2016 (4) TMI 1301 - HC - Money Laundering

Offence under PMLA - Adjudicating Authority was not composed as required under Section 6(1) of the Act as it had only one member, therefore was corum non judice - Held that - As during the pendency of the present petition, by virtue of order dated 09.09.2015 filed on behalf of the authority concerned, the Court clarified with regard to the interim order providing that the provisional attachment will not expire after 180 days as the petition was pending and the relief was in operation. Now, therefor the proceedings can be carried on before the properly constituted Adjudicating Authority. In this view, the present petition is liable to be disposed of requiring the Adjudicating Authority to take up the case and pass appropriate order. In view of aforesaid development and the duly constituted Adjudicating Authority functioning, the said authority-respondent No.3 herein is directed to proceed with the case and decide the same after giving opportunity of hearing to the parties. It is clarified that this Court has not expressed any opinion on merits. The Adjudicating Authority shall consider the matter on its merits and in accordance with law. The parties are at liberty to raise all contentions including in respect of show-cause notice as may be permissible in law and the Adjudicating Authority shall deal with the same on its merits and decide the matter.

Summary

Issues:
1. Composition of the Adjudicating Authority under the Money Laundering Act, 2002.

Analysis:
The petition challenged a show-cause notice issued to the petitioners by the Adjudicating Authority under the Money Laundering Act, 2002. The petitioners contended that the Adjudicating Authority was not properly composed as required by Section 6(1) of the Act, as it had only one member, rendering it corum non judice. The Court had previously granted ad-interim relief in a similar case, halting further proceedings by the Adjudicating Authority.

The respondent authority later informed the Court that the Adjudicating Authority had been duly constituted with multiple members appointed in accordance with Section 6 of the Act. The government had appointed members from various backgrounds, including law and administration, ensuring compliance with the Act's requirements. The Court clarified that the provisional attachment would not expire during the pendency of the petition, maintaining the status quo.

With the Adjudicating Authority now properly constituted, the Court directed the authority to proceed with the case, giving both parties a fair opportunity to present their arguments. The Court explicitly stated that it had not expressed any opinion on the merits of the case and emphasized that the Adjudicating Authority should decide the matter based on its merits and in accordance with the law. The petition was disposed of accordingly, with the interim relief vacated, and the petitioners agreed to appear before the Adjudicating Authority for further proceedings on the specified date.