The Supreme Court Order in P. Chidambaram v. ED: Some Thoughts

A Two Justices' Bench of the Supreme Court has decided the appeal filed by P. Chidambaram against an order of the Delhi High Court dismissing his plea for Anticipatory Bail in an ongoing investigation being conducted into what is being labelled as the "INX Media Scam" [Crl. Appeal 1340 of 2019, decided on 05.09.2019. ("Chidambaram")]. The main difference between the two sets of proceedings was that while the High Court order considered bail pleas in two parallel investigations being conducted by the Central Bureau of Investigation [CBI] and the Directorate of Enforcement [ED], the Supreme Court hearings were only concerning the ED case. This is because, as many will already know, the CBI arrested Mr. Chidambaram the same night that his bail plea was dismissed by the High Court.

The Gravity and Uniqueness of Economic Crime

I had discussed the High Court order here, and had flagged three issues which I thought were not only central to the hearings but also to the practice of deciding bail applications more generally within the sphere of economic offences. The High Court order had stressed upon the gravity of economic offences and had taken it so seriously that it considered it appropriate to recommend that anticipatory bail be taken away as a possible remedy in any such case. I did not think it was possible but the Supreme Court somehow managed to amp this rhetoric up several notches. 

While the Supreme Court does not expressly recommend removal of anticipatory bail as a relief, it went 9/10ths of the way [See Paragraphs 67 to 82], and almost reached that projected finish line in the specific context of money laundering cases. At the end of Paragraph 34, the Court went so far as to note that "In cases of PMLA, in exercising the power to grant anticipatory bail would be to scuttle the statutory power of the specified officers to arrest which is enshrined in the statute with sufficient safeguards."

The Supreme Court develops the logic adopted by the High Court, and links the rhetoric of economic offences being very grave with the idea that they are also very complex to investigate, and thus, uniquely in need of custodial interrogation [See Paragraphs 76 to 81]. Therefore, the Supreme Court concludes, that "Grant of anticipatory bail, particularly in economic offences would definitely hamper the effective investigation." [Paragraph 81] 

Pause here to see just how lazy this reasoning is. What are "economic offences"? Theft and cheating are economic offences — but are you telling me that they are so complex to investigate that you require custodial interrogation to get to the bottom of them? Of course not, which is why I implored the Court to try and come down from the high altar of principle and delve into the specifics and help give some clarity so that the lowly magistracy can go about applying the law with greater certitude. But this wasn't to be.

The laziness is also on display in terms of the Court unquestioningly accepting this position of cases involving economic offences being so complex as to almost justify custodial interrogation and denial of bail. Granted, some cases can be very complex — for instance, laundering through hawala channels where there were no real paper trails created. But surely this principled stance cannot apply to all cases, and this is why we needed the Court to get messy with detail. Moreover, why should the Court trump up custodial interrogation? What about how this can reduce incentives for independent investigations? This is hardly a novel thought — James Fitzjames Stephen retained the ban on confessions in the Indian Evidence Act because, as a civil servant told him, it made sure that the officers don't sit in the shade all day while rubbing chilli in the eyes of some poor sod trying to get him to confess to a crime, rather than go out and investigate a case.    

A Carte Blanche to the Police? 

Moving on, we find that the Supreme Court marries this discussion about the position of economic offences with a more general level of argument when it engages with the issue of what to do in situations where an accused denies she is being "evasive". Here, to remind readers, the accused asked the Court to call for transcripts of his questioning as he challenged the assertion that he had not been cooperating with the probe.

The Court refused these requests by turning to the principle that courts and police operate in separate spheres. This forestalls any court from qualitatively assessing the investigation, and so where an agency asserts that an accused is "not cooperating" or "being evasive", a court is supposed to accept these assertions without question. Doing otherwise would sully the principle of separation between the police and the judiciary. 

Alas, the Court forgot about its own prior judgment in Sakiri Vasu, where a different bench had actively authorised magistrates to entertain applications from persons aggrieved by the manner in which police ran an investigation. Or did it? In the section of the judgment which justifies why sealed covers are alright, the Supreme Court notes that looking at confidential material (without showing it to the accused) has always been accepted as long as it is done by a court "to satisfy itself that the investigation has been conducted in the right lines and that there is no misuse or abuse of process in the investigation" [Paragraph 53]. 

So then, how can the Court go ahead and refuse to test the police officer's assertion that an accused was "not cooperating" or "being evasive" in questioning? If a court is going to be deprived of the ability to question police on their stand in such situations, then aren't we effectively condemning a person to custody and surrendering her liberty to the mercy of the executive? The doublespeak on display is astounding, and deeply concerning. 

Conclusion: A Recipe for Disaster

Talk to anyone in the profession and they will tell you that the money laundering law has given wide powers upon executive officers that are capable of being abused. After all, money laundering is not a crime like theft or cheating, but a crime which depends entirely upon creating a narrative about what someone did with the fruits of that previous theft or cheating. The scope for imagination is wide, and in our system of slow-moving justice, the result of this imaginative exercise often results in an unfair onslaught upon the civil liberties of an individual for a significant time of her life.

Rather than take a scalpel and forensically examine allegations in some detail during bail hearings in order to make sure that an innocent person is not ensnared by police agencies on frivolous grounds, and to ensure that custodial interrogations do not become a principle of first resort for investigators, with its decision in Chidambaram, the Supreme Court has taken a leap towards a world where all of this becomes more than possible. It was once said that a draconian law is not only made on text, but also in how it is applied. With this verdict, perhaps the same might soon be said of the money laundering statute. Of course, if it wasn't already the case.