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TMI Blog2024 (9) TMI 1361X X X X Extracts X X X X X X X X Extracts X X X X ..... of the returns being accepted at face value, the same are not sufficient to explain the actual purchase consideration for the subject land. The legal position is undisputed that once a notice under Section 8(1) of PMLA, 2002 is issued, it is for the noticee to indicate the sources of his income, earning or assets, out of which or by means of which he has acquired the property attached under Section 5(1), the evidence on which he relies and other relevant information and particulars, and to show cause why all or any of such properties should not be declared to be the properties involved in money laundering and confiscated by the Central Government. Further, the presumption in inter-connected transactions under Section 23 as also the presumption under Section 24 is against the appellant. There are no merit in the contention that the Ld. AA has not considered the definition of proceeds of crime under PMLA, 2002. Even at the relevant time (prior to the amendments of 2015 and 2019), the definition of proceeds of crime took within its sweep any property derived or obtained, directly or indirectly, by any person as a result of criminal activity relating to a scheduled offence and even th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d with section 13(1)(e) of P.C. Act, 1988 against Shri/Smt. Bhanu Pratap Sahi, Uma Shankar Malviya, Prashant Kumar Singh, Ajay Singh, Anirudh Pratap Sengar, Abhishek Singh and Smt. Santoshi Devi. As per the said Final Report filed by the CBI before the Ld. Special Judge, CBI, Ranchi, Shri Bhanu Pratap Sahi had acquired disproportionate assets to the extent of Rs. 6,99,95,964/- during the check period from 13.03.2005 to 24.07.2009 which was to the extent of 3217.29 percent of his income during the period. The said assets were acquired in his own name and in the names of his relatives, including two front private limited companies. 3. Since Section 13 of the P.C. Act, 1988 was been incorporated as a Scheduled Offence under the Prevention of Money Laundering Act, 2002 (PMLA, 2002) with effect from 01.06.2009, an ECIR (ECIR/02/Pat/2009/AD dated 08.10.2009) was registered by the respondent Directorate. In pursuance of the proceedings so initiated, based on the material placed before him, the Jt. Director of Enforcement, Lucknow formed the reasonable belief that certain properties which are involved in 'Proceeds of crime' in terms of section 2(1)(u) of PMLA, 2002 are required to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice from Ld. AA, she prepared a simple reply in Hindi stating inter alia that the land purchased by her husband was from his legal sources of income. She sent it through Speed Post and email to the Ld. AA. However, the Ld. AA confirmed the attachment by not considering the facts and sources of appellant and passed confirmation order. 6. It is further submitted that appellant's husband had purchased land in Ranchi in the year 2008 out of his hard-earned money. Unfortunately, her husband died on 01.04.2011 and since the appellant is living with her two children. It is contended that the ECIR in this case was registered by respondent Directorate on 08.10.2009. From the said date, until the time of death of the appellant's husband, i.e., between 08.10.2009 to 01.04.2011 the Directorate did not bother to record the statement of her husband or seek any explanation from him and did not even investigate into his sources of income for acquiring his landed property. 7. It is further contended that the present appellant, Ms. Chanda Singh was not even made a party in the PAO and that the entire case of ED qua the appellant is based on presumption and assumption. The properties of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 500/- only and the contention that its actual value was Rs. 1 crore based on the testimony of Shri Arun Kumar, property dealer, is incorrect. That the sellers of the land, namely, Basanteshwari Prasad and Hemant Prasad have not produced any document of receiving of alleged amount of Rs.1 Crore. 13. It is further contended that the statements of Basanteshwari Prasad and Hemant Prasad have been recorded in the absence of the Appellant and her late husband and the same have not been confronted to the Appellant or her husband. Furthermore, as per the statement of Shri Basanteshwari Prasad, he and his brother Shri Hemant Prasad had actually received Rs. 60,00,000/- (Rs. 10,00,000/- on 18.07.2008, Rs. 10,00,000/- on 18.07.2008 and Rs. 40,00,000/- on 02.08.2008). Thus, there is inconsistency even in the statements of witnesses. According to Shri Arun Kumar, property dealer, the actual payment was Rs. 1 crore whereas as per the sellers the amount was 60,00,000/-. It is also questioned as to why the ED did not make any enquiries with the sellers who had claimed that he they received Rs. 60,00,000/- as against a recorded sale consideration of only Rs. 4,37,500/- in the sale deed. Further, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (PIL) No. 4700/2008, transferred the investigations in Jharkhand Vigilance Case No. 09/09 to the CBI. In compliance of this order, the Jharkhand vigilance case No. 09/09 was re-registered by the CBI as case No. RC 5(A)/2010/AHD-Ranchi. 19. CBI, AHD, Ranchi, filed the Charge Sheet No. 07/2011 dated 22.12.2011, under 173 of Cr. P.c. before the Hon'ble Special Judge, CBI, Ranchi, against Bhanu Pratap Sahi and others for commission of offence under section 13(2) read with section 13(1) of the Prevention of Corruption Act, 1988 Section 109 of IPC,1860. In the said charge sheet No. 07/2011 dated 22.12.2011, it was alleged that Shri Bhanu Pratap Sahi (a) After being elected as a member of Jharkhand Legislative Assembly on 13.03.2005 and while working as a public servant being a Minister of Health and Labour, Government of Jharkhand, during the period 07.02.2007 to 12.01.2009, in the cabinet headed by Sh. Madhu Koda, during the period 13.03.2005 to 24.07.2009, had acquired disproportionate assets to the extent of Rs. 6,99,95,964/- by abusing his official position; (b) The disproportionate assets, so acquired, are in the form of immovable /movable assets in the name of his relatives, tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he land to Ravindra Pratap Singh vides Sale Deed Number, 15980/14141 dated 02.08.2008, tendered his statement under Section 50 of PMLA,2002 on 26.12.2012 in which Sh. Basanteshwari Prasad stated that; (i) He sold 4.18 acres of land to Ravindra Pratap Singh vide Sale Deed No. 15980/14141 dated 02.08.2008; (ii) He and his brother Sh. Hemant Prasad has actually received Rs. 10,00,000 on 21.06.2008, Rs. 10,00,000 on 18.07.2008 and Rs. 40,00,000 on 02.08.2008 (total Rs. 60,00,000/-) towards sale of land vide the aforesaid Sale Deed dated 02.08.2008 against the declared value of Rs. 4,37,500/- (iii) As far his knowledge goes, the amount received by them as consideration for the sale of the property was of Sh. Bhanu Pratap Sahi (Accused). 25. It is submitted that the scrutiny of the Income Tax Returns of Ravindra Pratap Singh (PAN BISPS 7210 K), revealed that no Income Tax Return was filed in 2008-09, i.e., the year in which the above said purchase of land was made. Instead, ITRs for the AY 2010-11 and 2011-12 were filed, apparently, after initiation of the investigation by the CBI, in an attempt to cover the purchase of the said land. Further, even the extent of income declared in the ab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The reasons to believe that the properties attached are the proceeds of crime were duly recorded on the basis of material in hand. 29. It is further contended that after hearing both the sides at length and examining the evidences placed on record, the Ld. Adjudicating Authority has confirmed the abovesaid PAO in OC No. 238/2014 after considering all the aspects of the case and judiciously turned down the contentions of the Appellant in its confirmation order. 30. The respondents have further relied upon the judgement of the Hon'ble Bombay High Court in Radha Mohan Lakhotia v. Deputy Director, Enforcement Directorate First Appeal No. 527 of 2010 (Order dated 05.08.2010 wherein it was held : 19. We shall now revert back to the argument that the provisional attachment of properties is sans any material to show that the said properties are derived from the transaction of import of 200 kgs. of cocaine. Counsel for the Appellants vehemently argued that the Respondents have not been able to even remotely show that the Respondents have not been able to even remotely show that the properties under provisional attachment were acquired out of the sale proceeds of cocaine transaction in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not imposed the burden of proof enjoined by Section 24- On person accused of offence under Section 3 however burden applies, also for attachment and confiscation proceedings- Petition dismissed. The judgement in the case of Union of India v. Hassan Ali Khan, (2011) 10 SCC 235; (2012) 1 SCC (Cri) is also cited wherein it was held: 34. The allegations may not ultimately be established, but having been made, the burden of proof that the said monies were not the proceeds of crime and were not, therefore, tainted shifted to Respondent 1 under Section 24 of the PMLA,2002. 37. It is true that having a foreign bank account and also having sizeable amounts of money deposited therein does not ipso facto indicate the commission of an offence under the PMLA,2002. However, when there are other surrounding circumstances which reveal that there were doubts about the origin of the accounts and the monies deposited therein, the same principles would not apply. The following extract from the decision in Som Prakash v. State of Delhi, 1974 AIR 989 is also relied upon : The Central Law Commission considering white collar crime as a serious menace has made a report on the subject, and the Santhanam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sets were acquired by Sh. Sahi in his own name and in the names of his relatives and two front private limited companies. It is also not in doubt that Shri Ravindra Pratap Singh (since deceased), was a relative of Shri Bhanu Pratap Sahi, being sister's son-in-law of Sh. Sahi. It is, however, contended on behalf of the appellant that in the absence of any evidence, direct or indirect, to show that Mr. Bhanu Pratap Sahi had given the money for purchase of the said lands, no presumption can be drawn that the said lands were purchased out of proceeds of crime of Shri Bhanu Pratap Sahi only because Late Ravindra Pratap Singh was a relative of Shri Sahi. There is no iota of evidence on record that the source of income from which the purchase made by the Appellant is of Sh. Sahi. The appellant has also assailed the observation of the Ld. AA that the land in question is 'benami' property of Sh. Sahi. It is contended that in absence of any evidence, direct or indirect, to show that Mr. Sahi had given the money for purchase of the said lands, no presumption can be drawn that the said lands were purchased out of proceeds of crime . It is claimed that the land was purchased by Late ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d at face value, the same are not sufficient to explain the actual purchase consideration for the subject land. The legal position is undisputed that once a notice under Section 8(1) of PMLA, 2002 is issued, it is for the noticee to indicate the sources of his income, earning or assets, out of which or by means of which he has acquired the property attached under Section 5(1), the evidence on which he relies and other relevant information and particulars, and to show cause why all or any of such properties should not be declared to be the properties involved in moneylaundering and confiscated by the Central Government. Further, the presumption in inter-connected transactions under Section 23 as also the presumption under Section 24 is against the appellant. Considering the provisions of Section 8(1), 23 and 24, the burden of proof in this regard under law was squarely upon the appellant which has remained undischarged. In the absence of such evidence, the claim of deriving substantial income from legal sources and having purchased the subject property out of legitimate income has remained an empty claim. 35. An issue was also raised on behalf of the appellant that in view of the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Smt. Santoshi Devi (the appellant in Appeal No. FPA-PMLA-593/LKW/2014 which is also being disposed of through this order) and submits that this cannot lead to the conclusion the property belongs to Bhanu Pratap Sahi. Such a finding is unsustainable and against any logical reasoning. However, I find that this fact also constitutes a significant piece of circumstantial evidence which is not irrelevant to the findings against the appellant. 38. It is also submitted that the actual cost of the property was Rs. 4,37,500/- only and the contention that its actual value was Rs. 1 crore based on the testimony of Shri Arun Kumar, property dealer, is incorrect and that the sellers of the land, namely, Basanteshwari Prasad and Hemant Prasad have not produced any document of receiving of alleged amount of Rs.1 Crore. It is further contended that the statements of Basanteshwari Prasad and Hemant Prasad have been recorded in the absence of the Appellant and her late husband and the same have not been confronted to the Appellant or her husband. Furthermore, as per the statement of Shri Basanteshwari Prasad, he and his brother Shri Hemant Prasad had actually received Rs. 60,00,000/- (Rs. 10,00,000 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant was required to explain the sources for Rs. 4,61,018/- only and not Rs. 60,00,000/-. Having perused the contents of the order carefully and the evidence of the written agreement on nonjudicial Stamp Paper I am of the view that the value of the attached property should rightly be reflected as Rs. 60,00,000/- and not Rs. 4,37,500/-. 40. In light of the above discussions, having considered the rival contentions of the parties and the material on record, I do not find any reason to interfere with the order of the Ld. Adjudicating Authority. 41. Accordingly, this appeal is hereby dismissed, with pending applications, if any. FPA-PMLA-593/LKW/2014 42. This appeal has been filed by Smt. Santoshi Devi, wife of Shri Anirudh Pratap Sengar and a cousin of the main accused Shri Bhanu Pratap Sahi. The appellant herein was Defendant No. 4 before the Ld. AA. Two pieces of land at Hotwasi Hatia Dam site, Ranchi, standing in her name, valued at Rs. 15,28,456/-, have been attached vide the impugned order. Arguments on Behalf of the Appellant 43. The appellant has contended that the two lands at Hotwasi, namely, one piece of land bearing Khata No.1, Thana No. 232, Plot No. 1132,1133,1134,1139 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ohibition) Act, 1988 of either against Bhanu Pratap Sahi or against the appellant either in FIR or in the Charge Sheet filed by the CBI dated 22.12.2011. Apart from this, the CBI and the ED ignored the fact that the title deeds are seized from the custody and possession of the appellant and land attached is in the absolute possession of the appellant. It is also asserted that the ED simply relied on the allegations of the CBI without going through the actual facts and societal status of the family of the Appellant. 46. It is further submitted that the appellant, Smt. Santoshi Devi and her intellectually disabled brother Shri Santosh Sahi are the two issues out of the second wedlock of (late) Rashendra Pratap Nath Shahi and Smt. Savitri Devi. There is no issue out of the first wedlock of late Rashendra Pratap Nath Shahi with late Smt. Nirmala Devi and the appellant is taking care of the old aged widowed mother and intellectually disabled brother since the death of her father. It is reflected in documents filed that out of Partition Suit No. 30 of 1953 between appellant's grandfather Sh. Patait Fanindranath Sahi got about 200 acres of agricultural land as his share and further, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ary for 2008-09 was Rs. 1,32,350/-. 56. That the total income of the appellant above amounts to Rs.15,51,385/and that of her husband amounts to Rs. 6,88,100/- which was sufficient to purchase the provisionally attached properties. 57. In light of the above contentions, it is prayed by the appellant that the order of confirmation passed in PAO No.347 of 2013 in ECIR No./02/PAT/2009/AD by the Ld. AA against the present Appellant, be set aside. Arguments Contentions on Behalf of the Respondent 58. The respondent Directorate has strongly contested the arguments put forward on behalf of appellant. Referring to the background of the case, it pointed out that investigation has revealed that out of a total of Rs. 7,97,96,888/- (including indirect benefit derived in the form of rent derived on property acquired through proceeds of crime) involved in the offence of money laundering which were invested by the accused Shri Bhanu Pratap Sahi during the period in which he was a minister in the government headed by Shri Madhu Koda, two pieces of land at Hotwasi Hatia Dam site valued at Rs. 15,28,456/- were purchased by him (Shri Sahi) in the name of his cousin sister Smt. Santoshi Devi (the appel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The ITR has been filed late, on 22.01.2010, consequent to the search conducted by the Vigilance Bureau on 24.07.2009 against Shri Bhanu Pratap Sahi ■ In the ITR, Appellant has declared income from business and agriculture ■ In her ITR, for A.Y 2009-10, no declaration in respect of any loan nor any income received from the sale of Jewellery has been declared by the appellant ■ ITR of the Appellant does not reveal any gift received by her as 'Streedhan' from her husband ■ There is no mention of purchase of the above immovable property. 62. It is accordingly contended by the respondent Directorate that the appellant did not have the income to pay the consideration amount for the purchase of the properties. The claim made by the appellant in respect of the consideration money could not be substantiated by any documentary evidence by the appellant. 63. The decision of the Hon'ble Supreme Court in Sreelekha Banerjee and Ors. v. Commissioner of Income Tax, Bihar and Orrisa, AIR 1964 SC 697 is relied upon by the respondents wherein it was held as follows: Where the assessee was unable to prove that in his normal business or otherwise, he was possessed of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inately. Judicial attitudes have to be discriminating, as has happened in this case. 66. It is emphasized that the appellant was not having the financial capability to purchase the said land. The same has been established during the investigation. The evidence gathered by the respondent, on the basis of reason to believe, has established that the property is the benami property of Respondent No. 2. In the face of such evidence, custody and possession of the title deed does not legitimize the purchase of the property acquired from proceeds of crime. 67. It is further submitted that agricultural income is merely a conjecture in the absence of documents evidencing possession of agricultural land to fetch such high income. The husband of the appellant is a lowly-placed employee of Hindalco at Muri. Income in the absence of documents is a mere conjecture. Financial incapability to purchase the properties has been revealed in course of the investigations on the basis of the statement of the appellant under Section 50 of the PMLA and the ITRs filed by the appellants before the IT Department. It is an established fact that the ITRs were filed by the appellant for AY 2008-09, 2009-10 and 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of properties. The appellant in 2008 was not having any bank account in her name, as stated by her in her statement u/s 50 of the PMLA. 73. On the contention that the husband of the Appellant was employed at the Hindalco, Muri, The Respondent contends that the husband of the appellant was a lowly placed employee of HINDALCO. The annual income of Rs. 60,000/- for 2007-08 and Rs.1,31,350/- for 2008-09 itself establishes this fact. The so-called total income of both the appellant and her husband is a jugglery of figures in an apparent bid to create false income so that the proceeds of crime could be projected as untainted. 74. It is submitted that CBI in its charge-sheet has stated that the loan taken from Shri Pankaj Kumar was fake. Statement of the appellant u/s 50 of the PMLA also reveals that no loan from Shri Pankaj Kumar was taken. It is further submitted the burden of proof is on the appellant to justify the source of income utilized for the purchase of properties u/s 24 of the PMLA. The legal source of income for the purchase of properties could not be justified by the appellant. 75. With regard to the contention put forward on behalf of the appellant that the order of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in doubt that the appellant herein, Smt. Santoshi Devi is a relative of Shri Bhanu Pratap Sahi, being a cousin of Sh. Sahi. It is, however, contended on behalf of the appellant that in the absence of any evidence, direct or indirect, to show that Mr. Bhanu Pratap Sahi had given the money for purchase of the said lands, no presumption can be drawn that the said lands were purchased out of proceeds of crime of Shri Bhanu Pratap Sahi only because the appellant is a relative of Shri Sahi. 80. As per the respondent Directorate, there are considerable inconsistencies in the explanation as regards the sources of funds as explained by the appellant before the CBI which investigated the predicate offence, vis- -vis the ED which investigated the offence under PMLA, 2002. These are clearly evident from the charge sheet filed by the CBI which is a part of the relied upon document. Before CBI it was claimed that an amount of Rs. 2,00,000/- was a loan from Sh. Pankaj Kumar, a friend/colleague of her husband, which was found to be false and was denied by Sh. Pankaj Kumar. This explanation was not advanced by the appellant before ED. Before the CBI, there was no claim of receiving any loan from mo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nation for the non- availability of proof in support of the claim of having sold jewellery. As regards the 'loan' from mother, the same is stated to have been taken in cash so that there is no documentary proof, or bank entries in support of the explanation. The balance amount, namely, Rs. 7,05,000/-, is sought to be explained as 'streedhan' for which too, there is no proof whatsoever. 82. Nor do the above explanations find support in the ITRs filed by the appellant. It has been pointed out by the respondents that for the AY 2008-09 2009-10, Income Tax Returns (ITRs) were filed on 22.01.2010, i.e., after the search conducted by the Vigilance Bureau at residential premises of Shri Bhanu Pratap Sahi on 24.07.2009. Her ITR for AY 2008-09 revealed that income declared during the year from business was Rs. 1,70,200/- and from agriculture was Rs. 2,30,300/- (total Rs. 4,00,500/-) and the income declared for AY 2009-10 from business was Rs. 1,75,435/- and from agriculture was Rs. 2,25,450/- (total Rs.4,00,885/-). Having considered these facts, I am of the view that the same were a tailor-made effort to create sources of income to explain the acquisition of the property and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eans of which he has acquired the property attached under Section 5(1), the evidence on which he relies and other relevant information and particulars, and to show cause why all or any of such properties should not be declared to be the properties involved in moneylaundering and confiscated by the Central Government. Further, the presumption in inter-connected transactions under Section 23 as also the presumption under Section 24 is against the appellant. Considering the provisions of Section 8(1), 23 and 24, the burden of proof in this regard under law was squarely upon the appellant which has remained undischarged. In the absence of such evidence, the claim of deriving substantial income from legal sources and having purchased the subject property out of legitimate income has remained an empty claim. 86. The respondents have in my view rightly relied upon the authority of various decided cases in support of their contentions. As pointed out by them the Hon'ble Bombay High Court has held in Radha Mohan Lakhotia v. Deputy Director, Enforcement Directorate (First Appeal Nos. 527-529/2010) at this stage of the proceedings the respondents are not obliged to prove the fact beyond d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... two companies in the garb of share application money. Out of this, an amount of Rs. 5,68,35,000/- was invested as share application money in both M/s Sonanchal Buildcon (P) Ltd. and M/s Angesh Trading Co. (P) Ltd. by three companies, run by one Shri Atul Jalan of Delhi. The remaining amount of Rs.38,00,000/- was invested as share application money in M/s Angesh Trading Co. (P) Ltd. by M/s Magic Buildwell (P) Ltd, run by one Shri Ankur Mittal of Delhi. This is reflected in the table below : SL. NO. NAME OF THE COMPANY PROVIDING ACCOMMODATION ENTRY AMOUNT OF ACCOMMODATION ENTRY PROVIDED TOTAL SONANCHAL ANGESH 1. Atul Jalan Portfolio and Finance Pvt. Ltd. 1,32,00,000/- 90,50,000/- 2,22,50,000/ - 2. Raj Rani Securities Pvt. Ltd. 1,14,60,000/- 41,50,000/- 1,56,10,000/ - 3. Mridul Securities Pvt. Ltd. 1,07,75,000/- 82,00,000/- 1,89,75,000/ - 4. Magic Buildwell Pvt. Ltd. -- 38,00,000/- 38,00,000/- TOTAL 3,54,35,000/- 2,52,00,000 6,06,35,000/ - Ostensibly, both Shri Atul Jalan and Shri Ankur Mittal, in turn, subsequently sold the shares to various entities, which were actually grain merchants of Delhi. Almost all such merchants admitted that they had given adjustment entries by issuing ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cause equivalent amount of cash plus 0.1% commission in cash was paid to M/s Raj Rani Securities by M/s Sonanchal Buildcon and Angesh Trading, prior to making application for allotment of shares. 94. The director of M/s Atul Jalan Portfolio Finance Co. P. Ltd., Sh. Atul Jalan agreed with the statement given by Sh. Ankit Goel. Similarly, M/s Magic Buildwell (P) Ltd., upon receipt of two transfers of Rs. 20 lakhs and 18 lakhs respectively, issued two drafts of equal value on 30.01.2008 in favour of Angesh Trading Co. Pvt. Ltd. This was admitted by Shri Ankur Mittal, Director of M/s Magic Buildwell Pvt. Ltd. Investigations revealed that this company was a paper company operating solely for the purpose of providing accommodation entry against receipt of cash. 95. A detailed account of the modus operandi adopted to procure bogus entries in the form of share-application money against payment of cash including a small percentage of commission can be found in pages 25 to 35 of the impugned order. No share certificates were either issued or insisted upon by the purported allottees. However, in the name of share-application money, Rs. 6,06,35,000/- were introduced into the books of the two f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Jalan Port Folio, Raj Rani Securities Pvt. Ltd. And Mridul Securities Pvt. Ltd. were controlled by Mr. R.S. Jalan and he was the majority shareholder in all the three companies which went up to the extent of more than 95% shares. ED has no reasonable answer to the contention of the present Appellant company that this arrangement of making the company functional and earn profit was an arrangement between Mr. R.S. Jalan, the controller of three companies from where the funds were invested, and Mr. Prashant Singh who was working as a director of the Appellant company. The figure of share allotment in case of the present Appellant company shows that Mr. Prashant Singh and Mr. Abhishek Singh were minority shareholders and majority shareholders were Atul Jalan Port Folio and Finance Pvt. Ltd., Mridul securities Pvt. Ltd. And Raj Rani Securities Pvt. Ltd. 101. It is also contended That there is no link, either direct and indirect, to even suggest that the said investment in the present Appellant company was done by the illegal money generated by Mr. Bhanu Pratap Sahi. The presumption of authorities below that the Appellant company is the front company of Mr. Bhanu Pratap Sahi is legally u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CA/Authoried Representative of these companies and Sh. Atul Jalan, Director of one of the companies, in their statements dated 04/05.12.2012 and 23.11.2012 respectively. The said statements u/s 50 of PMLA, 2002 also establish the culpability of the present appellants. 107. It is pointed out that against receipt of Rs. 5,68,35,000/- during the year 2008-09 in the garb of share application money by M/s Sonanchal Buildcon Pvt.Ltd., a total 70,870 shares has been shown to be allocated in the books of account of M/s Sonanchal Building Pvt.Ltd. to M/s Atul Jalan Portfolio Finance Pvt. Ltd., M/s Raj Rani Securities Pvt. Ltd. and M/s Mridul Securities Pvt. Ltd. The above shares have been shown to have been allotted in the books of account on 31.03.2011, i.e., after the registration of F.I.R by the CBI on 11.08.2010, though the share application money has been received during the period 08.01.2008 to 24.03.2009, much prior to the search and it has been revealed during the investigation that no such shares were issues to/received by the entities who had provided the share application money. 108. During the course of investigation made by the Respondent Directorate, Sh. Ankit Goel, Chartered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e issued on the same day, i.e., 30.01.2008 in favour of M/s Angesh Tading Co. Pvt.Ltd., itself, again on the direction of Sh. Atul Jalan of M/s Jalan Portfolio and Finance Co. Pvt. Ltd. against which he has received commission of Rs. 3,800/- in cash without any subscription of any share . This clearly indicates that M/s Magic Buildwell Pvt. Ltd. was a paper firm operating solely for the purpose of providing accommodation entry against receipt of cash. 111. Sh. Ankit Goel, in course of his statement given on behalf of M/s Atul Jalan Portfolio and Finance Pvt. Ltd., M/s Raj Rani Securities Pvt. Ltd. M/s Mridul Securities Pvt. Ltd. also stated that no share was allotted in respect of the payment made to Sonanchal Angesh Trading Co. Pvt Ltd. It is submitted that M/s Sonanchal Buildcon Pvt. Ltd. and Angesh Trading Co. Pvt. Ltd. are companies in terms of section 2(1)(s) of the PMLA, 2002 and these companies also appear to be guilty of the offence of money laundering and are liable to be proceeded against and punished accordingly. It is crystal clear that the companies had no business activity of their own and were created with the sole intention of layering of proceeds of crime, so as to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are subsequently shown to have sold the shares to various entities, which were actually grain merchants of Delhi, most of whom admitted that they had given adjustment entries by issuing cheques against cash. Both Shri Atul Jalan and Shri Arun Gopal Bansal made statements under section 164, Cr. P.C. before the court, in this regard. These facts were also been admitted by Shri Ankit Goel, Chartered Accountant/ Authorised Representative of these companies and Shri Atul Jalan. Director in their statements statement u/s 50 of the PMLA recorded on 04/05.10.2012 and 23.11,2012, respectively. Furthermore, against receipt of Rs.5,68,35,000/- during 2008-09, in the garb of share application money by M/s Sonanchal. Buildcon (P) Ltd., shares were shown to have been allocated in the books of account of M/s Sonanchal Buildcon (P) Ltd. to three companies, namely, M/s Atul Jalan Portfolio Finance Pvt. Ltd., M/s Raj Rani Pvt Ltd., M/s Mridul Securities Pvt. Ltd. The said shares have been shown to have been allotted in the books of account on 31.03.2011, i.e., after the registration of FIR by the CBI on 11.08.2010, though the share application money has been received during the period 08.01.2008 to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Ld. AA has ignored the fact that all the three companies, namely, M/s Atul Jalan Port Folio, Raj Rani Securities Pvt. Ltd. And Mridul Securities Pvt. Ltd. were controlled by Mr. R.S. Jalan and he was the majority shareholder in all the three companies which went up to the extent of more than 95% shares, and that this was an arrangement between Mr. R.S. Jalan, who controlled the three companies from where the funds were invested and Mr. Prashant Singh, the director of the appellant companies to make the company functional and earn profit. Mr. Prashant Singh and Mr. Abhishek Singh became minority shareholders and M/s Atul Jalan Port Folio and Finance Pvt. Ltd., M/s Mridul securities Pvt. Ltd. and M/s Raj Rani Securities Pvt. Ltd. became the majority shareholders. 120. The above contentions of the appellant are contrary to the findings of the investigation which already discussed at length in the preceding paragraphs, namely, that Shri Atul Jalan and Shri Arun Gopal Bansal made statements under section 164, Cr. P.C. before the court, in essence admitting that the socalled share purchase transactions were essentially adjustment entries; that this fact were also admitted by Shri Ank ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pondents have pointed out that the initial dealings for taking over of these two companies was done by one Shri Ajay Singh, who was a close friend of Shri Bhanu Pratap Sahi. Shri Prashant Kumar, one of the Directors in both the companies was a nephew of Shri Bhanu Pratap Sahi, and was also the Convener of Nau Jawan Sangharsh Morcha of Shri Bhanu Pratap Sahi and was collecting donations for the party. There is also more than sufficient material on record to establish the money trail for securing the accommodation entries by way of share application money as discussed in the foregoing paragraphs. 122. It is next contended that the witnesses examined by ED under PMLA have stated that they received money from Mr. Atul Jalan and none of them have taken the name of either Mr. Bhanu Pratap Sahi or his friend Mr. Ajay Singh or his nephew Mr. Prashant Kumar Singh. This submission of the appellant only reconfirms the fact that appellants have made every effort to layer the transactions so that the illicit money is not traced back to its original source. 123. It is submitted that the Ld. AA failed to appreciate the fact the ED has to prove that the alleged properties of Appellant are Benami a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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