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2022 (11) TMI 3 - HC - Money LaunderingMoney Laundering - maintainability of petition - availability of alternative remedy - provisional attachment of properties - appellant has vehemently argued before this Court that once the Tribunal has become functional, the order dated 24.08.2022 passed in LPA 487/2022 will not come in the way of the parties as an appeal was already pending on the date when the order was passed - HELD THAT - This Court has carefully gone through the statutory provisions governing the field and it is an undisputed fact that an appeal lies before the Tribunal. The Division Bench of this Court has requested the learned Single Judge to decide the matter vide order dated 24.08.2022 only because at the relevant point of time when the order was passed by the Division Bench, no Tribunal was functional. The Hon ble Supreme Court in TITAGHUR PAPER MILLS CO. LIMITED. AND ANOTHER VERSUS STATE OF ORISSA AND ANOTHER 1983 (4) TMI 49 - SUPREME COURT , has, inter alia, held that We are constrained to dismiss these petitions on the short ground that the petitioners have an equally efficacious alternative remedy by way of an appeal to the Prescribed Authority under sub-section (1) of Section 23 of the Act, then a second appeal to the Tribunal under sub-section (3)(a) thereof, and thereafter in the event the petitioners get no relief, to have the case stated to the High Court under Section 24 of the Act. In the light of the various judgments delivered by the Hon ble Supreme Court and this Court, there is an equally efficacious remedy available under Section 26 of the PMLA and the High Court is an Appellate Authority above the Appellate Authority by virtue of Section 42 of the PMLA. Hence as the Appellate Authority is very much functional, the matter deserves to be heard by the Appellate Authority only. It is true that the High Court can certainly exercise its discretion keeping in view the peculiar facts circumstances of the case to decide a matter even if alternative remedy is available. In the present case, there is an equally efficacious alternative remedy available before the Appellate Tribunal and the Tribunal is very much functional, the matter deserves to be heard before the Tribunal and, therefore, the Tribunal is requested to decide the appeal at an early date. The present LPA stands allowed. The Tribunal is requested to decide the appeal at an early date. Needless to state that this Court has not dealt with the merits of the case.
Issues Involved:
1. Seizure of funds by the Directorate of Enforcement under PMLA and FEMA. 2. Jurisdiction and authority of various courts and tribunals. 3. Availability and exhaustion of alternative remedies. 4. Interim reliefs granted by different judicial bodies. 5. Legal precedents on the jurisdiction of High Courts under Article 226 when alternative remedies exist. Detailed Analysis: 1. Seizure of Funds by the Directorate of Enforcement under PMLA and FEMA: The Directorate of Enforcement seized significant amounts under the Prevention of Money Laundering Act, 2002 (PMLA) and the Foreign Exchange Management Act, 1999 (FEMA). The initial seizure order dated 26.08.2021 was later corrected, and additional amounts were seized under various orders. The respondent company challenged these seizures through multiple legal avenues, including writ petitions and appeals. 2. Jurisdiction and Authority of Various Courts and Tribunals: The respondent company initially filed a writ petition in the High Court of Telangana, which ordered the release of some seized funds. This order was set aside by the Division Bench of the High Court of Telangana. Subsequently, the Supreme Court intervened and directed the release of funds. The respondent then filed another writ petition in the Delhi High Court, which also granted interim relief. The Directorate of Enforcement challenged this interim relief before the Supreme Court, which dismissed the challenge. The matter was further complicated by the fact that the Appellate Tribunal, which had jurisdiction over the case, was not functional at various times during the proceedings. 3. Availability and Exhaustion of Alternative Remedies: The central issue was whether the High Court should entertain the writ petition given the existence of an equally efficacious alternative remedy before the Appellate Tribunal. The legal principle, as reiterated by the Supreme Court in several judgments, is that High Courts should ordinarily refrain from exercising their jurisdiction under Article 226 of the Constitution when an effective alternative remedy is available. The High Court's intervention is justified only in exceptional circumstances, such as when the statutory remedy is inadequate or when there is a need to prevent a miscarriage of justice. 4. Interim Reliefs Granted by Different Judicial Bodies: The respondent company obtained interim reliefs from various courts, including the release of significant amounts of seized funds. The Directorate of Enforcement's attempts to challenge these interim orders were largely unsuccessful. The High Court of Delhi, in particular, granted interim relief on the grounds that the Appellate Tribunal was not functional at the time. 5. Legal Precedents on the Jurisdiction of High Courts under Article 226: The judgment extensively cited precedents where the Supreme Court emphasized that High Courts should not bypass statutory remedies provided by law, especially in fiscal matters. The Supreme Court's decisions in cases like Titaghur Paper Mills Co. Ltd. v. State of Orissa and Assistant Collector of Central Excise v. Dunlop India Ltd. were particularly highlighted. These cases established that the existence of an alternative remedy should generally preclude the exercise of writ jurisdiction unless there are compelling reasons. Conclusion: The High Court ultimately decided that the matter should be heard by the Appellate Tribunal, which had since become functional. The Tribunal was requested to decide the appeal expeditiously. The High Court refrained from delving into the merits of the case, leaving all contentions and rights of the parties open for adjudication by the Tribunal. This decision aligns with the principle that statutory remedies should be exhausted before invoking the writ jurisdiction of High Courts.
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