2020 (4) TMI 837 - AT - Money Laundering

Commitment of scheduled offences - Uttar Pradesh State Industrial Development Corporation (UPSIDC), Varanasi - It is the contention of the present appellant that it is a State Authority and has been erroneously shown to have committed the scheduled offences - HELD THAT - On perusal of the impugned order PAO, it is seen that nowhere there is any allegations made by the ED that the present appellant has committed the scheduled offences or has generated proceeds of crime or laundered any proceeds of crime. In fact, it is admitted in the written reply to the appeal filed by ED that this appellant has been made as a party as it was the lessor of the property over which the defendants no(s) 1 to 3 has rights as lessee and the ED has got no objection if the order of the Adjudicating Authority is modified in relation to the contention of the appellant. On perusal of the materials available on record, it is seen that the Impugned Order has not disclosed as to how the present appellant is a party to the alleged commission of crime or has the possession of proceeds of crime or generated the proceeds of crime and laundered them even remotely. The implication of the present appellant along with other defendants by the Adjudicating Authority is neither proper nor legal. Appeal disposed off.

Summary

Issues involved:
Appeal against Provisional Attachment Order (PAO) confirming order by Adjudicating Authority in relation to scheduled offences under PMLA.

Analysis:

1. Identification of Appellant and Contention:
The appeal was filed by the Regional Manager of Uttar Pradesh State Development Authority (UPSDA) against the order confirming the Provisional Attachment Order (PAO) dated 14.09.2018. The appellant, UPSDA, contended that it is a State Authority erroneously implicated in the scheduled offences without distinction from other respondents.

2. Background and Allegations:
The case originated from a CBI case against officials of District Industry Centre and Northern Coalfields Limited for alleged offences under IPC and PC Act, leading to ED registering ECIR. The appellant, as the lessor of the property, was linked to lessees accused of committing the scheduled offences.

3. Contention of No Involvement:
The appellant argued that it had no connection with the alleged offences committed by other respondents and requested the impugned order to be quashed or modified in its favor.

4. ED's Response and Hearing:
ED maintained that the appellant was made a party to present objections as the lessor, while emphasizing the guilt of other respondents in committing scheduled offences and generating proceeds of crime. The matter was heard, and the appellant objected to observations implying its involvement in money laundering.

5. Judicial Analysis and Modification:
Upon review, the Tribunal found no allegations against the appellant for committing scheduled offences or laundering proceeds of crime. The order was modified to exclude the appellant from implications of possessing or generating proceeds of crime, as the Adjudicating Authority's observations were deemed improper and legally unsound.

6. Final Disposition:
After considering contentions from both parties and evidence on record, the impugned order was modified to exclude the appellant from being associated with the scheduled offences or proceeds of crime. The appeal was disposed of accordingly, with the order standing modified in favor of the appellant, UPSDA.

This detailed analysis highlights the key contentions, responses, judicial findings, and the final disposition of the appeal against the Provisional Attachment Order under the Prevention of Money Laundering Act.