The Enforcement Directorate cannot arrest a person under provisions of the Prevention of Money Laundering Act after a special court has taken cognisance of the complaint, the Supreme Court ruled on Thursday, Live Law reported.

In such a situation, the central law enforcement agency will have to apply to the special court if it wants to take the person into custody, it said.

A bench of Justices Abhay S Oka and Ujjal Bhuyan delivered the judgement in a case dealing with a question on whether a person accused in a money laundering case has to meet the twin-test requirements for bail after appearing before a special court in response to summons issued by it at the behest of the Enforcement Directorate, Bar and Bench reported.

Under section 45 of the Prevention of Money Laundering Act, twin conditions for a person applying for bail in a money laundering case first requires the court to allow the public prosecutor to be heard.

The bail is granted only when the court is satisfied that the accused person is not guilty and is unlikely to commit a similar offence when released.

On Thursday, the bench ruled that a person who is not arrested by the central agency in a money laundering case, but appears before a special court after being summoned by it, does not need to meet the twin conditions required for bail under section 45.

“If ED [Enforcement Directorate] wants custody of accused after the person appears after summons, ED can get custody after application to special court,” the bench said. “Court will only grant custody with reasons satisfying that custodial interrogation is needed.”

This would also mean that the central agency will not be able to invoke section 19 of the Act after it has moved a special court against an accused person who was not arrested prior to the complaint.

Section 19 allows the Enforcement Directorate to arrest an accused person if the agency has “reason to believe” that the individual is guilty of an offence punishable under the Act.