SC notice to govt over ED powers to seize property

Asking the ED to respond to the petition filed by KC Veerendra, a Bench led by Justice PS Narasimha on Friday clubbed the petition challenging the validity of Sections 20 and 21 of the PMLA with other petitions against the Act pending before the top court.

The petitioner sought to highlight that the adjudicating authority tasked with examining if the ED’s seizure of property was valid didn’t come from a judicial background.

The petitioner alleged that all his assets, including bank accounts, fixed deposits, jewellery and vehicles, were seized/frozen by the ED without being given any reasons or an opportunity to challenge the action. Such sweeping powers allow the ED to operate unchecked for at least six months before any judicial scrutiny begins, he contended.

On behalf of the petitioner, senior advocates Mukul Rohatgi and Ranjit Kumar pointed out that impugned provisions of the law permitted the ED to act without accountability, leading to a widespread abuse of power.

Noting that there appeared to be “a fault in the Act (PMLA)”, Justice Narasimha wondered how a non-judicial member could adjudicate complex matters involving property rights and constitutional safeguards.

Rohatgi explained that the challenge was twofold -- first, to Sections 20 and 21 of the PMLA that allowed the ED to retain property and records for 180 days without furnishing reasons, and second, to the composition of the PMLA Adjudicating Authority, which comprised a single member without any judicial background.

For the entire country, only one person - a cost accountant - was functioning as the adjudicating authority and he has confirmed nearly 99 percent of all attachments and retentions made by ED officers, he said, adding these figures were drawn from the ED’s own website.