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by sayum
02 April 2026 8:51 AM
"Nobody is under a duty not to be smart. But that smartness cannot extend to feigning ignorance and even giving false answers to the questions put by the interrogators." Delhi High Court, in a significant ruling dated March 30, 2026, held that the rigours of the twin conditions under Section 45 of the Prevention of Money Laundering Act (PMLA) strictly apply to anticipatory bail, and an accused who actively obstructs an investigation cannot claim relief even under the beneficial proviso for women.
A single-judge bench of Justice Girish Kathpalia observed that custodial interrogation is essential when an accused gives false answers to interrogators, noting that the judicial trend diluting twin conditions due to prolonged incarceration applies only to regular bail and not anticipatory bail.
BACKGROUND OF THE CASE
The case stems from the massive Rs 48,000 crore PACL and PGFL scam, where funds were fraudulently collected from investors under the guise of real estate schemes. The Enforcement Directorate registered an ECIR in 2016 against several accused, including the late Nirmal Singh Bhangoo. The present petitioner, his daughter Barinder Kaur, was accused of siphoning over Rs 657 crore in proceeds of crime to Australian companies where she served as a Director. She approached the High Court seeking anticipatory bail after the Sessions Court dismissed her plea following her repeated evasion of summons.
LEGAL ISSUES
The primary question before the court was whether the twin conditions under Section 45 of the PMLA apply to applications for anticipatory bail. The court was also called upon to determine whether a woman accused could claim the benefit of the proviso to Section 45 when there is evidence of evasive conduct, tampering with evidence, and a stated need for custodial interrogation by the investigating agency.
COURT'S OBSERVATIONS
Strict Application Of Section 45 PMLA To Pre-Arrest Bail
Relying heavily on the Supreme Court's precedent in the Dr. V.C. Mohan case, the High Court clarified that the stringent requirements of the PMLA cannot be bypassed merely by invoking Section 438 of the Code of Criminal Procedure. The court stated that the special legislation requires the judge to be satisfied on broad probabilities that the accused is not guilty and is unlikely to commit offences while on bail. The bench underscored that an anticipatory bail plea in a money laundering case automatically activates the underlying principles of the special statute. "Once the prayer for anticipatory bail is made in connection with offence under PMLA, the underlying principles and rigors of Section 45 PMLA must get triggered although the application is under Section 438 of the Code of Criminal Procedure."
Prolonged Incarceration Precedents Apply To Regular Bail, Not Anticipatory Bail
Addressing the petitioner's argument that recent Supreme Court judgments have diluted the twin conditions under Section 45 due to the fundamental right to life under Article 21 of the Constitution, the court drew a sharp distinction between regular and anticipatory bail. The bench reasoned that while prolonged incarceration can override statutory restrictions for regular bail, this logic cannot be overstretched to establish a complete bar on custodial interrogation. The court warned that such an interpretation would completely destroy the nature and purpose of financial investigations. "The line of judicial pronouncements qua dilution of the twin conditions pertain to the issues of regular bail and not anticipatory bail, especially where the investigating agency expresses need for custodial interrogation."
Evasive Conduct Defeats The Beneficial Proviso For Women
The court then turned to the petitioner's claim for leniency as a woman under the proviso to Section 45 of the PMLA. However, the bench observed that the petitioner had consistently demonstrated a scant regard for the law by feigning ignorance and refusing to divulge corporate details or funding sources during her interrogations under interim protection. The court noted that she even filed affidavits containing facts completely contrary to the statements she had previously made on oath before the investigators, thereby obstructing the process. "It is not that she gave 'smart answers' to the interrogation questions. It is that she gave 'false answers' to the interrogation questions."
Active Tampering Necessitates Custodial Interrogation For Asset Recovery
Taking serious note of the Enforcement Directorate's evidence, the court highlighted that the petitioner had actively instructed an associate over a video call to conceal incriminating digital evidence during a lawful search operation. The court emphasized that her conduct rendered the argument that she was not a flight risk completely insignificant. Recognizing the mandate of the Supreme Court-appointed Justice R.M. Lodha Committee to refund duped investors, the bench affirmed that the agency's demand for custodial interrogation was highly justified to unearth the foreign assets acquired through proceeds of crime. "Even if the twin conditions stipulated under Section 45 PMLA are ignored, the above described conduct of the accused/applicant would not justify allowing her the relief sought by her."
"Article 21 of the Constitution of India cannot be read in a manner that completely blocks custodial interrogation. For, it cannot be disputed that custodial interrogation in certain kind of cases is much more effective than interrogation of a person who goes to the investigator with protection from arrest in his pocket."
Consequently, the Delhi High Court dismissed the anticipatory bail application and the pending interlocutory application. The court granted the Directorate of Enforcement the liberty to proceed against the accused in accordance with the law, reaffirming that pre-arrest bail is a matter of exception in grave socio-economic offences, particularly when the recovery of duped investors' funds remains paramount.
Date of Decision: 30 March 2026
