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TMI Blog2020 (7) TMI 532X X X X Extracts X X X X X X X X Extracts X X X X ..... uld not make out a prima facie case and there are no merit in the application, hence, the application seeking ad-interim order for reversal of the transfer of funds and restoration of status quo-ante is dismissed. The appeal is already listed on 11th September, 2020. - MP-PMLA-7145/CHD/2020 (U.H.), MP-PMLA-7104/CHD/2020 (Stay), MP-PMLA-7103/CHD/2020 (U.H.), FPA-PMLA-3528/CHD/2020 - - - Dated:- 15-7-2020 - Shri G. C. Mishra : Acting Chairman For the Appellant : Mr. Dayan Krishnan, Senior Advocate, Mr. Kaustubh Sinha, Advocate For the Respondent (ED) : Mr. Vikas Garg, Advocate along with Ms. Aishani Narain, Advocate ORDER MP-PMLA-7103/CHD/2020(U.H.) MP-PMLA-7104/CHD/2020 (Stay) The matter is taken up through video conferencing. The appearances of the learned counsels are as above. The appeal is filed on 18.03.2020 against the impugned order dated 10.01.2020 and further corrigendum dated 03.02.2020. Alongwith the appeal the aforesaid two applications have been filed for urgent listing of the appeal and the stay application respectively. In the stay application which is numbered as MP-PMLA-7104/CHD/2020 the following reliefs have been sought:- a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nter-alia, are as below:- i. The applicant is seeking remedy from this Tribunal pursuant to the order of Hon‟ble Delhi High Court dated 04.06.2020 in the matter of Shashi Kant Chaurasia Vs. Union of India Ors. in W.P. (C) 3346 of 2020. ii. The appeal against the impugned order dated 10.01.2020 r/w corrigendum dated 03.02.2020 passed by the Adjudicating Authority under the PMLA, 2002 passed in O.C. no. 1181/2019. Along with the appeal, application seeking interim stay has also been filed. iii. The liquidation/transfer of attached amount from the back account was undertaken on 11.02.2020, even before the expiry of appeal period as prescribed under section 26 (3) of the PMLA, 2002. The applicant came to know about the liquidation/transfer of attached amount by the respondent after resuming of office as the business undertaking of the appellant was closed due to pandemic Covid-19. iv. The applicant has not been charge-sheeted by the CBI in the predicate offence. v. The entire proceedings ultra-vires to Article 20(1) of the Constitution of India as the predicated offences were not scheduled offences on the date when the offences alleged to have been committed. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... med only upon the order attaining finality, which could not have happened before the expiry of the period of appeal was over or till the pendency of the appellate proceedings. xiii. Since the amount already stood attached in the bank account of the applicant (and the lien duly acknowledged by the concerned bank), there was not probability whatsoever of the applicant attempting to transfer etc. xiv. The applicant is an entrepreneur and suffered severe stress due to adverse economic impact of the various restrictions imposed by the pandemic. The applicant is suffering irreparable loss due to sudden liquation of the attached amounts by the respondent and would result in further economic distress. xv. The appellant is willing to provide Bank Guarantees of same amount and the attachment of which shall be subject to the outcome of this application/appeal filed before this Tribunal. xvi. The applicant has a prima facie case. The balance of convenience lie in favour of the appellant and irreparable loss/harm will be caused to the applicant if an ad-interim ex-parte direction is not granted in the instant application whereas no injury would be caused to the respondent herein. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t knowingly assisted or was knowingly a party in the process or activity connected with the generation of POC. The Applicant, in this way, earned undue profit of ₹ 6,03,53,579/- which is covered under the definition of POC as per section 2(1)(u) of PMLA and was legally attached on provisional basis and has been legally confirmed by the Ld. Adjudicating Authority. v. The issue in Varinder Uppal and Ors. are still under consideration of this Tribunal and no way has similarity to that of the applicant. vi. The possession was taken as per provisions envisages under PMLA. vii. Section 8(4) nowhere speaks for possession of property on attainment of finality of the case. viii. The alleged loss suffered by the applicant due to prevalent reasons is not tenable as the said factor has not place/room in law and especially where money has been laundered on the basis of criminal activities. The respondent has relied on the Judgment of Hon‟ble Supreme Court in the case of Rameshwaram vs. Union of India in CWP No. 8784 of 2015 and Ors. , verdicted on12.03.2018. ix. The offer of the applicant to provide bank guarantee of the same amount is not tenable as such type of sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y amounts stand attached. The attachment was with regard to a direction to maintain the balance. (ii) Then the reference is made to the Para 4 of the conclusions arrived at by the adjudicating authority. He has drawn attention to few lines in the middle of the said para which read as follows:- prima facie for confirmation of PAO is made. No doubt that the property attached are involved in money laundering. Undersigned therefore orders confirmation of the above provisional attachment order. (iii) He submitted that Rule 4(5) of Manner of Taking Possession of Movable Property under Prevention of Money Laundering (Taking Possession of Attached or Frozen Properties Confirmed by the Adjudicating Authority) Rule,2013 (Said Rule) could not have been applied and that the attachment is direction to maintain a balance not to transfer the money lying in the bank. Therefore, the order of respondent directing the bank to transfer the amount is ex-facie illegal. (iv) The ld. senior counsel further submitted that the respondent should not have got the amount transferred before the stipulated statutory period for filing of appeal. He submitted that the impugned order dated 10.01.2020 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thority. On perusal of PAO it is seen that vide Corrigendum dated 27.07.2019 to the PAO No.05/2019 the respondent has sent directions to the Branch Manager, United Bank of India, Patel Nagar Branch, New Delhi to maintain/retain the balances not lesser than ₹ 6,03,53,579/- each in the A/c No.30800205000155 of the appellant. In the Original Complaint the respondent has, inter-alia, made the following prayer:- (i) take this Complaint on record for the purpose of adjudication under Section 8 of the PMLA, 2002. (ii) declare that the said assets, provisionally attached vide Provisional Attachment Order No.05/2019 dated 25.07.2019 are derived from the proceeds of the crime and are involved in money laundering; and (iii) Confirm the attachment of the assets specified under Provisional Attachment Order No.05/2019 dated 25.07.2019 in terms of Sub-Section (3) of Section 8 of the PMLA, 2002. And on the complaint the Adjudicating Authority passed the following order, the relevant portion of the impugned order is reproduced below: 4. On a thorough perusal of the PAO, Complaint, relied upon documents, the investigation conducted by the ED and the statements recorded u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ehalf shall forthwith take the [possession of the property attached under section 5 or frozen under sub-section (1A) of section 17, in such manner as may be prescribed: Provided that taken possession of.] The aforesaid provision has to be read with the procedure as prescribed under Rule 4(5) of the said Rules which provides the manner of taking possession of movable property and reads as follows: (5) Where the property confirmed by the Adjudicating Authority is in the form of money lying in a bank or a financial institution, the Authorized Officer shall issue a direction to the bank or financial institution, as the case may be, to transfer and credit the money to the account of the Directorate of Enforcement. Since the respondent has followed the procedure prescribed, I do not find any illegality in getting the amount transferred in the account of ED. The judgment cited by the appellant is not applicable to the present facts and circumstances of the case in view of the language used under Section 8(4) of the PMLA, 2002 and Rule 4(5) of the said Rules which empowers the respondent to act forthwith‟. Therefore, it is held that there is no illegality in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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