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TMI Blog2024 (10) TMI 457X X X X Extracts X X X X X X X X Extracts X X X X ..... r Solutions Ltd., Shri Yashovardhan Birla (Chairman/Director), Shri P.V.R. Murthy (Managing Director), Shri Y.P. Trivedi (Director), Shri Rajesh Shah (Director), Shri Upkar Singh Kohli (Director), Shri M.S. Arora (Director), Shri Ashish Mahendrekar (Manager & Authorized Signatory), Shri Tushar Dey (Group President & General Counsel of Yash Birla Group), Shri Anant Vardhan (Director) and Shri Manish Malani (Director) under Section 406, 420, 120(B) of the IPC and Section 3 and 4 of the Maharashtra Protection of Interest of Depositors (in Financial Establishments) Act, 1999 ("MPID Act"). 3. The case was subsequently transferred to the Economic Offences Wing (EOW), Mumbai Unit which filed a charge sheet on 29/03/2014 in the MPID Court against the arrested accused Shri P.V.R. Murthy. It was alleged that the accused company M/s Birla Power Solutions Ltd., their group entities and their director offered attractive interest on fixed deposits by way of advertisement. Investments to the tune of approximately Rs. 300 to 400 crores were collected from around 100 to 150 companies/persons. As per the charge sheet submitted by the EOW, an amount of Rs 57.04 crore and Rs 214 crores remained unpai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd. Consequently, as mandated by the Act, an Original Complaint (OC) was filed by the respondent Directorate under Section 5(5) of the Act before the Ld. Adjudicating Authority. In pursuance of the same, the Ld. AA, vide the impugned order dated 27.05.2016, confirmed the provisional attachment of the properties in question. Aggrieved by the said order of the Ld. AA, the appellants have filed these appeals before us. ARGUMENTS AND CONTENTIONS ON BEHALF OF THE APPELLANT 8. Upon perusal of the appeal paper book, it is seen that the appellant had raised several grounds therein. Detailed submissions have been made to argue that "reason to believe" which is a pre-requisite before property can be provisionally attached under Section 5, did not exist and that sufficient material did not exist to have "reason to believe". It is further contended that the document portrayed as 'charge-sheet' is not a charge-sheet within the meaning of Section 173 read with Section 170 of the Cr. P.C.; that Shri Bhavin Suryakant Sheth and other complainants were not examined by the ED and the investigation by the Directorate was confined to recording of statement of three complainants; that all the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11. In the above context, it is pointed out that in the present case, the PAO dated 08.12.2015 was confirmed by the Ld. AA on 27.05.2016. However, the prosecution complaint was filed only on 16.07.2018, i.e., after a delay of more than 2 years from the date of confirmation of the PAO. It is contended that the intention behind the amendment of the Act was to prevent "timeless attachment of the property of the innocent by the hands of the Director to Enforcement". The judgement of the Hon'ble Supreme Court in Vijay Madanlal Choudhary v. Union of India, [2022] 140 taxmann.com 610/2022 SCC online SC 929 is inter alia relied upon for the proposition that attachment made during the course of the investigation cannot be done for a timeless period in the spirit of Section 8(3)(a) of the PMLA, 2002. The Respondent (ED) did not file the prosecution complaint within the stipulated period of 90 days from the date of confirmation by the Ld. Adjudicating Authority and still enjoys the attachment of the said property in the teeth of the provisions of section 8(3)(a) of PMLA. 12. It is further contended that when the law provides for a thing to be done in a particular manner, then the same sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whole. If a statute is curative or merely declaratory of the previous law, retrospective operation is generally intended. The amendment would not serve its object in such a situation unless it is construed as retrospective. (iii) Hitendra Vishnu Thakur v. State of Maharashtra [1994] 4 SCC 602; AIR 1994 SC 2623 - * A statute which affects substantive rights is presumed to be prospective in operation unless made retrospective either expressly or by necessary intendment whereas a statute which merely affects procedure, unless such a construction is textually impossible, is presumed to be retrospective in its application, should not be given an extended meaning and should be strictly confined to its clearly defined limits * Law relating to forum and limitation is procedural in nature, whereas law relating to right of action and right of appeal even though remedial is substantive in nature * Every litigant has a vested right in substantive law but no such right exists in procedural law * A procedural statute should not, generally speaking, be applied retrospectively where the result would be to create new disabilities or obligations or to impose new duties in respect of trans ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the appeal, the respondents have addressed the issues raised in the grounds of appeal. It is contended that the funds raised from investors were not utilized for the intended purpose and were ultimately used for a cause which was not disclosed to the investors in the advertisement published by the appellant. The fraudulent intention of the appellant is proved from the fact that the funds received from investors were initially diverted to own sister concerns and ultimately to one Shri Madan Diwan and his companies. Out of these funds, Madan Diwan transferred back Rs. 98 crore to Yash Birla group companies. This clearly reveals the fraudulent intention of the appellant. Funds were collected from investors for expansion and filling of gap of working capital of Birla Power Solution Ltd. but the same were never used for the intended purpose and were routed to various companies of their own group and ultimately transferred to Madan Diwan and were finally utilized for Birla Surya Ltd. project which was subsequently abandoned due to adverse market conditions for their products. It was an act of dishonesty committed by the appellant on the investors to hide the true purpose of raising t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f these appellants. Further, it is not even the case of the appellants that the subject properties are beneficially owned by them or that they have some interest in the subject properties. At para 10 (pg. 86 of the appeal paper book) the Impugned order states that the subject properties are liable to be attached, but the order is not passed against the appellants. The paragraph in question reads as below: "10. For the reasons details above, it is prima-facie indicated that the above said defendants viz. M/s Birla Power Solution Ltd., through its Directors, M/s Birla Surya Ltd, through its Directors, Shri Yashovardhan Birla, P.V.R. Murthy, Madan Diwan, Alaka Madan Diwan, M/s Ramchandra Bhimaji and Company, Dadhe Infrastructures Pvt. Ltd., and Maha Urja Utilities Ltd. have committed offence under Section 3 of Prevention of Money Laundering Act (PMLA), 2002 and the above said immovable property valued at Rs. 30,22,90,468/- presently under order of provisional attachment are involved in money laundering and thereby rendering the same liable for confirmation of attachment under Section 8(3) of the said Act. The investigation under PMLA, 2002 is in progress. The present complaint is fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pect of all properties attached under para 3 and 4 of the chart, which are not the properties of the appellants and they have not been authorised in any capacity to seek reliefs in respect thereof. Therefore, the reliefs sought by the appellants are not maintainable. 20. It is also reiterated that the impugned order is well-reasoned and captures the role of the appellants in the commission of the offence of money laundering at pages 77, 84 and 87. The findings in respect of the role of all the appellants herein are also stated clearly in the Prosecution Complaint filed by the Directorate before the Ld. Special Court on 16.07.2018 which is now the subject matter of final adjudication and trial before the Special Court. 21. Based on the above contentions, the respondents have prayed that the present appeals be dismissed. It may be mentioned that no specific arguments have been presented from the respondents' side on the issue of limitation which is the only issue raised before us from the appellants' side at the stage of final hearing. ANALYSIS AND FINDINGS 22. We have given careful consideration to the rival contentions of the parties and perused the material on record. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mended clause came into effect on the date of publication of the notification, i.e., 19.04.2018. Accordingly, we are of the view that the respondent Directorate had 90 days from 19.04.2018 to file the prosecution complaint. As per appellants' own admission, the prosecution complaint in this case was filed on 16.07.2018. We find that counted from 19.04.2018, the said date was within the limitation period of 90 days. 26. In this context, we have also perused the case laws cited by the appellant but did not find anything in the same which could support the appellant's contention. There is nothing in para 246 of the judgment of the Hon'ble Supreme Court in Vijay Madanlal Choudhary (supra) to even remotely support the appellant's case. In Sree Sankaracharya University of Sanskrit (Supra), while upholding the position that if a statute is curative or merely clarificatory of the previous law, retrospective operation thereof may be permitted, the Hon'ble Supreme Court also pointed out that in order for a subsequent order/provision/amendment to be considered as clarificatory of the previous law, the pre-amended law ought to have been vague or ambiguous. It is only when ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be to create new disabilities or obligations or to impose new duties in respect of transactions already accomplished. This is clearly against the appellant's case rather than in its support. In Memon Abdul Karim Haji Tayab's case the Apex Court noted that it is well-settled that procedural amendments to a law, in the absence of anything to the contrary, apply retrospectively in the sense that they apply to all actions after the date they come into force even though the actions may have begun earlier or the claim on which the action may be based may be of an anterior date. In the present case, the Directorate has complied with the requirement of the amended law after it came into force by filing the prosecution complaint within 90 days of that date. 29. In light of the above discussion, we do not find any merit in the appellant's contention that the subject properties which were provisionally attached were liable to be released on account of the respondent Directorate's failure to file a prosecution complaint within 90 days of the order of the Ld. AA dated 19.01.2015. The period of 90 days would commence from the date the amendment came into force, i.e., 19.04.2018 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f PMLA, 2002, any person aggrieved by an order made by the Adjudicating Authority under the Act, may prefer an appeal to the Appellate Tribunal. It cannot be said that merely because none of the properties whose attachment has been confirmed belong to the appellants, they cannot be aggrieved by the impugned order, especially in light of the conclusions mentioned above. Furthermore, we find that the prayers of the appellants in these appeals are as follows: "(a) Set aside impugned Order No. OC-538/2016 dated 27.5.2016 passed by the Learned Adjudicating Authority confirming the Provisional Attachment Order; (b) set aside Provisional Attachment Order No. 21/2015 dated 8.12.2015 of the Dy. Director, Directorate of Enforcement, Mumbai Zonal Office, Mumbai; (c) Call for the judicial documents / records from the Ld. Adjudicating Authority based on which the impugned order has been passed; Issue suitable directions, order as are deemed necessary in the facts and circumstances of the case." 32. We do not find anything in the above Prayer in the appeals to indicate that the appellants are seeking the release of any specific property which does not belong to them. Their prayer is to se ..... X X X X Extracts X X X X X X X X Extracts X X X X
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