2020 (8) TMI 837 - HC - Money Laundering

Release of freezed bank accounts of petitioner - Money Laundering - proceeds of crime - reason to believe that the money lying in the credit of the said bank accounts are in any manner involved in money laundering or are proceeds of crime or not - HELD THAT - As an interim measure on the petitioner(s) securing the amount as mentioned in paragraph 2.8 of the said application copy whereof shall be supplied by the learned counsel for the respondent to the counsels appearing in the other petitions as well by way of a Bank Guarantee/Fixed Deposit or by maintaining a deposit of an equivalent amount in their bank accounts in question the operation of the Impugned action of the respondent of freezing their bank accounts shall remain stayed till the next date of hearing. List on 12th October 2020.

Summary

Issues:
1. Exemption from filing notarized affidavit and certified copies of annexures.
2. Exemption from filing notarized affidavit and affixing of court fee.
3. Freezing of bank accounts under Prevention of Money Laundering Act, 2002.

Exemption from filing notarized affidavit and certified copies of annexures:
An application sought exemption from filing duly notarized affidavit and certified copies of annexures. The deponent was bound to the contents of the application, and the exemption was granted. The application was disposed of.

Exemption from filing notarized affidavit and affixing of court fee:
Another application requested exemption from filing a notarized affidavit and affixing requisite court fee. The deponent was bound to the application's contents, and the exemption was granted. The court fee was to be deposited online within one week, and the physical stamp was to be filed within 72 hours from the date of the Court's regular functioning. The application was disposed of.

Freezing of bank accounts under Prevention of Money Laundering Act, 2002:
The petitioners challenged the freezing of their bank accounts under the Prevention of Money Laundering Act, 2002 (PMLA). They argued that the freezing lacked a 'reason to believe' that the funds were involved in money laundering or proceeds of crime. They claimed that due process under Section 17 and Section 60 of the PMLA was not followed and that the order might have been passed by an unauthorized officer. The respondent, on the other hand, stated that the action was taken based on a request from the Government of Brazil under Section 60(6) of the Act. The Court found the freezing of entire bank accounts unreasonable and not authorized by law. As an interim measure, the freezing was stayed if the petitioners secured the specific amounts mentioned in the application. The proceedings before the Adjudicating Authority were not stayed at the present time. The case was listed for further hearing on 12th October 2020.