2023 (11) TMI 618 - HC - Money Laundering

Maintainability of Revision petition - impugned order is an interlocutory order - Allowing release of property in lieu of fixed deposit - Money Laundering - HELD THAT - On going through the analysis in entirety, it is explicitly evident that the order passed by the Courts regarding handing over the custody of property would be considered as final order since they are finally adjudging the possession of the property. However, when the order is challenged on the basis of violation of law, without applying proper procedure and passed without jurisdiction, the revision certainly lies. Accordingly, the contentions of respondents regarding non-maintainability of this revision deserves to be and is dismissed. The learned Special Judge, in impugned order, has not mentioned anything with regard to the said manner specified in the Rules 3 and Rule 3A of PMLA Rule, 2016. Likewise, learned Special Judge has not clarified as to how the applicant coming into purview of definitions of ' claimants ' mentioned in Rule 2(b) of PMLA Rule, 2016 and first proviso of Section 8(8) of the PMLA, 2002. Virtually, the impugned order is a sear violation of the respective provisions of PMLA, 2002 and PMLA Rule, 2016. Thus, it can be safely held that the impugned order has been passed by the Special Judge without proper appreciation of the provisions of PMLA, 2002 and the PMLA Rule, 2016. As such, this order is suffering from gross infirmity and illegality. As a result thereof, this revision petition is allowed.

Summary

Issues Involved:
1. Whether the revision petition is liable to be dismissed on the basis of non-maintainability as the impugned order is an interlocutory order?
2. Whether the impugned order passed by the learned Special Court is suffering from infirmity, illegality, and impropriety?

Summary:

Issue 1: Non-maintainability as Interlocutory Order
The petitioner contended that the order passed by the Special Court is final in nature because the property substituted will never be retained if the case decides in favor of the Directorate of Enforcement. The order under challenge finally decides the rights of the prosecution and cannot be considered as an interlocutory order. On the contrary, the respondents argued that the order was passed in interim form and cannot be treated as a final order. The court referred to various judgments, including Parmeshwari Devi Vs. State & Anr., and concluded that if the order is finally deciding the rights and liabilities of the parties, even in an interim stage, it will be treated as a final order. Therefore, the revision against such an order lies.

Issue 2: Infirmity, Illegality, and Impropriety of the Impugned Order
The court examined the legality of the order passed by the Special Court. The order was mainly based on the second proviso of Section 8(8) of PMLA, 2002, which allows the Special Court to consider the claim of the claimant for the restoration of properties during the trial. However, the court noted that the applicants could not be treated as claimants as defined in the Prevention of Money-Laundering (Restoration of Property) Rules, 2016. The Special Court did not follow the manner specified in Rules 3 and 3A of the PMLA Rules, 2016, and did not clarify how the applicants fit the definition of 'claimants.' Therefore, the impugned order was found to be in violation of the respective provisions of PMLA, 2002, and PMLA Rule, 2016.

Conclusion:
The revision petition was allowed, and the impugned order passed by the learned Special Judge, PMLA Court, was set aside due to gross infirmity and illegality.