2021 (4) TMI 282 - HC - Money Laundering

Maintainability of petition - provisional attachment order lost its force with the expiry of 180 days - writ petition having been filed much beyond 180 days commencing from 20th January, 2020 - HELD THAT - Pendency of the writ petition will, however, not be an embargo on the respondents in proceeding with the complaint no.1262 of 2020 made under the provisions of Section 5(5) of PMLA as the same will not amount to any coercive step in terms of the provisional order of attachment. The matter can be more effectively heard after calling for affidavits - Let affidavit-in-opposition be filed within a period of four week from date. Reply, if any, thereto be filed by two weeks thereafter.

Summary

Issues Involved:
Challenge to provisional attachment order dated 20th January, 2020 under Prevention of Money Laundering Act, 2002 (PMLA); Maintainability of writ petition; Jurisdictional grounds; Continuation of interim order dated 21st October, 2020; Prayers for withdrawal of writ petition; Effect of expiry of 180 days from provisional attachment order; Conduct of petitioners affecting maintainability; Vacating interim order; Proceeding with complaint under PMLA during pendency of writ petition; Directions for filing affidavits.

Analysis:

The petitioners challenged the order of provisional attachment dated 20th January, 2020 under the Prevention of Money Laundering Act, 2002 (PMLA) by filing a writ petition on 7th October, 2020. An interim order was obtained on 21st October, 2020, restraining the respondents from taking any steps as the matter was to be heard on merits. Subsequently, the petitioners sought to withdraw the writ petition, claiming that the provisional attachment order had lost its force after 180 days as per Section 5(1)(b) of the PMLA.

However, the respondents opposed the withdrawal, arguing that the attachment order was still in force due to orders passed by the Court and the Supreme Court during the pandemic. The petitioners, faced with this opposition, decided not to withdraw the writ petition. The respondent no.3 then raised objections regarding the maintainability of the writ petition, including jurisdictional grounds.

The respondents contended that the interim order of 21st October, 2020 was based on their request for time and not on merits. They also highlighted the timing of the writ petition, stating that if the provisional attachment order had expired after 180 days, the petition would be untimely. The Court noted that the interim order could not be vacated at that stage, especially since no application for vacating had been made by the respondents.

The Court clarified that the pendency of the writ petition would not prevent the respondents from proceeding with a complaint under Section 5(5) of the PMLA, as it would not violate the provisional attachment order. After hearing submissions and reviewing the evidence, the Court decided that the matter required further examination through affidavits. It directed the filing of affidavits within specific timeframes, emphasizing the peremptory nature of the directions due to the subsistence of the interim order.

In conclusion, the Court deferred further proceedings to allow for the submission of affidavits and reserved the right for parties to mention after a specified period for inclusion in the hearing list.

This detailed analysis covers the various issues raised in the judgment, including the challenge to the provisional attachment order, maintainability of the writ petition, continuation of the interim order, and the procedural directions given by the Court.