'3,000 cases in 180 days': SC questions single-member PMLA adjudication
New Delhi, Sept. 16 -- The Supreme Court on Tuesday questioned the Enforcement Directorate (ED) on the practice of allowing a single member of the PMLA adjudicating authority to decide cases involving attachment of properties, asking whether there could be genuine application of mind when thousands of matters had to be dealt with within the statutory 180-day period.
"Will there be real application of mind or signing on the dotted lines?" , the Chief Justice of India Surya Kant-led bench asked during a hearing on whether a single member, particularly one without judicial experience, could confirm provisional property attachments made by ED under the Prevention of Money Laundering Act (PMLA).
The bench, also comprising justices Joymalya Bagchi and V Mohana, reserved its judgment on the issue but directed ED to furnish details of the number of attachment orders issued by it and the time taken by the adjudicating authority to dispose of challenges to such orders.
The court underlined that attachment of property under the anti-money laundering law has serious civil consequences and cannot be treated as a routine administrative exercise.
"But it does have civil consequences on possession and right to enter the property," the bench told ED, rejecting an argument that a provisional attachment order merely prohibits transfer of the property and does not determine criminality.
The exchange took place during the hearing of a batch of petitions raising questions over the functioning of adjudicating authorities under PMLA. One of the petitions, filed by M/s Karvy Realty (India) Ltd, challenges a 2024 Telangana high court ruling which held that a single-member adjudicating authority could exercise powers under Section 8 of PMLA even if that member did not have legal experience.
Section 6 of PMLA provides for an adjudicating authority comprising a chairperson and two other members with expertise in law, administration or finance. The provision also permits the chairperson to constitute benches of one or two members in specified circumstances.
The petitioners argued that the statutory scheme contemplated a judicial element in the adjudication of attachment proceedings, particularly since the Supreme Court had upheld the constitutional validity of PMLA in Vijay Madanlal Choudhary Vs Union of India (2022) while taking note of the safeguards built into the adjudicatory mechanism.
The court's concern, however, centred on whether the statutory 180-day timeline itself could undermine the quality of adjudication if a single member was required to handle a large volume of attachment proceedings.
"Can you imagine the pressure put on the tribunal to look into 3,000-5,000 cases within six months? Will there be real application of mind or signing on the dotted lines?" the bench asked.
Senior advocate Gopal Sankaranarayanan, appearing for one of the petitioners, told the court that the adjudicating authority had for a considerable period functioned with only a single member.
He referred to data on the authority's website showing that 8,851 cases had been initiated by ED, of which only 60 had reached trial, and said there were more than 3,000 attachment orders.
"The intent of the legislature is bestowed on one tribunal and attachment is the heart and soul of any investigation under PMLA. Will it not make the power illusory as there would hardly be any application of mind?" the bench asked.
Sankaranarayanan also referred to Regulation 26(2) of the 2013 PMLA Adjudicating Authority regulations, which requires every sheet of an order to be signed by the chairperson and a member, and argued that the regulatory scheme did not contemplate a single-member bench.
Senior advocate Siddharth Agarwal, appearing for another petitioner, said proceedings before the authority could involve recording of evidence and had the trappings of a court. "These are issues having a significant effect on people as their property is attached," he said, arguing that such proceedings should have a person qualified in law on the bench.
The petitioners also argued that the absence of a judicial member raised concerns about the separation of powers and the independence of the adjudicatory mechanism from the executive.
ED disputed the figures cited by the petitioners.
Additional solicitor general Anil Kaushik said the figure of 3,000 attachment orders did not represent 3,000 separate and distinct cases as there could be multiple attachment orders in the same matter. He told the bench that only 461 attachment orders had been issued between April 1, 2024 and March 31, 2025.
The bench nevertheless questioned why even a relatively smaller number of cases should necessarily be entrusted to a single officer when the proceedings affect property rights. "Even if 100 matters are there, why should only one member adjudicate? This involves people's property. It needs to be expeditiously decided," it said.
Senior counsel Zoheb Hossain, also appearing for ED, defended the single-member mechanism by referring to Section 6 of PMLA, which permits the constitution of one or two-member benches in specified circumstances.
He argued that not every matter before the authority would involve complex questions of law and that the statutory provisions had to be read harmoniously.
The petitioners, however, maintained that confirmation of an attachment was not a mere procedural step but an important independent check on ED's power to seize control of a person's property.
The court also sought data on the time taken by the adjudicating authority to dispose of challenges to attachment orders. It directed ED to file a note within a week before reserving judgment....
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