2024 (10) TMI 227 - AT - Money Laundering

Provisional attachment order - challenge to the order of the Adjudicating Authority has been made alleging it to be beyond 180 days from the date of the provisional attachment order - Money Laundering - possession of assets, dis- proportionate to the known sources of income while he was in service of Steel Authority of India Ltd. - HELD THAT - The period intervening 15th March 2020 till 28th February 2022 must be excluded for determination of the period of 180 days. It is not in dispute that the provisional attachment order was issued on 23 rd December 2020 and the confirmation order was passed on 09.11.2021. The period was affected by Covid 19 and the Apex Court in Suo Moto Writ Petition (C) No. 3 of 2020 excluded 2022 (1) TMI 385 - SC ORDER the period of Covid-19 for termination of proceedings in itsorder dated 10.01.2022. Since the period of Covid- 19 from 15.03.2020 till 28.02.2022 has been excluded by the Apex Court for termination of proceedings, the Telangana High Court took notice to it and held that if period of 180 days was falling during the period eliminated by the Apex Court for termination of proceeding, then the provisional attachment would not lapse. In the light of the detailed Judgement of the Telangana High Court, we are unable to accept the first argument. Attachment of the appellant's bank account receiving pension - It is submitted that on account of the attachment of bank account, the appellant has been deprived to get pensionary benefit which is not sustainable because one cannot be deprived from his pension - HELD THAT - If the appellant is getting pension, then the account in which it is received, should be allowed to operate by the appellant while maintaining the amount lying therein and would not be withdrawn by the appellant, but it should be with the permission to get the pension with its withdrawal by the appellant. While not causing interference the impugned order, the respondents are directed to allow the appellant to operate the bank account in which he is getting pension while the amount lying till date would be maintained and the appellant would not withdraw the said amount as agreed by the counsel. Appeal allowed in part.

Summary

Issues Involved:

1. Whether the confirmation of the provisional attachment order beyond 180 days is valid given the exclusion of the COVID-19 period.
2. Whether the attachment of the appellant's bank account receiving pension is lawful.

Issue-wise Detailed Analysis:

1. Confirmation of Provisional Attachment Order Beyond 180 Days:

The primary issue raised by the appellant was the validity of the confirmation of the provisional attachment order, which was issued beyond the stipulated 180 days from the date of the provisional attachment order. The appellant argued that as per Section 5 of the Prevention of Money Laundering Act (PMLA), the provisional attachment order must be confirmed within 180 days, failing which it would lapse.

However, the tribunal examined the impact of the COVID-19 pandemic on legal proceedings. The Supreme Court, in a suo motu writ petition, had extended the limitation period from 15th March 2020 to 28th February 2022 to account for the difficulties faced by litigants during the pandemic. This extension was applicable to all judicial and quasi-judicial proceedings, including the confirmation of provisional attachment orders under the PMLA.

The tribunal referenced several judgments, including those from the Telangana High Court and the Supreme Court, which clarified that the period affected by COVID-19 should be excluded when computing the 180-day period for confirming provisional attachment orders. The Telangana High Court, in particular, had held that if the 180-day period fell within the excluded COVID-19 period, the provisional attachment would not lapse.

Thus, the tribunal concluded that the confirmation of the provisional attachment order was valid as the period affected by COVID-19 was rightfully excluded from the computation of the 180 days. Therefore, the first argument of the appellant was not accepted.

2. Attachment of Bank Account Receiving Pension:

The second issue raised by the appellant was the attachment of a bank account where he received his pension. The appellant contended that the attachment of this account deprived him of his pensionary benefits, which is not permissible under the law. The appellant sought permission to operate the bank account to access his pension while maintaining the existing balance.

The tribunal found merit in the appellant's argument, emphasizing that pension is a protected benefit and should not be subject to attachment. The tribunal directed that the appellant should be allowed to operate the bank account to receive and withdraw his pension, although the existing balance in the account should not be withdrawn without permission.

Consequently, the tribunal partially allowed the appeal, directing the respondents to permit the appellant to operate the bank account for pension purposes while maintaining the current balance as agreed by the counsel.

In conclusion, the tribunal upheld the confirmation of the provisional attachment order due to the exclusion of the COVID-19 period but granted relief to the appellant regarding the operation of the bank account receiving pension.