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TMI Blog2024 (6) TMI 194X X X X Extracts X X X X X X X X Extracts X X X X ..... Makhru Singh @ Anil Singh now stands acquitted in all the seven FIRs filed against him in offences which constitute scheduled offences under PMLA, 2002. The other appellant, namely, Mrs. Pammi Devi, is the wife of Shri Makhru Singh and did not stand accused of any scheduled offence as per the filings and submissions from either side. Thus, the acquittal of Shri Makhru Singh @ Anil Singh in the scheduled offences has removed the bedrock upon which the edifice of the PMLA case leading to the attachment of the properties in question in these cases was built. The Provisional Attachment Order passed by the respondent Directorate and the impugned order passed by the Ld. AA confirming the same, have no legs to stand on. In the absence of any scheduled offence, there cannot be any proceeds of crime , i.e., property derived or obtained, directly or indirectly, by any person as a result of criminal activity relating to a scheduled offence or the value of any such property . Appeal disposed off. - SHRI G. C. MISHRA : MEMBER And SHRI V. ANANDARAJAN : MEMBER For the Appellants : Mr. Abhay Pandey , Adv For the Respondents : Mr. Chandra Prakash , Adv. Mr. Abhinav Kumar , Adv ORDER Through this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hiya, Bihar 35/2011 Dated 24.03.2011 114/2011 Dated 16.07.2011 302, 307, 387, 120B of IPC and 27 of Arms Act 3. On the basis of the aforesaid information, an ECIR (ECIR No. PTZO/04/2014 dated 07.01.2014) was recorded in respect of the said seven offences and the case was taken up for investigation by the Directorate. Investigations carried out by the Directorate revealed that the appellant Makhru Singh @Anil Singh had acquired properties in the name of his wife Smt. Pammi Devi from the proceeds of the above-mentioned crimes, by investing the said proceeds of crime in various movable and immovable properties. 4. Based on the investigations carried out, the Directorate, vide PAO No.02/2015 dated 30.03.2015, attached properties valued in all at Rs.87,50,922/-. 5. An Original Complaint ( OC ) having been filed before the Adjudicating Authority ( AA ) as required under the Act, the Ld. AA vide the impugned order dated 19.08.2015, held that the properties were proceeds of crime within the meaning of PMLA, 2002 and confirmed the provisional attachment of the subject properties. Aggrieved by the said order of the Ld. AA, the appellants have filed the present appeals. Arguments on Behalf of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... properties and the scheduled offence, the order of attachment is unsustainable in eyes of law and as such deserves to be set aside. Arguments on Behalf of the Respondent 8. On the other hand, the respondents in their pleadings, strongly opposed the contentions raised on behalf of the appellants. It was inter alia contended by them that investigations had revealed that the cash deposits in the bank account of Smt. Pammi Devi were to the extent of Rs. 2.21 crore for which no licit source of income was submitted. Similarly, the cash deposits in the bank account of Makhru Singh to the tune of Rs. 3.50 lakh were also without any licit source of income in the absence of any evidence being furnished by him. A comparison of the income declared by them vis- -vis cash deposits in the bank accounts revealed that the cash deposits were far in excess of the income declared. 9. It was further contended by the respondents that the balance sheets in the name of Shri Makhru Singh @ Anil Singh submitted by Smt. Pammi Devi in the course of her statement under section 50 of the Act, were manipulated so as to show cash-in-hand every year in the balance sheet. Further, the column of loans and advances ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h proceeds of crime by holding part of the proceeds of crime in her own name and/or projecting it as untainted property and hence committed the offence punishable under section 4 of the PMLA, 2002. Analysis and Findings 12. We have given careful consideration to the material on record and the rival contentions of the parties. We find that the factual averments made from either side regarding the sources of acquisition of the properties which have been attached by the respondents have become redundant in these cases on account of subsequent developments. As already mentioned, at the time of filing of appeals, it was submitted by the appellant that out of the seven FIRs which constituted the basis of the ECIR, the appellant Shri Makhru Singh @ Anil Singh already stood acquitted in four, and the prosecution had not gone for further appeal in those cases. It was further submitted that the remaining cases were in progress and he expected to be acquitted in those cases also. When the cases were finally heard on 03.04.2024, the learned counsel for the appellant took us through the orders passed by the jurisdictional criminal court in each of the seven FIRs and submitted by relating each o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f property as a result of criminal activity relating to a scheduled offence. It is concerning the process or activity connected with such property, which constitutes the offence of money-laundering. The Authorities under the 2002 Act cannot prosecute any person on notional basis or on the assumption that a scheduled offence has been committed, unless it is so registered with the jurisdictional police and/or pending enquiry/trial including by way of criminal complaint before the competent forum. If the person is finally discharged/acquitted of the scheduled offence or the criminal case against him is quashed by the Court of competent jurisdiction, there can be no offence of money- laundering against him or any one claiming such property being the property linked to stated scheduled offence through him. 15. Following the ratio laid down by the Apex Court in the aforesaid case, the Hon'ble High Court of Delhi in Emta Coal Limited and Ors. vs. The Deputy Director Directorate of Enforcement and Ors. [MANU/DE/0181/2023], Vijay Madanlal Choudhary, has held as follows: 24. In the facts of the present case, the Trial Court, in the complaint case which was pending before it, has clearly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the aforesaid ECIR also stands quashed. 18. In Omkar Realtors and Developers Private Limited v/s. Adjudicating Authority, Prevention of Money Laundering and Ors. [MANU/DE/1159/ 2023], the Hon ble Delhi High Court held as below: 18. Therefore, considering the facts and circumstances of the present case, it is clear that the PAO deserves to be quashed in view of the legal position as held in the above judgments and orders of the Supreme Court and also the recent decision of this Court in EMTA Coal Limited (supra). 19. Accordingly, the PAO dated 14th January, 2022 passed by the ED is set aside. In view of the settled legal position in Vijay Madanlal Choudhary (supra) and the subsequent decisions and orders thereafter, the properties of M/s. Omkar Realtors and Developers Pvt. Ltd., which were attached by the impugned PAO, shall be released. 19. Similarly, in Manturi Shashi Kumar and Ors. v/s. The Director, Directorate of Enforcement and Ors. [MANU/TL/ 0641/2023], the Hon ble Telangana High Court held as follows: 28. Thus, according to Supreme Court, the offence under Section 3 of PMLA is dependent on illegal gain of property as a result of criminal activity relating to a scheduled offe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and. 20. There is no controversy so far as the orders passed by the Hon'ble High Court of Madras (supra) is concerned. During the course of hearing, it is submitted from the side of the Appellants that the Learned Special Court, has accepted the order dated 18.02.2022 of Hon'ble High Court, Madras (supra) and that the said prosecution complaint is no more pending and that there is no dispute from the side of the Respondent in this regard. .. . 24. We are not in agreement with the submissions made from the side of the Respondent that this Tribunal cannot release the property. This power is inherent once it is held by this Tribunal that the impugned order is quashed and set aside, corollary to it is that the attachment of the property does not survive and that the prosecution complaint has been quashed before the commencement of Trial so, the property has to be released. However the aforesaid order like any other order of the Tribunal is subject to the order passed under Section 42 of PMLA, 2002. In view of the above, we are of the considered view that in the present facts and circumstances of the case this Tribunal has power to give directions for release of the property. 22 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before us, namely, Mrs. Pammi Devi, is the wife of Shri Makhru Singh and did not stand accused of any scheduled offence as per the filings and submissions from either side. Thus, the acquittal of Shri Makhru Singh @ Anil Singh in the scheduled offences has removed the bedrock upon which the edifice of the PMLA case leading to the attachment of the properties in question in these cases was built. In the light of the judgment of the Apex Court which has been followed in other cases cited above, the Provisional Attachment Order passed by the respondent Directorate and the impugned order passed by the Ld. AA confirming the same, have no legs to stand on. In the absence of any scheduled offence, there cannot be any proceeds of crime , i.e., property derived or obtained, directly or indirectly, by any person as a result of criminal activity relating to a scheduled offence or the value of any such property . 25. In the light of the above, we have no option but to set aside the impugned order of the Ld. AA confirming the attachment of the subject properties. Consequently, the present appeals are allowed. The properties shall stand released from attachment under PMLA, 2002. 26. It is, howe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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