2025 (3) TMI 271 - HC - Money Laundering

Money Laundering - predicate offence - direction to remove the attachment made by the 2nd respondent - HELD THAT - A perusal of the order passed by the appellate Tribunal reveals that when predicate offence does not survive on account of acquittal then it cannot be presumed that the said attached properties were purchased out of proceeds of crime by way of money laundering. Further the appellate Tribunal directed the 2nd respondent to release the attached properties of the appellants / affected persons as V. Kasimayan and the other accused persons are already acquitted in predicate offence under NDPS Act vide judgment of acquittal dated 01.08.2017 in Complaint Case No.52 of 2016. Since already the appellate Tribunal directed the 2nd respondent to release the attached properties in pursuant to the Complaint Case No.52 of 2016 the attachment made by the 2nd respondent in respect of the subject properties is hereby raised in pursuant to the order passed by the appellate Tribunal dated 14.09.2023. The registering authority is directed to record the same in the book of records in respect of the subject properties forthwith. Conclusion - i) When an accused is acquitted in a criminal case the attached properties cannot be presumed to be proceeds of crime through money laundering. ii) The attachment made by the 2nd respondent on the subject properties was raised in accordance with the appellate Tribunal s order and the registering authority was directed to record the same. Petition allowed.

Summary

The issues presented and considered in the judgment are as follows:1. Whether the 1st respondent should remove the attachment made by the 2nd respondent on certain properties based on the order of the appellate Tribunal for SAFEMA, FEMA, PMLA, NDPS, and PBPT Act.2. Whether the petitioners have the right to have the attachment on the properties removed after the appellate Tribunal's order to release the attached properties.Issue-Wise Detailed Analysis:The relevant legal framework and precedents in this case include the Prevention of Money Laundering Act, 2002 (PMLA Act) and the Narcotic Drugs and Psychotropic Substances Act, 1985 (NDPS Act).The Court's interpretation and reasoning were based on the fact that the petitioners had purchased the properties without any encumbrances, but the 2nd respondent attached the properties due to the involvement of the petitioner's vendor in a case under the NDPS Act. The appellate Tribunal subsequently directed the release of the attached properties as the accused was acquitted from the criminal case.Key evidence and findings included the order passed by the appellate Tribunal, the judgment of acquittal in the predicate offence under the NDPS Act, and the lack of evidence linking the properties to proceeds of crime through money laundering.The Court applied the law to the facts by recognizing that when the predicate offence does not survive due to acquittal, it cannot be presumed that the attached properties were purchased with proceeds of crime through money laundering. Therefore, the Court ordered the release of the attached properties based on the appellate Tribunal's decision.Competing arguments were presented by the petitioners seeking the removal of the attachment and the 2nd respondent arguing that the petitioners should have approached the Special Court as per the PMLA Act.Significant Holdings:The core principle established in this case is that when an accused is acquitted in a criminal case, the attached properties cannot be presumed to be proceeds of crime through money laundering. The final determination was that the attachment made by the 2nd respondent on the subject properties was raised in accordance with the appellate Tribunal's order, and the registering authority was directed to record the same.In conclusion, the Writ Petition was allowed with no costs, and the Court directed the release of the attached properties based on the appellate Tribunal's decision.