Introduction:
In a significant legal development, the Supreme Court of India has granted bail to Arun Kumar Tripathi, an Indian Telecommunications Service Officer, who was arrested by the Enforcement Directorate (ED) on August 8, 2024, in connection with a money laundering case linked to the Chhattisgarh liquor scam. The bail was granted after the quashing of the Special PMLA Court’s order taking cognizance of the prosecution complaint against him.
Background of the Case:
Arun Kumar Tripathi was implicated in a money laundering case related to the Chhattisgarh liquor scam. The ED filed a supplementary prosecution complaint naming Tripathi as an accused on October 5, 2024, and the Special PMLA Court took cognizance of this complaint on the same day. However, on February 7, 2025, the High Court quashed the Special Court’s order taking cognizance, citing the absence of the necessary sanction for prosecution. This decision was influenced by the Supreme Court’s November 2024 judgment in Directorate of Enforcement Etc. v. Bibhu Prasad Acharya Etc., which mandated that sanction is essential to prosecute public servants under the Prevention of Money Laundering Act (PMLA).
Arguments Presented:
During the hearing, the Supreme Court bench, comprising Justice Abhay S. Oka and Justice Ujjal Bhuyan, questioned the ED’s rationale for continuing Tripathi’s custody after the quashing of the cognizance order. Justice Oka inquired, “If cognizance has been quashed, why should the accused be in jail?” He further expressed concerns about the potential misuse of the PMLA, drawing parallels to the misuse of Section 498A of the Indian Penal Code, which has been criticized for being used to unjustly incarcerate individuals.
Additional Solicitor General (ASG) S.V. Raju, representing the ED, contended that the quashing of the cognizance did not render the arrest illegal. He informed the court that the necessary sanction had since been obtained, and the ED had applied for fresh cognizance based on this sanction. The ASG emphasized the gravity of the allegations, stating that the accused were involved in running a parallel liquor business and siphoning off money to Dubai. He argued that such serious offenses should not allow the accused to evade justice on mere technicalities.
On the other hand, Senior Advocate Meenakshi Arora, representing Tripathi, highlighted that her client had been in custody since August 2024 and that the order taking cognizance had been quashed due to the lack of necessary sanction. She argued that in the absence of a valid cognizance order, continued detention was unwarranted.
Court’s Observations and Judgment:
The bench expressed its displeasure with the ED for not promptly informing the court about the quashing of the cognizance order. Justice Oka remarked, “It is shocking that ED knows that the cognizance was quashed, yet this was suppressed. After 5 questions, this was informed to us. We should summon the officers. ED must come clean.”
Justice Bhuyan pointed out that the ED had acted upon the High Court’s order by applying for fresh cognizance based on the newly obtained sanction. He emphasized that as of now, no valid complaint existed against Tripathi since the original order taking cognizance had been set aside.
The bench concluded that, given the peculiar circumstances of the case—particularly the quashing of the cognizance order and the subsequent application for fresh cognizance—Tripathi’s continued custody was unjustified. The court directed that Tripathi be produced before the Special Court within a week and be released on bail, subject to stringent conditions, including the surrender of his passport and an undertaking to regularly attend court proceedings.