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TMI Blog2024 (11) TMI 831X X X X Extracts X X X X X X X X Extracts X X X X ..... t there was extra-ordinary situation during the period Covid-19 and, therefore, the Apex Court in the case of Prakash Corporates v. Dee Vee Projects Limited [ 2022 (2) TMI 1268 - SUPREME COURT ] has provided safeguard to the litigants and others for termination of proceedings and illustratively reference of few provisions like Arbitration Act was given. It was with clarity that it would apply to other statutes also - the argument of the appellant to lapse the proceedings despite the period for termination of proceedings which was excluded from 15.03.2020 till 20.08.2022, cannot be accepted. If the aforesaid period is excluded, left out period in this case is hardly of 26 days i.e. less than 180 days. Thus, even the subsequent legal issue raised by the appellant is not worth acceptance and is rejected summarily. Accordingly, appeal fails and is dismissed. - JUSTICE MUNISHWAR NATH BHANDARI, CHAIRMAN SHRI BALESH KUMAR, MEMBER For the Appellant: Shri Amitabh Gupta, Authorized Representative For the Respondent: Ms. Nidhi Raman, Advocate FINAL ORDER FPA-PMLA-4644/MUM/2022 By this appeal under Section 26 of the Prevention of Money Laundering Act, 2002 (in short, the Act of 2002), a chal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he accused/appellant and based on it, ECIR was recorded on 29.10.2009. The FIR (CR No. 109/2006) was registered for the offence under Section 465,467,468,471,420 and 120-B IPC. 4. The allegation against the appellant, apart from Alok Agarwal and others, was for criminal conspiracy, cheating and forgery. It was in reference to irregularities in allotment of residential rooms/shops under Slum Rehabilitation Scheme implemented at Garib Mazdoor Sangh Zopadpatti to the persons not connected to the said Zopadpatti. Accordingly, the inquiry revealed that many persons, who were not at all entitled for it, were allotted residential rooms/shops under the said Scheme based on forged documents, such as affidavits, ration cards, electricity bills, etc. 5. It was also found that the appellant submitted inflated number of huts/persons for the proposal of S.R. Scheme to the SRA Authority and got it approved from the Government authorities by submitting fabricated/forged documents such as Ration Cards, Electricity Bills, affidavits showing purchase of huts. 6. During the course of investigation, another FIR bearing No. 436/2017 for the offence under Section 465,467,468,471,406,420,423 IPC was regis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the appellant, his associates, Government employees and other persons were recorded and considered by the Adjudicating Authority to find out a case of money laundering. The statement of Government officials was sufficient to find a case of commission of offence for which FIR was registered against the appellant. 9. The case of the appellant was that none of the offence have been committed by him or other accused for which two FIRs were registered followed by ECIR. The case of the appellant is that subsequent to the dispute between the two companies, a Supplementary Agreement was executed in the year 2016 to the main agreement and accordingly M/s Chintan Life Spaces LLP was having no right as a Developer in the said project. A litigation in the shape of a Civil Suit was filed before the Bombay High Court which was obviously for the rights of the sale components and necessary permission. In the light of the Civil Suit filed by the complainant, the FIR was not maintainable or could not have been taken for money laundering yet ECIR was recorded by the ED and has been questioned by the appellant whose property has been attached. 10. The counsel for the appellant raised the issues onl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sold rooms/shops to them thereby reducing the number of Project Affected Persons (PAP) tenements resulting in proceed of crime Rs. 11 crores. 15. Another FIR was registered for M/s Chintan Life Spaces LLP. A Transfer-cum-Assignment Deed dated 30.04.2013 was executed by way of criminal conspiracy, cheating and forgery. The appellant had taken Rs. 101.50 Crores and otherwise total value of the proceeds of crime could have been Rs. 117 Crores. The proceeds of crime acquired by the appellant was utilized for purchase of immovable properties situated at Innova Building, Lower Parel (W), Mumbai. It was also found that appellant and his entities owned and controlled by him, apart from family received an amount to the extent of Rs. 101.50 Crores from M/s Chintan Life Spaces LLP and is a part of proceeds of crime and accordingly those properties were attached. The prayer was accordingly to dismiss the appeal as no case is made out even on facts. 16. We have considered the rival submissions of the parties and scanned the matter carefully. 17. The Economic Office Wing (EOW0 of Mumbai Police registered a case vide CR No. 109/2006 dated 21.10.2006 against Shri Alok Agarwal, Shri Sailesh Savla O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been made. The civil dispute between the two parties i.e. the appellant and M/s Chintan Life Spaces LLP would be decided by the Court. Accordingly, prayer was made to cause interference in the order. The appellant has not submitted argument to defend the allegation other than to submit that subsequently, a supplementary agreement was entered between the appellant and complainant and thereby complainant no more remains a developer. We, however, find no challenge to the FIR or ECIR, rather they still exist. 24. So far as the allegation regarding cheating for a sum of Rs. 11 Crores is concerned, no argument whatsoever was advanced by the appellant on facts and otherwise the material available on record has been taken into consideration by the Adjudicating Authority and we find it to be sufficient to draw conclusion regarding offence of money laundering against the appellant. Thus, no case is made out to cause interference in the impugned order. 25. The learned counsel for the appellant raised legal argument in written submissions given subsequently though it was not raised orally. However, we would be dealing with it. It is submitted that the order dated 29.03.2022 was passed after 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, 2022 to extend the termination of proceedings excluding the period from 15.03.2020 to 20.08.2022. The Tribunal and for that High Court are not having authority to take a decision contrary to the judgment of the Apex Court. Elaborately, this issue was considered and decided by the Telangana High Court. It is in the case of Hygro Chemicals Pharmtek Pvt. Limited Vs. Union of India Ors. reported in MANU/TL/1003/2023 where a similar issue in reference to period of 180 days provided u/s 5(1) was taken into consideration. Relevant part of para 15 of the said judgment is quoted hereunder: 15. Issue No.3: Whether the period from 15.03.2020 to 28.02.2022 which was excluded by the Apex Court in computation of limitation vide In re: Limitation (supra) is applicable to orders confirming provisional attachment within 180 days? i) The Petitioner in W.P. No. 34238 of 2022 contends that the provisional attachment order i.e., PAO No. 04 of 2022 dated 03.02.2022 could not have been confirmed by the Adjudicating Authority vide order dated 22.08.2022 as the same was passed after the lapse of 180 days. Further, the Petitioner contends that Adjudicating Authority cannot rely on In re: Limitation (supr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... courts/tribunals across the country including this Court, it is hereby ordered that a period of limitation in all such proceedings, irrespective of the limitation prescribed under the general law or special laws whether condonable or not shall stand extended w.e.f. 15-3-2020 till further order(s) to be passed by this Court in present proceedings. v) Subsequently, the limitation period was extended vide In re: Cognizance for Extension of Limitation (hereinafter In re: Limitation, 2022 ) till 28.02.2022. The Apex Court vide the said order clarified that where any statute provides an outer limit of limitation period within which the proceedings are to be completed, the period between 15.03.2020 to 28.02.2022 shall be excluded in computing such period. The relevant paragraphs of In re: Limitation, 2022 (supra) are extracted below: 5.1. The order dated 23-3-2020 [Cognizance for Extension of Limitation, In re, (2020) 19 SCC 10 : (2021) 3 SCC (Cri) 801] is restored and in continuation of the subsequent orders dated 8- 3-2021 [Cognizance for Extension of Limitation, In re, (2021) 5 SCC 452 : (2021) 3 SCC (Civ) 40 : (2021) 2 SCC (Cri) 615 : (2021) 2 SCC (L S) 50], 27-4-2021 [Cognizance for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion (supra) in computation of 180 days for confirming the provisional attachment of property, it is apposite to discuss the nature of time frame prescribed under Section 5 of the PMLA. ***** xvii) Similarly, the Calcutta High Court in Hiren Panchal (supra) held that vide orders in In re: Limitation (supra), the Apex Court extended the period of limitation to safeguard the right of litigants to institute proceedings. The Court held that computation of 180 days to confirm provisional attachment of properties under Section 8(3) of the PMLA cannot be equated to initiation/institution of proceedings. The Court also held that prescription of 180 days is in the form of a protection against deprivation of right to property. The relevant paragraphs are extracted below: 15. It is further relevant to state that the orders passed by the Supreme Court in the Suo Motu writ petition mention specific provisions in specific statutes such as Sections 23(4) and Section 29A of The Arbitration and Conciliation Act, 1996, Section 12A of the Commercial Courts Act, 2015 and Section 138 provisos (b) and (c) of the Negotiable Instrument Act, 1881. On an examination of the specific statutes mentioned by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... obindo Das, the Appeal Court disagreed with the view of the Adjudicating Authority being a non-litigant . The Division Bench was also disturbed by the fact that the bank accounts of the writ petitioners have been debited leaving the balance at zero despite the order of attachment. Prakash Corporates dealt with the prescribed statutory time period for filing of the written statement under Order VIII Rule 1 of The Code of Civil Procedure, as amended by the Commercial Courts Act. Prakash Corporates also recognised the fact that the decision in S. Kasi was concerned with filing of the charge sheet under Section 167(2) of The Code of Criminal Procedure (Cr.P.C.) and hence would not apply to filing of written statements beyond the prescribed time-limit. 22. The reasoning in S. Kasi would apply to the present case. The Supreme Court recognised that the 23rd March, 2020 order in the Suo Motu writ petition was for the benefit of those whose remedy may be barred by time because of not being able to physically come to Court to file proceedings. The Supreme Court made a distinction between the benefit given to litigants and extension of time for filing of a chargesheet by the police as contemp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... passed. The relevant paragraphs are extracted below: 304. The other grievance of the petitioners is in reference to the stipulation in sub-section (4) of Section 8 providing for taking possession of the property. This provision ought to be invoked only in exceptional situation keeping in mind the peculiar facts of the case. In that, merely because the provisional attachment order passed under Section 5(1) is confirmed, it does not follow that the property stands confiscated; and until an order of confiscation is formally passed, there is no reason to hasten the process of taking possession of such property. The principle set out in Section 5(4) of the 2002 Act needs to be extended even after confirmation of provisional attachment order until a formal confiscation order is passed. Section 5(4) clearly states that nothing in Section 5 including the order of provisional attachment shall prevent the person interested in the enjoyment of immovable property attached under sub-section (1) from such enjoyment. The need to take possession of the attached property would arise only for giving effect to the order of confiscation. This is also because sub-section (6) of Section 8 postulates th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (supra) cannot be unnecessarily narrowed and in relation to S. Kasi (supra) held that the same stands on different footing as it dealt with Article 21 of the Constitution of India. The relevant paragraphs are extracted below: 27.7. We are not elaborating on other directions issued by this Court but, when read as a whole, it is but clear that the anxiety of this Court had been to obviate 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. [ To complete the scenario, we may indicate in the passing that even after we had heard this matter, there had been re-surge of Covid-19 cases with spread of a new variant of the virus. The drastic re-surge in the number of Covid cases has led this Court to again deal with the matter in SMWP No. 3 of 2020 on an application bearing No. 21 of 2022; and by the order dated 10-1-2022 [Cognizance for Extension of Limitation, In re, (2022) 3 SCC 117 : (2022) 2 SCC (Civ) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n S. Kasi case pertains to the scope of Section 167(2) of Cr.P.C. which is directly referable to Article 21 of the Constitution of India viz., personal liberty of a person. The same cannot be equated while dealing with a property right under Article 300-A of the Constitution of India and the judgment of the Apex Court in S. Kasi case cannot be applied to a case involving property right of an individual or a corporate. 14. Our reasoning supra is also supported by the judgment of the Apex Court in Prakash Corporates v. Dee Vee Projects Limited [(2022) 5 SCC 112]. The Apex Court has explained the scope of the order passed in S. Kasi case and has categorically held that the same cannot be applied in a matter involving proceedings before a Court. The second respondent was exercising a quasi-judicial function and the ratio in S. Kasi case cannot be applied to such a quasi-judicial authority. In any case, we keep this issue open to enable the petitioner to agitate the same before the Appellate Tribunal. xxiv) This Court also disagrees with the view adopted in Vikas WSP Ltd. (supra), Gobindo Das (supra) and Hiren Panchal (supra). The decision in Vikas WSP Ltd. (supra) was stayed by a Divis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed . 29. Paras quoted above not only makes reference of the judgment of the Apex Court in Suo Motu Petition decided vide the order dated 10.01.2022 but subsequent judgment again of the Supreme Court in the case of Prakash Corporates v. Dee Vee Projects Limited reported in (2022) 5 SCC 112. 30. The effort of the counsel for the appellant is to decide the issue in conflict with the judgment of the Apex Court. The arguments have been made without realizing that the judgment of the Apex Court in the case of Vijay Madan Lal Choudhary Vs, Union of India reported in 2022 SCC Online 929 was given on a challenge to the constitutional validity of certain provisions of the Act of 2002 and therein reasons were given to hold provisions to be constitutional valid. The reference of safeguard inbuilt in the Act were given for that purpose. It is true that the Adjudicating Authority needs to pass an order to terminate the proceedings within 180 days otherwise the attachment would lapse but there was extra-ordinary situation during the period Covid-19 and, therefore, the Apex Court has provided safeguard to the litigants and others for termination of proceedings and illustratively reference of few p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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