature and cause of the accusation, it must also contain the legal characterisation given to the accusation in a detailed manner. Currently, the practice of not supplying the accused with such information by way of an ECIR deprives the accused of this very right, hampering his right to prepare the defence.
APPLYING INTERNATIONAL TRENDS AND OBLIGATIONS TO THE INDIAN SCENARIO
When deciding to not supply the accused with a copy of the ECIR, the law ends of distinguishing between an ECIR and an FIR. We submit that the reason why FIR is mandatory to be supplied to the accused holds true in the case of an ECIR as well. It is necessary to furnish the accused with the ECIR in order to protect his right to defence. In Dhanpat v. Emperor, it was held to be vitally necessary for an accused to be granted a copy of the FIR at the earliest in order to seek legal advice. More recently, in Youth Bar Association of India v. Union of India and Anr., the apex court held that the right of an accused to get a copy of the FIR is an inherent part of Article 21 of the constitution of India. In re: To issue certain guidelines regarding inadequacies and deficiencies in criminal trials v. the state of Andhra Pradesh & Ors., the Supreme Court had ruled that investigating agencies need to provide a list of all documents and materials seized to the accused so that he can also request for their production under relevant provisions of CrPC in the court, in the interest of justice. Such an interpretation of the right to defence and fair trial is in consonance with the international trends and practices, as stated above. An analysis of the laws of other legal jurisdictions adhering to the FATF, and international statutes shows that the right to defence has been interpreted in a broad way, to include relevant documents or information along with evidence which has been relied upon by the prosecution. This would mean that merely providing grounds of arrest is not enough, as the ECIR contains grounds of arrest, and details of offences and may also contain details of the material in possession of the authority.
Implementation of such an inference is not alien to the Indian legal system, as it has been stated to be true in cases of an FIR, with a deviation from the rule being caused in cases under PMLA. In Vijay Madanlal, the apex court had the chance to analyse this and compare FIR with ECIR. The court held that since FIR does not always contain enough specific information and still the accused has been able to ask for bail and prepare a defence, not giving an ECIR will also not create a prejudice against the accused. In light of the international trends discussed above, a better approach would be to ensure that if relevant information is missing from such FIRs, it is supplemented with relevant documents, instead of using such FIRs as a reason to not provide ECIR. Moreover, in Vijay Madanlal Choudhary v. Union of India in its observation, has failed to take into account the additional factor that while applying for bail under PMLA, the accused has an additional responsibility to satisfy the “twin conditions of bail”, for which the supply of relevant documents and detailed information to the accused becomes imperative for the exercise of their right to defence. Pankaj Bansal took this into consideration and ruled it to be necessary to furnish a written copy of the ECIR to the accused.
CONCLUSION
Money laundering is a crime with a vast kind of acts under it and can be seen as an extension of the scheduled or predicate offences that lead to the generation of proceeds of crimes, an essential for money laundering. Having such a stringent and draconian law through which one of the most basic and fundamental pillars of our justice system, the right to a fair trial, is damaged, leads to way wider repercussions as compared to what it would have been if it were any other law regarding a standard crime. Non-disclosure of ECIR which contains relevant evidence and other information not only violates international human rights law but also goes against the fundamental rights guaranteed in our constitution. It has been used to undermine them instead of being subject to such rights. Keeping in mind how international jurisdictions have treated money laundering as any other ordinary crime, India should do away with its special status, and bring it back under the fundamental right obligations.
Otherwise, we suggest that the courts follow along the path of Pankaj Bansal in order to protect the right to defence of the accused, by doing away with the confusion created by the Ram Kishore Arora case. If the courts find it incorrect to ask the ED to provide ECIR, the right to defence should be protected by providing all relevant documents and evidence which might even be present in the ECIR through a separate disclosure document either at the time of arrest or before the trial starts. While doing so, the courts should also clarify as to what qualifies as sensitive information, so that the power given to ED to omit such information by Pankaj Bansal from the ECIR before disclosing, is kept in check.
FATF is yet to be done with its fourth round of evaluation with India, which is supposed to be published in the near future. In light of its recent observations with regard to the unintended consequences of its recommendations on human rights, it should keep the curtailment of human rights as one of the criteria on which it is evaluated.
The authors are 3rd students at Dr. Ram Manohar Lohiya National Law University Lucknow. They have a keen interest in research and writing about Policy and Criminal law.