2023 (1) TMI 846 - HC - Money Laundering

Provisional attachment order - case of petitioner is that Madura Chemicals Pvt. Ltd. was acquired by the petitioner in the year 2015 and that the petitioner was never put on notice either after the provisional attachment order was passed or when the confirmation order was passed by the Adjudicating Authority - HELD THAT - Madura Chemicals Pvt. Ltd. has been specifically added as a party before the Adjudicating Authority and it is represented by the above said Mathesh. We are dealing with a legal persona in the present case and it is enough if notice is issued to the company. The grievance of the petitioner that he did not personally know about this case is a matter to be resolved with Mathesh, who had received money from the petitioner enabling the petitioner to acquire the company. Hence, we are not satisfied with the contention raised by the learned counsel for the petitioner that Madura Chemicals Pvt. Ltd. was never put on notice by the Adjudicating Authority while confirming the provisional attachment order. In any event, we cannot get into this factual issue for the first time while dealing with this writ petition and such factual disputes cannot be adjudicated in a writ petition. Jurisdiction of the second respondent to pass the confirmation order beyond the period of 180 days - HELD THAT - The second respondent apart from dealing with the merits of the case, has justified the passing of the Adjudication Order beyond 180 days by relying upon the various orders passed by the Apex Court extending the period of limitation. In the Apex Court has explained the scope of the order passed in S.Kasi case 2020 (6) TMI 727 - SUPREME COURT and has categorically held that the same cannot be applied in a matter involving proceedings before a Court. The second respondent was exercising a quasi-judicial function and the ratio in S.Kasi case cannot be applied to such a quasi-judicial authority. In any case, we keep this issue open to enable the petitioner to agitate the same before the Appellate Tribunal. This Writ Petition is dismissed and liberty is granted to the petitioner to approach the Appellate Tribunal u/s.26 of the PMLA and work out his remedy in accordance with law.

Summary

Issues:
Challenge to confirmation order under Prevention of Money Laundering Act, 2002 without notice to petitioner; Jurisdiction of second respondent to pass confirmation order beyond 180 days.

Analysis:

Issue 1: Challenge to confirmation order without notice
The petitioner challenged the confirmation order passed by the second respondent under the Prevention of Money Laundering Act, 2002 (PMLA) without being put on notice. The petitioner contended that the company in question, Madura Chemicals Pvt. Ltd., was acquired by him in 2015, and he was unaware of the attachment orders issued against the property. However, the Court noted that the company was represented before the Adjudicating Authority, and notice to the company sufficed legally. The Court declined to delve into factual disputes regarding notice in a writ petition, emphasizing that such matters should be resolved with the company's representative. The petitioner's contention of lack of notice was deemed insufficient for challenging the confirmation order.

Issue 2: Jurisdiction to pass confirmation order beyond 180 days
The petitioner argued that the second respondent lacked jurisdiction to pass the confirmation order beyond the 180-day limit. The second respondent justified the delay by citing Supreme Court orders extending the limitation period. The Court examined a Delhi High Court judgment referenced by the petitioner, noting that the specific issue of jurisdiction beyond 180 days was not addressed in that case. Additionally, a stay order on the Delhi High Court judgment was highlighted. The Court also discussed a Calcutta High Court judgment relying on an Apex Court decision, emphasizing the inapplicability of the latter to property rights cases. Referring to a previous case, the Court granted the petitioner liberty to approach the Appellate Tribunal to address the jurisdictional issue. The Court's decision was supported by an Apex Court judgment clarifying the scope of previous rulings in matters involving quasi-judicial functions.

In conclusion, the writ petition challenging the confirmation order was dismissed, and the petitioner was granted liberty to seek remedy through the Appellate Tribunal under section 26 of the PMLA. The Court emphasized maintaining consistency with previous decisions and kept the jurisdictional issue open for the petitioner to pursue further.