The Supreme Court of India, on December 19, 2024, convened to adjudicate upon Shashi Bala @ Shashi Bala Singh v. Directorate of Enforcement (Petition for Special Leave to Appeal (Crl.) No. 16260/2024), which arose from the denial of bail by the Allahabad High Court to a woman accused under the Prevention of Money Laundering Act, 2002 (PMLA). The Bench, comprising Justice Abhay S. Oka and Justice Augustine George Masih, scrutinized the statutory interpretation of the proviso to Section 45(1) of the PMLA, which ostensibly exempts certain classes of individuals, including women, minors, and the infirm, from stringent bail conditions.

The petitioner, Shashi Bala, a government schoolteacher, is implicated in an alleged conspiracy to launder proceeds of crime generated by the Shine City Group of Companies. The Directorate of Enforcement (ED) contends that she acted in concert with Rasheed Naseem, the company's director, to facilitate fraudulent financial transactions, thereby duping numerous investors through illicit schemes. The magnitude of the alleged offense, encompassing multiple jurisdictions and adversely affecting a large number of victims, was a determinative factor in the Allahabad High Court's denial of bail. The High Court opined that her role in aiding and abetting the laundering of illicit proceeds rendered her ineligible for bail under the PMLA’s rigorous framework.

The ASG representing the Directorate of Enforcement advanced the argument that the exemption provided under the proviso to Section 45(1) is not absolute and that the gravity of the offense necessitates the application of the strict bail conditions prescribed under Section 45(1)(ii). The ASG asserted, “She is not a rustic woman; she is a director in the company where this entire thing has happened.”

In response, Justice Oka interrogated the statutory basis of this submission, observing, “Are you suggesting that the rigors of clause (ii) of Section 45(1) will also apply to women, contrary to the express language of the statute?” The Court took exception to the argument advanced by the Union of India, cautioning that advancing submissions in derogation of the statute would necessitate the appearance of the Attorney General.

The Court further recorded that the ASG sought time to take instructions and file a counter affidavit addressing the scope and applicability of the proviso. Justice Oka remarked, “Rigors of clause (ii) will not apply, but that does not mean that bail will be granted mechanically. The statutory exception must be applied judiciously.”

The Bench remarked upon the straightforward nature of the legal issue, emphasizing the clear language of the proviso to Section 45(1), which provides that the stringent conditions prescribed therein shall not apply to women, minors, and sick or infirm persons. Justice Oka observed, “We will record that for answering such a simple question, the learned ASG seeks time. This is a recurring phenomenon in this Court, where counsel allege denial of opportunity when clear statutory provisions are involved.”

The Court recorded the initial submission of the ASG, who argued that the rigorous conditions under Section 45(1)(ii) are applicable even to women, notwithstanding the proviso. It directed the filing of a counter affidavit by January 10, 2025, and listed the matter for further hearing on January 15, 2025.

The Allahabad High Court, in its impugned order dated September 10, 2024, held that the petitioner’s custody since November 2023 and her status as a woman did not warrant bail, given the gravity of the allegations. The High Court observed her close association with the principal accused and her significant role in the alleged laundering of proceeds of crime. It further distinguished her case from precedents such as K. Kavitha v. Directorate of Enforcement and Manish Sisodia v. Directorate of Enforcement, observing that the large-scale fraud involving multiple FIRs disqualifies her from receiving similar relief.

Case Title: Shashi Bala @ Shashi Bala Singh v. Directorate of Enforcement
Case No.: Petition for Special Leave to Appeal (Crl.) No. 16260/2024
Bench: Justice Abhay S. Oka and Justice Augustine George Masih