The Prevention of Money Laundering Act 2002 has been called both a powerful weapon and a contested instrument. Examine the SC’s Vijay Madanlal verdict and the institutional role of the Enforcement Directorate.

Introduction:

PRS Legislative (2024) records only 24 convictions out of 7,083 PMLA cases registered by the Enforcement Directorate; the Supreme Court in Vijay Madanlal Choudhary vs Union of India (27 July 2022) upheld ED's wide powers under PMLA; the FATF Mutual Evaluation Report (September 2024) placed India in the regular follow-up category — the strongest rating among major economies.

PMLA architecture:

PMLA 2002 criminalises laundering of proceeds of a scheduled "predicate offence," with a list covering 156 offences. Section 17 enables search, Section 19 arrest, Section 24 reverses the onus of proof, and Section 45 imposes twin conditions for bail. FIU-IND under Section 12 receives suspicious transaction reports.

Vijay Madanlal verdict:

The Court upheld ED's powers of search, seizure, attachment, and arrest; held PMLA proceedings to be sui generis and not strictly criminal; sustained the twin-conditions bail regime; and ruled that the ECIR is not a charge-sheet and need not be supplied to the accused. A review petition is pending on key issues.

Institutional role of ED:

ED has attached property worth ~₹1.21 lakh crore by 2024; high-profile cases include Aircel-Maxis, INX Media (P. Chidambaram), the Delhi excise policy case (2024), and inclusion of crypto VDAs in 2023. Yet conviction outcomes remain disproportionately low.

Way forward / Conclusion:

Codify ECIR sharing post-arrest, impose statutory time-limits for PMLA trials, judicially review the reverse-onus clause, and strengthen FIU-IND's STR analytics — aligning with the Senthil Balaji bail jurisprudence by 2027 under MoF.