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NEW DELHI: “Cash travels faster than light,” observed the Supreme Court on Tuesday while stressing the need for a fast investigation if the Enforcement Directorate (ED) comes across an intelligence input indicating huge illegal money laundering.

A bench headed by Justice A M Khanwilkar, dealing with a batch of petitions concerning the interpretation of certain provisions of the PMLA, referred to a situation saying if ED gets actionable input of illegal money transaction and asked whether it should wait for registration of an FIR by police or other agencies for the predicate offence before swinging into the action to probe the money laundering.

“Cash travels faster than light. The evidence may vanish quickly if the agency (ED) waits for registration of the FIR (for predicate offence),” observed the bench which also comprised justices Dinesh Maheshwari and C T Ravikumar.

The bench again referred to its question of whether the Enforcement Directorate will have jurisdiction to probe the unaccounted money under PMLA in the absence of a prior FIR registered for the predicate offence.

Under the Prevention of Money Laundering Act (PMLA), ED registers an ECIR (enforcement case information report) to probe laundering of proceeds of a crime, committed prior, for which an FIR is already there.

Senior advocate Amit Desai, appearing for one of the petitioners, said that the ED cannot have the jurisdiction that statute does not provide for.

Desai referred to Section 19 of the PMLA and said that the ED cannot have the unbridled power of arrest and attachment of properties as these authorities are draconian.

The bench referred to the language of the provision and said that the power of arrest is exercised by the Director, Deputy Director, Assistant Director, or any other officer authorised on this behalf by the Central Government by general or special order.

Moreover, the officer has to give the reasons in writing after scrutinising the prima facie materials before proceeding with the arrest of the accused, it said.

“It is not the peon or clerk which can have the power of arrest under section 19 of the Act….rather this right to arrest is supported by Article 21 (protection of life and liberty) of the constitution,” the bench said. The court would resume hearing on Wednesday.

Earlier on February 10, the bench had referred to the recent recovery of cash to the tune of Rs 190 crore in Uttar Pradesh and had asked if ED will have no jurisdiction to probe the unaccounted money under PMLA in the absence of a predicate offence.

Prior to this, the bench was told that there cannot be “mechanical lodging” of an ECIR as the PMLA requires that there must be some indication of the act of money laundering and projecting the proceeds of crime as untainted.

Solicitor General Tushar Mehta had earlier told the bench that there are over 200 petitions in the matter and interim stays have been granted in several serious cases due to which investigation has been affected.

Some of these petitions have challenged the validity of certain provisions of the PMLA.