Case at a Glance
The former promoter and non-executive Chairman of Amtek Auto Ltd. was arrested by the Enforcement Directorate in July 2024 in money laundering cases linked to alleged bank fraud. With about 16 months and 20 days in custody, cognizance not yet taken and over 200 prosecution witnesses cited, the Supreme Court granted him bail. It held that economic offences cannot be treated as a single class for blanket denial of bail, that prolonged incarceration without progress in trial cannot be countenanced, and that the trial delay was attributable to the ED, not the accused.
Corporate insolvency proceedings were initiated against Amtek Group entities in 2017-2018. On 21 December 2022, FIRs were registered at the instance of IDBI Bank and Bank of Maharashtra under the IPC and the Prevention of Corruption Act, naming 28 accused including the appellant, alleging fraud of ₹385.35 crore and ₹289 crore. The ED registered two ECIRs on 21 March 2023. The appellant appeared under Section 50 PMLA, was searched and was arrested on 9 July 2024. A prosecution complaint and a supplementary complaint followed, the latter naming 40 accused; only the appellant was in custody and cognizance had not been taken.
The Special Judge rejected bail on 21 January 2025, and after interim medical bail, the High Court rejected regular bail on 19 August 2025. Before the Supreme Court, the appellant, aged about 64 with multiple ailments, pointed to his cooperation and the trial delay; the ED relied on the gravity of the offence, Section 45’s twin conditions, and alleged witness influence and dissipation of proceeds of crime.
The Key Question Before the Court
Should regular bail be granted under Section 483 BNSS read with Section 45 PMLA to an accused in prolonged pre-trial custody where the trial has not commenced and the delay is attributable to the prosecution?
Gravity Is Case-Specific, and Article 21 Applies to Every Accused
The Court held that gravity must be judged on the facts of each case, including the prescribed sentence, and that economic offences cannot be grouped together for a blanket denial of bail, relying on Satender Kumar Antil v. CBI, (2022) 07 SC CK 0064 and Javed Gulam Nabi Shaikh v. State of Maharashtra, (2024) 08 SC CK 1104. Article 21 applies regardless of the nature of the crime; citing V. Senthil Balaji v. Deputy Director, Enforcement Directorate, (2024) 09 SC CK 0057, it noted that where the maximum sentence is seven years, prolonged incarceration may warrant bail if trial is unlikely to end in reasonable time. “Prolonged incarceration of an undertrial, without commencement or reasonable progress of trial, cannot be countenanced.” It also referred to Union of India v. K.A. Najeeb, (2021) 02 SC CK 0001, Manish Sisodia v. Enforcement Directorate, (2024) 08 SC CK 0020 and P. Chidambaram v. Directorate of Enforcement, (2019) 12 SC CK 0007.
On the facts, the appellant had joined the investigation, the matter was at the document-scrutiny stage and trial was unlikely to begin soon. The trial was delayed by about eight months because the ED itself challenged a trial court notice and obtained a stay, later withdrawing its petition: “The delay in the trial is thus attributable only to the respondent, not the appellant.” The witness-influence allegation was “wholly incredulous” because he was already in custody when the witness was named, and the dissipation allegation was “untenable at this stage” as no material linked him to the property sales. Following Padam Chand Jain v. Enforcement Directorate, documentary evidence already seized reduced the risk of tampering.
What the Court Actually Held
- Economic offences are not a homogeneous class for blanket denial of bail; gravity depends on the facts and the prescribed punishment.
- Prolonged pre-trial custody without commencement or reasonable progress of trial violates Article 21 and can justify bail even under Section 45 PMLA.
- Delay caused by the prosecution’s own litigation cannot be held against the accused; unsupported allegations of witness influence and dissipation do not defeat bail.
- The High Court order of 19 August 2025 was set aside and bail granted, on terms fixed by the trial court, with conditions to share a contact number with the ED, surrender his passport and not leave India without permission.
Why This Judgment Matters
- It adds to the line of Supreme Court rulings that Section 45 PMLA does not override Article 21 when trials stall.
- It holds the prosecution accountable for delay it causes.
- It warns against reflexive bail denial merely because an offence is labelled economic.
What Should Advocates Take Away From the Judgment?
For Undertrials
- Track the stage of trial: no cognizance and many witnesses support a delay argument.
- Document your cooperation with the investigation.
- Allegations of tampering must be backed by material.
For Counsel
- Chart the custody period against the maximum sentence and trial status.
- Show who caused the delay, with dates of stays and withdrawals.
- Rely on V. Senthil Balaji, Manish Sisodia and Padam Chand Jain in PMLA bail matters.
Key Takeaways
- Bail is not to be denied by treating all economic offences alike.
- Prolonged custody without trial progress cannot be countenanced.
- Prosecution-caused delay weighs in favour of the accused.
- Courts can impose conditions such as passport surrender instead of continued custody.
Frequently Asked Questions
Can bail be granted under PMLA despite the twin conditions of Section 45?
Yes. The Court reiterated that prolonged incarceration without trial progress, especially where the maximum sentence is seven years, can justify bail under Article 21.
Why did the Court say the delay was the ED’s fault?
Because the ED had challenged a trial court notice and obtained a stay, delaying the trial by about eight months before it withdrew its petition.
What conditions were imposed?
Terms were left to the trial court, with directions to give the ED a contact number, surrender the passport and not leave India without the trial court’s permission.
Conclusion
The ruling applies settled Article 21 principles to a high-value economic offence case and refuses to let the label ‘economic offence’ justify indefinite custody. It places responsibility for delay where the record showed it lay.
Practical takeaway: In PMLA bail matters, a detailed record of custody length, trial stage and the cause of delay can outweigh the gravity argument and the twin conditions.
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