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TMI Blog2021 (9) TMI 1469X X X X Extracts X X X X X X X X Extracts X X X X ..... the Indian Bank, confirmed the attachment by an order 26.06.2012 during the pendency of the Writ Petitions and during the operation of the stay order. The Hon'ble Apex Court has repeatedly held that any proceeding initiated, conducted or concluded in violation of an order of interim stay or injunction is non-est in the eye of law and the Adjudicating Authority should have waited till the disposal of the writ petitions or till the order of stay passed by this court is vacated. The action of the Adjudicating Authority despite having the knowledge of interim order of stay is clearly in defiance of the said interim order of stay. Therefore, the whole proceedings are vitiated and even the order dated 26.06.2012 passed during the pendency of the writ petitions shall be illegal and liable to be set aside as null and void. Appeal dismissed. - W.A.Nos.2614 and 2615 of 2012 And M.P.Nos.1 & 2of 2012 - - - Dated:- 13-9-2021 - THE HONOURABLE MR.JUSTICE T.RAJA AND THE HONOURABLE MR.JUSTICE V.SIVAGNANAM For Appellant in: M/s.Hema Babu For Respondent: Mr.N.Balachandar, Mr.B.Kumar senior counsel, Mr.B.Natarajan, Mr.B.Kumar senior counsel, M/s.Aiyan Dolia JUDGMENT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... td. availed three Medium Term Loans and OCC (Open Cash Credit Facility) totaling to an amount of Rs.4.47 crores from Indian Bank, Anna Nagar Branch, Chennai, by giving a forged third party collateral security of an immovable property in Chennai during the period between October 2005 and January 2006. Palpap Inchinichi Software International Limited availed 161 personal loans in the names of various fictitious persons purportedly, its employees to the extent of Rs.1.66 crores from the State Bank of India, Vivekananda House Branch, Chennai, during the period between August 2005 and February 2006. Palpap Inchinichi Software International Limited. availed 148 personal loans in the names of fictitious persons purportedly, employees of his company Palpap Inchinichi Software International Limited, Chennai to the extent of Rs.2.22 crores from the Bank of India, Anna Salai, Chennai during the period between May 2007 and October 2007. 4. Learned counsel further contended that on a complaint dated 31.01.2008 lodged by the Vigilance Section of Indian Bank, Chennai and another complaint dated 11.11.2008 lodged by the Regional Manager, Region II State Bank of India, Chennai, the FIRs No.RC.1/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proceeds of crime as defined in Section 2(u) of the PMLA and the said property is projected as untainted property by Palpap Inchinichi Software International Limited. 6.Further, learned counsel contended that the details of the immovable property (proceeds of crime) were also recorded in writing in the Provisional Attachment Order dated 22.02.2012. The Joint Director has recorded in writing in his order dated 22.02.2012 that he has reason to believe that in case such properties (proceeds of Crime) are not attached, they are likely to be concealed, converted, disposed, parted, transferred or dealt with in any manner which will result in frustrating any proceedings under the PMLA relating to confiscating of such proceeds of crime. 7. The learned counsel further submitted that the learned Single Judge failed to take into consideration the main object of the PMLA and further contended that any action that had been taken by the Directorate of Enforcement is only as per the provisions contemplated in law. In respect of number of scheduled offences, there will be many victims of crime and if for that reason, such proceeds are not attached, the very purpose of the PMLA shall be defea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sistant Commissioner (CT) Anna Salai- III Assessment Circle, Sire Mansion vs. Indian Overseas Bank, Rep. by its Manager, Recovery Administrative Branch Central Office and Another and thus pleaded to dismiss the appeals. 9. Learned counsel appearing for Palpap Inchinichi Software International Limited, submitted that the subject matter of the property is not proceeds of crime within the meaning of Section 2(1) (u) of the PMLA Act. The entire sale consideration for the purchase of property had been given by the bank to the vendors. The sale consideration was given by the bank directly to the vendors. The property was mortgaged to the bank and the bank has a right to recover its dues by bringing the property to sale in exercise of the power conferred under the SARFAESI Act. Palpap Inchinichi Software International Limited had not committed any offence under the PMLA and thus pleaded to dismiss these appeals. 10. Heard learned counsel for the concerned parties and perused the materials available on record. 11. The admitted facts of the case are that on 31.01.2008 the Indian Bank lodged a complaint to the Superintendent of police, Central Bureau of investigation against P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Adjudicating Authority, in its order, has also mentioned about the pendency of writ petitions. 13. The provisional order of attachment was passed by the Joint Director with regard to the property on 22.02.2012. Knowing this fact, immediately, the Indian Bank filed W.P.No.4696 of 2012 along with M.P.No.1 of 212 on 27.02.2012. The next day, on 28.02.2012, this Court granted an order of interim stay. The prayer in M.P.No.1 of 2012 in W.P.No.4696 of 2012 filed by the Indian Bank runs as follows: Petition praying that in the circumstances stated therein and in the affidavit filed therewith, this Court proceedings of the order dated 22.02.2012 of the first respondent viz., the Directorate of Enforcement in File No.ECIR/06/CZO/PMLA/2009, ECIRs 27 and 35/CZO/PMLA/2010. On the above prayer, this Court passed an interim order on 28.02.2012 which reads as follows: Interim stay for a period of four weeks. Notice. Private notice is permitted. In the meantime, since it is reported by the petitioner-bank that the subject property is going to be auctioned tomorrow under SARFAESI Act, by the petitioner-Bank, the sale proceeds of the auction shall be kept in an int ..... X X X X Extracts X X X X X X X X Extracts X X X X
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