SC upholds powers of arrest raid under PMLA for ED

The Supreme Court upheld the core amendments made to the Prevention of Money Laundering Act (PMLA), which gives the government and the Enforcement Directorate (ED) virtually unbridled powers of summons, arrest, and raids, and makes bail nearly impossible while shifting the burden of proof of innocence on to the accused rather than the prosecution.

Did the judgement say?

The Supreme Court called the PMLA a law against the “scourge of money laundering” and not a hatchet wielded against rival politicians and dissenters.

Money laundering is an offence against the sovereignty and integrity of the country. It is no less a heinous offence than the offence of terrorism, the court noted.

Why in news?

The verdict came on an extensive challenge raised against the amendments introduced in 2002 Act by way of Finance Acts.

The three-judge Bench said the method of introduction of the amendments through Money Bills would be separately examined by a larger Bench of the top court.

What were the petitions?

Petitions were filed against the amendments, which the challengers claimed would violate personal liberty, procedures of law and the constitutional mandate.

The petitioners included many veteran politicians who all claimed that the “process itself was the punishment”.

There were submissions that the accused’s right against self-incrimination suffered when the ED summoned them and made them sign statements on threats of arrest.

But the court said these statements were recorded as part of an “inquiry” into the proceeds of crime.

A person cannot claim right against self-incrimination at a summons stage.

About Enforcement Directorate (ED)

It goes back to May 1, 1956, when an ‘Enforcement Unit’ was formed in the Department of Economic Affairs.

It then aimed for handling Exchange Control Laws violations under the Foreign Exchange Regulation Act (FERA).

The ED today is a multi-dimensional organisation investigating economic offences under the Prevention of Money Laundering Act (PMLA), Fugitive Economic Offenders Act, Foreign Exchange Management Act and FERA.

From where does the ED get its powers?

When proceeds of crime (property/money) are generated, the best way to save that money is by parking it somewhere, so one is not answerable to anyone in the country.

Therefore, there was a need to control and prevent the laundering of money.

The PMLA was brought in for this exact reason in 2002, but was enacted only in 2005.

The objective was to prevent parking of the money outside India and to trace out the layering and the trail of money.

So as per the Act, the ED got its power to investigate under Sections 48 (authorities under act) and 49 (appointment and powers of authorities and other officers).

What are the other roles and functions of the ED?

The ED carries out search (property) and seizure (money/documents) after it has decided that the money has been laundered, under Section 16 (power of survey) and Section 17 (search and seizure) of the PMLA.

On the basis of that, the authorities will decide if arrest is needed as per Section 19 (power of arrest).

Under Section 50, the ED can also directly carry out search and seizure without calling the person for questioning.

It is not necessary to summon the person first and then start with the search and seizure.

If the person is arrested, the ED gets 60 days to file the prosecution complaint (chargesheet) as the punishment under PMLA doesn’t go beyond seven years.

If no one is arrested and only the property is attached, then the prosecution complaint along with attachment order is to be submitted before the adjudicating authority within 60 days.

Can the ED investigate cases of money laundering retrospectively?

If an ill-gotten property is acquired before the year 2005 (when the law was brought in) and disposed off, then there is no case under PMLA.

But if proceeds of the crime were possessed before 2005, kept in storage, and used after 2005 by buying properties, the colour of the money is still black and the person is liable to be prosecuted under PMLA.

Under Section 3 of PMLA, a person shall be guilty of money-laundering, if such person is found to have directly or indirectly attempted to indulge or knowingly assist a party involved in one or more of the following activities:

Concealment; possession; acquisition; use; or projecting as untainted property; or claiming as untainted property in any manner etc.

Replacement Level Fertility achieved in India

India has achieved replacement level fertility, with 31 States and UTs reaching a Total Fertility Rate (an average number of children per woman) of 2.1 or less, Union Minister of State for Health and Family Welfare has informed Parliament.

What is Replacement Level Fertility?

Replacement level fertility is the level of fertility at which a population exactly replaces itself from one generation to the next.

In simpler terms, it denotes the fertility number required to maintain the same population number of a country over a given period of time.

In developed countries, replacement level fertility can be taken as requiring an average of 2.1 children per woman.

In countries with high infant and child mortality rates, however, the average number of births may need to be much higher.

RLF will lead to zero population growth only if mortality rates remain constant and migration has no effect.

Benefits of achieving RLF

RLF helps ensure greater food security.

The reduced demand for food would in turn lessen agri- culture’s impact on the environment.

It would also likely lead to economic benefits through a “demographic dividend.”

Finally, achieving replacement level fertility would yield significant social benefits―especially for women.

How did India achieve this?

Between 2012 and 2020, the country added more than 1.5 crore additional users for modern contraceptives, thereby increasing their use substantially.

India has witnessed a paradigm shift from the concept of population control to population stabilisation to interventions being embedded toward ensuring harmony of continuum care.

Way forward

Although India has achieved replacement level fertility, there is still a significant population in the reproductive age group that must remain at the centre of our intervention efforts.

India’s focus has traditionally been on the supply side, the providers and delivery systems but now it’s time to focus on the demand side which includes family, community and society.

Significant change is possible with this focus, instead of an incremental change.

Household Consumption Expenditure Survey (HCES)

The Centre has kicked off the process for conducting the quinquennial Household Consumption Expenditure Survey (HCES) this month.

What is the Household Consumer Expenditure Survey (CES)?

The HCES is traditionally a quinquennial (recurring every five years) survey conducted by the government’s National Sample Survey Office (NSSO).

It is designed to collect information on the consumer spending patterns of households across the country, both urban and rural.

Typically, the Survey is conducted between July and June and this year’s exercise is expected to be completed by June 2023.

Why HCES?

The HCES is used to arrive at estimates of poverty levels as well as review key economic indicators like Gross Domestic Product (GDP).

The results of the survey are also utilised for updating the consumption basket and for base revision of the Consumer Price Index.

It helps generate estimates of household Monthly Per Capita Consumer Expenditure (MPCE) as well as the distribution of households and persons over the MPCE classes.

It is used to arrive at estimates of poverty levels in different parts of the country and to review economic indicators such as the GDP, since 2011-12.

Why need this survey?

India has not had any official estimates on per capita household spending.

It provides separate data sets for rural and urban parts, and also splice spending patterns for each State and Union Territory, as well as different socio-economic groups.

What about the previous survey?

The survey was last held in 2017-2018.

The government announced that it had data quality issues.

Hence the results were not released.

Universal Service Obligation Fund (USOF)

The Union Cabinet has approved a project for providing 4G mobile services in thousands of villages across the country under the USOF.

What do you mean by Universal Service?

In the modern world, universal service refers to having a phone and affordable phone service in every home.

It means, providing telecommunication service with access to a defined minimum service of specified quality to all users everywhere at an affordable price.

In 1837, the concept was rolled on by Rowland Hill, a British educator and tax reformer, which included uniform rates across the UK and prepayment by sender via postage stamps.

What is USOF?

The Universal Service Obligation Fund (USOF) was formed by an Act of Parliament, was established in April 2002 under the Indian Telegraph (Amendment) Act 2003.

It aims to provide financial support for the provision of telecom services in commercially unviable rural and remote areas of the country.

It is an attached office of the Department of Telecom, and is headed by the administrator, who is appointed by the central government.

Scope of the USOF

Initially, the USOF was established with the fundamental objective of providing access to ‘basic’ telecom services to people in rural and remote areas at affordable and reasonable prices.

Subsequently, the scope was widened.

Now it aims to provide subsidy support for enabling access to all types of telecom services, including mobile services, broadband connectivity and the creation of infrastructure in rural and remote areas.

Funding of the USOF

The resources for the implementation of USO are raised by way of collecting a Universal Service Levy (USL), which is 5 percent of the Adjusted Gross Revenue (AGR) of Telecom Service Providers.

Nature of the fund

USOF is a non-lapsable Fund.

The Levy amount is credited to the Consolidated Fund of India.

The fund is made available to USOF after due appropriation by the Parliament.