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TMI Blog2018 (7) TMI 1223X X X X Extracts X X X X X X X X Extracts X X X X ..... he light of the above said reasons, we allow the appeal. The impugned order 28.09.2017 passed against the appellant is set-aside. Consequently, provisional attachment order is also quashed. - FPA-PMLA-2127/BNG/2017 - - - Dated:- 18-7-2018 - Justice Manmohan Singh Chairman And Shri G. C. Mishra Member For the Appellant : Shri R. Swaroop Anand, Advocate For the Respondent : Ms. Shilpi Satyapriya Satyam, Advocate JUDGEMENT FPA-PMLA-2127/BNG/2017 1. By this order, we propose to decide the above-mentioned appeal which is filed against the order dated 28.09.2017. 2. This Tribunal after hearing of earlier appeal No. 588/2015 and 636/2014 passed the common order dt: 22/06/2017 remanded the matters back to the Adjudicating Authority with the following direction: 11. Therefore it is felt by this Tribunal that this case is a fit case to be remanded back to the adjudicating authority with direction to specifically give a clear finding as to whether ₹ 70 lakhs is the money out of the 19 crores, claimed to be legitimate money in the account of M/s Indu Builders or from ₹ 85,28,68,700/- crores alleged to be proceeds of crime in the account of M/s Indu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h an over draft account. The said company of appellant repaid a sum of ₹ 70 lakh to the appellant on 01.08.2007 which was transferred to her Federal Bank account on 02.08.2007; (iv) That, at a later date the appellant returned the amount of ₹ 70 lakh, borrowed from Sri K.S. Naidu, by depositing the said amount in favour of M/s G.V. Infrastructure as per the instruction of Sri K.S. Naidu. (v) That, the Appellant was summoned by the Deputy Director of Enforcement Directorate and her statement was recorded under section 50 of the PMLA Act, 2002. Thereafter, provisional attachment order was passed on 24.01.2014 under section 5(1) of PMLA. (vi) That, in the appeal memo, the appellant has described the facts stated by the complainant in the provisional attachment order and original complaint regarding the report under section 173 of CrPC filed by the Police Wing of the Karnataka Lokayuktha, Bangalore. (vii) That, the appellant had challenged the order dt. 24.02.2014 passed by the Adjudicating Authority before the Hon ble High Court of Karnataka bearing Writ Petition no. 19369/2014. That the Hon ble High Court vide its order dated 04.06.2014 directed this Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rity has not furnished any reasons as to why it came to conclusion that ₹ 70 lakh received by the appellant from the account of M/s Indu Builders is proceeds of crime. 5. After remand, the matter was re-heard by the Adjudicating Authority who still confirmed the provisional attachment order. The following conclusion was given in para-43 of the impugned order. The same read as under:- 43. Conclusion: On a thorough perusal of the PAO, Complaint, relied upon documents, the investigations conducted by the ED and the statements recorded us 50 of the PMLA and on careful consideration of the arguments advanced on behalf of the Complainant and Defendant undersigned coms to the prima facie conclusion that the defendant have committed the Scheduled Offences, generated proceeds of crime or value thereof and are involved in money laundering. Undersigned therefore orders confirmation of the above Provisional Attachment Order. This order shall continue during the pendency of the proceedings relating to any offence under this Act before court or under the corresponding law of any other country, before the competent court of criminal jurisdiction outside India as the case may b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thout assigning any reason the Adjudicating Authority has traversed beyond the complaint to classify the amounts from M/s UTL Ltd. amounting to ₹ 37 crore and ₹ 91 lakhs from M/s JS Software without assigning any reason and for the same the impugned order. It is stated on behalf of the appellant that the said order is bad in law and opposed to the direction given by this Tribunal. 13. It is submitted on behalf of the appellant that the order dt: 24/02/2014 produced at the Annexure A-9 and the notice dt: 24/02/2014 produced at Annexure A-3 issued by the Adjudicating Authority under Section 8 of the Act is issued in gross violation of Article 14 of the Constitution of India is against principles of natural justice. The Adjudicating Authority is bound to record and furnish reasons in support of its conclusion to issue a notice under section 8(1) of the Act to any person pursuant to receipt of a complaint under section 5(5) of the Act. It is urged by the appellant that order dt: 24/02/2014 produced at ANNEXURE A-9 and the notice produced at ANNEXURE A-3 issued by the Adjudicating Authority to the Appellant does not disclose any reasons nor does it called upon the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ltd. 3.5.5. Smt. Shobha Karandlaje further stated that a few months after the said amount was received from the account of M/s Indu Builders through Sri Katta Subramanya Naidu, she got a loan sanctioned from SBI, Indiranagar Branch. Out of the said loan amount, she offered Shri Katta Subramanya Naidu re-payment of the amount received from him As per his indication, the said amount was paid back to him through a cheque bearing No. 517923 from her account of The Federal Bank, RT Nagar Branch issued in the name of M/s G.V. Infrastructure, and the same was debited in her account on 02.08.2007. 17. In her statement even prima facie, no link and nexus with the accused whatsoever directly or indirectly has been established. It is not even prima has come out from her statement or from the reasons to believe that she is knowingly received the loan amount and actually involved in any process or activity connected with the proceed of crime. All the said mandatory elements are missing in the matter as far as present appellant is concerned. 18. In the present case, as per pleadings of the appellant, the facts are that the Appellant s company required funds ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provisionally attaching a sum of ₹ 70 lakhs in the account of the Appellant in Federal Bank, RT Nagar Branch, Bangalore bearing No. 14720100008074. 25. No doubt that the first requirement of Section 5(1) is that the person should be in possession of proceeds of crime. In the complainant, it was not disclosed the fact that the total amount which has come into the account of M/s Indu Builders over a period from 02/05/2007 to 14/10/2010 is a sum of ₹ 104,18,55,950/- crore. 26. As per the complaint, it is only an amount of ₹ 85.28 crore in the account of M/s Indu Builders which constitute proceeds of crime as on 01/12/2010 which is the date of registration of the FIR for the schedule offence. In other words even according to the allegations in the complaint a sum of approximately 19 crore in the account of M/s Indu Builders would constitute clean and legitimate money. 27. The complainant has not produced the entire account statement of M/s Indu Builders as to whether the sum of ₹ 70 lakhs received by the Appellant from the account of M/s Indu Builders as loan from Sri Katta Subramanya Naidu has come from clean source or not case of the appellant is tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d money to M/s Aravind Fashions and M/s Kapila Manjushri Apparels Pvt Ltd and thus as on the date of the order of provisional attachment she was not in possession of any proceeds of crime; (iii) thirdly the money was repaid by the Appellant to Sri. Katta Subramanya Naidu as per his instructions to M/s GV Infrastructure came from the clean and legitimate source of loan account sanctioned by SBI, to M/s Kapila Manjushri Apparels Pvt Ltd and; (iv)fourthly the Appellant as on the date of repayment of loan to Sri. Katta Subramanya Naidu or on the date of provisional attachment was not in possession of any proceeds of crime and for the same the provisional order of attachment is bad in law and is liable to be set-aside. 33. Even otherwise admittedly by order dated 22nd June, 2017 this Tribunal has remanded back the matter to the Adjudicating Authority to give a clear finding. The details are mentioned below:- 11. Therefore it is felt by this Tribunal that this case is a fit case to be remanded back to the adjudicating authority with direction to specifically give a clear finding as to whether ₹ 70 lakhs is the money out of the 19 crores, claimed to be legitimate mone ..... X X X X Extracts X X X X X X X X Extracts X X X X
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