2016 (11) TMI 1546 - HC - Money Laundering

Service of order - Condonation of delay in filing appeal - Does the service of say an order on the counsel amount to its proper service on the party to the proceedings? - Held that - sub-rule (b) is mandatory in its scope and ambit; necessarily the communication should be addressed to the party and the party alone. Any alternative service through post on the so-called authorised agent does not amount to proper service. Is Rule 5 ultra vires of the Parent Statute? - Held that - A Constitutional Court unless inevitable should avoid adjudicating constitutional issues and resolve the case on say statutory grounds - Because the main issue resolves the legal tangle on delayed approach to the Court we need not address this issue. Condonation of delay - Held that - the appellant came to know about the order on 22-9-2015 when the respondents filed the counter-affidavit in the appellant s previous writ petition. The respondent asserted that the Tribunal had already served the order copy on the appellant s counsel. Reknoned from 22-9-2015 there is a delay of 55 days in filing the appeal - Given the reason of ill health cited by the appellant in the affidavit filed to support the application and the attendant circumstances it is a fit case for exercising our discretion to condone the delay which is within the permissible limit of sixty days. Appeal disposed off.

Summary

Issues Involved: Proper service of order on the party, delay in filing the appeal, and the validity of Rule 5 under the Prevention of Money Laundering (Appeal) Rules, 2005.

Issue-wise Detailed Analysis:

I. Proper Service of Order on the Party:

The primary issue was whether the service of an order on the counsel constitutes proper service on the party involved. The appellant argued that neither the substantive provisions of the statute nor the rules contemplated service of notice on the counsel. Section 26(5) of the Prevention of Money Laundering Act, 2002 mandates that the Appellate Tribunal shall send a copy of its order to the parties to the appeal. The appellant contended that Rule 5(b) of the Rules, which allows service on an authorized agent, conflicts with Section 26(5) and is therefore ultra vires. The appellant further argued that service through registered post must be addressed to the party and not the counsel.

The court examined various analogous provisions and concluded that Rule 5(b) operates mandatorily and exclusively, requiring service to be addressed to the party. The court held that service through registered post on the counsel does not amount to proper service on the party. The court emphasized that strict compliance with procedural rules is necessary, especially when non-compliance could lead to penal consequences such as dismissal of an appeal on the ground of limitation.

II. Delay in Filing the Appeal:

The appellant contended that the appeal was filed within the permissible time limit from the date of obtaining the certified copy of the order. Alternatively, the appellant sought condonation of delay citing justifiable reasons. The court noted that the appeal was filed within four days of obtaining the certified copy and that there was a delay of 55 days from the date the appellant became aware of the order through a counter-affidavit filed by the respondent.

Considering the appellant's reasons, including ill health, the court found it appropriate to exercise discretion to condone the delay, which was within the permissible limit of sixty days. The court directed the registry to process the appeal further.

III. Validity of Rule 5 under the Prevention of Money Laundering (Appeal) Rules, 2005:

The appellant challenged the validity of Rule 5, arguing that it was ultra vires the parent statute. However, the court did not address this issue separately, as the resolution of the first issue regarding proper service of the order rendered it unnecessary to adjudicate on the constitutional validity of Rule 5.

Conclusion:

The court concluded that the service of the order on the counsel did not amount to proper service on the party, leading to a delay in filing the appeal. The delay was condoned, and the registry was directed to process the appeal further. No order on costs was made.