Prevention of Money Laundering Act, 2002
The PMLA: Critical Evaluation and Pending Questions
Few Indian statutes have been as powerful, or as debated, as the PMLA. Its defenders point to India's international obligations, the scale of economic crime, and a strong FATF evaluation. Its critics point to a very low number of convictions relative to cases registered, prolonged pre-trial detention under Section 45, and concerns about its use against political figures. The Supreme Court has upheld the Act while steadily strengthening the safeguards around it, and several major questions remain open before it. This note sets out the evidence, the arguments, and the pending questions, as a balanced answer would.
Cases registered and convictions, how to read the numbers, and the questions still open
1. The Numbers
Financial year | ED cases registered | Cases with convictions (accused) |
|---|---|---|
FY 2021-22 | 1,116 | 3 (4) |
FY 2022-23 | 953 | 9 (24) |
FY 2023-24 | 698 | 13 (19) |
FY 2024-25 | 775 | 9 (38) |
FY 2025-26 | 1,080 | 9 (19) |
Total | 4,622 | 43 (104) |
- Source. A written reply of the Minister of State for Finance in the Rajya Sabha in August 2026, which also reported 2,444 prosecution complaints filed and 1,243 accused arrested, and noted that cases filed and convictions in a given year are not directly correlated.
- Earlier data. In December 2024, the Government told Parliament that of 911 prosecution complaints filed between January 2019 and October 2024, convictions had been secured in 42.
2. The Arguments
Perspective | Argument |
|---|---|
Critics | Convictions are very few compared with cases registered; stringent bail makes pre-trial detention a punishment; the reach of s. 3 and the predicate link are wide; attachment can cripple businesses for years; a large share of high-profile cases concern political figures |
The Government and the ED | Many cases are recent and at various stages of trial; conviction rates among completed trials are high; cases filed and verdicts are not matched by year; the Act meets international obligations, and India's 2024 FATF evaluation was favourable |
The courts | The Supreme Court upheld the Act in 2022 but has since strengthened safeguards: written grounds of arrest, bail as the rule, delay as a ground for bail, limits on arrest after cognizance, inadmissibility of custodial statements, and a hearing before cognizance; in 2024 it urged the ED to focus on the quality of prosecution |
§ Safeguards added by law and judgment By amendment. Since 2019, the ED must file a closure report before the Special Court where no money laundering is made out (proviso to s. 44(1)(b)). By judgment. Pankaj Bansal, Mihir Rajesh Shah, Tarsem Lal, Prem Prakash, Manish Sisodia, V. Senthil Balaji, Kushal Kumar Agarwal and Parvinder Singh have each added a procedural protection. Structural. Recorded reasons, sealed forwarding to the Adjudicating Authority, and appeals remain the Act's built-in checks. |
3. The Questions Still Open
Question | Status |
|---|---|
Review of Vijay Madanlal Choudhary | Notice issued in August 2022, reportedly on the non-supply of the ECIR and the reverse burden under s. 24; the ED contests maintainability; the bench was reconstituted in August 2026 as Chief Justice Surya Kant and Justices Joymalya Bagchi and V. Mohana |
The Money Bill question | Whether amendments to the PMLA made through Finance Acts were validly passed as Money Bills was left to a larger Bench |
Need and necessity of arrest | Referred to a larger Bench in Arvind Kejriwal v. Directorate of Enforcement (2024) |
Written grounds of arrest | Reconciling the 24-hour rule of Ram Kishor Arora (2023) with the two-hours-before-remand rule of Mihir Rajesh Shah (2025) |
Pre-cognizance hearing | The scope of Kushal Kumar Agarwal (2025) and Parvinder Singh (2026), which some commentators criticise for treating official complaints like private ones |
Secured creditors against attachment | No single settled rule on priority between the PMLA, SARFAESI and the IBC outside s. 32A |
- Check before relying. Several of these are live before the Supreme Court as of September 2026; confirm the current status before citing them.
4. How to Write a Balanced Answer
§ A structure that works • Begin with the need: transnational economic crime, international obligations, and the logic of attacking proceeds. • Set out the powers: attachment before trial, reverse burden, stringent bail, admissible statements. • Present the evidence: the conviction data with its caveats, and the criticism of prolonged detention. • Show the judicial correction: the safeguards added since 2023. • End with the open questions, and a view: a strong law needs strong safeguards and faster trials, not weaker powers. |
5. Frequently Asked Questions
What is the PMLA's conviction record?
According to data given to Parliament in August 2026, the ED registered 4,622 cases in five years and secured convictions in 43 cases involving 104 accused, though cases and verdicts are not matched by year.
Is the Vijay Madanlal judgment final?
Review petitions are pending before the Supreme Court; the bench was reconstituted in August 2026.
What are the main criticisms of the PMLA?
Low convictions relative to cases registered, prolonged pre-trial detention, the breadth of the offence, and concerns about selective use, balanced by the Government's points on pending trials and completed-trial conviction rates.