2020 (9) TMI 740 - AT - Money Laundering

Grant of Order of Status Quo - provisional attachment order - Ad-interim stay of the operation of impugned order - Eviction notice - HELD THAT - There is no dispute that the aforesaid appellants are either FIR or ECIR named accused and that there is no allegations against these appellants that the aforesaid amounts that have been paid to the builders are out of proceeds of crime and that it is not denied by the Respondent that the aforesaid amounts have not been paid by these appellants and that it is an admitted fact that the appellants are not physically residing in the aforesaid flats and the flats are under lock and key. Having due regard to the facts and circumstances of the case, justice would be served, at this stage, if the conditional order of status quo is passed with respect to the aforesaid properties. Both the parties are directed to maintain status quo as on today till the next date of hearing. List the stay applications alongwith the appeals on 27th November, 2020.

Summary

Issues:
1. Permission to place additional documents on record in various appeals.
2. Applications for ad-interim stay of impugned orders and eviction notices.
3. Granting order of status quo for certain properties.

Analysis:

1. Permission to place additional documents on record:
- In multiple appeals, applications were made seeking permission to include additional documents such as electricity bills, copies of Power of Attorney, Writ Petitions, and receipts of payments. These applications were allowed, and the documents were taken on record for proper adjudication of the appeals.

2. Applications for ad-interim stay:
- Appellants filed applications seeking ad-interim stay of impugned orders and eviction notices related to specific properties. The appellants claimed to be bonafide purchasers of the flats and had made substantial payments towards the purchase. They argued that they were not accused in FIR or ECIR, and the amounts paid were not proceeds of crime. The appellants had also filed writ petitions challenging provisional attachment orders. The Respondent objected to granting a stay, arguing that the appellants were not title holders, were not physically residing in the flats, and the builders used proceeds of crime in construction.
- The Tribunal noted that the appellants were not accused in FIR or ECIR regarding the payments made to builders. It was acknowledged that the appellants were not residing in the flats but had put them under lock and key. The NCLAT had appointed an Executive Officer to oversee the project. Considering the circumstances, the Tribunal ordered a conditional status quo on the properties, directing both parties to maintain the current state until the next hearing. Appellants were instructed not to change the nature of the flats or reside in them, while the Respondent was told not to alter the status either. Various conditions were imposed, including the continuation of attachments and prohibition on creating third-party rights or encumbrances.

3. Granting order of status quo:
- The Tribunal found that justice warranted a conditional order of status quo on the properties in question. Both parties were directed to maintain the current status until the next hearing. The appellants were specifically instructed not to change the nature or character of the flats and not to reside in them. The Enforcement Directorate retained legal and constructive possession, and appellants were barred from creating any third-party rights or encumbrances. The Respondent was given six weeks to file replies to the stay applications.

The Tribunal listed the stay applications along with the appeals for further hearing on 27th November 2020.