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2017 (9) TMI 55 - HC - Money LaunderingPrevention of Money Laundering - provisional attachment order - Held that - The impugned notice, in the present case, no doubt, has serious fiscal/penal consequences in case the explanation offered by the petitioner is not accepted by the Adjudicating Authority. But entertaining a writ petition seeking quashment of the aforesaid notice would amount to exercising discretion in the matter of arrogating jurisdiction only by virtue of the location of the Adjudicating Authority which is in Delhi. The petitioner, otherwise also has various stages and forums available to him for challenging any decision/action of the respondent or the Adjudicating Authority, viz. the Appellate Tribunal and the High Court. Section 42 of the Act clearly indicates that in case the matter travels upto the Appellate Tribunal under Section 26 of the Act, any person aggrieved against the order of the Appellate Tribunal could approach the High Court within the jurisdiction of which the aggrieved party ordinarily resides or carries on business or personally works for gain. In case the Central Government is the aggrieved party, the High Court within the jurisdiction of which the respondent, or in a case where there are more than one respondent, any of the respondents ordinarily resides or carries on business or personally works for gain, shall have the jurisdiction. In that view of the matter, the respondent would be forced to, if it is aggrieved finally by an order of the Appellate Tribunal to challenge such order before the High Court of Kolkata only whereas if the contention of the petitioner is accepted and if this Court assumes the jurisdiction of exercising its discretion, two options would be available to the petitioner namely of Kolkata High Court and Delhi High Court. This would definitely militate against the principle of forum convenience. This Court, therefore, is of the view that this Court ought not to entertain the present writ petition. In case the petitioner is so advised, an appropriate petition could be preferred before the High Court of Kolkata for the needful. In that view of the matter, the Adjudicating Authority shall not pass any final order for a period of 15 days to be counted from the date of the present order so as to enable the petitioner either to assail the present order before the superior Court or file appropriate petition before the Kolkata High Court. The petitioner in that event shall not be permitted to raise any objection with regard to the delay for the aforesaid period in completing the proceedings within the statutory period of 180 days.
Issues Involved:
1. Registration of ECIR No.07/2012/KOL/PMLA. 2. Original complaint No.78/2017. 3. Show cause notice dated 21.06.2017. 4. Provisional attachment order dated 23.05.2017. Detailed Analysis: 1. Registration of ECIR No.07/2012/KOL/PMLA: The petitioner challenged the registration of ECIR No.07/2012/KOL/PMLA dated 18.04.2012, which initiated a detailed investigation under Section 3 of the Prevention of Money Laundering Act, 2002 (PMLA). The ECIR was based on an FIR No.RC0102011A0035 dated 30.12.2011, filed by the CBI, Anti Corruption Branch, alleging that the petitioner caused a wrongful loss to the Railways amounting to ?355 crores through a conspiracy involving false declarations under a dual freight policy. 2. Original Complaint No.78/2017: The original complaint No.78/2017 dated 13.06.2017 was filed by the Joint Director of the Enforcement Directorate under Section 5(5) of the PMLA before the Adjudicating Authority. This complaint sought confirmation of the provisional attachment of properties valued at ?9,07,94,663/-, suspected to be proceeds of crime. 3. Show Cause Notice Dated 21.06.2017: The petitioner limited their challenge to the issuance of the show cause notice dated 21.06.2017 under Section 8(1) of the PMLA, arguing it was unnecessary and premature. The notice required the petitioner to explain the source of income for the attached properties and show cause why the properties should not be declared involved in money laundering and confiscated by the Central Government. 4. Provisional Attachment Order Dated 23.05.2017: The provisional attachment order dated 23.05.2017 attached immovable and movable assets valued at ?9,07,94,663/-, suspected to be derived from criminal activities. The petitioner argued that the attachment was premature, given the ongoing adjudication of the validity of the dual freight policy by the Supreme Court and the lack of effective quantification of losses by the Railway administration. Jurisdiction and Forum Convenience: The primary issue was the jurisdiction of the Delhi High Court to entertain the writ petition. The respondent argued that the appropriate forum was the Kolkata High Court, given that the predicate offence, ECIR, and attached properties were all based in Kolkata. The court noted that while a small fraction of the cause of action arose in Delhi due to the location of the Adjudicating Authority, the principle of forum convenience favored Kolkata High Court. Court's Decision: The Delhi High Court decided not to entertain the writ petition on the grounds of jurisdiction and forum convenience. The petitioner was advised to approach the Kolkata High Court. The Adjudicating Authority was directed not to pass any final order for 15 days to allow the petitioner to seek appropriate relief.
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