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TMI Blog2024 (7) TMI 1566X X X X Extracts X X X X X X X X Extracts X X X X ..... was given to the appellant has been noticed and as it was earlier belonging to one of the accused thus, the documents were seized by the respondent and we do not find any illegality in it. The words the value of such property does specify it to be earlier to the crime or subsequent and we can insert words thus value of such property would mean the property acquired prior or subsequent to the crime.' It is not that only those properties which have been were derived or obtained directly or indirectly out of the crime can be attached rather in case of non-availability of the property derived or obtained directly or indirectly rather when it is vanished or siphoned off, the attachment can be of any property of equivalent value. It is necessary to clarify that the proceeds of crime would not only include the property derived or obtained directly or indirectly out of the criminal activity relating to the scheduled offence but any other property of equivalent value. The word or has been placed before the value of any such property and is of great significance. Any property of equivalent value can be attached when the proceeds directly or indirectly obtained out of the crime has been v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... namely M/s Vision Procon (through its Proprietor Dinesh Kumar, Accused), M/s Heights International (through its Proprietor Amanpreet Singh Sodhi, Accused), and M/s Saibhakti Impex Pvt. Ltd., Accused (through its Directors Aman Kirpal - Accused and Gaurav Kirpal - Accused) to have caused loss to the bank to the tune of USD 47.86 Million equivalent to approximate Indian Rs. 321.00 crores (calculated @ Rs. 67 per USD) as on date. d) M/s Colour Wave (HK) Ltd., an accused company, having office address at G/F, CAR, PO, Commercial Building, 18- 20, Lyndhurst Terrace Central Hong Kong (Also at 4/E, Flat D-E, Wah Factory Building, 50-60, Wong Chuk Hang Road, Aberdeen) was the beneficiary of all the fraudulent SWIFT Messages sent. e) Further, Brigadier (Retd.) M.S. Dullat, Accused, is the father-in-law of Accused and is Director in M/s VyaparAgrotech Limited in which the Accused Mr. Amanpreet Singh Sodhi was another Director. f) The Indian Overseas Bank had informed that Accused Ashu Mehra, the master mind, was indulging in issuing Letters of Undertaking (LOUs) through SWIFT messages fraudulently in collusion with others to cheat the Bank. The overseas banks had provided Buyers Credit to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... btain offer letters from the overseas funding banks.For obtaining the offer letters, the accused Ashu Mehra was in touch with another accused Amanpreet Singh Sodhi (Proprietor of M/s Heights International, Ludhiana as well as Director of M/s Colour Wave(HK) Ltd.). The investigation further revealed that the accused Amanpreet Singh Sodhi was in touch with one Nitin Girdhar of M/s Nextgen Financial Services having office in Indirapuram, Ghaziabad (UP) for obtaining the offer letters from the overseas funding banks. l) Based upon the fraudulent LOUs issued through SWIFT messages, the overseas funding banks, viz. Punjab National Bank, Dubai and Bank of Baroda, Bahamas, disbursed the funds on account of the said fraudulent LOUs to the HSBC bank account of the beneficiary accused company, viz. M/s Colour Wave (HK) Ltd., in Hong Kong. m)The beneficiary accused Hong Kong based company, viz. M/s Colour Wave (HK) Ltd., used to repatriate the proceeds of crime generated as a result of the said fraudulent LOUs into the bank accounts of the firms/companies owned or controlled by the accused in India, either directly or by routing the same through bank accounts of two firms M/s Besco Internation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the scheduled offence, but any other property of equivalent value, in case the property acquired out of crime has been vanished or siphoned off. Reference to the definition of `proceeds of crime‟ under Section 2 (1) (u) of the Act of 2002 has been given. The definition includes not only the property directly or indirectly obtained out of the scheduled offence but even property of equivalent value. Thus, it is not necessary that the property attached or seized should be directly or indirectly an outcome of the crime rather in a given case where it has been siphoned off or vanished, it can be a property of equivalent value to the amount involved in the crime even acquired prior to the crime. 6. It is further submitted that if somebody is in possession of the property out of money laundering or falls within the definition of the `proceeds of crime‟ then it could be subjected to seizure or attachment though the person possessing the property or holding it may not be an accused. The requirement is to attach the proceeds of crime‟ involved in money laundering, thus, no case is made out in favour of the appellant on any of the issues raised by them. The prayer was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be serious. It would result to a situation where the accused would immediately try to vanish or siphon off the proceeds so that the properties may not be attached. In light of the same, the definition has been framed after taking care of all the circumstances and therefore it is not that only the property derived or obtained directly or indirectly from the crime would come within the sweep of Proceeds of Crime but it would be the property of equivalent value as well which may not have nexus with the proceeds of crime. It would also be when the property is taken or held outside the country then the property of equivalent value held within the country. The argument that attachment can be only of the property derived or obtained directly or indirectly out of the criminal activity was an issue before the Delhi High Court in the case of Enforcement Directorate v. Axis Bank, reported in 2019 SCC OnLine Del 7854 and Prakash Industries Ltd. v. Directorate of Enforcement, reported in 2022 SCC OnLine Del 2087. 9. The Ld. Counsel for the Appellant referred a judgment of Kerala High Court in W.P.(Crl) No. 406/2024 Satish Motilal Bidri vs. Union of India dated 28th June, 2024 to press upon the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Article 226 of the Constitution of India, notwithstanding the existence of an alternative remedy, this Court is of the view that the provisional attachment of the immovable property as seen from schedule A to Exhibit P11 order dated 22.05.2024 is liable to be set aside. However, as relating to the provisional attachment mentioned in schedule B to Exhibit P11, i.e. those relating to the amount in the bank accounts the petitioner has an effective alternative remedy provided by the statute. The perusal of the judgment in the case of Satish Motilal Bidri (supra) would show reference of the earlier judgment of different High Courts, which includes the judgment in the case of Seema Garg Vs. Deputy Director, Directorate of Enforcement 2020 SCC online Punjab Haryana 738 and also the judgment in the case of Axis Bank (supra). We, however, do not find reference of relevant para of the judgment of the Apex Court in the case of Vijay Madanlal Chaudhary Ors. Vs. Union of India 2022 SCC online Supreme Court 929rather makes reference of other paras.Para 68 of the said judgment is relevant and quoted thus: 68. It was also urged before us that the attachment of property must be equivalent in value ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the definition. 107. In contrast, the second and third kinds of properties mentioned above would ordinarily be untainted property that may have been acquired by the suspect legitimately without any connection with criminal activity or its result. The same, however, are intended to fall in the net because their owner is involved in the proscribed criminality and the tainted assets held by him are not traceable, or cannot be reached, or those found are not sufficient to fully account for the pecuniary advantage thereby gained. This is why for such untainted properties (held in India or abroad) to be taken away, the rider put by law insists on equivalence in value. From this perspective, it is essential that, before the order of attachment is confirmed, there must be some assessment (even if tentative one) as to the value of wrongful gain made by the specified criminal activity unless it be not possible to do so by such stage, given the peculiar features or complexities of the case. The confiscation to be eventually ordered, however, must be restricted to the value of illicit gains from the crime. For the sake of convenience, the properties covered by the second and third categories ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... holding such property can be subjected to attachment or seizure though he may not be accused in the FIR. It is for the reason that if the interpretation otherwise is taken, it would frustrate the object of the Act of 2002. It can be in a manner that the person who derived or obtained the property out of the crime may immediately park it with a third person and the property in that case would not be liable for attachment or seizure for the reason that the person holding the property has not been named as an accused, in that case, the very purpose and object of the Act would be frustrated. In view of the above, even if the appellant is not named as an accused but he is holding the `proceeds of crime‟ and even if the property if not directly or indirectly obtained out of the crime but is of the value thereof, it would fall in the definition of proceeds of crime and such property or document can be subjected to seizure. 16. In the instant case, serious allegations of fraudulent transactions to the tune of Rs.164.99 crores exists against many accused which includes appellant s grandfather. The appellant s grandfather purchased a property in the year 1988 but it was gifted to the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imb, which refers to the value of any such property would indicate any other property which was acquired prior to the commission of crime and it would be attached only when the proceeds directly or indirectly obtained or derived out of the criminal activity is not available. It may be on account of siphoning off or vanished by the accused. In those circumstances the property of equivalent value can be attached. The word the value of any such property signifies without any embargo that it should be the property purchased after the commission of crime or prior to it rather it would apply in both the eventuality in the given circumstance. Thus, we are not in agreement with the counsel for the appellant who has questioned the attachment in reference to the property acquired prior to commission of crime. We are not going even further that the properties have nexus with the proceeds out of the crime but even in given circumstances and scenario that the property was acquired prior to commission of crime then, also under certain circumstances, it can be attached for the value of any such property. The issue otherwise has been dealt with by this Tribunal in the case of Ayush Kejriwal (Supra ..... X X X X Extracts X X X X X X X X Extracts X X X X
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