Bail under Section 45 PMLA: The Twin Conditions

Section 45 of the Prevention of Money-laundering Act, 2002 is the reason bail in an Enforcement Directorate case is argued differently from bail in almost any other economic offence. Ordinary bail law asks whether the accused should be kept in custody pending trial. Section 45(1) adds a statutory filter on top: where the Public Prosecutor opposes the application, the court must be satisfied that there are reasonable grounds for believing that the accused is not guilty of the offence and is not likely to commit any offence while on bail. Those are the "twin conditions", and Section 45(2) makes clear that they apply in addition to every limitation on bail in the general criminal procedure law.

This note works through the text of Section 45, the offence it attaches to, the proviso, the courts that hear PMLA bail applications, and the provisions of the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS) that remain relevant once an accused is in custody.

Key points

• Section 45(1) applies to any person "accused of an offence under this Act". Since 19 April 2018 it is no longer confined to particular scheduled offences.
• Both limbs must be satisfied when the prosecutor opposes: reasonable grounds to believe the accused is not guilty, and that he is not likely to commit any offence while on bail.
• The first proviso lets the Special Court release a person under sixteen, a woman, a person who is sick or infirm, or a person accused of laundering less than ₹1 crore.
• The Explanation inserted in 2019 declares all PMLA offences cognizable and non-bailable, with arrest subject to the conditions in Section 19.
• Bail is heard by the Special Court under Sections 43 and 46; the High Court's bail powers are preserved by Section 44(2).
• Section 479 BNSS (formerly Section 436A CrPC) sets outer limits on undertrial detention, but Section 45 opens with a non-obstante clause.

What does Section 45(1) PMLA actually say?

The sub-section begins with a non-obstante clause: "Notwithstanding anything contained in the Code of Criminal Procedure, 1973". It then provides that no person accused of an offence under the Act shall be released on bail or on his own bond unless two things happen.

First, the Public Prosecutor must have been given an opportunity to oppose the application. This is a procedural precondition. A bail order passed without notice to the prosecutor does not comply with the section, however strong the merits.

Second, where the Public Prosecutor does oppose, the court must be satisfied that there are reasonable grounds for believing that the accused is not guilty of such offence and that he is not likely to commit any offence while on bail. The two limbs are joined by "and". Satisfying one is not enough.

Three features of the drafting matter.

The standard is reasonable grounds for believing, not proof. The court is not asked to acquit the accused at the bail stage. It is asked whether the material on record, read as a whole, gives reasonable grounds for a belief in innocence of the money-laundering offence.

The second limb looks forward and is not confined to money-laundering. The words are "any offence". Material suggesting a risk of tampering with evidence, influencing witnesses, or further dealing with the property under investigation is relevant to this limb.

Section 45(2) closes the gap the other way: the limitation in sub-section (1) is in addition to the limitations under the Code of Criminal Procedure, 1973 or any other law on granting of bail. The Code of Criminal Procedure was replaced by the BNSS from 1 July 2024, and the corresponding bail provisions are now Sections 480 and 483 BNSS (formerly Sections 437 and 439 CrPC), so the ordinary bail considerations still have to be met as well.

Which offences attract the twin conditions?

The answer has changed over the life of the Act.

Since 2018, the question is simply whether the person is accused of an offence under the PMLA; the gravity of the underlying crime no longer matters to whether the conditions apply.

What is the offence of money-laundering?

Because Section 45 speaks of being "not guilty of such offence", the bail argument is always framed by the definition in Section 3. A person is guilty of money-laundering if he directly or indirectly attempts to indulge, or knowingly assists, or knowingly is a party, or is actually involved in any process or activity connected with the proceeds of crime, including its concealment, possession, acquisition or use and projecting or claiming it as untainted property.

The Explanation inserted with effect from 1 August 2019 does two things. It lists the processes or activities separately — concealment, possession, acquisition, use, projecting as untainted property, claiming as untainted property — so that involvement in any one of them is enough. And it declares that the process or activity is a continuing activity, which continues for as long as a person is enjoying the proceeds of crime by any of those means.

Everything turns on "proceeds of crime". Section 2(1)(u) defines the term as property derived or obtained, directly or indirectly, by any person as a result of criminal activity relating to a scheduled offence, or the value of such property. The 2019 Explanation adds that it includes property derived or obtained as a result of any criminal activity "relatable to" the scheduled offence. A scheduled offence under Section 2(1)(y) is an offence in Part A of the Schedule, an offence in Part B where the total value involved is ₹1 crore or more, or an offence in Part C.

Two consequences follow for bail. The status of the scheduled offence — whether it has been registered, investigated, charged, closed or ended in discharge or acquittal — bears directly on whether property can be described as proceeds of crime at all. But the Explanation to Section 44(1), also inserted in 2019, provides that the Special Court's jurisdiction over the money-laundering offence is not dependent on orders passed in respect of the scheduled offence. The application should therefore set out the scheduled-offence position precisely and argue its effect on the definition, not on jurisdiction.

What punishment does Section 4 prescribe?

Section 4 provides rigorous imprisonment of not less than three years, which may extend to seven years, and fine. The cap on fine was removed in 2013. Where the proceeds of crime relate to an offence under paragraph 2 of Part A of the Schedule — offences under the Narcotic Drugs and Psychotropic Substances Act, 1985 — the maximum rises to ten years. These maximum figures matter for the BNSS detention limits discussed below.

Who can be released without meeting the twin conditions?

The first proviso to Section 45(1) states that a person who is under the age of sixteen years, or is a woman, or is sick or infirm, or is accused either on his own or along with other co-accused of money-laundering a sum of less than one crore rupees, may be released on bail if the Special Court so directs. The one-crore limb was added from 19 April 2018.

Two cautions. The proviso uses "may", so the Special Court retains discretion and the ordinary bail considerations continue to apply. And the one-crore limb is measured by the sum the accused is alleged to have laundered "either on his own or along with other co-accused", so an application relying on it needs the aggregate figure, not merely the applicant's own share.

The second proviso deals with a different subject: the Special Court shall not take cognizance of an offence punishable under Section 4 except on a complaint in writing by the Director or an officer authorised by the Central Government. Section 45(1A) separately bars a police officer from investigating a PMLA offence unless specifically authorised by the Central Government.

How does Section 24 affect a bail hearing?

Section 24 provides that in any proceeding relating to proceeds of crime, in the case of a person charged with the offence of money-laundering under Section 3, the Authority or Court shall, unless the contrary is proved, presume that such proceeds of crime are involved in money-laundering. For any other person, the presumption is discretionary ("may presume").

How much weight the presumption carries at the bail stage is for the court. But an application that does not engage with it leaves a statutory presumption unanswered, so documents showing the lawful source of the property should form part of the bail record from the outset.

Which court hears a PMLA bail application?

Section 43 requires the Central Government, in consultation with the Chief Justice of the High Court, to designate one or more Courts of Session as Special Courts for the trial of offences punishable under Section 4. Section 44(1)(a) makes the money-laundering offence, and any connected scheduled offence, triable by the Special Court for the area in which the offence was committed.

Section 46 applies the Code of Criminal Procedure, "including the provisions as to bails or bonds", to proceedings before a Special Court, deems the Special Court to be a Court of Session, and deems the person conducting the prosecution to be a Public Prosecutor. Section 44(2) preserves the High Court's special powers regarding bail under Section 439 CrPC, now Section 483 BNSS, as if the reference to a Magistrate included a Special Court.

In Delhi, applications are heard by the designated PMLA Special Courts, with the Delhi High Court exercising its concurrent bail jurisdiction. The forums are listed on the courts and tribunals page.

How does the arrest itself shape the bail application?

The Explanation to Section 45 declares that PMLA offences are cognizable and non-bailable and that authorised officers may arrest without warrant, subject to the fulfilment of conditions under Section 19. Those conditions are the first thing a bail application should test against the record.

Section 19(1) permits the Director, Deputy Director, Assistant Director or an authorised officer to arrest a person only if, on the basis of material in his possession, he has reason to believe, with the reason recorded in writing, that the person has been guilty of an offence punishable under the Act. The person must be informed of the grounds of arrest as soon as may be. Section 19(2) requires the officer, immediately after the arrest, to forward a copy of the order with the material to the Adjudicating Authority in a sealed envelope. Section 19(3) requires production before the Special Court or a Judicial or Metropolitan Magistrate within twenty-four hours, excluding journey time.

Arrests under the PMLA are made physically. The Directorate's press release of 8 October 2025 states that there is no concept of a "digital arrest" or "online arrest" under the Act, a point worth knowing when an arrest is threatened over a video call. Attendance in answer to a summons, and the rights that go with it, are covered in the companion note on ED summons under Section 50 PMLA.

Does Section 479 BNSS help an accused held in a PMLA case?

Section 479(1) BNSS, formerly Section 436A CrPC, applies to a person detained during investigation, inquiry or trial "of an offence under any law", other than an offence for which death or life imprisonment is one of the punishments. Where such a person has undergone detention for up to one-half of the maximum period of imprisonment specified for the offence, he shall be released by the Court on bail. A first-time offender, one who has never been convicted of any offence, is to be released on bond after one-third of the maximum.

The section carries its own limits. The court may, after hearing the Public Prosecutor and for recorded reasons, order continued detention beyond one-half. Time lost to delay caused by the accused is excluded from the computation. Section 479(2) bars release under the section where investigation, inquiry or trial in more than one offence or in multiple cases is pending against the person. Section 479(3) requires the jail superintendent to apply to the court once the relevant period is completed.

Section 45(1) begins "notwithstanding anything contained in the Code of Criminal Procedure". How that non-obstante clause interacts with Section 479 BNSS in a particular case is a question the court decides. An application relying on Section 479 should still set out the period in custody precisely, show that no delay is attributable to the accused, and address the multiple-cases bar.

What about default bail under Section 187 BNSS?

Section 187(3) BNSS, formerly Section 167(2) CrPC, entitles a person to be released on bail if the investigation is not completed within ninety days where the offence is punishable with death, life imprisonment or imprisonment for ten years or more, and within sixty days for any other offence. Section 65 PMLA applies the criminal procedure code to arrest, investigation and prosecution under the Act in so far as it is not inconsistent with the Act. The general mechanics are covered in the note on regular bail under Section 483 BNSS and default bail under Section 187.

What should a Section 45 bail application contain?

A disciplined application usually addresses the following, in this order:

• The arrest record: the date and time of arrest, the written grounds supplied, and compliance with the twenty-four hour production requirement in Section 19(3).
• The scheduled offence: its registration, its current stage, and whether the applicant is an accused in it.
• The property: what is alleged to be proceeds of crime, and the documents showing its lawful source, which also answer Section 24.
• The applicant's alleged role under each limb of the Section 3 Explanation relied upon by the Directorate.
• The second limb: absence of antecedents, cooperation with summons, and conditions the applicant offers, such as surrender of passport, residence within jurisdiction and non-contact with witnesses.
• The proviso: if the applicant is a woman, is sick or infirm, or the aggregate alleged sum is below ₹1 crore, a separate heading with supporting documents.
• Period of custody and the Section 479 BNSS computation, where relevant.

Pre-arrest protection, and the limits special statutes place on it, are covered in the note on anticipatory bail under Section 482 BNSS. Where the scheduled offence itself is weak on the face of the FIR, the inherent-jurisdiction remedy discussed in quashing under Section 528 BNSS may bear on the money-laundering case as well. Borrowers and guarantors facing parallel travel restrictions should read the note on look out circulars against bank borrowers.

How this fits with the rest of an economic-offence defence

A PMLA case rarely stands alone. It usually follows an FIR for a scheduled offence, often runs alongside attachment proceedings, and may sit beside recovery action where the alleged proceeds came from bank credit, including a lender's fraud classification of a borrower account. Bail strategy has to be consistent with the position taken in each of those forums, because statements made in one are available in the others. The wider practice area is described on the criminal defence page, and recurring terms are defined in the legal glossary.

This article is general information on the statutory framework and is not legal advice; the outcome of any bail application depends on its own record. Queries on PMLA proceedings may be sent through the contact page.