The Enforcement Directorate (ED) holds significant power in its role concerning surveys, searches, and seizures. This article will delve into the powers exercised by the ED during these activities and discuss important provisions outlined in the Prevention of Money Laundering Act (PMLA).
Powers while conducting the Survey
Under Section 16 of the PMLA and Section 7 of the Fugitive Economic Offenders Act 2018 (FEOMA), the investigating officer conducting a survey can exercise the following powers:
a) Marking identification on the inspected goods.
b) Maintaining an inventory report detailing all the furniture on the premises.
c) Recording statements made by individuals present during the survey.
Key Takeaways
- The Enforcement Directorate (ED) holds significant power in its role, particularly in conducting surveys, searches, and seizures under the Prevention of Money Laundering Act (PMLA) and the Fugitive Economic Offenders Act 2018 (FEOMA).
- During surveys, the investigating officer can mark identification on inspected goods, maintain an inventory report of furniture, and record statements made by individuals present.
- When conducting seizures or searches, officers can search the entire property, including houses, vehicles, and other possessions. They can inspect lockers, break almirahs, and open lockers belonging to the owners. They must prepare a report or inventory of the seized items and record statements of the person possessing the property.
- The ED can issue summonses to individuals, requiring their physical presence during investigations. Summoned persons must submit the required documents and answer questions. They can appear in person or appoint an agent.
- The ED can order a search of an individual who is believed to be hiding crucial property or possessions.
- Suppose fines are imposed as penalties are not paid within the specified timeframes. In that case, the ED or authorized personnel can recover the outstanding amounts as per relevant laws, such as the Income Tax Act, 1961, and the Foreign Exchange and Management Act (FEMA).
- The ED can detain important records or property gathered during investigations, with the deputy director requiring a valid reason. Records can be retained for a period not exceeding 180 days.
Powers of the Investigating Officer during Seizure or Search
According to Section 17 of the PMLA and Section 8 of the FEOMA, officers performing seizures or searches have the following powers:
a) The authority to search the entire property, including houses, vehicles, motor vehicles, and other possessions.
b) The power to inspect lockers, break almirahs, and open lockers belonging to the owners during the search process.
c) Preparation of a report or inventory detailing the seized items.
d) Marking identification on the inspected goods.
e) Recording statements of the person in possession of the property.
Power to Issue Summons
- Prevention of Money Laundering Act, 2002: The ED can issue summons to individuals when their physical presence is necessary for conducting investigations. The summoned person must submit the required documents and answer questions posed during the investigation. They can either appear in person or designate an agent appointed by the Enforcement Directorate.
- Fugitive Economic Offenders Act (FEOMA) 2018: The director has the authority to issue summonses to individuals if their physical presence is important in a particular case and if essential documents possessed by the concerned person need to be reviewed.
- Search Conducted for a Person: Under Section 18 of the PMLA and Section 9 of the FEOMA, if the Enforcement Directorate believes that a person is hiding or has hidden any property or possessions that may be crucial to specific proceedings, they can pass an order to search for that individual.
Recovery of Fines, Penalties, and Arrears of Penalties
Prevention of Money Laundering Act, 2002: According to Section 69, if the fine amount imposed as a penalty is not paid within 60 days, the director, deputy director, or any authorized person can recover the outstanding amount as specified in the Income Tax Act, 1961.
Foreign Exchange and Management Act (FEMA): Under Section 14A, the adjudicating authority can direct the Enforcement Directorate to take necessary steps to recover fines, penalties, or penalty arrears that have not been paid within 90 days by the concerned person.
Other Powers under PMLA
Retention of Records: As per Section 50, the ED can detain important records or property gathered during the investigation. However, the deputy director can detain records only upon specifying a valid reason.
Time Period: According to Sections 20 and 21, the records collected by the ED can be retained for a period not exceeding 180 days.
Conclusion
The ED possesses extensive powers that allow it to conduct investigations regardless of the authority’s influence. Through schemes like the PMLA and FEMA, the ED safeguards India’s financial system and protects foreign transactions occurring within the country.
