Extending the Section-45 PMLA “Twin Conditions” to Anticipatory Bail – A Detailed Commentary on Naresh Kumar Gulia v. Directorate of Enforcement (2025)

1. Introduction

The Jammu & Kashmir and Ladakh High Court’s decision in Naresh Kumar Gulia v. Directorate of Enforcement and Anr., Bail Application No. 51/2025 (decided 15 July 2025) addresses the availability of pre-arrest (anticipatory) bail to persons accused of money-laundering under the Prevention of Money-Laundering Act, 2002 (PMLA). This is the first reported decision after the enactment of the Bhartiya Nagarik Suraksha Sanhita, 2023 (BNSS) to hold explicitly that the twin conditions contained in Section 45 PMLA—earlier applied mainly at the post-arrest/regular-bail stage—also govern applications for anticipatory bail made under Section 482 BNSS.

The petitioner, an ex-Army Havaldar allegedly masterminding a large-scale crypto-currency Ponzi scheme, sought protection against arrest. The Enforcement Directorate (ED) resisted, citing massive public loss, petitioner’s evasion, and bar under Section 45. Justice Mohd. Yousuf Wani dismissed the application, laying down a structured test that grafts the Section 45 limitations onto the anticipatory-bail regime.

2. Summary of the Judgment

• The Court dismissed the anticipatory bail plea, holding that the petitioner’s custody was necessary for an effective investigation into a ₹16.81 crore money-laundering scam affecting more than 2,000 victims.
• Relying on Section 45 PMLA, the Court ruled that its twin conditions—(i) opportunity to the Public Prosecutor to oppose; and (ii) the Court’s satisfaction that the accused is prima facie not guilty and will not re-offend—apply mutatis mutandis to anticipatory bail.
• Reviewing Supreme Court jurisprudence on anticipatory bail (Siddharam Mhetre, Sushila Aggarwal, Gurbaksh Singh etc.), the Court emphasised that personal liberty must be balanced against societal interest, especially in economic offences.
• Factually, the petitioner was an absconder, had ignored summons, and was allegedly in possession of proceeds of crime worth ₹6.05 crore. These grounds defeated his claim of bona fide apprehension and satisfied the court that custodial interrogation was indispensable.

3. Detailed Analysis

3.1 Precedents Cited and Their Influence

1. Siddharam Satlingappa Mhetre v. State of Maharashtra (2011) – The Court extracted the nine-factor test for anticipatory bail. While recognising its liberal tenor, Justice Wani held that the test cannot override statutory embargoes imposed by special statutes like PMLA.
2. Sushila Aggarwal v. State (Nct Of Delhi) (2020, Constitution Bench) – Reaffirmed that anticipatory bail is not time-bound and detailed discretionary parameters. The High Court used these to reiterate that conditions may be tailored case-to-case but endorsed that special “limiting conditions” can legitimately be super-imposed when Parliament so mandates (Section 45).
3. Gurbaksh Singh Sibbia v. State of Punjab (1980); Balchand v. State of Rajasthan (1978) – Both emphasise that bail discretion hinges on likelihood of flight and tampering. The High Court applied this doctrine to find the petitioner’s abscondence fatal.
4. Older cases such as Chain Lal, Salimuddin, K.L. Verma etc. were referenced primarily to show the evolution of anticipatory-bail jurisprudence, but held per incuriam to the extent inconsistent with modern liberal approach.

3.2 Court’s Legal Reasoning

The Court’s reasoning may be broken into four logical steps:

1. Statutory Priority of Section 45 – Relying on the non-obstante clause (“notwithstanding anything in CrPC/BNSS”) and the phrase “no person accused of an offence under this Act shall be released on bail…”, the Court held that Section 45 is a mandatory override on all forms of bail, not just regular bail.
2. Harmony with BNSS – Section 482 BNSS (anticipatory bail) is a general procedural provision. Under the principle of generalia specialibus non derogant, the special, later-enacted PMLA prevails. Thus, Section 45 conditions are deemed to be imported with great force into anticipatory-bail hearings.
3. Application of the “Twin Conditions” – Having provided the Public Prosecutor a full hearing, the Court examined the record and held it could not, at this stage, be “satisfied” that the petitioner was not guilty nor likely to re-offend. Consequently, the gateway to any bail (anticipatory or otherwise) remained shut.
4. Conventional Bail Factors – Independent of Section 45, the Court found serious, well-documented allegations, huge quantum, multiple victims, the petitioner’s non-cooperation, possibility of flight abroad, and need for custodial interrogation—each disqualifying him under the prudential tests from Gurbaksh Singh and Siddharam Mhetre.

3.3 Projected Impact of the Judgment

• Uniformity Across India’s Successor Codes – BNSS is slated to replace the Code of Criminal Procedure nationwide. This ruling provides early guidance that special statutes with restrictive bail clauses (PMLA, NDPS, UAPA, etc.) automatically curb anticipatory bail under BNSS.
• Investigative Leverage in Economic Offences – By affirming that economic crime suspects cannot easily shield themselves through anticipatory bail, the judgment strengthens agencies like the ED and curbs forum shopping for “transit” protection.
• Precedent Value – Although a High Court ruling, it is likely to be cited widely until the Supreme Court squarely adjudicates the question. Other High Courts may follow suit, making Section 45 an all-embracing barrier.
• Practical Defence Strategy Shift – Accused persons may need to focus on post-arrest regular bail compliance with Section 45 rather than preliminary anticipatory relief, and gather material to satisfy the “not guilty” prima facie test at the earliest stage.

4. Complex Concepts Simplified

• Anticipatory Bail: A pre-arrest court order that if the police attempt to arrest the applicant for a specified offence, he/she shall be released on bail.
• BNSS 2023: The Bhartiya Nagarik Suraksha Sanhita is India’s new procedural criminal code, set to replace the CrPC 1973. Section numbering differs; Section 482 mirrors old Section 438 (anticipatory bail).
• Section 45 PMLA Twin Conditions: Before granting bail, the Court must (i) hear the Public Prosecutor; (ii) be satisfied that the accused is prima facie not guilty and will not commit further offences. These are stringent and reverse the normal presumption of innocence for bail purposes.
• ECIR (Enforcement Case Information Report): The ED’s analog of an FIR, recording a PMLA investigation.
• Ponzi Scheme: An investment fraud paying returns to earlier investors from new investors’ funds rather than legitimate profit.

5. Conclusion

The High Court has cemented a significant doctrinal extension: statutory bail-restrictions designed for post-arrest scenarios under a special enactment (PMLA) equally fetter courts at the anticipatory-bail stage. This interpretation, anchored in the supremacy of Section 45’s non-obstante clause and principles of statutory construction, tilts the scales decisively towards investigation agencies in money-laundering cases. Future litigants must now surmount a higher threshold even before arrest. The ruling underscores a broader judicial sentiment—economic offences, viewed as “heinous” due to their systemic impact, merit stricter bail standards. As BNSS takes centre-stage nationally, Naresh Kumar Gulia is poised to be a touchstone for harmonising special-statute restrictions with the new procedural framework, signalling a more exacting regime for white-collar crime suspects.