India's Supreme Court has determined that the twin-condition bail requirements embedded in Section 45 of the Prevention of Money Laundering Act, 2002 cannot be applied in ways that strip away the constitutional protections against extended detention guaranteed under Article 21. The two-judge bench — comprising Justice Aravind Kumar and Justice Vipul M. Pancholi — overturned a Calcutta High Court ruling and extended regular bail to Sanjay Sureka, also identified as Sanjay Kumar Sureka, who faces a money laundering matter in which the alleged proceeds of crime are put at more than Rs. 6,210 crore.
The bench drew a distinction between a procedural gap — specifically, the Enforcement Directorate's five-day lag in forwarding arrest paperwork to the Adjudicating Authority under Section 19(2) of the PMLA, which it held does not invalidate the arrest itself — and the broader question of keeping an accused in custody without trial for an open-ended period, ruling that prolonged pre-trial detention cannot stand when proceedings are unlikely to conclude within a reasonable timeframe.
The proceedings have their foundation in a Corporate Insolvency Resolution Process lodged against M/s. Concast Steel and Power Limited on 7 November 2017, a sequence of events that ultimately carried the company into liquidation. A petition lodged by the Liquidator on 8 October 2021 invoked Sections 43, 45, and 66 of the Insolvency and Bankruptcy Code, 2016, placing before the tribunal allegations that those directing the company had carried out both fraudulent and avoidable transfers of assets. No appeal was lodged against the ruling by which the National Company Law Tribunal threw out the application.
On 6 September 2022, the Central Bureau of Investigation lodged a formal complaint invoking criminal conspiracy, cheating, and falsification of accounts provisions under the Indian Penal Code of 1860, alongside corruption-related clauses drawn from the Prevention of Corruption Act of 1988. Roughly fifteen months after the initial matter arose, the Enforcement Directorate opened an Enforcement Case Information Report — designated an ECIR — on 24 March 2023, listing the appellant alongside four other individuals as subjects of the proceeding.
The Enforcement Directorate contends that the appellant used a layered series of financial manoeuvres to inflate the company's reported turnover, obtain credit facilities from a State Bank of India-led banking consortium through deceptive means, and channel those funds toward personal financial gain. Of the Rs. 6,210.72 crore in crime-linked funds identified by the agency, attachment orders had been executed on just Rs. 777.10 crore. Prosecutors contend that the appellant arranged a network of 62 shell companies, placed 34 individuals as nominal directors, and drew on 20 firms staffed by family members.
The appellant was taken into custody by the Enforcement Directorate on 18 December 2024. In challenging the Calcutta High Court's 14 November 2025 ruling, the appellant's legal representative put forward the position that procedural failures under Sections 19(1) and 19(2) of the PMLA had fatally undermined the detention, thereby placing the bail conditions set out in Section 45 outside the statute's operative reach. Defence counsel drew the Adjudicating Authority's attention to a gap of five days between the issuance of the detention order and the delivery of accompanying documentation to that body.
The defence further argued that two documents dated 18 November 2024 — one setting out the grounds of arrest, the other the reasons to believe — were substantively indistinguishable, differing only in minor textual adjustments to their closing portions, a likeness that pointed to a failure of independent application of mind, and that no interrogation of the appellant had taken place during the period of custody. Arguing over the proceedings timeline, the appellant noted that the Enforcement Directorate lodged its principal prosecution complaint on 15 February 2025, at which point the agency had indicated that its inquiry into the appellant was concluded.
Two supplementary prosecution complaints were lodged by the prosecution — one dated 11 July 2025, the other 1 July 2026. Taken together, the three filings name 97 individuals as accused, list 48 witnesses for the prosecution, and draw on a documentary record running to roughly 15,000 pages, with inquiries into additional accused persons still under way. With more than 20 months already spent on remand against a statutory ceiling of seven years, the appellant put forward the position that proceedings could not be brought to a close within a reasonable timeframe.
In contesting the plea, the Enforcement Directorate placed before the court its position that the appellant had been brought before the Special Court within the required 24-hour window and that any challenge grounded in Section 19(2) rested on a flawed reading of the provision. Procedural steps taken after an arrest, the agency contended, cannot be recast as conditions that must be satisfied before a remand order is granted, and a delay of five days in transmitting documentation does not on its own render the arrest unlawful.
The Enforcement Directorate further maintained before the court that any overlap between the arrest grounds and the reasons-to-believe document had not prejudiced the appellant, that the foundational protections under Section 19(1) had been met, that the underlying matter involved an economic offence with a claimed value exceeding Rs. 6,210.72 crore, and that the appellant's name appeared across more than 444 separate cases.
When weighing bail decisions — particularly those tied to graver charges — the panel noted that a court is required to hold the interests of the state and those of the person in custody in careful equilibrium. Under statutes such as the Prevention of Money Laundering Act, 2002, bail thresholds are set deliberately high, reflecting a legislative judgment that financial offences of substantial scale disrupt the broader economic order in ways that filter down through institutions and ultimately affect a wide cross-section of the public. The tightening of the PMLA's provisions draws its rationale from that underlying reasoning. The bench also noted that investigative bodies carry an obligation to move cases forward without undue delay, because without that momentum no principled basis remains for holding an accused person in custody beyond a reasonable timeframe.
Turning to the procedural question of whether the arrest itself was lawful, the bench declined to accept the appellant's argument that forwarding materials to the Adjudicating Authority five days late had the effect of invalidating the detention. The panel observed that the legislation's use of the word "immediately" carries no fixed hourly deadline, with the ruling clarifying that the term obliges the transfer of material to occur without delay and in a concurrent manner rather than within any prescribed time boundary. Transmitting a case file that stretches across thousands of pages takes the arresting officer a period of time to complete, and that delay is not unexpected. The bench held that where the transfer of materials occurs at essentially the same moment as the arrest — with only unavoidable procedural delays — a court would find no breach of Section 19(2) of the Act.
On the question of how long the appellant should remain in custody, the court sided with the appellant's position that the scale of the proceedings made any swift resolution unrealistic. By the time the appeal was heard, the appellant had been held on remand for more than 20 months — a period tied to a charge whose statutory ceiling stood at seven years — while investigators had concluded their work on the case. In its ruling, the bench held that the twin conditions prescribed under Section 45 of the PMLA could not be applied in a manner that displaces the constitutional protections afforded to personal liberty under Article 21, a position drawn from the precedent set in Manish Sisodia v. Directorate of Enforcement.
Pointing to a witness list of roughly 98 individuals and documentary material running into thousands of pages — a volume that would push any verdict well beyond the near term — the Supreme Court extended regular bail to the appellant, subject to bond conditions set by the trial court, and observed that prolonged pre-trial detention under such circumstances would strip away the constitutional guarantees to which an accused person remains entitled.
As a condition of the order, the appellant was directed to surrender his passport to the trial court, obtain advance authorisation before travelling outside India, and take no steps to interfere with evidence or approach witnesses. The court noted that any violation of the conditions would give the trial court grounds to revoke the bail, and the panel stated that nothing in its ruling amounted to a determination on the substance of the case.
The matter is recorded under the name Sanjay Sureka, also identified as Sanjay Kumar Sureka, as the petitioning party, with the Directorate of Enforcement as the respondent. The case carries the designation Criminal Appeal No. 4904 of 2026. The two-judge panel comprised Justice Aravind Kumar and Justice Vipul M. Pancholi. This report was filed on 14 October 2026.
