During the proceedings, the ED contended that the stringent bail conditions outlined in Section 45(1) of the PMLA should uniformly apply, without exceptions for women. This stance directly contradicts the statute, which permits courts to exempt women from these rigorous conditions. The Supreme Court, visibly displeased, stated, "We will not tolerate conduct on the part of the Union of India to make submissions contrary to statute."
Solicitor-General Tushar Mehta, representing the ED, apologized for the miscommunication, attributing it to a misunderstanding. He clarified that the agency intended to argue that Bala was a principal figure in a money-laundering operation that defrauded numerous investors, thereby justifying the opposition to her bail. However, the Court remained unconvinced, emphasizing that government counsel must be well-versed with the law to prevent such misinterpretations.
Justice A S Oka remarked, "If people who appear for the Union of India do not know basic provisions of law, why should they appear in the matter?" He further criticized the ED's approach, suggesting it reflected a predetermined intent to deny bail in PMLA cases, irrespective of individual circumstances.
This incident underscores a broader concern regarding the ED's application of PMLA provisions. The Supreme Court has consistently maintained that bail should be the norm and jail the exception, even in money laundering cases. In a separate judgment, the Court granted bail to Prem Prakash, an aide to Jharkhand Chief Minister Hemant Soren, emphasizing that Section 45 of the PMLA should not be construed to make bail an impossibility. The Court stated, "Liberty of the individual is always a rule and deprivation is the exception."