Interpreting the Right to Default Bail: Supreme Court’s Verdict in Enforcement Directorate v. Kapil Wadhawan

The Supreme Court of India, in Enforcement Directorate v. Kapil Wadhawan & Anr. (Criminal Appeal Nos. 701-702 of 2020), addressed a crucial issue pertaining to an accused’s right to default bail under Section 167(2) of the Code of Criminal Procedure, 1973 (CrPC). This judgment, delivered by a three-judge bench comprising Justices K.M. Joseph, Hrishikesh Roy, and B.V. Nagarathna, clarified whether the date of remand should be included or excluded in computing the 60/90-day period for the right to default bail.

Background of the Case

The Enforcement Directorate (ED) arrested the respondents, Kapil Wadhawan and others, on May 14, 2020, for offenses under Section 3 of the Prevention of Money Laundering Act, 2002 (PMLA). They were produced before the Magistrate on the same day and remanded to custody.

On July 11, 2020, the ED filed a complaint via email, followed by a physical submission on July 13, 2020. The accused applied for default bail on July 13, 2020, asserting that the 60-day period expired on July 12, 2020 (Sunday), thereby entitling them to release under Section 167(2) of CrPC. The Special Court rejected their plea, stating that the period should be calculated excluding the date of remand, making July 13, 2020, the last day for filing the charge sheet.

The Bombay High Court, however, ruled in favor of the accused, holding that the period should be calculated by including the date of remand. Consequently, as the charge sheet was filed on the 61st day, the accused were entitled to default bail.

Key Legal Issue

The core issue in this case was whether the day on which the Magistrate orders remand should be included in computing the period under Section 167(2) CrPC. The legal conflict arose due to divergent rulings on this computation:

1. State of M.P. v. Rustam & Ors. (1995 Supp (3) SCC 221) and M. Ravindran v. Intelligence Officer ((2021) 2 SCC 485) held that the date of remand should be excluded.
2. Chaganti Satyanarayan v. State of Andhra Pradesh ((1986) 3 SCC 141) and Gautam Navlakha v. National Investigation Agency (2021 SCC OnLine SC 382) ruled that the date of remand must be included.

Supreme Court’s Analysis and Ruling

The Court undertook a detailed analysis of statutory provisions and precedents. It emphasized that:

1. Purpose of Section 167(2) CrPC: The provision exists to prevent prolonged incarceration without trial. It ensures that an accused is not detained indefinitely due to investigative delays.
2. Per Incuriam Decisions: The Court noted that Rustam and its progeny failed to consider the binding precedent in Chaganti, which had correctly interpreted the law. Thus, Rustam was deemed per incuriam and not a binding precedent.
3. Personal Liberty Considerations: Citing Maneka Gandhi v. Union of India and A.K. Gopalan v. State of Madras, the Court reiterated that liberty should not be taken away by procedural ambiguity. Including the date of remand in the computation serves the interests of justice and fairness.
4. General Clauses Act Inapplicable: The State’s reliance on Sections 9 and 10 of the General Clauses Act, 1897, was rejected. The Court ruled that Section 167 CrPC does not fall within the scope of statutory limitation laws.

Final Holding

The Court upheld the Bombay High Court’s judgment, affirming that the stipulated 60/90-day period for default bail should be calculated by including the date of remand. Since the charge sheet was filed on the 61st day, the respondents had an indefeasible right to default bail.

Impact and Significance

This ruling has far-reaching implications for accused persons and investigating agencies. It reinforces the fundamental right to liberty under Article 21 of the Constitution by ensuring a strict interpretation of procedural safeguards against unlawful detention. The judgment sets a crucial precedent in determining default bail eligibility, providing clarity in a long-standing legal conundrum.

References

1. Enforcement Directorate v. Kapil Wadhawan & Anr., Criminal Appeal Nos. 701-702 of 2020.
2. Chaganti Satyanarayan v. State of Andhra Pradesh (1986) 3 SCC 141.
3. State of M.P. v. Rustam & Ors. (1995 Supp (3) SCC 221).
4. M. Ravindran v. Intelligence Officer (2021) 2 SCC 485.
5. Gautam Navlakha v. National Investigation Agency, 2021 SCC OnLine SC 382.
6. A.K. Gopalan v. State of Madras, AIR 1950 SC 27.
7. Maneka Gandhi v. Union of India, AIR 1978 SC 597.