2015 (2) TMI 1196 - HC - Money Laundering

Attachment of property involved in money laundering - Held that - A perusal of Section 5 of the Act makes it clear that the order passed under sub-section 1 is a provisional measure and valid for maximum period of 180 days. The provisional attachment has to be approved by the Adjudicating Authority after proper adjudication within 180 days. The act envisages three layers of the grievance redressal in addition to safeguards incorporated in Section 5(1) of the Act. The Adjudicating Authority may confirm or set aside the provisional attachment order on the basis of material produced by the parties before it. If Adjudicating Authority confirms the order of provisional attachment, the Act envisages appeal before the Appellate Tribunal. Section 42 of the Act provides further appeal to the High Court. Thus, it is clear that petitioner has an effective alternative remedy upto the High Court by way of adjudicating proceedings, appeal to the Appellate Tribunal and finally, appeal to the High Court. Petitioner can raise all the pleas including that of the jurisdiction before the Adjudicating Authority. It is one thing to say that in exercise of power vested in it under Article 226 of the Constitution, this High Court entertain a writ petition against any order passed by or action taken by the State and/or its agency or any public authority or order passed by quasi-judicial authority and it is altogether different thing to say that each and every petition filed under Article 226 of the Constitution must be entertained by the High Court as a matter of course ignoring the fact that aggrieved person has an effective alternative remedy. Rather, it is settled law that when a statutory forum is created by law for redressal of grievances, a writ petition should not be entertained ignoring the statutory dispensation. Thus not inclined to entertain the writ petition and the same is dismissed.

Issues Involved:
1. Maintainability of the writ petition under Article 226 of the Constitution of India.
2. Availability of alternative remedies under the Prevention of Money Laundering Act, 2002 (the Act).
3. Jurisdiction and validity of the provisional attachment order.

Issue-wise Detailed Analysis:

1. Maintainability of the Writ Petition under Article 226 of the Constitution of India:

The petitioner filed a writ petition under Article 226 of the Constitution of India, seeking to quash the complaint, show cause notice dated 3rd February 2015, and the provisional attachment order dated 9th January 2015. At the outset, the counsel for the respondent raised objections regarding the maintainability of the writ petition due to the availability of alternative remedies under the Act. The court noted that Article 226 vests wide discretion in the Writ Court to entertain writ petitions and grant appropriate relief. However, it is an extraordinary jurisdiction, and the Writ Courts observe self-imposed restraint, especially when an efficacious and effective remedy is provided by the concerned statute. The court emphasized that ordinarily, a writ petition is not entertained if the aggrieved person has an effective alternative remedy, except in cases of exceptional nature or glaring injustice.

2. Availability of Alternative Remedies under the Act:

The court highlighted the statutory remedies available to the petitioner under the Act. Section 26 of the Act provides a remedy of appeal before the Appellate Tribunal to any person aggrieved by the order made by the Adjudicating Authority. Further, Section 42 of the Act envisages that any person aggrieved by any decision or order of the Appellate Tribunal may file an appeal to the High Court within sixty days from the date of communication of the decision or order of the Appellate Tribunal. The court noted that the petitioner has effective and efficacious statutory remedies to prove the nature of acquisition of assets and to ventilate their grievances. The court emphasized that the writ court cannot go into the merits of the issue at this stage, even before the attachment order has become final, the investigation is completed, the trial concluded, and the issue of attachment is considered by the Adjudicating Authority, Appellate Authority, and second Appellate Authority.

3. Jurisdiction and Validity of the Provisional Attachment Order:

The petitioner contended that the provisional attachment order was passed without jurisdiction and that there was no material available to indicate that the money in the bank and the properties attached were generated from crime money. The court examined Section 5 of the Act, which deals with the attachment of property involved in money laundering. The court noted that the order passed under sub-section 1 of Section 5 is a provisional measure valid for a maximum period of 180 days and has to be approved by the Adjudicating Authority after proper adjudication within this period. The Act envisages three layers of grievance redressal in addition to safeguards incorporated in Section 5(1). The Adjudicating Authority may confirm or set aside the provisional attachment order based on the material produced by the parties. If the Adjudicating Authority confirms the order, the Act provides for an appeal before the Appellate Tribunal and a further appeal to the High Court. The court concluded that the petitioner has an effective alternative remedy up to the High Court by way of adjudicating proceedings, appeal to the Appellate Tribunal, and finally, appeal to the High Court. The petitioner can raise all the pleas, including that of jurisdiction, before the Adjudicating Authority.

Conclusion:

For the foregoing reasons, the court was not inclined to entertain the writ petition and dismissed it. The application for stay (Crl.M.A.2482/2015) was disposed of as infructuous.

← Previous Next →