New Delhi: The Supreme Court has granted bail to Arvind Dham, former promoter and non-executive Chairman of Amtek Auto Ltd., in a money laundering case, holding that his prolonged incarceration of over 16 months without commencement of trial violated his fundamental right to a speedy trial under Article 21 of the Constitution.
A Bench of Justice Sanjay Kumar and Justice Alok Aradhe quashed the Delhi High Court’s order rejecting regular bail and set aside the Special Court’s earlier rejection, emphasizing that the right to a speedy trial is not eclipsed by the nature of the offence and that prolonged pre-trial detention cannot be permitted to convert into punishment.
The case arose from FIRs registered on December 21, 2022, by IDBI Bank and Bank of Maharashtra, alleging fraud of ₹385.35 crore and ₹289 crore respectively, under Sections 120B, 420, 406 and 468 of the IPC and Sections 13(2) and 13(1)(d) of the Prevention of Corruption Act, 1988. Dham was arrayed as an accused along with 27 other individuals. Based on these FIRs, the Directorate of Enforcement registered two ECIRs on March 21, 2023, alleging laundering of proceeds of crime.
The gravamen of the allegations against Dham was that he was the ultimate beneficiary of a well-orchestrated fraud scheme executed at his behest, involving diversion and siphoning of public funds through layered entities, resulting in substantial wrongful loss to public sector banks.
Dham appeared in response to summons under Section 50 of the PMLA on June 19, 2024, and his statement was recorded. Search and seizure operations were conducted at his residence on June 20, 2024, and he was arrested on July 9, 2024. A prosecution complaint dated September 6, 2024, was filed against 16 accused persons (six individuals and ten companies), followed by a supplementary complaint on August 2, 2025, against 40 accused persons (22 individuals and 18 companies). Of the 28 individuals, only Dham was arrested and remained in custody. A total of 208 prosecution witnesses were cited, but cognizance of the prosecution complaint had not yet been taken.
Dham moved for bail before the Special Judge on December 16, 2024, which was dismissed on January 21, 2025, on the ground that he was not covered by the proviso to Section 45 of the PMLA. He then approached the High Court under Section 483 of the BNSS and Section 45 of the PMLA on February 4, 2025. He was granted interim bail on medical grounds on March 11, 2025, until April 1, 2025. The High Court rejected his regular bail application on August 19, 2025.
Senior Counsel for Dham argued that he was about 64 years old, suffered from multiple ailments, and had been in custody for over 16 months—amounting to prolonged incarceration in violation of his right to liberty and speedy trial under Article 21. Of the 28 individuals, only Dham had been arrested, and the investigation against him had concluded. He had cooperated with the investigation, and there was no likelihood of the trial commencing in the foreseeable future. No cognizance had been taken, and proceedings remained at the stage of scrutiny of documents.
Senior Counsel further pointed out that a delay of approximately eight months was attributable to the Enforcement Directorate, which had filed Crl. M.C. No. 7860 of 2024 before the High Court challenging the order issuing notice to proposed accused persons. The High Court granted an interim order deferring proceedings before the Special Judge, and after eight months, the ED withdrew the petition on May 23, 2025.
On allegations of witness tampering—specifically that Dham instructed Ms. Anuradha Kapur not to join the investigation—counsel argued that the allegation was incredulous, as Dham had been in custody since July 9, 2024, while Kapur was arrayed as a witness only on August 2, 2025, in the supplementary complaint. Therefore, the question of instructing her prior to summons did not arise.
Regarding allegations of dissipation of properties at Panipat and Alwar, it was submitted that Dham had been in custody since July 9, 2024, and had no knowledge of such dissipation. He was not a Director of M/s Marichika Properties and had no knowledge of the properties mentioned in the chart.
Counsel argued that while the predicate offence alleged fraud of ₹673.35 crore, the figure of ₹38,000 crore was deliberately exaggerated to portray the case as India’s largest bank fraud to justify prolonged custody. Reliance was placed on precedent establishing that economic offences cannot be treated as a separate class for determining bail.
The Additional Solicitor General contended that the gravity of the offence disentitled Dham from exemption from the mandatory twin conditions under Section 45 of the PMLA. He was described as an influential person who had instructed his cousin, Ms. Anuradha Kapur—a dummy director in his group—not to join the investigation. He was also alleged to have dissipated proceeds of crime (immovable properties at Alwar and Panipat) after attachment. Mere long incarceration, it was argued, could not be the sole ground for bail in light of allegations of tampering and influence over witnesses.
The ASG further argued that any delay was attributable to Dham, as reflected in the Trial Court order sheets. Out of 210 witnesses, 25 were common to both prosecution complaints. Of the 63,691 pages of relied-upon documents, only a few were relevant to proving loss. The ED had filed an application on September 27, 2025, seeking day-to-day hearing.
Justice Alok Aradhe, authoring the judgment, undertook an exhaustive review of jurisprudence on bail in economic offences and the constitutional right to speedy trial. The Court emphasized that while considering bail, courts must examine the gravity of the offence based on facts and circumstances, including the prescribed sentence. However, all economic offences cannot be treated as a homogeneous class warranting denial of bail.
The Court held:
“It is well settled that if the State or any prosecuting agency, including the court concerned, has no wherewithal to protect the fundamental right of an accused to a speedy trial under Article 21 of the Constitution, then the State or prosecuting agency should not oppose bail solely on the ground that the crime is serious.”
Relying on V. Senthil Balaji v. Deputy Director, Enforcement Directorate, the Court reiterated that where the maximum sentence under the PMLA is seven years, prolonged incarceration pending trial may warrant bail if there is no likelihood of trial concluding within a reasonable time. Statutory restrictions cannot result in indefinite pre-trial detention.
The Court also relied on the three-Judge Bench decision in Padam Chand Jain v. Enforcement Directorate, reiterating that prolonged incarceration cannot convert pre-trial detention into punishment, especially where documentary evidence has already been seized.
Applying these principles, the Court found compelling circumstances warranting bail. Dham had joined the investigation even prior to arrest on June 19, July 2, and July 9, 2024, and had cooperated fully. Of 28 individuals, only he was arrested. The maximum sentence was seven years, and he had spent approximately 16 months and 20 days in custody.
No cognizance had been taken, proceedings were at the stage of scrutiny of documents, and 210 witnesses were yet to be examined, making early commencement of trial unlikely. The Court held that continued incarceration in such circumstances violated Article 21.
The allegation of instructing Ms. Anuradha Kapur not to join the investigation was held to be “wholly incredulous.” On delay, the Court found that the eight-month stay was attributable solely to the ED. Allegations of dissipation of properties were also found untenable for lack of material linking Dham.
Accordingly, the Supreme Court quashed the High Court’s order and directed that Dham be released on bail during the pendency of trial, subject to conditions to be fixed by the Trial Court, including surrender of passport, restriction on foreign travel, and furnishing contact details to the ED.
Case Title: Arvind Dham v. Directorate of Enforcement
