The Orissa High Court has granted interim protection from arrest to a businessman facing proceedings under the Prevention of Money Laundering Act, 2002 (PMLA), holding that while issuance of summons alone may not justify apprehension of arrest, subsequent proceedings indicating prima facie satisfaction of involvement in money laundering can create a reasonable basis for such apprehension.
The bench of Justice R.K. Pattanaik has observed that mere existence of criminal antecedents or involvement in predicate offences is insufficient to justify arrest under the PMLA. The Enforcement Directorate must demonstrate, based on incriminating material, that the accused is involved in the process or activity connected with proceeds of crime. The Court reiterated that the jurisdiction of the ED arises only when there is material linking the accused to laundering of proceeds derived from scheduled offences.
The case arose from a petition filed under Section 482 of the Bharatiya Nagarik Suraksha Sanhita (BNSS), where the petitioner sought pre-arrest bail after being summoned by the Directorate of Enforcement (ED) in connection with a money laundering inquiry. The petitioner contended that despite extensive searches at his residence and business premises, no incriminating material was recovered, and the summons were issued based on incorrect information.
The Enforcement Directorate opposed the plea, arguing that summons issued under Section 50 of the PMLA are part of an investigative process and do not imply that the person summoned is an accused. It further contended that since the petitioner had already appeared and his statement was recorded, there was no immediate apprehension of arrest, rendering the anticipatory bail application not maintainable.
However, the Court noted that developments beyond the issuance of summons—particularly proceedings initiated under Section 17 of the PMLA and the subsequent show cause notice issued by the Adjudicating Authority after recording prima facie satisfaction under Section 8(1)—could legitimately give rise to apprehension of arrest. The Court held that such circumstances cannot be ignored while considering a plea for anticipatory bail.
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The Court also underscored that personal liberty remains a fundamental constitutional consideration. Relying on established Supreme Court precedents, it observed that arrest during investigation should not be routine and must be justified by necessity, such as custodial interrogation, risk of absconding, or possibility of tampering with evidence.
Addressing the ED’s argument on non-disclosure of materials, the Court held that while investigative agencies may withhold certain information to protect ongoing investigations, such discretion is not absolute. The Court referred to judicial precedents affirming that accused persons are entitled to access relevant materials, especially when stringent bail conditions under Section 45 of the PMLA are invoked.
Balancing the competing interests of effective investigation and protection of individual liberty, the Court granted interim protection from arrest to the petitioner for a period of six weeks. This relief was made conditional upon the petitioner’s cooperation with the investigation and compliance with summons issued by the Enforcement Directorate.
Case Details
Case Title: Krupasindhu Muduli Versus UOI
Citation: JURISHOUR-983-HC-2026(ORI)
Case No.: ABLAPL No.1316 of 2026
Date: 23.04.2026
Counsel For Petitioner: B. Senapati, Advocate
Counsel For Respondent: S. K. Dwivedy & Vijay Kumar Meena
