2019 (12) TMI 809 - AT - Money Laundering

Grant of interim stay on provisional attachment order - de-freezing of bank accounts of appellant - applicant has confined his submission an order for release of amount deposited in Madhya Pradesh Gramin Bank subsequent to the passing of provisional attachment order - HELD THAT - It is the uncontroverted fact that the appellant/applicant is maintaining the account bearing no. 2004101130000261 with Madhya Pradesh Gramin Bank, Shahpura Branch, Bhopal. It is the contention of the appellant/applicant that the Madhya Pradesh Govt. has transferred certain amount which is required for the purpose of payment to be made to the vendors and salary of the staff etc. and if the amount so deposited by the Madhya Pradesh Govt. is not released it is likely that the entire project shall be terminated. During the course of hearing, it is clearly submitted by the ld. Counsel for the respondent that the account in question has not been attached. The amount that has been attached to the tune of ₹ 5,53,401/- in six different banks accounts. The amount which is asked to be released by the appellant has not been attached or freezed under the PAO. This Tribunal has a limited jurisdiction of deciding legality and propriety of the impugned order, since the amount sought to be de-freezed are beyond the scope of the Provisional Attachment Order and the order of confirmation of the said PAO and is not with respect to the amount sought to be released so the question of passing an order for de-freezing the amount transferred by the Madhya Pradesh Govt. and being not part of PAO Impugned Order is beyond the scope of present appeal, hence can t be considered. The prayer in Ad-Interim relief application sought by the appellant/applicant is also rejected - Application disposed off.

Summary

Issues:
1. Application for ex-parte interim stay on Provisional Attachment order
2. Request to de-freeze bank accounts
3. Impact on project under National Food Security Act 2013
4. Additional documents submission
5. Respondent's reply to the application for relief
6. Release of amount deposited in bank post provisional attachment order
7. Dispute over attached amount and request for release
8. Jurisdiction of the Tribunal over de-freezing request

Analysis:

1. The appellant filed an application seeking an ex-parte interim stay on the Provisional Attachment order dated 14.02.2019, requesting to de-freeze the bank accounts and any further orders. The appellant argued that the project under the National Food Security Act in Madhya Pradesh would face severe consequences if the stay order is not vacated, leading to unemployment for over 120 employees and hindering project operations.

2. The respondent opposed the appellant's request, citing the significance of the Provisional Attachment Order related to proceeds of crime amounting to crores. The respondent highlighted that the appellant's plea to de-freeze accounts was an attempt to evade further departmental action under the Prevention of Money Laundering Act (PMLA) and secure the balance proceeds of crime.

3. An additional application was made to submit documents, including a letter from the Madhya Pradesh State Electronics Development Corporation Ltd. However, the Tribunal found the additional document irrelevant and rejected the application to include it in the record.

4. The Tribunal noted discrepancies in the contentions presented by the parties regarding the ultimatum to resolve payment issues for vendors and staff. Upon review of the annexure and arguments, the Tribunal found no merit in the appellant's claims related to the termination of the project due to frozen accounts.

5. After hearing both parties, the Tribunal focused on the release of an amount deposited post the provisional attachment order in a specific bank account. The respondent emphasized the attachment of a specific amount in six bank accounts and rejected the appellant's plea for de-freezing beyond the scope of the Provisional Attachment Order.

6. The Tribunal clarified the limited jurisdiction in deciding the legality of the impugned order and the scope of the relief sought by the appellant. As the requested amount for release was not part of the attachment order, the Tribunal dismissed the application for relief, emphasizing the boundaries of its authority.

7. Ultimately, the Tribunal rejected both the applications, including the request for an interim stay on the Provisional Attachment order and the plea to de-freeze the bank accounts. The judgment highlighted the legal constraints governing the Tribunal's decisions and the specific scope of relief sought by the appellant, leading to the disposal of both applications.