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TMI Blog2024 (8) TMI 523X X X X Extracts X X X X X X X X Extracts X X X X ..... olved in the crime thus, not named even as an accused yet his property has been attached. Other legal issues have also been raised which would be dealt with by us separately but before that we may refer to the brief facts of the case. Brief facts of the case: 3. FIR No. 118 was registered on 11.10.2017 with Police Station Mohali against Gurinder Singh and Pirtpal Singh for the offences under Sections 472, 473,384, 420 and 120-B IPC. Further, FIR No. 158 was registered on 11.10.2017 at Police Station Mataur, Mohali against Pirtpal Singh for the offence under Section 30 of the Arms Act, 1959. On the basis of the reliable information, investigation was initiated against M/s Seabird Education and Immigration Consultants Pvt. Ltd. under the Foreign Exchange Management Act, 1999. During investigation, it was found that Pirtpal Singh along with Manoj Kumar, are the Director of M/s Seabird Education and Immigration Consultants Pvt. Ltd, incorporated on 27.05.2008. It was in the field of arranging education visa to the students and they claimed that they have two colleges in Australia. It was further revealed during investigation that the said Pirtpal Singh later on formed a new firm in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e made the payments which were in the course of business. However, ignoring the aforesaid, the properties of the appellant have been attached alleging receipt of payment directly from the students amounting to Rs.78,96,700/-. The facts, however, remain that the appellant had advanced the loan and its receipt and for that IT return was produced. In the light of the facts aforesaid, the prayer was made to cause interference in the impugned order. Other than the issues referred above, no other argument was raised by the counsel for the appellant. Arguments of the side opposite. 9. The appeal was seriously contested by the respondent. It was submitted that neither any factual nor legal ground is made out to cause interference in the impugned order. The appellant was a recipient of the `proceeds of crime. He had assisted the main accused for layering of money. It was layered by the banking channel. It was established by the bank statements. 10. The facts on record shows that the appellant had received a sum of Rs.78,96,700/- directly from the students without specifying the reasons for receipt of the said amount. In fact, the said amount was received to layer the `proceeds of crime' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant is a recipient of the `proceeds of crime' to the extent of Rs.78,96,700/- directly from the students who have made serious allegations against Pirtpal Singh and Gurinder Singh of M/s Seabird International Pvt. Ltd. for cheating them and extracting money to the tune of Rs.7.56 crores in the name of arranging visa for international study in Australia. The appellant was in possession of the `proceeds of crime' and in the light of the aforesaid, it was liable to be attached. A reference of Sections 2(1)(u), 3 and 5 of the Act of 2002 would be relevant and are quoted hereunder: "2(1)(u)"proceeds of crime" means any 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 [or where such property is taken or held outside the country, then the property equivalent in value held within the country or abroad]; Explanation. For the removal of doubts, it is hereby clarified that "proceeds of crime" include property not only derived or obtained from the scheduled offence but also any property which may directly or indirectly be derived or obtained as a result of any crimin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by a person authorised to investigate the offence mentioned in that Schedule, before a Magistrate or court for 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 2[first proviso], 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.] Provided also that for the purposes of computing the period of one hundred and eighty days, the period during which the proceedings under this section is stayed by the High Court, shall be excluded and a further period not exceeding thirty days from the date of order of vacation of such stay order shall be counted.]; (2) The Direc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aundering. It is not right in assuming that the attachment of property (provisional) under the second proviso, as amended, has no link with the scheduled offence. Inasmuch as section 5(1) envisages that such an action can be initiated only on the basis of material in possession of the authorised officer indicative of any person being in possession of proceeds of crime. The precondition for being proceeds of crime is that the property has been derived or obtained, directly or indirectly, by any person as a result of criminal activity relating to a scheduled offence. The sweep of section 5(1) is not limited to the accused named in the criminal activity relating to a scheduled offence. It would apply to any person (not necessarily being accused in the scheduled offence), if he is involved in any process or activity connected with the proceeds of crime. Such a person besides facing the consequence of provisional attachment order, may end up in being named as accused in the complaint to be filed by the authorised officer concerning offence under section 3 of the 2002 Act." In view of the judgment supra, first issue is answered against the appellant. 15. The other issue is that the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irmed. Section 5(3) provides that an order of attachment would cease to have effect after the expiry of the period specified i.e. 180 days unless an order is made under Section 8(3) of the Act. Section 8 (3) is also quoted hereunder for ready reference: "8. Adjudication. (1) and (2) xxx (3) Where the Adjudicating Authority decides under sub-section (2) that any property is involved in money-laundering, he shall, by an order in writing, confirm the attachment of the property made under sub-section (1) of section 5 or retention of property or 3[record seized or frozen under section 17 or section 18 and record a finding to that effect, whereupon such attachment or retention or freezing of the seized or frozen property] or record shall- (a) continue during 4[investigation for a period not exceeding 5[three hundred and sixty-five days] or] the pendency of the proceedings relating to any 6[offence under this Act before a court or under the corresponding law of any other country, before the competent court of criminal jurisdiction outside India, as the case may be; and] (b) become final after an order of confiscation is passed under sub-section (5) or sub-section (7) of secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 022 is greater than 90 days, that longer period shall apply. IV. It is further clarified that the period from 15.03.2020 till 28.02.2022 shall also stand excluded in computing the periods prescribed under Sections 23(4) and 29A of the Arbitration and Conciliation Act, 1966. Section 12A of the Commercial Courts Act, 2015 and provisos (b) and (c) of Section 138 of the Negotiable Instruments Act, 1881 and any other laws, which prescribe period(s) of limitation for instituting proceedings, outer limits (within which the court or tribunal can condone delay) and termination of proceedings". 19. The perusal of the order of the Apex Court makes it clear that the exclusion of the period given therein is even for termination of proceedings. The Apex Court has specifically provided in Para 5 (IV) of the order dated 10.01.2020 to exclude the period from 15.03.2020 till 28.02.2022 for computation of the period prescribed under certain legislations which includes The Arbitration and Conciliation Act, 1996, The Commercial Courts Act, 2015 and Negotiable Instruments Act, 1881, etc. It is apart from other laws which prescribed the period of limitation for institution of proceedings, outer limits ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... achment till the date of passing of confirmation order to compute the period of 180 days. iv) It is relevant to note that the Apex Court in In re: Limitation (supra) took suo moto cognizance of the Covid-19 pandemic situation and extended the period of limitation from 15.03.2020 for the purpose of filing petitions/applications/suits/ appeals/all other proceedings under any general or special law before any Court or Tribunal. The object of such extension was in recognition of the difficulties that might be faced by lawyers/litigants to file their applications physically. The relevant paragraphs of In re: Limitation (supra) are extracted below: 1. This Court has taken suomotu cognizance of the situation arising out of the challenge faced by the country on account of Covid-19 virus and resultant difficulties that may be faced by litigants across the country in filing their petitions/applications/suits/appeals/all other proceedings within the period of limitation prescribed under the general law of limitation or under special laws (both Central and/or State). 2. To obviate such difficulties and to ensure that lawyers/litigants do not have to come physically to file such procee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Act, 2015 and provisos (b) and (c) of Section 138 of the Negotiable Instruments Act, 1881 and any other laws, which prescribe period(s) of limitation for instituting proceedings, outer limits (within which the court or tribunal can condone delay) and termination of proceedings. vi) For instance, Section 29A of the Arbitration & Conciliation Act, 1996 provides a time limit of 12 months within which an award has to be passed. By virtue of In re: Limitation, 2022 (supra), the period from 15.03.2020 to 28.02.2022 shall be excluded to compute the period of 12 months under Section 29A of the Arbitration & Conciliation Act, 1996. Similarly, Section 12A(3) of the Commercial Courts Act, 2015 provides an outer time period of three months within which pre-institution mediation shall be completed. However, by virtue of In re: Limitation, 2022 (supra), the period from 15.03.2020 to 28.02.2022 shall be excluded to compute the period of 3 months. Therefore, In re: Limitation, 2022 (supra) states that wherever a statute prescribes a maximum period within which proceedings have to be completed, the period from 15.03.2020 to 28.02.2022 shall be excluded to compute such maximum period. vii) T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rocedure after the same has been initiated cannot be equated to institution of a suit or filing of a petition/application which is a starting point of litigation for a person who seeks relief under a statute. The 180 days window in Section 5 contemplates an endpoint whereas the Supreme Court in the Suo Motu writ petition sought to protect the starting-point, which was at the risk of being defeated by reason of the pandemic. 19. In other words, what was being protected by the orders of the Supreme Court was the right to remedy, not the right to take away a remedy under a given statute. The respondents before this Court seek to do the latter. The only step taken by the ED is the order of the provisional attachment dated 30th September, 2021. No other steps were taken by the ED before the petitioners reply on 3rd January, 2022 or before the expiry of 180 days period on 31st March, 2022. By its inaction and failure to act in terms of Section 5(1)(b) or the other conditions of the said section, the ED has made itself vulnerable to Section 5(3) of the PMLA. The petitioner in turn has been given the breather of exhaustion of the 180 days window from 1st April, 2022 and the ED cannot now r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n re: Limitation (supra) is not applicable in computing 180 days under Section 5(3) of the PMLA. In S. Kasi (supra), In re: Limitation (supra) was held to be inapplicable to proceedings involving personal liberty of a person where the investigating officer failed to file charge sheet within the prescribed time. The decision in S. Kasi (supra) cannot be extended to PMLA proceedings dealing with confirmation of provisional attachment order within 180 days. xix) It is true that provisional attachment of property has an effect of potentially depriving a person of his property. However, right to personal liberty and right to property stand on a different footing and cannot be equated. This is evident from the fact that the urgency in concluding proceedings dealing with a person in jail is much higher than a person whose property is provisionally attached. Further, under Section 5(4) of the PMLA, the person whose property is provisionally attached can still enjoy such property till the same is confiscated. Even in cases of confirmation of provisional attachment, a person can still enjoy such property till the same is confiscated. xx) In Vijay MadanlalChoudhary (supra), the Apex Cour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from 15-3-2020 till 28-2-2022 shall stand excluded for the purposes of limitation as may be prescribed under any general or special laws in respect of all judicial or quasi-judicial proceedings. Be that as it may, the fresh order in SMWP No. 3 of 2020 need not be elaborated for the present purpose.] **** 32.2. In fact, in S. Kasi case [S. Kasi v. State, (2021) 12 SCC 1 : 2020 SCC OnLine SC 529] , this Court also noticed that a coordinate Bench of the same High Court had already held [Settu v. State, 2020 SCC OnLine Mad 1026] that the said order dated 23-3-2020 [Cognizance for Extension of Limitation, In re, (2020) 19 SCC 10 : (2021) 3 SCC (Cri) 801] did not cover the offences for which Section 167CrPC was applicable but, in the order [S. Kasi v. State, 2020 SCC OnLine Mad 1244] impugned, the other learned Single Judge of the same High Court took a view contrary to the earlier decision of the coordinate Bench; and that was found to be entirely impermissible. In any case, the said decision, concerning the matter of personal liberty referable to Article 21 of the Constitution of India and then, relating to the proceedings to be undertaken by an investigating officer, cannot be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not a litigant, the authorized officer representing the ED is a litigant to the proceedings initiated under PMLA and for the purpose of application of In re: Limitation (supra). Therefore, where the ED has been diligent in provisionally attaching the property and filing the original complaint within 30 days under Section 5 of the PMLA, prejudice cannot be caused to it by not excluding the period from 15.03.2020 to 28.02.2022. One litigant"s interests cannot be protected at the cost of another. This Court would further like to stress that the provisionally attached properties can still be enjoyed under Section 5(4) of the PMLA. xxvi) The reasoning in Hiren Panchal (supra) that what was protected under In re: Limitation (supra) was institution of proceedings and not proceedings which were already initiated cannot be accepted in light of the decision in Prakash Corporates (supra) which held that In re: Limitation (supra) cannot be narrowly applied. xxvii) Lastly, the decisions in S. Kasi (supra),Vikas WSP Ltd. (supra), Gobindo Das (supra) and Hiren Panchal (supra) cannot be applied for the simple reason that In re: Limitation (supra) was further clarified in In re: Limitation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 452 of 2020 decided on 19.06.2020, it has been argued on behalf of the Respondent that a 3-Judge Bench of this Court has specifically ruled that the said order dated 23.03.2020 in SMWP No. 3 of 2020 is not applicable to all the applications; and benefit of the order of extension of limitation cannot be taken by police while filing chargesheet Under Section 167(2) of the Code of Criminal Procedure, 19736. Further, with reference to the decision in the case of Sagufa Ahmed (supra), it has been argued that what was extended in SMWP No. 3 of 2020 was only the period of limitation and not the period upto which delay could be condoned in exercise of discretion conferred by the statute. The learned Counsel would also submit with reference to the decision of this Court in SCG Contracts (supra) that where a Defendant fails to file the written statement within permissible time, it is beyond the Court's power to condone the delay. 11. In his rejoinder submissions, the learned Senior Counsel for the Appellant has contended that S. Kasi's case (supra) related to the fundamental right of liberty, referable to Article 21 of the Constitution of India read with Section 167(2) Code of C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vocates-on-Record and the litigants to institute cases in Supreme Court and other courts in Delhi. Consequently, restoration of the order dated 23rd March, 2020 has been prayed for. We have heard Mr. Shivaji M. Jadhav, President SCAORA in support of the prayer made in this application. Learned Attorney General and Learned Solicitor General have also given their valuable suggestions. We also take judicial notice of the fact that the steep rise in COVID-19 Virus cases is not limited to Delhi alone but it has engulfed the entire nation. The extraordinary situation caused by the sudden and second outburst of COVID-19 Virus, thus, requires extraordinary measures to minimize the hardship of litigant-public in all the states. We, therefore, restore the order dated 23rd March, 2020 and in continuation of the order dated 8th March, 2021 direct that the period(s) of limitation, as prescribed under any general or special laws in respect of all judicial or quasi-judicial proceedings, whether condonable or not, shall stand extended till further orders. It is further clarified that the period from 14th March, 2021 till further orders shall also stand excluded in computing the periods pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the hardships likely to be suffered by the litigants during the onslaughts of this pandemic. Hence, the legal effect and coverage of the orders passed by this Court in SMWP No. 3 of 2020 cannot be unnecessarily narrowed and rather, having regard to their purpose and object, full effect is required to be given to such orders and directions". 24. The Apex Court has distinguished its earlier judgment in reference to Article 21 of the Constitution and did not find applicable to the proceedings in hand, which are civil in nature, thus we cannot record our finding in favour of the appellant. 25. It is true that order for it has to be passed within 180 days. We have excluded the period from 15.03.2020 to 28.02.2022 for computation of 180 days in view of the judgment of the Apex Court in Suo Motu Writ Petition (supra). In the light of the aforesaid, the issue is decided against the appellant and in favour of the respondent.In the light of the judgment referred to above, we are unable to accept even second legal argument raised by the appellant because confirmation order was passed within 180 days after the exclusion of the period till 28.02.2022. 26. Coming back to the factual issue, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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