2018 (8) TMI 182 - AT - Money Laundering

Offence under PMLA - Attachment orders continue till the final outcome of the criminal complaint which is pending before the Special Court - Held that - Matter was listed from time to time in the connected appeals though the appellants are different in common order. The suggestion was made on the last few dates that the attachment order already passed in respect of Room No. 39, 3rd Floor, Ambulkar Sadan, Gokhale Road, South Dadar, Mumbai-400028 may continue till the final outcome of the criminal complaint which is pending before the Special Court. The counsel for the respondent has no objection. The counsel for the appellant states that this Order may be passed without prejudice to the right and contention of the appellant. The counsel for the appellant agrees to deposit ₹ 181/- per month with the respondent till the final outcome of the matter before the Special Court. The said suggestion is agreeable to the learned counsel for the respondent. Appeal is disposed of. In case the proceedings pending before the Special Court are decided in favour of the appellant, who would be entitled to file appropriate application as well as refund of the rental amount which is being deposited as user and occupation charges as well as release of flat in question.

Issues involved:
1. Challenge to impugned order dated 21st August, 2014 regarding provisional attachment order.
2. Violation of principles of natural justice in the proceedings.
3. Stay granted against dispossession during pendency of appeal.
4. Agreement to deposit monthly charges till final outcome of the matter before Special Court.

Analysis:

Issue 1: Challenge to impugned order dated 21st August, 2014
The appellant, identified as Defendant no. 6 in the provisional attachment order, contested the ownership of the property mentioned in the complaint, asserting it as a tenancy property not subject to confiscation under the Prevention of Money-laundering Act, 2002. The appellant argued that the property in question was acquired through a tenancy agreement and provided evidence to support this claim. Additionally, the appellant raised concerns regarding the lack of opportunity to present a written submission and alleged violations of natural justice principles in the proceedings.

Issue 2: Violation of principles of natural justice
The appellant highlighted procedural irregularities, including inadequate notice periods and denial of an opportunity to substantiate their claims properly. Specifically, the appellant criticized the Adjudicating Authority for not adhering to the prescribed notice period under section 8(1) and for rushing the proceedings, leading to the pronouncement of judgment in the appellant's absence. These actions were deemed as violations of the principles of natural justice, emphasizing the importance of fair procedures in adjudicative processes.

Issue 3: Stay granted against dispossession
In response to the challenge, the Tribunal granted an interim stay against the dispossession of the appellant from the disputed premises, subject to the appellant depositing a specified amount monthly with the respondent. The Tribunal considered factors such as prima facie case, balance of convenience, and potential irreparable loss to the appellant in making this decision. The stay was contingent on the appellant complying with the deposit requirements and maintaining possession of the property during the appeal process.

Issue 4: Agreement to deposit monthly charges
Subsequently, the matter progressed with discussions on continuing the attachment order for the property until the final resolution of the criminal complaint before the Special Court. Both parties agreed to the appellant depositing a monthly amount with the respondent until the matter's conclusion. The appeal was disposed of with the understanding that the appellant could seek appropriate relief if the proceedings before the Special Court favored them, including the refund of deposited charges and the release of the property in question.

In conclusion, the judgment addressed the challenges to the impugned order, highlighted violations of natural justice, granted a stay against dispossession, and established terms for depositing charges pending the final outcome of the legal proceedings.

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