The petitioner, whose identity is withheld, is challenging his arrest and detention by the ED in connection with an alleged scam involving the Chhatrapati Shivaji Education Society, Kolhapur. The case revolves around financial irregularities related to the collection of funds under the guise of MBBS admissions for the period between 2011 and 2016. The ED began its investigation following a complaint filed in 2021, which led to the registration of the ECIR.

Despite not being named in the First Information Report (FIR) or charge-sheeted in the primary offense, the petitioner was arrested in September 2024. His arrest followed several summonses from the ED that he had responded to, and his family’s alleged involvement in the financial transactions connected to the proceeds of crime. The petitioner’s father, Appasaheb Deshmukh, had previously been arrested, and the petitioner was summoned multiple times for questioning.

The primary issue before the Court was whether the arrest, detention, and subsequent remand of the petitioner were just, legal, and in compliance with the guidelines laid down by the Supreme Court in the case of Arvind Kejriwal v. Directorate of Enforcement (2024). In its examination, the Court noted that the arrest appeared to be based on subjective satisfaction rather than objective legal grounds.

The Court observed that the "reasons to believe" recorded by the ED for the petitioner’s arrest and the "grounds of arrest" were exactly the same, which raised questions about the credibility and necessity of the arrest. Furthermore, the petitioner had not been named in the FIR or the charge-sheet related to the predicate offense, and the only justification for his arrest was alleged non-cooperation with the investigation.

The Court found that the arrest seemed to be a retaliatory move in response to the petitioner’s legal actions, including a complaint against a sitting MLA, Jaykumar Gore, over a separate COVID-19 scam. The petitioner had filed a writ petition seeking action against Gore, which the Court had directed the police to investigate. The timing of the arrest, according to the Court, raised concerns about the ED’s motives.

The Bombay High Court drew heavily on the Supreme Court’s precedents, particularly the case of Arvind Kejriwal v. Directorate of Enforcement, where the Court emphasized that the mere formation of a belief was not enough to justify an arrest under Section 19 of the PMLA. The Court further clarified that the necessity for arrest, including preventing the destruction of evidence or influencing witnesses, must be clearly established, which was not demonstrated in this case.

The High Court also referred to the Supreme Court’s observation in Vijay Madanlal Choudhary v. Union of India (2022) and V. Senthil Balaji v. State (2024), stating that non-cooperation with the investigation, by itself, could not justify arrest. The Court emphasized that arrest should not be used as a tool for investigation and must be based on more than subjective reasons.

Given the lack of sufficient grounds for arrest, the Court concluded that the petitioner’s detention was likely illegal and granted him interim bail. The petitioner was directed to execute a personal bond of Rs. 50,000 with one or two sureties in the same amount to the satisfaction of the Special Judge under the PMLA. In case the petitioner could not provide sureties, he was allowed to furnish cash security of Rs. 50,000 for six weeks.

In addition to the bail conditions, the petitioner was required to cooperate with the investigation when summoned, refrain from influencing witnesses or tampering with evidence, and provide his residential address and contact details to the authorities.

The Bombay High Court's order underscores the importance of adhering to constitutional and legal safeguards in arrest and detention under the Prevention of Money Laundering Act. While the case is still under investigation, the Court has made it clear that the right to liberty is sacrosanct, and actions taken by investigating agencies must be in strict accordance with the law. The Court has scheduled the next hearing for 26th November 2024 to consider the further progress of the petition.