Delhi court slams ED over arresting practices

A Delhi court has criticised the Enforcement Directorate (ED) for conducting a substandard investigation in a money laundering case, where the agency arrested a man who had previously been made a witness by the agency. The court granted bail to the accused, highlighting the inconsistencies in the ED’s approach.
“The hallmark of any investigation is its objectivity. Subjective interpretations by an IO must be condemned, as they can make what is supposed to be an objective investigation subject to the uncontrolled whims and fancies of an individual, who holds the extreme power of arrest, potentially curtailing the liberty of an individual. In this case, there is a disturbing scenario where one IO chose to cite the applicant as a witness, while the next IO opted to arrest him based on the same evidence,” stated additional sessions judge Dheeraj Mor in his order on Saturday.
The court was hearing a bail application filed by Mangelal Sunil Agarwal, who was implicated in a money laundering case involving the alleged siphoning of ₹18.9 crore. ED had filed a prosecution complaint in October 2022, naming eight accused, while Agarwal was made a prosecution witness. However, Agarwal was later arrested in August 2024 after the investigating officer (IO) in the case changed.
The court noted that the IO arrested Agarwal based on the same evidence that was already before the court, which had not found him sufficiently complicit to face trial for the offence.
“While IO has the discretion to arrest or not arrest an individual, this discretion cannot be exercised arbitrarily. When the evidence available to both the IO and the court is identical, and the court has refrained from summoning the individual as an accused, the IO’s decision to arrest him on the same evidence is an apparent overreach of his powers, which must be disapproved,” the court said.
The court directed the ED director to inform the court if there is any standard operating procedure (SOP) or regulation governing arrests and what processes are in place for senior officials to monitor the arrest of an accused. It also ordered an inquiry to determine why the two IOs took diametrically opposite approaches based on the same evidence.
The court requested an inquiry report within a month to identify whether either officer had failed in their duties and what actions would be taken against the responsible party. If both opposing views are found justifiable, the court asked for clarification on how to reconcile the situation.
Meanwhile, the court granted bail to Agarwal, noting that there was no evidence on record to show that the applicant had the intent (mens rea) when dealing with the alleged proceeds of crime. It was also observed that he had no prior criminal record.
“In these circumstances, there is no reason to believe that he is likely to commit any offense while on bail. Therefore, he has successfully met the mandatory twin conditions under Section 45 of the PMLA,” the court stated.
Agarwal was granted bail on a personal bond of ₹2 lakh, along with one surety of the same amount, after the court noted that he satisfied the triple test required for bail.