2015 (2) TMI 1242 - HC - Money Laundering

Provisional attachment orders for a period of 180 days - PMLA - Held that - The life of provisional attachment order was 180 days, which had come to an end after the order has been passed by the adjudicating authority. Thus, we are not inclined to go into the question of legality and validity of the provisional attachment order and also further to examine the impugned order passed by the learned Single Judge. However, in the facts of the case, we keep it open to be considered by the appropriate authority at an appropriate stage. We further grant liberty to the appellants to raise all issues permissible under the provisions of law before the appropriate forum, if so advised. The appropriate forum is competent to deal with the matter independently on its own merit, without being influenced by some observations made, if any, in the order dated 17.11.2014 passed by the learned Single Judge.

Summary

Issues:
Challenge to the legality and validity of the order of provisional attachment under the Prevention of Money Laundering Act, 2002.
Validity of the show cause notice issued by the Adjudicating Authority.
Competency of the Adjudicating Authority to consider factual disputes.
Prima facie conclusion by the Adjudicating Authority regarding commission of scheduled offences and money laundering.
Validity of the final order passed by the Adjudicating Authority.
Appellants' intention to question the legality and validity of the final order.
Duration and implications of the provisional attachment order.

Issue 1: Challenge to the legality and validity of the order of provisional attachment under the Prevention of Money Laundering Act, 2002.
The appeals arose from an order directing the provisional attachment of immovable properties under Section 5(1) of the PMLA Act. The Single Judge concluded that the provisional attachment was legal and valid. The appellants sought to challenge this conclusion before the appropriate forum. The High Court noted that the provisional attachment order's life had ended after the final order by the Adjudicating Authority, making the issue moot. The High Court disposed of the appeals, granting liberty to the appellants to raise all permissible issues before the appropriate forum.

Issue 2: Validity of the show cause notice issued by the Adjudicating Authority.
One of the appellants questioned the show cause notice issued by the Adjudicating Authority. The High Court did not delve into the specifics of this issue as the provisional attachment order's validity was already addressed by the Single Judge. The High Court granted liberty to the appellants to raise this issue before the appropriate forum.

Issue 3: Competency of the Adjudicating Authority to consider factual disputes.
The Single Judge held that the Adjudicating Authority is competent to consider factual disputes and pass orders after examining the same. The High Court did not further address this issue as the appeals were disposed of due to the provisional attachment order becoming moot.

Issue 4: Prima facie conclusion by the Adjudicating Authority regarding commission of scheduled offences and money laundering.
The Adjudicating Authority, during the pendency of the appeals, concluded that the defendants had committed scheduled offences, generated proceeds of crime, and laundered them. The High Court noted this conclusion but did not delve into its specifics as the appeals were disposed of due to the provisional attachment order's mootness.

Issue 5: Validity of the final order passed by the Adjudicating Authority.
The Adjudicating Authority passed a final order holding that the defendants had committed scheduled offences and were involved in money laundering. The High Court acknowledged this final order but did not examine its validity as the appeals were disposed of due to the provisional attachment order's mootness.

Issue 6: Appellants' intention to question the legality and validity of the final order.
The appellants expressed their intention to challenge the legality and validity of the final order before the appropriate forum. The High Court granted them liberty to raise all permissible issues before the appropriate forum.

Issue 7: Duration and implications of the provisional attachment order.
The provisional attachment order had a duration of 180 days, which ended after the Adjudicating Authority's final order. The High Court did not delve into the legality and validity of the provisional attachment order due to its mootness. The High Court disposed of the appeals, leaving it open for consideration by the appropriate authority at a later stage.