Liberty of an individual is always a rule and deprivation an exception even in cases registered under the anti-money laundering law which has stringent provisions for bail, the Supreme Court said on Wednesday.

Citing the enduring legal principle that "bail is the rule and jail is the exception", a bench of Justices BR Gavai and KV Viswanathan granted bail to Prem Prakash, an aide of Jharkhand Chief Minister Hemant Soren, in a money laundering case related to an alleged land scam. 

"Liberty of the individual is always a rule and deprivation is the exception. Deprivation can only be by the procedure established by law, which has to be a valid and reasonable procedure," the bench said.

The top court said confessional statements given in custody by an accused in a different case attracting the provisions of the Prevention of Money Laundering Act (PMLA) will not be admissible in the court of law.

Prakash, while in custody, had purportedly confessed to his involvement in another land scam case. 

"We have no hesitation in holding that when an accused is in custody under PMLA, irrespective of the case for which he is under custody, any statement under Section 50 PMLA to the same investigating agency is inadmissible against the maker.

"The reason being that the person in custody pursuant to the proceeding investigated by the same investigating agency is not a person who can be considered as one operating with a free mind," the court said.  

The top court said it will be "extremely unsafe" to render such statements admissible against the maker as such a course of action would be contrary to "all canons of fair play and justice". 

The bench referred to a 2022 verdict of the apex court which upheld the provisions of the PMLA and its August 9 judgement in the money laundering and corruption cases against former Delhi deputy chief minister Manish Sisodia who was granted bail and said, it has been made amply clear that even under PMLA the governing principle is that "bail is the rule and jail is the exception".

The bench said all that section 45 of PMLA (which lays down twin conditions for bail of an accused in a money laundering case) says is that certain conditions are to be satisfied.

"Section 45 of PMLA by imposing twin conditions does not rewrite the principle to mean that deprivation is the norm and liberty is the exception. As set out earlier, all that is required is that in cases where bail is subject to the satisfaction of twin conditions, those conditions must be satisfied," Justice Viswanathan, who penned the verdict on behalf of the bench said.

The twin conditions for bail under PMLA are that the judge should be prima facie satisfied that the accused has not committed the offence and that he is not likely to commit any offence while on bail.

The bench in its 44-page verdict said, "The principle that bail is the rule and jail is the exception is only a paraphrasing of Article 21 of the Constitution of India, which states that no person shall be deprived of his life or personal liberty except according to the procedure established by law."

It added that Article 21 being a higher constitutional right, statutory provisions should align themselves to the said higher constitutional edict.

Granting bail to Prem Prakash in the money laundering case related to alleged forging of the sale deed of a land in Ranchi, the bench said it has been held by the apex court that where the accused has already been in custody for a considerable number of months and there being no likelihood of conclusion of trial within a short span, the rigours of Section 45 of PMLA can be suitably relaxed to afford conditional liberty.

The bench, while referring to the recent verdict in the money laundering and corruption cases against Manish Sisodia, a deputy chief minister of Delhi, said it has reiterated that keeping people behind bars for unlimited periods of time in the hope of speedy completion of trial would deprive them of their fundamental right to personal liberty.

The bench noted that Prakash was in custody since August 25, 2022 in a money laundering case related to alleged illegal mining. The ED arrested him in the case of an alleged land scam on August 11, 2023.

It said the statements recorded by Prakash while in custody in different cases will not be admissible in court and be "hit" by section 25 of the Evidence Act.

"In the facts of the present case, we hold that the statement of the appellant if to be considered as incriminating against the maker, will be hit by Section 25 of the Evidence Act since he has given the statement whilst in judicial custody, pursuant to another proceeding instituted by the same Investigating Agency.

"Taken as he was from the judicial custody to record the statement, it will be a travesty of justice to render the statement admissible against the appellant," the bench said.

It set aside the March 22 order of the Jharkhand high court denying bail to Prakash and directed the trial court to proceed in accordance with law.