Saturday, May 20, 2023

Collapsing Distinctions between Scheduled Offences and the PMLA - A Cause for Concern

Just before retirement, a bench headed by Justice Ramasubramanian delivered a judgment in a batch of petitions concerning the 'cash for jobs scam' from Tamil Nadu regarding alleged irregularities during 2011 to 2015 in recruitment for public sector jobs in the state transport sector. For convenience, we will refer to the judgment by the lead petition Y. Balaji v. Karthik Desari & Anr. [SLP (Crl) No. 12779-781 of 2022 (Decided on 16.05.2022) (Y. Balaji)]. 

As it pertains to a complex set of facts and several issues, the judgment is naturally long (89 pages). But in this short post, I am concerned with only one set of the issues, which pertained to the proceedings initiated by the Enforcement Directorate (discussion starts at page 42, and court analysis from page 71). I argue that while the outcome on this issue in Y. Balaji may well be correct, the judgment has nevertheless missed a beat in not properly clarifying the relationship between the three integral concepts responsible for the operation of the Prevention of Money Laundering Act 2002 [PMLA]. 

The Mechanics of the PMLA and the Problem of Collapsing Distinctions

Section 3 of the PMLA defines the offence of money laundering. I want to focus on just the first part of this definition: "Whoever directly or indirectly attempts to indulge or knowingly assists or knowingly is a party or is actually involved in any process or activity connected with the proceeds of crime" (Emphasis mine). Money laundering, then, requires someone to engage in "any process or activity" connected with "proceeds of crime". Section 3 goes a step further to illustratively list out by way of an Explanation (that was inserted in 2019) the various processes or activities  — concealment, possession, acquisition, use, or projecting property as untainted. 

Proceeds of Crime is not defined within Section 3, but elsewhere in Section 2(u) of the Act, and refers to any property derived or obtained by engaging in criminal activity relating to a 'Scheduled Offence'. This last phrase is a moniker for a list of offences that is set out in a Schedule to the PMLA and includes a variety of crimes from across penal statutes. 

If you go back to the definition of the money laundering offence in Section 3, it should now be clear that the offence is a 'parasitic' one. It does not exist fully independently, and requires commission of criminal activity in relation to a Scheduled Offence, which must generate Proceeds of Crime. Close attention to the framing of Section 3 is important. The offence is not punishing someone who engages with a process or activity with property that may be treated as Proceeds of Crime. Instead, it is a step removed. It requires a prior set of transactions to have occurred which lead to property being seen as Proceeds of Crime and the money laundering offence punishes the act of being involved in a separate process or activity connected with what are already Proceeds of Crime.

The difficulty arises when we look at what all constitutes a process or activity for Section 3: it includes the possession or acquisition of Proceeds of Crime. This brings us to the problem of collapsing distinctions in how the money laundering law works. On the one hand, the offence clearly requires a prior set of acts to have taken place, which led to the treatment of some property as Proceeds of Crime. On the other hand, the Section 3 offence can technically punish the possession or acquisition of Proceeds of Crime, which on first blush can easily collapse the statutory distinction between the prior set of transactions and the money laundering crime. On this uncritical reading, it is easy to artificially break down one transaction and see it as first generating Proceeds of Crime and thereafter resulting in its possession. 

Why is it a problem? Three obvious reasons stand out. First, because there could not be a clearer instance of punishing the same underlying act twice, and the idea of successive prosecutions for the same acts has been historically frowned upon as a classic exercise of state oppression, recognised in Article 20(2) of the Constitution of India proscribing double jeopardy. Second, such a reading of the statute would make every petty thief or corrupt official a money launderer by definition, which makes a mockery of the law and the offence of money laundering itself. Third, and flowing from this, is the rendering ordinary of what is an avowedly extraordinary procedural regime of the PMLA in terms of its harshness on bail and admission of prior statements to law enforcement officials. 

The correct reading of Section 3 would be to emphasise on the two-step working of the PMLA. First, look at the transactions which lead to generation of Proceeds of Crime. If this requirement is not satisfied, then close the case here itself (logic endorsed in Vijay Madanlal Choudhary). If it is satisfied, look at whether anything was done subsequently in respect of the Proceeds of Crime by the same person, or other person. On this reading, the crime of acquiring Proceeds of Crime would make sense only when applied to a person other than one who generated the Proceeds of Crime. Otherwise we have a peculiarly odd situation where a person first generates Proceeds of Crime and then acquires the same Proceeds of Crime by doing nothing more.  

This is why, in context of the Proceeds of Crime Act 2002 in the U.K. (which contains money laundering offences for that jurisdiction), the House of Lords and later the UK Supreme Court in R. v. GH [2015 UKSC 24] has tried to tread a path which respects the statutory scheme without also setting too high a burden on the agency by whittling down the scope of possession / use based offences. It has held that the transaction generating Proceeds of Crime cannot be artificially broken up into two parts, to treat the same transaction as first generating the proceeds of crime and then resulting in its possession or use. In essence, it has consistently held against collapsing distinctions between the underlying criminal activity and the money laundering offence. At the same time though, the UK courts have controversially been content with even the slightest change of circumstance reflecting a new transaction to satisfy the offence. 

The missed Opportunity of Y. Balaji  

Now let us look at the facts in Y. Balaji. Ministers / public officials in Tamil Nadu were alleged to have taken bribes in return for promising government jobs. One could argue that the facts in Y. Balaji went much further and consisted of several transactions having taken place in respect of the bribe-money after it was first obtained, and so technically the collapsing distinctions problem did not squarely arise. But it did not stop the Court from proceeding to frame this issue for consideration: "whether without identifying the proceeds of crime or a property representing the proceedings of crime and without identifying any process or activity connected to proceeds of crime as required by Section 3, which constitute the foundational / jurisdictional fact, ED can initiate an investigation and issue summons?". The second part of that question presents the problem we are considering.

It was argued that launching an investigation under PMLA required that the agency first identify proceeds of crime had been generated, and the investigation could only concern what was done in respect of the alleged proceeds of crime. This, according to the Court, was placing the cart before the horse (Paragraphs 93-94). The Court then gives its interpretation of how Section 3 works (Paragraph 99):   

"All the three FIRs allege that the accused herein had committed offences included in the Schedule by taking illegal gratification for providing appointment to several persons in the Public Transport Corporation. In one case it is alleged that a sum of more than Rs.2 crores had been collected and in another case a sum of Rs.95 lakhs had been collected. It is this bribe money that constitutes the ‘proceeds of crime’ within the meaning of Section 2(1)(u). It is no rocket science to know that a public servant receiving illegal gratification is in possession of proceeds of crime. The argument that the mere generation of proceeds of crime is not sufficient to constitute the offence of money-laundering, is actually preposterous. As we could see from Section 3, there are six processes or activities identified therein. They are, (i) concealment; (ii) possession; (iii) acquisition; (iv) use; (v) projecting as untainted property; and (vi) claiming as untainted property. If a person takes a bribe, he acquires proceeds of crime. So, the activity of “acquisition” takes place. Even if he does not retain it but “uses” it, he will be guilty of the offence of money-laundering, since “use” is one of the six activities mentioned in Section 3." (Emphasis in original)

The Court seems to have completely missed the point for there is no appreciation of the two-step manner in which Section 3 operates. There is an undue emphasis on reading the illustrative list of activities or processes within the Explanation to Section 3, divorced from the substantive content of the provision which, at the cost of repetition, does not punish simply engaging in such activities with property that may then become Proceeds of Crime, but with property that is already Proceeds of Crime. This fatal misstep results in a whole-hearted support for collapsing the distinction between the first step of actually generating the proceeds of crime and the second step of doing something with it, as can be seen from the emphasised part in the extract above.

What perhaps ameliorates the problem is that Y. Balaji did not involve facts where there was nothing other than the first transaction of allegedly obtaining the bribe money. The Court could have arrived at the same outcome of there being a cause of action for the Enforcement Directorate without doing violence to the clear text of Section 3. Doing so would necessarily have required revisiting a more problematic precedent which, surprisingly, found no mention within Y. Balaji — the decision in Directorate of Enforcement v. Padmanabhan Kishore [SLP (Crl.) 2668 of 2022 (Decided on 31.10.2022)] rendered by a Three Justices' Bench in October 2022. 

Unlike Y. Balaji, the facts in Padmanabhan Kishore presented the collapsing distinctions problem much more starkly. A public servant was caught red-handed while accepting a bribe. This single act not only led to a prosecution for corruption offences, but also triggered a money laundering prosecution. The Madras High Court held that the money laundering prosecution could not be sustained as the facts had to reflect that an accused had done something with the proceeds of crime. The Supreme Court reversed, concluding that moment that bribe money exchanged hands it became Proceeds of Crime for the PMLA, and in one single movement it also satisfied the requirement under Section 3 of the PMLA of being in 'possession' of Proceeds of Crime. The decision, much like Y. Balaji, committed the same error in being blinded by the list of activities / processes mentioned in Section 3 without considering it in context of the overall text of the provision. 


It is appropriate to return to R v. GH here, where the UK Supreme Court recognised the likely harms that could follow from its reading of the law, and noted that:

"A thief is not guilty of acquiring criminal property by his act of stealing it from its lawful owner, but that does not prevent him from being guilty thereafter of an offence under one or other, or both, of those sections by possessing, using, concealing, transferring it and so on. The ambit of those sections is wide. However, it would be bad practice for the prosecution to add additional counts of that kind unless there is a proper public purpose in doing so ... The courts should be willing to use their powers to discourage inappropriate use of the provisions of POCA to prosecute conduct which is sufficiently covered by substantive offences, as they have done in relation to handling stolen property." (Emphasis mine)

Since there is no prosecutorial discretion in India of the kind available in the UK, the above observation leaves only courts as possible bulwarks against oppressive use of the PMLA given its intended breadth of coverage. Y. Balaji was a good opportunity for the Court to take up that mantle and start the long road to making the application and implementation of PMLA a reasonable exercise again. Unfortunately, because of how the Supreme Court looked at the issues, it failed to recognise the harms that followed by collapsing distinctions between the underlying offence and the PMLA altogether. One can only hope that whenever the next such opportunity arises, the Court pays close attention to not just the Explanation to Section 3 but the entirety of that provision, so as to restore the two-step process which is clearly endorsed by the statute itself. 

Friday, May 12, 2023

The Doctrinal Discomforts of Default Bail (poked by Ritu Chhabaria)

As the Indian Constitutional Law and Philosophy Blog discussed what seems like an eternity ago (it was only twelve days), a peculiar set of events had unfolded in the Supreme Court where a judgment passed by a Division Bench on 26.04.2023 was challenged by adopting a hitherto unknown process of a 'recall' application. The application had not yet cleared the registry to make it to the list of matters was therefore 'mentioned' orally on 01.05.2023 before a Division Bench comprising the Chief Justice, who directed that it shall be reconsidered and in the meantime not given effect to. 

There are rumours about the alleged procedural irregularities associated with the progress of the original case till its ultimate judgment. One does not know enough and therefore cannot comment on whether it was these set of circumstances which prompted the Supreme Court to adopt this unprecedented route thus far. But two wrongs never do make a right. Here, I take a different approach, and engage with the legal issues instead.

The judgment in question was Ritu Chhabaria v. Union of India [W.P. (Crl.) 60 of 2023 ("Ritu Chhabaria")]. The issue that it dealt with was that of bail under Section 167(2) of the Criminal Procedure Code 1973 [Cr.P.C.], or what is popularly called 'Default Bail'. It is a species of bail which accrues as a right to a person detained in custody during an investigation, and where the investigating agency fails to complete its investigating by filing the police report within the stipulated time-period of 60 or 90 days (depending upon the seriousness of the alleged crime). 

More specifically, the issue in Ritu Chhabaria was determining what amounts to completing investigation for purposes of extinguishing the right under Section 167(2). If triggering this right can be circumvented by police simply filing any collection of papers in court before expiry of the 60 / 90 day period, it renders default bail completely anodyne and illusory. It also undercuts the very intent behind incorporating this set of provisions in the first place: As Ritu Chhabaria and several decisions in the past have pointed out, the point was to try and curb the then-rampant habits of police to file 'preliminary chargesheets' at the end of 15 days (the earlier time limit) only to keep undertrials behind bars. The 1973 Code raised the limits by a wide margin, but this was done while incorporating default bail to ensure that undertrial incarceration is not oppressively long.

Herein lies the problem in this oft-retold tale of Section 167 being a means to rein in bad police practices. The tale is incomplete, giving us only half the picture, because by a sleight of hand it wants us to forget that the process of keeping a person behind bars is not a one-man show but a tag-team event. It needs both the police and the courts. The police will ask for custody, but it is the magistrate who must sanction it, and the tragedy of incessantly and oppressively long undertrial incarceration was as much a product of judicial apathy to personal liberty and treating bail as linked to the merits of a case. To sum up, the introduction of Section 167 was not only to deal with bad police practices, it was also to curb bad judicial practices by taking away fuzzy discretion and introducing a concrete rule for bail.      

You cannot change the stripes on a tiger as they say, and in a way that is the story of what has followed. The time limits were seen as insufficient by many and prompted the Supreme Court to label Section 167 as a 'paradise' for criminals in its first foray into the statutory provision. The sense of panic at the thought of countless 'criminals' being let loose led to amendments in 1978 increasing 60 days to 90 days for a subset of offences carrying higher sentences. In parallel came litigation before high courts where accused persons challenged rejections to their bail applications on grounds that what the police had done was nothing other than file a 'preliminary chargesheet' even at the end of 60 / 90 days. Since the late 1970s till today, we have had courts — both High Courts and the Supreme Court — adopting myriad approaches to deal with this perceived problem of letting the criminals go on a 'technicality'. 

What connected all of these approaches was that all of them concurred in rejecting a bright-line approach that required an investigation to be complete in all respects at the end of the 60 / 90 days period. The stakes were simply seen as too high for the result to be decided on a rule, and so courts did what they do best and brought in wriggle room to make individualised decisions. Instead of demanding complete investigations, the judiciary substituted that rule with one that retained a measure of discretion for itself. Determine for yourself, magistrates were told, as to whether the document before you suggests the investigation is more or less complete. If so, reject the default bail. The result was to open a new arena of litigation within the matrix offering both the accused and police an opportunity to challenge unfavourable orders, and ensure that there can never be a settled law on the point.      

Ritu Chhabaria was the latest chapter in this history and, in that regard, offered an entirely unremarkable conclusion when it observed that any chargesheet or complaint filed without completing the investigation would not extinguish the right to default bail. Rather, the problem I would argue is what the judgment can be seen to stand for — a harkening back to a stricter rule of default bail requiring the agencies do more within the stipulated time period and restore some measure of importance to default bail. This is clearer if we look at the facts, which do not involve an alleged incompleteness because of some forensic reports not being filed, but question the very nature of the investigative exercise conducted which, to the court, was hopelessly short of the standard it considered to be required by Section 167.  

A stricter, more bright-line, rule of default bail in respect of completeness of investigations is a past which is certainly not appreciated by the police and other agencies which continue to decry the shortness of time to complete investigations, never fully answering the more pointed question — why does this require the continued incarceration of the individual as well? But as I suggest, a bright-line approach to default bail is not one that the courts are too fond of either, because they never came around to fully accepting the radical premise behind a concept of bail completely de-linked from the merits of the case (as argued elsewhere on the log). These are serious allegations, and continued incarceration of undertrials is presumably a small price to pay to make sure that courts can apply their mind to these facts to get it right

History would suggest that the Supreme Court in reconsidering Ritu Chhabaria will nudge the pendulum back to the perceived centre on this issue. Old habits die hard, after all.

Saturday, March 25, 2023

The Arup Bhuyan Review

Twelve years. That's about how long the judgments in Raneef [(2011) 1 SCC 784], Arup Bhuyan [(2011) 3 SCC 377] and Indra Das [(2011) 3 SCC 380]—all decided by the same bench—remained good currency. For eleven of those, they remained under a cloud on account of review petitions filed in 2011 by the Union of India and the State of Assam, in which the Supreme Court found some merit in 2014 and decided for the matters to kept before a larger bench. That larger bench has now rendered its judgment, partly overruling the decisions [Arup Bhuyan (Review) - decided on 24.03.2023 (lead opinion by Shah, J. and a concurrence by Karol, J.]. 

For convenience, I've extracted the holding from the lead opinion below:

"18. In view of the above and for the reasons stated above we hold that the view taken by this Court in the cases of [Raneef, Arup Bhuyan, and Indra Das] taking the view that under Section 3(5) of Terrorists and Disruptive Activities (Prevention) Act, 1987 and Section 10(a)(i) of the Unlawful Activities (Prevention) Act, 1967 mere membership of a banned organisation will not incriminate a person unless he resorts to violence or incited people to violence and does an act intended to create disorder or disturbance of public peace by resort to violence and reading down the said provisions to mean that over and above the membership of a banned organisation there must be an overt act and / or further criminal activities and adding the element of mens rea are held to be not a good law. It is observed and held that when an association is declared unlawful by notification issued under Section 3, which has become effective of sub-section 3 of that Section, a person who is and continues to be a member of such association is liable to be punished with imprisonment for a term which may extend to two years, and shall also be liable to fine under Section 10(a)(i) of the UAPA, 1967." [Emphasis in original]

This post deals with Arup Bhuyan (Review) at three levels. The first level is engagement with the opinions to discern what exactly has been held outside of the concluding paragraph, and how. The second level is a look at judgments which were being reviewed—Raneef, Arup Bhuyan, and Indra Das—to understand the foundational missteps committed in Arup Bhuyan (Review). Finally, the third level zooms out from this particular case to look at the broader landscape of personal liberty and the law. 

What has the Court done in Arup Bhuyan (Review)

The ultimate conclusion in Arup Bhuyan (Review) has been extracted above. Simply put, it means that for purposes of the relevant clauses — Section 3(5) of TADA and Section 10(a)(i) of the UAPA — there is no need for the state to show an accused was an 'active' member of an unlawful organisation (the UAPA language) for purposes of the offence. Note that the UAPA today deals with 'terrorist acts' differently and far more seriously than it does 'unlawful acts' and in question here was the scheme pertaining to the latter. The Court has held that it is sufficient if, after an organisation is declared as unlawful under the statute, that a person continued with her membership of the same. I will come back to just 'how' the Court arrived at this outcome. Before that, we need to flag some of the other conclusions arrived at in the opinions. 

First, the leading opinion endorses the Union of India's submission that a statutory provision cannot be 'read down' without giving an opportunity of hearing to the Union as it's interests stand to be prejudiced by such a verdict. The judgments under review were all ordinary appeals / bail hearings, not constitutional challenges to the provisions, and an exercise of 'reading down' of clauses could not have taken place in such proceedings.  

Second, both opinions endorse the view that comparative law can only be used with great care on account of the perceived uniqueness of India's constitutional regime. It has been held that one of the main problems in Raneef, Arup Bhuyan, and Indra Das was their overzealous reliance upon U.S. cases without adequately appreciating the difference between the two jurisdictions; specifically, the limits crafted upon Article 19(1) by Article 19(2) and 19(4), which seemingly were absent within the U.S. framework. 

This second point about the uniqueness of Article 19 was at the heart of why Arup Bhuyan (Review) read the legal provisions in question differently from the earlier judgments. According to both opinions, and the Union of India, these earlier judgments had completely ignored the import of Article 19(4) which had been amended in 1963 to allow restrictions on the freedom to form associations where it may prejudice interests of the sovereignty or integrity of India. A declaration that an organisation is 'unlawful' under the UAPA means that these interests are at stake, making it a reasonable restriction. This perspective was not appreciated in the earlier 2011 judgments.

The process by which a declaration of an organisation as 'unlawful' under the UAPA takes place was given great emphasis by the Union, and the Court. It was not an overnight proclamation, but the result of an 'adversarial' process  overseen by a sitting High Court judge, where members had the right to appear and object, and in which the ultimate declaration was widely publicised. The offence only punished persons who had been, and continued to be, members. Surely, there could be no imagined prejudice for 'passive' members who continued with membership after all these steps were taken under law.

The Many Missteps of Arup Bhuyan (Review) 

Understanding the correctness of the conclusions arrived at in Arup Bhuyan (Review) is impossible unless we go back to the source of the problem — the judgments under review. Proceedings chronologically (not from date of filing but date of judgment) we start with Raneef which was a bail case, where no offence of Section 10 UAPA was involved as per details available in the High Court verdict which was challenged in the Supreme Court in Raneef

Why did the argument of membership come up at all? Because the state made it an issue, even as it did not specifically invoke the membership offence instead choosing to go for conspiracy ones under UAPA. An incriminating circumstances raised was that all accused were either members or office bearers of PFI or SDPI which could be confirmed with recoveries made during investigation. Neither PFI nor SDPI were organisations that had been banned at the time, but to set the record completely straight on the issue, both the High Court and Supreme Court observed that merely being a member of some organisation could not lead to the conclusion that the accused was part of a conspiracy to murder hatched by specific people also alleged to be members of the same organisation. 

Next, we have Arup Bhuyan and Indra Das, both being TADA cases with similar facts. The accused was alleged to be the member of a banned terrorist organisation, on the strength of a confessional statement and no other material, and thus convicted under the TADA membership offences [Section 3(5)]. Notably, the TADA offence was not phrased like the UAPA one, and punished any person who was a member of a terrorist organisation — clauses that have been retained for terrorist, not unlawful, organisations under the UAPA as well. 

The Supreme Court in both judgments first concluded that proceeding only on a confession was not good enough to convict a person. But then it turned its attention to the unfairness of the provision in question which seemed to punish mere membership. In Arup Bhuyan the Court observed that even if the state had proven that a person was a member, it had not established that he was an 'active' member of the terrorist organisation, and nothing less would satisfy a conviction. It applied this conclusion to the facts in Indra Das as well. It was in this regard that it cited various U.S. decisions and Indian decisions in both Arup Bhuyan and Indra Das, to finally hold in only the latter case that its conclusions would apply to other similar offences which punished mere membership of organisations such as Section 10 of the UAPA.

Having read these three judgments, the fault-lines running through Arup Bhuyan (Review) become starkly apparent. At the outset, it is clear that the offences under Section 3(5), TADA and 10(a) of the UAPA were not identically worded, so a big chunk of the Court's reasoning regarding the fairness of Section 10 of the UAPA as being a reason to review the 2011 judgments would not apply to Section 3(5), TADA.  

Next, it is plain as day that the judgments did not blindly follow American precedent as they were now being accused of doing, but considered them in light of the Indian landscape. Also, to suggest that the U.S. landscape has no limits to free speech is worse than disingenuous, yet this is the broad generalisation that Arup Bhuyan (Review) subscribes to. 

To show the distance between the U.S. and India, the Court invokes Babulal Parate on the urging of the Union, and conclude that public order could justify pre-emptive strikes against speech. However, looking at a case allowing for preemptive restrictions on certain rights on account of public order such as Babulal Parate in a context of punishing persons for being members without showing anything more, is like using a chainsaw to fix your fridge. 

The reason behind invoking Babulal Parate, and raising a furore around the three judgments not having considered Article 19(4), was because the Court completely misunderstood the question at times in Arup Bhuyan (Review). Nobody claimed, or held, that the legislature is out of bounds creating laws that punish membership of banned organisations on grounds of a perceived danger to the sovereignty and integrity of India. That battle was lost in 1963 and then in 1967. The issues here were of a different order — could I be punished for merely having been a member of an organisation that was banned because it had been found as posing such a threat? Would all members go to jail, because the organisation was banned? 

Key here is another feature which the Court pays surprisingly little attention to — membership is not a defined concept within the UAPA or TADA. We are not dealing with neat lists of shareholders, but a hazy group of people where membership would depend upon perceptions and beliefs. The facts in Raneef, Arup Bhuyan and Indra Das had shown us that proving membership did not need much more than a confession and recoveries of inconvenient literature (even the Communist Manifesto might do). The entire burden of proof at trial would, in effect, stand reversed upon the accused if mere membership became the crime as the state would claim that the fact of continued membership was only within the knowledge of an accused (Section 106, Indian Evidence Act). Which would bring us to a situation where nothing short of a loud denouncement of one's beliefs and memberships would be sufficient to erase any doubts about the matter. Or, as it used to be called during the inquisition, oaths of loyalty.  

By concluding that the offence needed something more than merely being a member, the 2011 judgments had inserted a measure of fairness in line with what the Supreme Court had done in a variety of contexts in the past; none of those judgments being constitutional litigations with the Union of India in attendance, but regular criminal appeals where the liberty of persons was at stake. Foremost among these being the offences punishing possession of contraband, where courts simply read the clause to require that conscious possession must be proven. Even the judgments regarding exclusion of showing any intent or knowledge, such as in Mayer Hans George, required the court to determine whether this was the only justified way to read the statute, on its own terms and its consequences. No effort was made to undertake this exercise in Arup Bhuyan (Review) and the Court simply accepted this contention at face value. 

Is the Glass Still Half Full?

Arup Bhuyan (Review) is sparsely reasoned, sure. But zoom out, and what you see is that this decision is a microcosm of the various contests that the Indian Constitution failed to resolve even as it safeguarded various civil liberties. It never confronted state power head-on, instead adopting an approach where small zones of freedom were carved out from the overarching might of the state to at least allow for the Davids to try and battle Goliath. To call this a balancing approach is farcical, yet this notion of balancing is what has become best associated for the courts themselves when they deal with issues of fundamental rights. In Arup Bhuyan (Review) we get another reminder of just how skewed this balance always was in favour of the state's interests—many of the judgments relied upon by the Court are from the 1960s—and how much farther it can tilt in times when the popular discourse is rife with ideas of threats to security and sovereignty. This privileging of public interest even under Article 21 is as ominous for the present times as is the alacrity with which the Supreme Court in Arup Bhuyan (Review) has accepted the submission that the Union of India must be heard before a court reads down a statute.  

So why do I say that the glass can still be seen as half full? Because there is still enough life left in Raneef, Arup Bhuyan, and Indra Das and many other judgments to allow the Davids to keep fighting. Since Raneef was not dealing with the membership offence, its observations that mere membership of a banned organisation is not an incriminatory circumstance to establish that I had conspired with other members of that specific organisation to commit crimes, would still stand. And since the injustices are far greater in relation to terrorism offences than those pertaining to 'unlawful activities' (both being separate concepts under UAPA), these findings (coupled with those in the more recent judgment of Thwaha Fasal) remain invaluable. Similarly, the observations in Arup Bhuyan and Indra Das that convictions for membership offences will not follow solely on the basis of purported confessions would remain valid and useful to combat eventual prosecutions. Lastly, the Court in Arup Bhuyan (Review) limits its observations to membership of the 'unlawful' organisation under Section 10 of the UAPA and not those clauses that pertain to membership of terrorist organisations, where the arguments of mens rea would still be available.   

This is a mightily optimistic reading of the lay of the land. But what is left if even hope is lost? 

Friday, March 24, 2023

Guest Post: Obscenity and the TVF Judgment

(This is a guest post by Yogesh Byadwal)

On 06.03.2023, in a batch of petitions led by TVF Media Lab v. State (Govt. of NCT of Delhi (TVF), a Single Judge Bench of the Delhi High Court held that a prima facie was made out against the Petitioner under Sections 67 & 67A of the Information Technology Act, 2000 (IT Act), and not only under Section 67, partly reversing the impugned judgment. The court applied the ‘contemporary community standards test’, as laid down by the Supreme Court in Aveek Sarkar & Anr v. State Of West Bengal (where that Court had discarded the 'Hicklin' Test) to decide whether the content of the web series in question was ‘obscene’.

In TVF, the court interpreted the ‘community standards test’ to mean:
“The approach of this Court for applying the test of a common man and how the content will affect him and what his reaction will be, has to be in the Indian context as the Indian morality and values can only be judged in the Indian context, keeping in mind the contemporary standards of civility and morality.”
It noted that:
“The Court had to watch the episodes with the aid of earphones, in the chamber, as the profanity of language used was of the extent that it could not have been heard without shocking or alarming the people around and keeping in mind the decorum of language which is maintained by a common prudent man whether in professional or public domain or even with family members at home.”
Based on these findings, it concluded that:
“When the entire content of the series is seen in the light of above, it would lead any common person to a conclusion that the language used in the web series is foul, indecent and profane to the extent that it will affect and will tend to deprave and corrupt impressionable minds.Therefore, on the basis of this finding it can be held that the content of the web series will certainly attract the criminality as envisaged under Section 67 of the Information Technology Act.”
I argue, that the court applied the ‘community stands test’ incorrectly by not reasoning within the two prongs of the community test. In my opinion, the reasoning employed, in a regressive manner, shifts the obscenity standard back to the Hicklin Test which was discarded in Aveek Sarkar. I conclude suggesting adoption of a new standard for determining obscenity in light of the progress made as regards the Roth Test in American jurisprudence. 

Community Standards Test: A Step Back?
The community standards test was laid down in Roth v. US which was later adopted by the court in Aveek Sarkar, although in a limited manner. The part adopted by the Indian Supreme Court read:
“The standard for judging obscenity, adequate to withstand the charge of constitutional infirmity, is whether, to the average person, applying contemporary community standards, the dominant theme of the material, taken as a whole, appeals to prurient interest.”
Therefore, the test has two prongs:
  1. The material must be taken as whole taking into relevant circumstances
  2. The dominant theme of the material must appeal to prurient interest of an average person of the community
As regards first prong, the court in TVF ignored it. The case was decided on basis of particular scenes in Episode 5 of Season 1 of the series. Precisely, objection was raised to airtime starting from 5 minutes 24 seconds to 6 minutes 40 seconds as well as from 25 minutes and 28 seconds to 25 minutes and 46 seconds. The court decided the obscenity of the web series by solely relying on 96 seconds of clip of the series. Whether the court would still have decided the series as obscene after relying on the dominant theme of the series is different question of law. 

However, the court never considered the dominant theme of the series relying on each episode of the series. The reasoning used by the court is reminiscent of the Hicklin Test. As Gautam Bhatia writes, under the test acontextual ‘matter’ was obscene if any part of it could be demonstrated, to the satisfaction of the judges, to have a tendency to deprave or corrupt. In this case also, the court undertook an acontextual analysis of the content by observing that other episodes contained excessive use of ‘swear words’, ‘profane language’ and ‘vulgar expletives’ which is not ‘civil language’. Nothing else detailed is discussed about the episodes or overall theme. On the other hand, the judgement focuses in detail on the impugned airtime in episode 5 to decide the obscenity of the series. The court conveniently ignores the rigour of the test while acknowledging its existence. 

On the second prong, the court in TVF did not test the material against the prurient interest of an average person. Rather, the tone of the judgement is fixated on the ‘youth’ and ‘impressionable minds’. The court observed:
"The content is to be read with regard to the circumstances of the content itself and is also with regard to the persons who will read, see or hear such content. In the case at hand, the content in question is the content of the web series ‘College Romance’ and the persons who are likely to be affected or the persons to whom such content can deprave and corrupt, in the present circumstances are the impressionable minds."
Further, it noted:
"The power of obscenity and sexual explicitness of language used in this web series … has a definite effect of depraving and corrupting the minds of people, especially the impressionable minds … The web series does deprave the morality of the impressionable minds."
An argument of this sort is similar to the Hicklin test which was discarded by in Aveek Sarkar. The court concluded, as noted above, the web series would attract Section 67 as language used in the web series tend to deprave and corrupt impressionable minds. A conclusion that the content is obscene because it has a capacity to corrupt ‘impressionable minds’ is in direct conflict with the community standards test. The test should not be from the point of view of people most likely to get depraved or corrupted (most vulnerable constituency test) but from the point of view of a person of average understanding. 

The court in order to get around the conflict observes that the language is obscene even when judged from an average person's perspective:
"In the episode in question, there is clear description and reference to a sexually explicit act. The Court had to watch the episodes with the aid of earphones, in the chamber, as the profanity of language used was of the extent that it could not have been heard without shocking or alarming the people around and keeping in mind the decorum of language which is maintained by a common prudent man whether in professional or public domain or even with family members at home." 
However, I submit, this is not the proper way to decide the ‘community standards’. The setting of the court is obviously much more decorous from the setting of a private space. It is incomprehensible and inexcusable to speak expletives in a court room which obviously demands a higher sense of propriety. This obviously raises the standards for decency to a much higher level. However, in private space, the threshold for decency is much lower. 

It is not uncommon to find videos on public domain which constantly employ ‘reproachful language’ to evoke humour. Seldom are any cases filed against such videos and rarely are they punished. Therefore, it leads one to believe that there is a sense of tolerance, if not acceptance, of the kind of language used in the particular case. However, in a patronising fashion, the court tries to brush off these claims by claiming without substantiation that:
"... the majority of this country cannot be said to be using such vulgar, profane, indecent, swear words and expletives as projected in the web series in question in day-to-day spoken language with each other even in educational institutions."
The Way Forward 
Aveek Sarkar while adopting the Roth test ignored that it was three pronged. As Bhatia points out, community standards constituted the first prong, under the second prong the material had to be “patently offensive”, and under the third prong, “of no redeeming social value”. Therefore, the threshold for deciding obscenity under Roth was much higher than what Aveek Sarkar understood the law. 

This test has since been replaced by the Miller Test (Miller v. California) which requires the material to fulfil three conditions:
1. Whether ‘the average person, applying contemporary community standards’ would find that the work, ‘taken as a whole,’ appeals to ‘prurient interest’
2. Whether the work depicts or describes, in a patently offensive way, sexual conduct specifically defined by the applicable state law, and 
3. Whether the work, ‘taken as a whole,’ lacks serious literary, artistic, political, or scientific value.
As Bhatia writes, the last ground is crucial, because it is on the social value prong that works of art, literature, sculpture etc., that would otherwise be deemed obscene, are not. 

Obscenity standards in India must be re-looked from the point of view of freedom of speech. The right under Article 19(1) will have no meaning if the courts can curtail speech on the ground that it offends majority views. Obscenity standards must therefore progress in a manner which allows marginalised and unpopular opinions to be transmitted without imposition of majority standards as far as possible.

Thursday, March 16, 2023

Section 144 Cr.P.C. — Part IX: From Emergency to Everyday, the Silent Transformations of Section 144

(This is the final post in a multi-part series on Section 144. The previous posts can be accessed here)

The first post in this series covering Section 144 of the Criminal Procedure Code 1973 [Cr.P.C.] came more than two years ago. In a change for this blog, the long time it has taken to reach this series' climax is not due to my indolence alone, but other circumstances, such as a pending research project into the on-ground workings of Section 144 that has only now achieved fruition. With this final piece of the puzzle in place, we can complete the chronicling of this most extraordinary of provisions, turning our attention to the last fifty years of its operation. Incidentally, this is perhaps the only period during our charting of the history behind Section 144 when the new Code of 1973 has been in operation.


Considering the long delay, a brief recap is in order. We had reached the passing of the new Code and the enactment of Section 144 as we know it today. This had come on the back of a momentous decade for the law in question, bookended by two decisions of the Supreme Court carrying enormous importance even today for all issues pertaining to the legality of Section 144 (and, arguably, emergency powers in general). These were Babulal Parate [AIR 1961 SC 884] delivered in 1961, and Madhu Limaye [AIR 1971 SC 2486] delivered in 1970.

The result in both of these had been to overwhelmingly back the conferral of broad, nearly-unfettered, powers with the 'boots-on-the-ground' police to deal with emergency situations. Whatever risks such a position entailed was to be contained by way of robust procedural safeguards — something which the Supreme Court thought that Section 144 did have, which convinced Parliament to retain the same set of safeguards when it passed the 1973 Code.

What were these safeguards? The requirement to record proper reasons and detail the circumstances which require exercise of such powers; the existence of a time-limit on the life of an order (two months), which could only be extended up to six months by the government; and, the ability to contest and seek a review of orders before the issuing authority, as well as challenge them before a superior court. 

Groundhog Days — Litigating Section 144 post the 1970s

Once two Constitution Benches had conferred their seal of approval on Section 144, and Parliament had decided to refrain from disturbing it as well, it was pretty much game-over for hopes of challenging the clause in court. Which is why the subsequent litigation on the clause has had a feeling of Groundhog Day, but without the happy-ending where the protagonist what he had to do differently to come out of the rut. 

Each decently-big litigation since Madhu Limaye seems to play out along the same script of courts coming down on the authorities not adhering to the procedural safeguards and to the same outcome of the petitioners securing a meaningless victory for the damage to civil liberties (in the form of banning a march, etc.) was already done. In fact, one might say that most of the big litigation was not on Section 144 at all, but where 144 arose as an incidental issue; merely the preferred bludgeoning instrument that was taken by the state while dealing with fundamental rights. 

Good examples of this being Gulam Abbas [(1982) 1 SCC 71] and Acharya Jagdishwaranand [(1983) 4 SCC 522], where the main issue was the enjoyment and exercise of the fundamental rights under Article 25 which had been curtailed by using Section 144. Or, more recently, Anuradha Bhasin [(2020 3 SCC 637] which concerned the right to access the internet which had been curtailed by using Section 144. In all of these litigations, the Supreme Court questioned (to varying degrees) the propriety of how Section 144 had been used and either expressly or implicitly acknowledged its misuse. Yet, in each of these, the rights in question had been long-lost by the time these pronouncements were delivered.

Subterranean Shifts — From Emergency to the Everyday 

This is the kind of story which broadly presents itself if we focus on individual cases at the Supreme Court. If we take a step back and look at these cases across a longer arc of history, say a fifty-year arc, and include the High Courts in our field of view, then some trends become noticeable that a case-by-case approach could not reveal. Two of these are of special importance.

First, in a variety of contexts one can see that Section 144 orders acquire a semi-permanent existence. The concerned authorities are simply re-issuing prohibitory orders at the expiry of the two-month period to make a mockery out of the time-limits which were at the heart of the clause. For instance, in Acharya Jagdishwaranand, the concerned authorities issued repetitive orders under Section 144 for practically four years between 1979 and 1982 preventing the Anand Margis from carrying out processions on the grounds of perceived disturbances to public order. Or, more recently in Bano Bee [WP No. 5000/2010 decided on 31.05.2011] where the repeated issuance of Section 144 orders in parts of Delhi was assailed but ultimately avoided scrutiny as the Delhi Police admitted to engaging in this practice but undertook to discontinue it, and issue orders when the need arose.

Second, the authorities had come to rely upon Section 144 as a tool for regulating daily life, either by issuing orders that imposed positive obligations upon people to actively take steps, or donning the hat of the morality police by banning activities which were otherwise not illegal. A good example of this being a recent judgment by the Delhi High Court in State v. Bhanwar Singh [Crl. L.P. 508/2017, decided on 12.10.2017]. This was a leave to appeal filed by the State challenging the acquittal of Bhanwar Singh, who had been prosecuted for failing to comply with a Section 144 Order. What was the directive? The Delhi Police (through DCP South) had issued a Section 144 order directing all landlords to verify the details of tenants, and an inspection revealed that Bhanwar Singh had failed to comply with this. 

History would have shown us that such positive obligations were, and still are, outside the scope of Section 144 which can be used to impose negative covenants and not positive obligations. But the Trial Court was not required to go into this issue, and acquitted Bhanwar Singh on the simple ground that the order was illegal being the sixth successive order passed issuing the same directions. 

The High Court did not interfere with this acquittal, dismissing the petition seeking leave to appeal, but what is pertinent here is the state's argument — the order was issued "keeping in view the threat raised by terrorists seeking residence in the capital" and that the Supreme Court's decision was outdated in an era "where the country faces a threat due to terrorist activities" making such successive orders a necessity. The submission could not be more blunt than this. The very procedural safeguards which the Supreme Court had considered the mainstay of Section 144's legality were being contended as outdated, by the State no less. 

Perhaps, the time had come for a serious conversation about change?  

Making a Case for Change — Studying the use of Section 144 Today

Looking at cases could only get one so far. Which is where I turned to searching for Section 144 orders in the public domain. It did not yield much by way of results, even though these are orders which, by design, are meant to be widely published whenever the public at large is affected. As luck would have it, I got the opportunity to be part of a fantastic team comprising of Vrinda Bhandari, Natasha Maheshwari, Madhav Aggarwal to research on the issue and pull out these orders to study them, backed by a grant by the Thakur Foundation. The result of this long-drawn effort is finally ready in the form a Report, titled 'The Use and Misuse of Section 144 CrPC' which we have uploaded on to SSRN.

The Report is one of the few efforts looking at Section 144 orders at the ground-level and not by studying judicial decisions. Using the Right to Information Act, we made efforts to study the provision's use in Delhi for the duration of one year (2021), which meant studying over 5000 orders (yes, 5000, in a year). And this was not even the full archive. In a bid to ensure engagement, the Report itself carries a sampling of orders, with our full archive of orders separately available on Justice Hub

As I am naturally interested in getting people to read the Report, I will refrain from summarising it here beyond giving the one broad conclusion that we drew from the work, which is that Section 144 has been fundamentally transformed in its usage by the police today from being seen as an Emergency power to deal with processions or sudden threats to public order, to a means for micro-level governance on a host of issues ranging from women's safety, to kite-flying, and the running of business traditionally seen as 'suspect'. Rather than deal with a perceived and identifiable threat to public order—say, a call for a march to Parliament—Section 144 is now being used to deal with the unidentified and ever-present risks to law and order that exist by the mere virtue of modern city-life—unidentified tenants being 'criminal elements'. 

It is a fascinating turn from a sociological and criminological perspective which merits deep and serious engagement. From the legal perspective, it confirms that the core premise of Section 144's usage, at least in New Delhi, has been founded contrary to constitutional logic insofar as the emergency power has been normalised into an everyday tool for enforcing police powers and criminalising an entire citywide population by creating obligations that can't ever be fully complied with. It confirms that the premise of procedural safeguards ensuring that the use of Section 144 remains within limits has been completely and utterly demolished over time, with the State justifying its refusal to adhere to the same. 

We are witnessing the natural consequence of retaining a law with language that was always designed to cast an infinitely-wide net to repress civil liberties even after, at least in theory, bidding goodbye to such policies. Rather than condemn the clause to history, both Parliament and the Supreme Court decided to retain the entire regime of Section 144 lock, stock, and barrel, but now sought to teach its users to use the same powers but with a mindset that protected civil rights and liberties. And, whenever push came to shove, both Parliament and the Courts twisted themselves into knots in emphasising the importance of these rights and liberties whilst unequivocally supporting the retention of unbridled power with the executive to interfere with them for securing a mirage of public order. It could not be more evident that this balancing act has spectacularly failed. 

Life in India has travelled a great distance from 1861, when the first iteration of Section 144 came on the statute books. In another sense, though, what the history of this provision shows us (and it is surely not alone in telling this tale) that life has travelled hardly any distance at all. The fragile sense of peace remains built upon a mountain of coercive power which can be exercised at whim without any real justification potentially against anyone in interests of the greater good / public safety / public order / law and order / you name it. Of course, in practice, it is only to be used against the usual suspects.   

Tuesday, March 14, 2023

Guest Post: Interpreting the Reasonable Expectation of Privacy Standard for Voyeurism

(This is a guest post by Paras Khetan)

Voyeurism is defined as the non-consensual observation of someone who would expect secrecy and has some sexual element linked to it. It involves a violation of one’s sexual autonomy and is therefore criminalized under S.354C of the Indian Penal Code, 1860 (‘IPC’) and S.66E of the Information Technology Act, 2000 (‘IT Act’). The Justice Verma Committee Report, which recommended the inclusion of the IPC provision, highlighted the negative impact of voyeurism on female children’s right to education and their freedom of expression and movement. Due to increasing instances of voyeurism, as indicated by the NCRB statistics, it becomes pertinent to define the scope of this offence.

Previously in another blog post, an analysis of the definition of ‘private act’ under S.354C of IPC was undertaken. This post is, in its analysis, limited to the interpretation of the ‘reasonable expectation of privacy’ standard under S.354C of IPC. It would not engage with S.66E of the IT Act due to the presence of sufficient clarity in the provision with regards to the meaning of ‘reasonable expectation of privacy’. The analysis would be primarily done through case laws from foreign jurisprudence (primarily the UK and Canada because of similar voyeurism provisions in these countries) due to a lack of evolved jurisprudence on the same in India. There is an absence of any case engaging in the interpretation of the ‘reasonable expectation of privacy’ standard in India. Nonetheless, the piece tries to locate the foreign case laws within Indian case law.

‘Reasonable Expectation of Privacy’ Standard
The interpretation of the ‘reasonable expectation of privacy’ standard has been a point of controversy across jurisdictions. This standard has been used in K.S. Puttaswamy v Union of India (Privacy-9J.) while considering the inherent right to privacy under Article 21 of the Indian Constitution. The Supreme Court pointed out that this standard has both subjective and objective elements to it. The subjective element is whether the individual has exhibited an actual expectation of privacy and the objective element is whether the individual’s subjective expectation of privacy is one that society would recognize as reasonable. This elaboration on the standard would help in interpreting the same.

The scope of this standard has been narrowed by judicial pronouncements through an ‘assumption of risk’ test. However, later the courts have emphasized on an important factor which allows an expansive understanding of the standard.

A. ‘Assumption of Risk’ Test
The ‘assumption of risk’ test has its genesis in Katz v United States. Justice Harlan, in his concurring opinion, points out that a person’s house would be considered a place where he expects privacy. However, the objects and activities that he exposes to the ‘plain view’ of outsiders will not be protected because he does not intend to keep them to himself. This implies that the person would not have any expectation of privacy for he has assumed the risk. This is a useful factor in construing ‘reasonable expectation of privacy’. It is also covered by the subjective and objective elements of the Puttaswamy test as the individual has neither exhibited any actual expectation of privacy nor it would be considered reasonable by society. This reasoning is used to limit one’s reasonable expectation of privacy to non-public places.

An important case that analyses the scope of the ‘assumption of risk’ test is R v Wong of the Canadian Supreme Court. It highlights that there exists a crucial distinction between the degrees of risk that you have exposed yourself to. There exists a difference between the risk that someone might observe one’s private activities as opposed to the risk that someone might make a permanent video record of the same. Therefore, even if one has assumed the risk of violating one’s privacy, it does not necessarily imply that you forgo the right to be protected from the creation of a permanent record of your private act.

A similar proposition has been accepted by UK courts as well. This position evolved in response to the limiting of the offence of voyeurism to private places. In R v Bassett, the court held that while construing whether something creates a reasonable expectation of privacy, it is the nature of the observance that is relevant. 

This interpretation of the ‘reasonable expectation of privacy’ standard is a powerful interpretation and is the settled position of law in the UK and Canada. It is also in consonance with Puttaswamy where it was held that the reasonable expectation of privacy may vary from the private to the public arena and that it cannot be done away with merely because the individual is in a public place. The potency of this interpretation would become clearer with the application of this test in the next section.

B. Application of the Test
Bassett used this logic to hold that a person taking a shower in the general space of a changing room beside a public swimming pool would have a reasonable expectation of privacy from being spied on by someone from outside the changing room. However, a person would not have any reasonable expectation of privacy from casual observance by others in the changing room. The Court also relied on the marathon runners’ case in Swyers [(2007) EWCA Crime 204] where it was held that the marathon runners urinating behind a hedge would have a reasonable expectation of privacy from being watched by a person who is loitering there for a sufficient period of time and closely observing them. However, they would not have any reasonable expectation of privacy from casual and unintended encounters. The emphasis in these cases has been on the nature of observance – deliberate as opposed to casual observance.

This interpretation has been used to include the act of secretly filming sexual intercourse with another person where the accused was also a participant in the sexual intercourse. In R v Richards, the court, relying on Bassett, held that the victim had a reasonable expectation of privacy from being secretly recorded by the other participant in the sexual activity. In a similar case (R v Trinchi, 145 OR 3d 721), the court held that the capturing of an image of one partner by the other during a live-video stream where both were naked amounted to a violation of the reasonable expectation of privacy of the partner. The court emphasised on the crucial distinction between mere observance and creation of a permanent record through recording. These cases indicate that this interpretation of the standard also applies to private places and would help in tackling instances of revenge porn.

However, in R v Lebenfish (2014 OJ No 1261) this distinction between observation and recording was held to be ineffective in applying to cases where the use of a recording device is very ubiquitous (like a nude beach). This provides a useful exception to the distinction between observation and recording and brings further clarity on the application of the ‘reasonable expectation of privacy’ standard.

In R v Jarvis, the court held that the recording of students’ breasts in the classroom, at an angle such that the breasts would ordinarily not be visible to other students, would amount to a violation of their reasonable expectation of privacy. The court reasoned that the word “circumstances” as used in the provision was indicative of the legislative intent to not confine voyeurism to private places only. The Court also laid down nine factors that would be relevant in construing whether the circumstances gave rise to a reasonable expectation of privacy. These include the location of the person, the nature of the observance, and the relationship of the persons.

Therefore, the above analysis indicates that the initial “assumption of risks” test has been severely diluted to extend the reasonable expectation of privacy standard to public places. The emphasis on the nature of the observance (including the distinction between observing and recording) as an important factor in construing the circumstances in which a reasonable expectation of privacy may arise has allowed a consistent and sound interpretation of the standard.

This piece has analysed the foreign jurisprudence on the interpretation of the reasonable expectation of privacy standard and how the same can be transposed in Indian law using Puttaswamy. The wide range of applications (as enumerated above) of interpreting the standard, with an emphasis on the nature of observance, can be used to tackle many instances of voyeurism that may arise, especially due to the growing instances of revenge porn in India. However, it is important to create sufficient awareness of the voyeurism offence and its harms for it may pose a barrier to its effective utilisation.