Tarsem Lal and PMLA Complaints: Must an Accused Be Taken into Custody after Cognizance?
When ED completes investigation without arrest and the Special Court takes cognizance of its complaint, must the accused first surrender to custody and then seek bail? The Supreme Court answered this important procedural question in Tarsem Lal v. Directorate of Enforcement, 2024 INSC 434.
Cognizance is not an arrest warrant by default
The Court explained that after taking cognizance under Section 44(1)(b) PMLA, the Special Court ordinarily issues summons to the person shown as an accused. If that person appears pursuant to summons, appearance does not place the person in custody merely by operation of law. The accused need not apply for bail simply because cognizance has been taken when ED did not arrest during investigation.
The court may secure attendance by a bond under Section 88 CrPC. Under the new procedural code, the corresponding bond provision must be read in the Bharatiya Nagarik Suraksha Sanhita, 2023 according to the proceeding’s commencement and saving provisions. The critical point is that a bond for appearance is not the same as custodial bail.
What if summons are disobeyed?
The protection is for a person who responds to the court. If summons are avoided, the Special Court may issue a bailable warrant and, if necessary, a non-bailable warrant. A person arrested on such a warrant must seek bail, and Section 45 may then apply. Courts should follow escalating process rather than treating the complaint itself as justification for immediate incarceration.
ED’s power of further investigation
Tarsem Lal also recognised that further investigation and a supplementary complaint remain possible after cognizance. ED may exercise Section 19 if later material supplies the statutory basis for arrest. But an arrest must independently comply with Section 19; it cannot be used merely to defeat the protection attached to voluntary appearance.
Why the ruling matters
The judgment separates three concepts frequently merged in practice: appearance before court, execution of a bond to attend, and custody followed by bail. It also discourages needless pre-trial detention where the investigating agency itself considered arrest unnecessary throughout investigation.
An accused receiving summons should appear on time, seek acceptance of an appearance bond, and avoid casually describing the application as one for bail. The Special Court should record whether the person was arrested during investigation and why any coercive process is necessary.
Tarsem Lal does not abolish Section 45 or immunise an accused from later lawful arrest. It ensures that criminal procedure does not manufacture custody solely because ED filed a complaint.
Sources
Supreme Court of India, Tarsem Lal v. Directorate of Enforcement, 2024 INSC 434: https://api.sci.gov.in/supremecourt/2023/53731/53731_2023_7_1502_53220_Judgement_16-May-2024.pdf
Prevention of Money-Laundering Act, 2002, Sections 19, 44 and 45: https://www.indiacode.nic.in/handle/123456789/15402
Bharatiya Nagarik Suraksha Sanhita, 2023: https://www.indiacode.nic.in/handle/123456789/20099
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