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TMI Blog2019 (9) TMI 424X X X X Extracts X X X X X X X X Extracts X X X X ..... activities which is constituting proceeds of crime and the property constituting the value of any such property. The attached property being value of such property , has to have a link or nexus with the actual property derived from criminal activity and it cannot merely be a property equivalent in value , attachment of which is only permissible if the proceeds of crime is taken or held outside India. Such conditions are missing from the facts of the present case, nor it is the case of respondent as nothing has been even prima facie established that the appellants are involved in the money laundering. When the case of the ED falls under equivalent in value of any such property , it cannot take any unrelated property which has no nexus or link with the actual proceeds of crime and attach the same as property equivalent in value in the absence of evidence. In the present case, such property means the shares, in question, which were admittedly acquired in the year 2003. The relevant period of bribes was from 2008 onwards and secondary in the year 2003, PMLA was in existence. It is also a matter of fact that Mr. D.P. Singh, advocate for the respondent, has conceded befor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was frozen by Directorate of Enforcement on 13.02.2018 u/s 102 Cr PC, then on 23.03.2018 Directorate of Enforcement instructed BSE to remit INR.386,10,00,261/- (approx USD 60 million equivalent of 64,94,891 shares) to USA to purchaser (M/s PabraiInvestment Fund) andallowed remaining shares to be sold for INR.30,35,006.90 through BSE. 4. The total shares of 1,43,38,330 [78,38,330 + 65,00,000]were subscribed by the Appellants in November, 2003 by foreign inward remittances from Saudi Arabia to India through State Bank of India, Overseas Branch, New-Delhi. Approval of the Reserve Bank of India was obtained and is on record. These shares were held uninterrupted from 2003 to 2018 Jan/Feb. The PML Act, 2002 was notified on 01.07.2005. 5. The brief facts of the present matter are as follows: a) The Appellants are the foreign nationals and are residing in Saudi Arabia. b) They are importer of rice in Saudi Arabia from India for more than three decades. The imports of rice from India directly is above 2 billion USD in the last 30 years. c) Due to interest in the rice business, the Appellants decided to make some inv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allotment. The shareholding of the Appellantshave been duly disclosed in the annual audited accounts of KRBL Ltd. submitted every year to all the government authorities particularly because KRBL Ltd. is a listed company in the Bombay Stock Exchange and National Stock Exchange. g) The equity shares allotted to the Appellants were also listed on the trading portal of Bombay Stock Exchange as per order dated 12.10.2004 of the Stock Exchange. Copy of the order dated 12.10.2004 of the Bombay Stock Exchange is filed as Annexure M. 6. It is contended on behalf of appellants that the Enforcement Directorate after issuing instructions dated 13.02.2018 to BSE to restrain them (BSE) not to give effect to a concluded transaction No. 1718218 of 65 Lacs shares sold on 12.02.2018, thereby depriving the Appellants funds worth approx.. ₹ 386 crores and it is alleged that the said act on the part of ED was illegal. 7. On 23.03.2018, Enforcement Directorate further issued another instructions to BSE to remit these funds to the tune of ₹ 386 Croresto M/s.Pabrai Investment Fund, USA. The BSE has compiled the said direction despite of having kno ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on to BSE. It is at this stage that on 13.02.2018 at 5:37 pm, the Deputy Director of the Enforcement Directorate sent a communication stopping the transaction pertaining to the sale of the said shares. The said letter is relevant and is set out below: F.No. ECIR/15/DLZO-1/2014 Dated 13.02.2018 To, Sh. Poonam Chand BSE Ltd. (Stock Exchange) 101 , 1st Floor, Aggarwal Corporate Tower Plot No. 23, District Center, Rajendra Place, New Delhi - 110 008 Sub: Seizure/freezing of Shares of M/s KRBL Limited u/s 102 Cr.P.C. r/w section 65 r/w Sec. 2(na) of PMLA. Sir, This Directorate is conducting investigation against M/s KRBL Limited in AgustaWestland Helicopter Scam and Embraer case under the Prevention of Money Laundering Act. Investigation reveals that M/s Rawasi Al Khaleej General Trading, UAE which is controlled by promoters of M/s KRBL Limited, received Agusta kickbacks through M/s Abdulla Ali Obeid Balsharaf Omar Ali Obeid Balasharaf. These p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een subscribed by the proceeds derived from any crime. 79. On 15.02.2018, BSE sent an email informing the Enforcement Directorate that it had withheld funds to the extent of ₹ 3,86,10,00,261.00 payable to the petitioners and 64,94,891 equity shares of KRBL Ltd. which were to be delivered to The Pabrai Investment Fund II LP securities. The said email is relevant and is set out below:- Dear Sir, As per your telecom, we would like to inform you that, Exchange have withheld the funds and securities of the following entities for their trades executed in the scrip KRBL Ltd. (530813) on trade date 12/02/2018. Buyer Client Securities to be withheld Seller Client Funds to be withheld The Pabrai Investment Fund II LP 64,94,891 shares Abdullah Ali Balsharaf Omar Ali Obaid Balsharaf ₹ 3,86,10,00,261.00 80. It is apparent from the afor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In this regard, it is intimated that you may release the funds to the buyer M/s Pabrai Investment Funds and continue to withhold the securities at your end till further, instructions. Yours sincerely, S/d NARESH MALIK Assistant Director(PMLA) 86. This Court is at a loss to understand as to under which provision of law, such directions were given. Plainly, provisions of Section 102 Cr.P.C. do not empower any police officer to nullify a transaction. The sale of shares of KRBL Ltd. were complete and SMC had tendered the shares and M/s Pabrai Investment Fund had tendered the consideration and was entitled to the said securities. The petitioners were entitled to the consideration paid by M/s Pabrai Investment Fund. By directing BSE to release funds to M/s Pabrai Investment Fund, the Deputy Director of the Enforcement Directorate had proceeded further; he had interdicted the BSE from effecting the clearing and, by the letter dated 23.03.2018, the Assistant Director of the Enforcement Directorate had nullified the sale transaction that was complete. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tinued to hold the shares of KRBL Ltd. even after the same had been delivered by SMC to the BSE as is contended on behalf of the Enforcement Directorate and the said shares were to be attached and confiscated under the PMLA, the said officer would have no authority to permit the sale of any part of the said shares. His actions, plainly, indicate that the instructions to return the funds to M/s Pabrai Investment Fund were issued callously and in complete disregard of the provisions of the PMLA. 89 However, on instructions of the Enforcement Directorate, BSE continued to withhold 64,94,891 shares of KRBL Ltd. and ₹ 30,35,006.90 which were received as consideration for the sale of 5109 shares. 90 Thereafter, on 23.03.2018, the Assistant Director of the Enforcement Directorate informed BSE to release the securities (64,94,891 shares) to the petitioners. This Court was informed during the course of proceedings that the value of the shares had fallen significantly by the said date . 91 Thereafter, on 12.06.2018, the Assistant Director instructed BSE to release ₹ 30,35,006.90 to SMC. 92. This ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith this Tribunal to decide and the parties are allowed to argue before this Tribunal as to whether the provisions of PMLA would apply against the appellants in the facts of the present case. The relevant paras of the said Judgement are reproduced hereunder:- 97. As regards the issue with respect to the involvement of the petitioners as recipients of the proceeds of crime is concerned, it is affirmed in the Counter Affidavit that the proceeds of crime are suspected to be parked in the account of M/s Rawasi AI Khaleej General Trading, LLC Dubai under the ledger entries of M/s Omar Ali Balsharaf- GK, who is a major shareholder of M/s KRBL Limited . 98. As is apparent from the above that whilst it is clear that RAKGT is alleged to have received the alleged proceeds of crime, it is unclear on what basis it is alleged that the petitioners are recipients of proceeds of crime. Clearly, a ledger entry is not a property and cannot be the proceeds of crime. It appears from the reading of the counter affidavit that it is the Enforcement Directorate s allegation that certain funds were received by RAKGT which were essentially kickbacks paid by Agusta Westla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this Court that the books of accounts of RAKGT had revealed that money was received by RAKGT from the petitioners and had credited in the ledger account maintained in the name of OAB-GK. Paragraphs 2 and 3 of the said affidavit are relevant and are set out below:- 2. That further, the books of account of M/s RAKGT revealed that the money was received by M/s. RAKGT from the Petitioner Omar Ali Balsharaf and the same has been shown as credited in its ledger account maintained in the name of OAB-GK. Basis the money trail, there are strong reasons to believe that the same are Proceeds of Crime parked in the said ledger account and investigation to ascertain the exact nature of the transaction is still ongoing. . 3. That therefore, approximately ₹ 111 Crores were found credited in the ledger account of Petitioner Omar Ali Balsharaf from the above companies, which are directly or indirectly in receipt of proceeds of crime related to M/s. Agusta Westland . 103. A credit entry in the books of RAKGT indicates receipt of money. According to the Enforcement Directorate, RAKGT had received funds, which are alleged to be proceeds ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ittances paid through banking channels much prior to commission of any alleged crime and much prior to the PMLA coming into force. 110. The petition is, accordingly, disposed of in the aforesaid terms. It would be open for the petitioners to seek consequential and other reliefs in any court or forum. The pending applications are also disposed of. 12. Let me now deal with the rival submissions of parties on the issuein hand on merit, which is to be decided by this Tribunal as observed by the Hon ble High Court in paras97-110 of the judgement. The order which was pronounced by the Hon ble Single Bench of the High Court, has been confirmed by the Division Bench, who dismissed the appeals filed by ED and BSE. 13. It is submitted on behalf of appellantsthat Bombay Stock Exchange (Respondent no. 2 herein) is a necessary party to the captioned Proceedings. The Hon ble Division Bench of Delhi High Court in a petition bearing no. LPA 163/2019 filed by Bombay Stock Exchange (Respondent no. 2 herein), has dismissed the appeal filed by BSE/ Respondent no. 2 vide order dated 08.03.2019. 14. The cause of action against Bombay S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... funds and securities to the receiving members pursuant to the direction received from the ED. . 16. It is alleged on behalf of appellants thatthe Respondent no. 1 Directorate of Enforcement and Bombay Stock Exchange (Respondent no. 2 herein) have acted in league with each other to deprive about INR.386 crores to the Appellants. The affidavit filed before this Tribunal by Bombay Stock Exchange (Respondent no. 2 herein) is replete with averments that Bombay Stock Exchange (Respondent no. 2 herein) has followed illegal instructions of the Respondent no. 1 Directorate of Enforcement. It is stated by the appellants that in was done without a whimper of any protest or application of its own mind. 17. During hearing of the appeals, EDdid not raise any objection if BSE is impleaded as respondent no.2. Counsel of BSE has filed the counteraffidavit and argued the appeals. Therefore, in order to decide the real controversy, BSE is a necessary party. 18. In fact, Bombay Stock Exchange (Respondent no. 2 herein) hadtaken action on the basis of communications issued by Respondent no. 1 Directorate of E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 23. It appears from reason to believe that on 23.02.2018 when reason to believe recorded by the authorised officer, he inter-alia had mentioned that further on 12.02.2018, the bull of trading of shares of M/s. KRBL Limited owned by Omer Ali Balsharaf was done in BSE, which seems to be an attempt to shift the suspected proceeds of crime related to the present case to frustrate the purpose of further proceedings under PMLA during the pendency of investigation and the same was put on hold with BSE. 24. On 13.2.2018, there is a recordal of reason to believe that also on the basis of news published. The relevant part is reproduced below:- From Today s Economic Times, it has been learnt that Omar Ali Balsharaf had entered into a transaction in bulk trading of shares of KRBL yesterday on 12.02.18, which is strongly suspected due to transfer of money in view of on-going investigation and examination of the Directors of KRBL in recent past in Embraer case. In view of above facts and circumstances, the suspected persons are still under the process of layering of tainted money as untainted and attempting to frustrate the further proc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Enforcement not only illegally depleted India s forex reserves amounting to USD.60 million,but also knowingly caused wrongful loss to the Balsharafs, whose lawful interest is to be bound to protect. Directorate of Enforcement wrongly induced BSE to deliver Balsharaf s property to USA party and since the Directorate of Enforcement s actions are illegal and malafide, no protection u/s 67 PMLA is available to them. 28. Learned counsel appearing on behalf of BSE has made very short submission and admitted that the BSE has followed the instruction of ED for releasing the money to Pabrai Investment Fund. Counsel has admitted that it was the concluded contract between two parties. In normal course, the appellants were entitled to the said amount towards selling of shares. However, BSE had no option to return the amount, once the letter is received from Deputy Director of ED. 29. It is evident that Pabrai has never insisted for refund of amount against the shares purchased. In its letter, it was merely given two options, either to receive the refunds back or to the securities which the company sought to buy, but ED, despite of contract, issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... professional, with him or any of his companies. 33. Therefore, it is argued by him that there are reasons to believe that the frozen shares may be proceeds of crime under the PMLA. He also states that after the completion of investigations, the appellants might or might not found to be involved, however, at this stage, no opinion can be formed. 34. It is stated on behalf of appellants that Directorate of Enforcement has allegedly shown ₹ 111 crores worth of ledger entry abroad, and has frozen about ₹ 900 crores (value of 1,43,38,330 shares) alleging them as equivalent to ₹ 111 crores and its shows the non-application of mind of the authorised officer of Directorate of Enforcement. Therefore, the freezing orders dated 22.3.2018 and 14.6.2018 are, thus, liable to be quashed even on merit on the ground itself and evidence. 35. In reply to the contention of learned senior counsel for the appellants about the retrospective effect, Mr. D.P. Singh, counsel for ED submitted that Article 20(1) of the Constitution of India prohibits ex-post facto laws resulting in conviction for offences or imposition of penalties greater tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as a result of criminal activity. The property itself may no longer be available but the equivalent value of such property, whether held in cash, etc., would be available for attachment . 39. It is submitted by him that the shares were frozen in lieu of value of equivalent which provision was already existed previously. The said amendment of property equivalent abroad only which seeks to prevent frustration of any proceeding relating to attachment and confiscation of proceeds of crime, in line with the object of the Act, by necessary implication. 40. Let me now deal with the rival submissions of parties. It is not denied on behalf of ED and BSE that on 13th February, 2018, 65 lakhs shares were sold by Balsharafs on the platform of BSE and approx.. ₹ 386,10,00,261/- were payable to Balsharafs. Sale was concluded even as observed in paras 80, 86 of Hon ble High Court order dated 9.1.2019. 41. It appears that on 23.3.2018 Directorate of Enforcement instructed BSE to remit about USD 60 millions(INR.386,10,00,261/- ofBalsharafs money) to USA. It is argued on behalf of appellants that the said Act is in violation of Section 3 (b) of Fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd sent a letter to ED confirming the purchase of shares and paid the entire consideration to BSE and ED has no justification to withhold the same. The Hon ble High Court has recorded that by letter dated 23.3.2018, Assistant Director, PMLA sent a letter to BSE to release the amount paid by M/s. Pabrai Investment Fund but to continue to withhold the securities and shares of KRBL Ltd. 46. The Hon ble High Court of Delhi in para-86 of the judgement, held that the Police Officer cannot set-aside a transaction which was completed contract under the provision of Section 102 Cr.P.C. and the appellants were entitled to the consideration paid by Pabrai Investment Fund. The Deputy Director of ED had interdicted the BSE for doing so in its letter dtd. 23.03.2018. 47. The Hon ble High Court judgment dated 9.1.2019 in para 82 has held that :- Clearly, the Deputy Director of the Enforcement Directorate had no authority whatsoever to freeze the shareswhich were to be delivered in settlement to the purchaser . 48. This Tribunal is also of the opinion as held by the Hon ble High Court as on 15.02.2018, INR.386,10,00,261/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... million abroad in violation of Section 3 (b) of FEMA, 1999, and in contravention of PML Act, 2002 without any power to exercise Section 102 Cr PC to freeze shares and/or interdict and annul an executed sale purchase transaction, held Hon ble High Court. This Tribunal fully endorsed the finding of the Hon ble Court. 54. Mr. D.P. Singh has not disputed the fact that the Hon ble Delhi High Court has already dealt with this aspect, included the interpretation of Section-65 of the PMLA as well as the provision of Section 102 Cr.PC where the arguments of D.P. Singh were rejected. The said paras 56 to 74 of the judgement where the said issues were discussed, are reproduced below:- 56. It is clear from the aforesaid scheme of the PMLA that any property can be provisionally attached under Section 5 or be seized under Section 17 or be frozen under Section 17(1A) of the PMLA. However, any such order can be passed only if the necessary checks and balances are complied with; namely, that the seizure or attachment is preceded by the concerned authority having reason to believe that such properties are proceeds of crime or are otherwise related to crime. Further, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... where the property seized is such that it cannot be conveniently transported to the Court, he may give custody thereof to any person on his executing a bond undertaking to produce the property before the Court as and when required and to give effect to the further orders of the Court as to the disposal of the same. 61. It is clear from the plain reading of Section 102 Cr.P.C. that any police officer may seize the property, which may be alleged or suspected to have been stolen or which is found in circumstances which create suspicion of the commission of any offence. However, the said order of seizure is only a temporary order and in terms of sub-section (3) of Section 102 of Cr.P.C., the police officer seizing any property on the grounds of suspicion of an offence is required to forthwith report the seizure to the Magistrate having jurisdiction. 62. The said property seized is required to be produced before a Court and/or reported to a Magistrate. In such cases, the court would have the power to pass necessary orders with regard to the said property. In terms of Section 457 of the Cr.P.C., whenever a property is seized by any police officer and is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sue orders for immediately seizing the property on mere suspicion but at the same time ignores the provisions of Section 102(3) of Cr.PC which requires such seizure to be reported to a Magistrate. There is clearly no principle of law that would permit such interpretation, where officers can draw the power under a statute and yet not be accountable for the checks and balances enacted therein. 67. Mr Singh had contended on behalf of the Enforcement Directorate that the PMLA does not contain any provision regarding seizure on mere suspicion, therefore the power to make such seizure can be drawn from Section 102 of Cr.P.C. He contended that the provisions of Section 102(1) of Cr.P.C. are, therefore, not inconsistent with the provisions of the PMLA with regard to seizure of property. The said contention is unmerited. The question whether an enactment is repugnant to another is not determined on whether two provisions can be simultaneously obeyed but is determined in the context of thescheme of the legislative enactment. The question to be asked is whether the schemes of the two enactments can subsist and be implemented simultaneously. It is apparent that the scheme of e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... statutes is to find out where one of the statutes has adopted a plan or a scheme, which will be hindered or obstructed by giving effect to the other statute. This principle to determine whether there is repugnancy between two enactments is of universal application. If one applies the aforesaid test, it is at once clear that the PMLA has set out a separate scheme with a separate set of safeguards for ensuring that properties of parties are not attached or seized without the authorities effecting such actions having reason to believe that such properties are proceeds of crime or are related to a crime. 70. If the contention as advanced on behalf of the Enforcement Directorate is accepted, it would mean that whereas the property cannot be provisionally attached under Section 5(1) of the PMLA and/or seized or frozen under Section 17 of the PMLA without (a) theDirector having a reason to believe, on the basis of material available with him, that the properties are proceeds of crime and (b) recording such reasons in writing; the same officer can on mere suspicion pass orders for freezing the properties without recording reasons. Further, there are strict timelines provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal attachment is plainly unpersuasive. 72. It is possible that prior to acquiring any material providing the Enforcement Directorate any reason to believe that any property is a proceed of crime, the concerned officers may entertain a suspicion that property in question represents proceeds of crime; but that does not entitle them to freeze the property, interdict transactions and perhapsbring a person s business to a standstill. The nature of the power of seizure contemplated under the provisions of Cr.P.C. is drastic and exercise of such powers is likely to have severe adverse effects on the person concerned; thus, the parliament in its wisdom did not confer upon the Enforcement Directorate, any powers to attach or freeze assets on a mere suspicion. 73. The learned counsel appearing for the Enforcement Directorate has also referred to the decision of the Supreme Court in V.T.Khanzode and Ors. v. Reserve Bank of India and Anr.: (1982) 2 SCC The said decision has no application in the facts of the present case. In that case, the petitioners had challenged the circular issued by the Reserve Bank of India whereby it had decided to co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d shall also be liable to fine which may extend to five lakh rupees: Provided that where the proceeds of crime involved in money-laundering relates to any offence specified under paragraph 2 of Part A of the Schedule, the provisions of this section shall have effect as if for the words which may extend to seven years , the words which may extend to ten years had been substituted. Retrospective effect 58. It is matter of fact that a new offence of property equivalent of proceeds of crime was enacted by Parliament vide Finance Act, 2015 (w.e.f 14.05.2015). It is admitted position that these shares were purchased in 2003 when PMLA was not in existence. It is also matter of record that the relevant period about the bribe amount, if any, is between from the period 2008 onward. The question of purchase of shares in the year 2003 from tainted amount or acquiring the shares from proceed of crime does not arise. 59. Clause 145 of the Finance Act, 2015, and Clause 171 of the Finance Bill, 2015, reads, inter-alia, as follows :- AMENDMENT TO THE PREVENTION OF MONEY-LAUNDERING ACT, 2002 145. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt in value , attachment of which is only permissible if the proceeds of crime is taken or held outside India. Such conditions are missing from the facts of the present case, nor it is the case of respondent as nothing has been even prima facie established that the appellants are involved in the money laundering. There is no material on record to show that they are ever investigated for the last many years at their Saudi Arabia. It appears that the respondent is rather insisting that they should come to India and clarify certain things. However, they have already denied all allegations against them. It is admitted by Mr. D.P. Singh that the matter is after investigation, the appellants may or may not be involved, however, the respondent would only come to know once the investigation is complete. 63. The legislature has consciously used the words value of any such property and property equivalent in value in the same definition clause and therefore, they cannot connote or mean as the same property. 64. Therefore, when the case of the ED falls under equivalent in value of any such property , it cannot take any unrelated property which has no ne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd Others (2012) 11 SCC at page 90 paras 153 154 held that: 153. Having carefully considered Section 17-A, I have no hesitation in holding that the said provision is prospective. There is no indication in Section 17-A or in terms of the amending Act that by insertion of Section 17-A Parliament intended to alter the pre-existing state of affairs. Parliament does not seem to have intended by bringing in Section 17-A to undo the reservation of any mining area made by the State Government earlier thereto for exploitation in public sector. Parliament has no doubt plenary power of legislation within the field assigned to it to legislate prospectively as well as retrospectively. As early as in 1951 this Court in KeshavanMadhavaMenon v. State of Bombay [AIR 1951 SC 128 : (1951) 52 Cri LJ 860] had stated about a cardinal principle of construction that every statute is prima facie prospective unless it is expressly or by necessary implication made to have retrospective operation. Unless there are words in the statute sufficient to show the intention of the legislature to affect existing rights, it is deemed to be prospective only. In Principles o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made them retrospective; and the retrospective operation will be limited only to the extent to which it has been so made by express words, or necessary implication. The second rule is that the intention of the legislature has always to be gathered from the words used by it, giving to the words their plain, normal, grammatical meaning. The third rule is that if in any legislation, the general object of which is to benefit a particular class of persons, any provision is ambiguous so that it is capable of two meanings, one which would preserve the benefit and another which would take it away, the meaning which preserves it should be adopted. The fourth rule is that if the strict grammatical interpretation gives rise to an absurdity or inconsistency such interpretation should be discarded and an interpretation which will give effect to the purpose the Legislature may reasonably be considered to have had will be put on the words, if necessary even by modification of the language used. d) K. C. Arora and Another Versus State of Haryana, 1984 (3) SCC 281, para 15 [3 Judge Bench of SC], held that: 15. It may be pointed out at the very outset that the P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s or imposing new disabilities, unless there are express words in the statute affecting the existing rights of unless there is clear manifestation of the intention of the Legislative on the basis of which it can be said that the law is retrospective in character, and even vested rights have been taken away or new liabilities have been created or new disabilities have been imposed. There are laws and law s and cases, the real question of application of the cardinal rule of construction which is propounded and considered above. It is also well established that there is a presumption against retrospectivity and this presumption can only be rebutted by express words in the Statute or by necessary intendment of the statute. It is also well established that only to what extent, retrospectivity may be considered of the provisions in the statute which necessary arises from the express words or from necessary intendment. Beyond that extent, retrospectivity should not be considered to have arisen. 70 . These shares were admittedly not acquired from the proceeds of crimewhich is even recorded by the Hon ble Court when the respondent had changed his stand. The allegatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... olved, the sameis always perspective. There is no saving clause about the retrospective effect in the Act or the amendment carried out in year 2015. 75. The authorised officer is to follow the following steps after search and seizure or frozen of any property, any action taken under Section 17(2) or 17(1A) i) the first one is that in case the authority seizes any record or material under sub-section (1) or sub-section (1A) of Section-17, the authorized officer shall within a period of thirty days from the date of seizure or frozen can file the application requesting for retention of such property. ii) Secondly, sub-section (1) of Section 20 mandates that where any property has been seized under Section 17 or Section 18 or frozen under sub-section (1A) of Section17, the officer authorised on the basis of material in his possession has chosen to retain the property for the purposes of adjudication under Section 8, he has to pass as to record the reason to believe in writing for continuation of the same for a period not exceeding one hundred and eighty days from the day the such property was seized or frozen as the case may be. The office ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment of Order by the Adjudicating Authority Rule 5 of Attachment Rules, 2005: Acknowledgment of Order by the Adjudicating Authority 5. S.20(1): Outer limit of 180 days S.5(1): Outer limit of 180 days 6. S.8(3): Order by the Adjudicating Authority S. 8(3): Order by the Adjudicating Authority 7. S.8(3)(a): Retention restricted to 90 days during investigation. S.8(3)(a): Attachment restricted to 90 days during investigation. 79. Mr.D.P.Singhhas confirmed that no FIR for the alleged offence is pending against the appellants nor they are charged under the schedule offence. The appellants are not charged for an offence by any court. No prosecution complaint is filed against the appellants. The statutory period of 90 days for investigation is already expired for filing the prosecution complaint under section 8(3) (a) from the date of passing the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... b-section (1) of Section 5, or, seized or frozen under Section 17 or Section 18, the evidence on which he relies and other relevant information and particulars, and to show cause why all or any of such properties should not be declared to be the properties involved in money-laundering and confiscated by the Central Government: Provided that where a notice under this subsection specifies any property as being held by a person on behalf of any other person, a copy of such notice shall also be served upon such other person: Provided further that where such property is held jointly by more than one person, such notice shall be served to all persons holding such property. (2) The Adjudicating Authority shall, after- (a) considering the reply, if any, to the notice issued under sub-section (1); (b) hearing the aggrieved person and the Director or any other officer authorised by him in this behalf; and (c) taking into account all relevant materials placed on record before him, by an order, record a finding whether all or any of the properties referred to in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... who is also empowered to break open the lock of any door, box, locker, safe, almirah or other receptacle where the keys thereof are not available and seize any record or property found as a result of such search, place marks of identification on such record or make or cause to be made extracts or copies therefrom; make a note of an inventory or such record or property and to examine on oath any person who is found to be in possession or control of any record or property, in respect of all matters relevant for the purposes of any investigation. However, the said action is sustainable subject to conditions stipulated in the proviso of Section 17(1) of the Act, which says that the search and seizure shall not be conducted unless in relation to the scheduled offence, a report has been forwarded to a Magistrate under section 157 of the Code of Criminal Procedure, 1973, (2 of 1974) or a complaint has been filed by a person, authorised to investigate the offence mentioned in the Schedule, before a Magistrate or court for taking cognizance of the schedule offence, as the case may be, or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... basis if the agency has suspected some wrong doing by a party. The alleged accused has denied having any association or contact with the appellants. The appellants are the foreign nations and are residing in Saudi Arabia, they are the importer of rice for the last about 30years. The investment in KBB Limited was made in 2003 of Indian Company. 88. Mr. D.P. Singh, learned counsel is not able to answer that under which law merely on the basis of suspicion that contract between two private parties got terminated/cancelled by any agency. 89. It is correct that the power to attach or seize or freeze a property can be exercised only if the officer concerned has material in his possession who has a reason to believe that property sought to be attached or seized is proceed of crime or related to the crime irrespective as to whether complaint under the schedule offence and prosecution complaint under PMLA is filed or not against the party who has in his possession of proceeds of crime. 90. But, the situation where the investigation was being done on the basis of a mere suspicion against the party where the statute provides prescribed period of ti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nterest. He has referred the relevant dates, facts and Section-35 of PML Act, 2002, the power of Appellate Tribunal. He says that any order passed by this Tribunal is executable as a decree of Civil Court u/s 35(1)(3) of the Act. Senior counsel says that the Act of ED and BSE is not bonafide, rather malafide, wilfully and in bad faith. 96. Mr.D.P. Singh, learned counsel appearing on behalf of ED has strongly opposes the prayer. He says that this Tribunal has no jurisdiction to a decree for money. Even otherwise, there is bad of suits in civil court under Section-67 of the Act if anything is done by Government in good faith under this Act. 97. This Tribunal on the basis of facts involved in the matter is clearly of the view that the appellant is entitled to receive the entire amount with interest or difference of amount as the value of the shares have gone down. Now, the question before this Tribunal is as to whether a decree for such amount can be passed in the present set of appeals. 98. One of the prayers (A) read as under Award a decree of INR.386,10,00,261/- in favour of Appellants against Directo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 18/2018 cannot be passed. The appellants, no doubt, are entitled to receive the money which is wrongly remitted to third party but in accordance with law. However, the appellants are entitled for relief of defreezing all the shares forthwith, subject to the conditions. 103. There is no dispute that laundering of proceed of crime is a continuing offence and it does not wipe out the original guilt and it keeps the contravention alive but it depends upon case to case basis. If the properties are attached against the proceed of crime and valid case of Section 3 is made out and proceed of crime covers Section 2(u) of the Act on the date of passing the provisional attachment order on the basis of material placed on record. 104. But the same would not apply in those cases where if the party is not involved in money laundering and is not connected with proceed of crime, namely, has not in his possession of proceed of crime, the party has not concealed the proceed of crime or has not acquired or use or projecting as untainted property and claiming thereof. Then, under these circumstances, the question of continuing offence does not arise and the retrospective e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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