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TMI Blog2019 (11) TMI 962X X X X Extracts X X X X X X X X Extracts X X X X ..... iso to Section 5(1) of the PMLA. Secondly, the notice under Section 8(1) of the PMLA also should be communicated recording the reason to believe . Only when there is a violation of the legal requirements, the PAO would be rendered illegal. It is to be stated that the PAO is valid for a period of 180 days and within a period of 30 days of passing such order, the concerned authority has to forward a complaint under Section 5(5) of the PMLA to the Adjudicating Authority, which has been done in this case on 26-10-2018. The Adjudicating Authority, after issuing notice, hearing the parties and considering their reply and other materials, has to pass a reasoned order as to the nature of the property deciding whether the property is involved in money laundering or not. Though the expression continuing offence is not defined in the PMLA, whether a particular offence is a continuing one or not depends upon the nature of offence and the purpose intended to be achieved. The concept of continuing offence is keeping the offence alive day by day without wiping the original guilt. Thus, there is an ingredient of continuance of the offence in continuing offence. Therefore, the contention o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quash the Complaint dated 26-10-2018 in Provisional Attachment Order No. 09/2018, dated 10-10-2018 in ECIR/07/HIU/2017 filed before the second respondent by the first respondent in exercise of powers conferred under Section 5(5) of the Prevention of Money Laundering Act, 2002 (PMLA) seeking an order for confirmation of the said Provisional Attachment Order under Section 8(3) of the said Act, wherein, a direction was issued to the petitioner to handover the possession of the said properties in terms of Section 8(4) of Prevention of Money Laundering Act, 2002 (in short, PMLA ) on the very same grounds. 3. The facts, which led to the passing of the impugned orders/complaint/letter, in a nutshell run as hereunder : (i) The petitioner was incorporated in 2005 and it is in the business of Consultancy. It has set up a subsidiary in Singapore. It has been complying with all laws and has been filing Foreign Liabilities and Assets (FLA) statement and other statutory compliance papers before the competent authorities. (ii) On 15-5-2017, the Central Bureau of Investigation (CBI) registered a First Information Report (FIR) No. RC2202017 E 0011 for the offence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the said FIR registered by the CBI, on 18-5-2017 the ED registered an Enforcement Case Information Report (ECIR) No. ECIR/07/HIU/2017 alleging commission of offence under Section 3 of the PMLA punishable under Section 4 of the said Act. During the course of investigation, ED recorded a statement under Section 50 of the PMLA from one Indrani Mukherjea, who had deposed that Mr. Karti demanded 1 Million US Dollars for helping INX Group in the Ministry of Finance. It is claimed by the petitioner that Mr. Peter Mukherjea, who is none other than the husband of Mrs. Indrani, did not corroborate the said statement. However, based on the statement of Mrs. Indrani, in exercise of powers under Section 5(1) of PMLA, a Provisional Attachment Order No. 9/2018, dated 10-10-2018 (PAO) was passed by the first respondent attaching assets worth ₹ 53.83 crores as constituting proceeds of crime in INX Media case. (vii) The Deputy Director (Intelligence) in the office of the ED, in terms of Section 5(5) of the PMLA, which mandates the Director or any other officer, who provisionally attaches a property under sub-section (1), to file a complaint before the Adjudicating Authority const ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other hand, it is stated that the attachment order has been passed on the basis of the investigation conducted by the ED authorities. A few of the facts revealed during the course of investigation and the materials came to light have been narrated in those counters. 4.6 The PAO is valid for a period of 180 days and within a period of 30 days of passing such order, the concerned authority has to forward the complaint under Section 5(5) of the PMLA to the Adjudicating Authority. If the petitioner impress upon the Adjudicating Authority with sufficient material that the materials placed before it are not proceeds of crime, the Adjudicating Authority would not confirm the PAO. But without availing statutory remedy, the petitioner filed the instant writ petitions, which are not maintainable. 4.7 The petitioner could very well discharge its burden before the Adjudicating Authority under Section 24 of the Act. Without doing so, the petitioner ought not to have filed the instant writ petitions. 4.8 The total amount involved in money laundering is ₹ 62.68 crores, whereas, the value of the property attached is only ₹ 54.03 crores. 5. The quest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taking cognizance of the scheduled offence, as the case may be, or a similar report or complaint has been made or filed under the corresponding law of any other country : Provided further that, notwithstanding anything contained in clause (b), any property of any person may be attached under this section if the Director or any other officer not below the rank of Deputy Director authorised by him for the purposes of this section has reason to believe (the reasons for such belief to be recorded in writing), on the basis of material in his possession, that if such property involved in money laundering is not attached immediately under this Chapter, the non-attachment of the property is likely to frustrate any proceeding under this Act. 8. The above provision empowers the ED to provisionally attach the properties of a person in possession of any proceeds of crime. Though it is contended that the PAO is bad without filing charge-sheet under Section 173 of the Code of Criminal Procedure (CrPC), the second proviso permits such attachment even if the charge-sheet is pending, provided there is a reason to believe that if the property is not attached immediately, such n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Learned Counsel for the petitioner, the absence of search and failure to furnish such reasons to the affected persons are procedural irregularities, which would only render the order freezing the accounts illegal. 12. The further contention of the Learned Counsel for the petitioner is that at the time of the alleged commission of the offences under Sections 120B and 420 IPC in the year 2008, those offences were not included in the schedule to the PMLA and they were included in the schedule only with effect from 1-6-2009 and thus, ED has no jurisdiction to register ECIR. Likewise, Sections 13(2) and 13(l)(d) of the Prevention of Corruption Act were also included in the schedule to PMLA only with effect from 1-6-2009. Without there being any scheduled offence, there is no question of proceeds of crime to register the ECIR and commission of scheduled offence is the sine qua non to invoke the provisions of the PMLA. Thus, it is contended that the PAO is unsustainable in law. But the contention of the Learned Additional Solicitor General is to the effect that the inclusion of Section 420 IPC in the year 2009 does not make any difference, if the person against whom the accu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al. 17. Though the expression continuing offence is not defined in the PMLA, whether a particular offence is a continuing one or not depends upon the nature of offence and the purpose intended to be achieved. The concept of continuing offence is keeping the offence alive day by day without wiping the original guilt. Thus, there is an ingredient of continuance of the offence in continuing offence. Therefore, the contention of the petitioner that the second proviso to Section 5(1) is only prospective and not retrospective is without substance or force. The second proviso is applicable to property acquired even prior to the coming into force of this provision. Hence, retrospective penalization is permissible. 18. As stated above, when there is a statutory violation, then only the power of this Court under Article 226 of the Constitution could be invoked. This Court is of the view that the petitioner could have agitated the aforesaid procedural violations before the Adjudicating Authority or at least now before the Appellate Tribunal and the same could not be agitated before this Court. 19. The contention that the person aggrieved over the order of the Adju ..... X X X X Extracts X X X X X X X X Extracts X X X X
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