Supreme Court Limits ED’s Arrest Powers Post-Cognizance: Safeguarding Personal Liberty under PMLA

In a significant judgment aimed at balancing the powers of investigative agencies with the fundamental right to personal liberty, the Supreme Court of India ruled that the Enforcement Directorate (ED) cannot arrest an accused under Section 19 of the Prevention of Money Laundering Act (PMLA), 2002, once a Special Court has taken cognizance of the complaint. The bench, comprising Justices Abhay S. Oka and Ujjal Bhuyan, clarified that after a Special Court takes cognizance, the agency’s power to arrest an accused—based on its own "reason to believe" they are guilty—comes to an end. Instead, if the ED requires the custody of the accused for further interrogation, it must apply to the Special Court. The court will then decide on the request after hearing the accused and providing reasons. This transition from agency-led arrest to court-mandated custody ensures that the judicial process remains supreme once a formal complaint is filed.