The Supreme Court has reserved its judgment on an important question concerning the functioning of the Adjudicating Authority under the Prevention of Money Laundering Act, 2002 (PMLA).
A three-judge Bench comprising Chief Justice of India Surya Kant, Justice Joymalya Bagchi and Justice V. Mohana examined whether a single-member Adjudicating Authority, particularly one without a judicial member, can confirm provisional attachment orders passed by the Enforcement Directorate (ED).
WHAT IS THE ISSUE?
Under Section 5 of the PMLA, the ED can provisionally attach property which it has reason to believe represents the proceeds of crime, subject to the statutory conditions.
The matter then proceeds before the Adjudicating Authority under Section 8, which determines whether the attached property is involved in money laundering and whether the provisional attachment should be confirmed.
The petitioners have questioned whether such an important quasi-judicial determination can be made by a single member without a judicial member
SUPREME COURT’S CONCERN
During the hearing, the Court raised concerns about the enormous workload before the Adjudicating Authority.
The Bench questioned whether there can be genuine and adequate application of mind when thousands of cases have to be considered within the statutory framework, including the 180day period applicable to provisional attachment under Section 5.
The Court also sought relevant data from the ED concerning the pending matters before the Authority.
WHY IS THIS SIGNIFICANT?
The issue goes beyond the composition of an administrative body.
Confirmation of attachment can have substantial consequences for property and possession. Therefore, the proceedings raise important questions concerning:
• Natural Justice
• Application of Mind
• Quasi-Judicial Decision-Making
• Property Rights
• Procedural Fairness
• Institutional Independence and Judicial Oversight
The Court was also apprised of data concerning PMLA cases and the number of matters progressing to trial, adding to the broader discussion regarding the consequences of prolonged attachment proceedings.
LEGAL POSITION UNDER PMLA
The dispute particularly involves the interpretation and functioning of Sections 5, 6 and 8 of the PMLA.
Importantly, courts have previously considered whether a single-member bench of the Adjudicating Authority is legally competent. In R.P. Infosystems Ltd. v. Adjudicating Authority, the Calcutta High Court had held that Section 6 permits the Adjudicating Authority to function through a single-member bench.
The Supreme Court’s present consideration therefore places renewed focus on the statutory scheme and the safeguards applicable to PMLA attachment proceedings.
CURRENT STATUS
The Supreme Court has reserved its judgment.
Therefore, the question whether a single-member, non-judicial Adjudicating Authority can validly confirm ED attachment orders remains pending before the Supreme Court as of 16 September 2026.
LEGAL INSIGHT
The proceedings highlight a fundamental principle of regulatory adjudication:
“Where an administrative decision has significant civil consequences, procedural fairness and genuine application of mind remain central to the legitimacy of the decision-making process.”
1. Key Legislation: Prevention of Money Laundering Act, 2002
2. Key Sections: Sections 5, 6 & 8
3. Authority: Supreme Court of India
4. Status: Judgment Reserved 5. Date: 16 September 2026