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TMI Blog2024 (12) TMI 1308X X X X Extracts X X X X X X X X Extracts X X X X ..... on recorded by the Directorate of Enforcement under Prevention of Money Laundering Act, 2002 was initiated. 4. It was alleged that various accused persons including the Appellant Sh. Dinesh Pratap Singh, who was the Special Land Acquisition Officer (SLAO)/Competent Authority of Land Acquisition (CALA) in connivance with other revenue officers/middlemen etc. distributed exorbitant and unjustified compensation to farmers with the intention of getting monetary benefits, misappropriated government funds by way of granting compensation on acquisition of land at non-agricultural rate for the agricultural land which resulted into loss of Rs. 215.11 crores to Government. The investigation conducted by the Directorate of Enforcement and thereupon Prosecution Complaint was filed before Ld. Special Judge (PMLA), Dehradun, Uttarakhand. 5. The properties of present Appellant namely Sh. Dinesh Pratap Singh and his wife Smt. Alka Singh were provisionally attached under Section 5(1) of PMLA, 2002 and subsequently Original Complainant no. 1229/2019 was filed before Ld. Adjudicating Authority which has confirmed PAO. The counsel for the appellant raised following issues for challenge to the impugn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i) Hence, in terms of aforesaid judgments and law enunciated by the High Court, the impugned attachment order passed by Ld. Adjudicating Authority is liable to be quashed and set aside. B. NO SCHEDULED OFFENCE AND OFFENCE OF MONEY LAUNDERING IS MADE OUT IN THE LIGHT OF THE OBSERVATION OF LD. SPECIAL JUDGE (PMLA), DEHRADUN, UTTARAKHAND (i) It was submitted that in terms of Vijay Madanlal Choudhary vs Union of India, 2022 SCC online 929 it is trite principle of law that the offence under Section 3 of PMLA, 2002 depends on the fulcrum of the scheduled offence and offence of money laundering does not stand alone without the predicate offence. It is the case of the prosecution that the Appellant Dinesh Pratap Singh was involved in generating so called "proceeds of crime" by giving exorbitant compensation on the basis of back date orders of conversion of land u/s 143 of Uttar Pradesh Zamidari Abolition & Land Reforms Act, 1950 to the farmers of the Kashipur whose land was acquired for widening of NH-74. The appellant was posted as Special Land Acquisition Officer (SLAO)/Competent Authority of Land Acquisition (CALA) and passed the award. It has been ignored by the respondent that the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecial Judge (PMLA) has judicial binding on the order passed by the Ld. Adjudicating Authority. The order clearly suggest that instant case would not result into conviction and the properties are confiscated only when the accused is convicted under Section 3 & 4 of PMLA, 2002. It is trite principle of law that though adjudication proceedings and criminal proceedings are independent to each other but the material for commission of offence recorded by the authorities may be relevant. Reliance was placed on a judgment of the Supreme Court in the case of Radheshyam Kejriwal vs State of West Bengal (2011) 3 SCC 581 which enunciates the said proposition. In terms of said judgment, the impugned attachment order is liable to be quashed. (vi) The order passed by Ld. Special Court is evident and sufficient to rebut the presumption under Section 24 of PMLA, 2002 and therefore the Directorate of Enforcement was not entitled to take benefit of Section 24 of PMLA, 2002. The Directorate of Enforcement despite of its exhaustive investigation was not able to connect the present Appellant with any money trail which is being mentioned in Original Complainant filed by the respondent. Even for the argu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of Kumar Pappu Singh vs Union of India, 2021 SCC OnLine AP 983 and HDFC Bank Limited vs Govt. of India, Ministry of Finance, 2021 SCC OnLine Pat 4222. (iv) Details of properties provisionally attached by the Directorate of Enforcement and later on confirmed by Ld. Adjudicating Authority qua Appellant Sh. Dinesh Pratap Singh are as follows:- (v) PROPERTY DETAILS 1. Village- Bahubana, Tehsil- Maholi, District- Sitapur, Gata No. 44, Area 0.963 hectare 2. Village- Maharaj Nagar, Tehsil- Maholi, District- Sitapur, Gata No. 192, 284 & 289, Area- 0.465 hectare and land at Gata No. 125, Area- 0.482 hectare, Total Area - 0.947 hectare 3. Village- Baddapur, Tehsil- Maholi, District- Sitapur Gata No. 128, 183, 32, 229, Area 1.0502 hectare (vi) It is submitted that properties provisionally attached by the Directorate of Enforcement and later on confirmed by the Ld. Adjudicating Authority are ancestral properties of Appellant Dinesh Pratap Singh and the same has been transferred in the name of Appellant by the virtue of gift deeds. Copies of Khatauni, Jamabandi and other relevant land records suggest that the properties in question has no connection with "the proceeds of crime". ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 011 SCC Online AP 152, the impugned attachment order is liable to be quashed and set aside. (xi) The financial credential of Sh. Dinesh Pratap Singh was deeply scrutinized and examined by the Income Tax Department during the assessment and given clean chit to the Appellant and therefore it is evident that the funds transferred to the Appellant Smt. Alka Singh by her husband Sh. Dinesh Pratap Singh was legitimate and untainted money and therefore the attachment of property by the Directorate of Enforcement on the assumption that the property held by the Smt. Alka Singh is from the proceeds of crime is contrary and inconsistent to law and therefore the impugned attachment is liable to be set-aside. (xii) It can be ascertained that Rs. 30,00,000/- (Rupees Thirty Lacs Only) was paid by Sh. Dinesh Pratap Singh to her wife Smt. Alka Singh from his legitimate income which had nothing to do with alleged "proceeds of crime" and another sum of Rs. 15,10,000/- (Rupees Fifteen Lacs Ten Thousand Only) has already been returned by Smt. Alka Singh to her husband Sh. Dinesh Pratap Singh. D. NON-SATISFACTION OF BASIC INGREDIENTS OF OFFENCE OF MONEY LAUNDERING (i) It is trite principle of law th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thout appreciating the contentions of the Appellants herein even out rightly ignored. (ii) The High Court of Delhi in Kankipati Rajesh vs Adjudicating Authority gave warning and directions to Ld. Adjudicating Authority to refrain itself from using template paragraphs and disconcerted language in its order. (iii) In other similar matters, High Court of Delhi has remanded the matters back for fresh consideration for the reason that the grounds taken by Petitioners therein were not considered and the order was passed by the Adjudicating Authority in mechanical manner that too on format and templates. Even the impugned order has been passed by using the technology of "cut-copy-paste" without appreciating the material on record. The order has been passed in very causal and cryptic manner. The said practice has been reprimanded and depreciated by Hon'ble Supreme Court of India in Union Public Service Commission vs Bibhu Prasad Sarangi, (2021) 4 SCC 516. 8. In the view of aforesaid submissions and grounds, the impugned attachment order passed by Ld. Adjudicating Authority may be set-aside. Arguments of the respondents 9. The counsel for the respondent has contest the appeal on al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... agricultural. This was done despite the fact that no objection was raised by the land owners for seeking higher rate of compensation. Thereby, not only the accused, Dinesh Pratap Singh, but others in connivance with each other manipulated the record for conversion of land from agricultural to non-agricultural in the back date and granted excess amount of compensation. 13. After registration of the FIR, the ECIR was recorded on 05.06.2018. The investigation was conducted under the Act of 2002. It revealed that apart from the main accused, there are many other officers involved which includes the public servants, the farmers and the middle man for grant and receipt of the compensation of the land at the rate of 'non agricultural land' which was much higher to the rate for 'agricultural land'. 14. The statement of the accused and others were recorded under section 50 of the Act of 2002. After a detailed investigation and considering the documents which includes the bank accounts, a case of money laundering was found and accordingly, the properties belonging to the appellants were attached finding them to be the direct proceeds of crime or towards "value of any such property" that is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rmination of the proceedings if period has been provided under the statute. The issue in reference to the lapse of the provisional attachment after expiry of 180 days was before the Telangana High Court in the case of Hygro Chemicals Pharmtek Pvt. Limited Vs. Union of India & Ors [MANU/TL/1003/2023] where elaborate Judgement has been given and would cover first issue raised by the appellant. 19. The relevant paras of the judgement are quoted thus:- "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 (supra) in calculating the period of 180 days in light of the Apex Court's decision in S. Kasi (supra). ii) In W.P. No. 34627 of 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch 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 MANU/SC/0108/2022: (2022) 3 SCC 117 (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, MANU/SC/0505/2020 : (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, MANU/SC/0158/2021 : (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 Extension of Limitation, In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tation 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. For the sake of convenience, Section 5 is extracted below: 5. Attachment of property involved in money-laundering.-29[(1) Where the Director or any other officer not below the rank of Deputy Director authorised by the Director for the purposes of this section, has reason to believe (the reason for such belief to be recorded in writing), on the basis of material in his possession, that- (a) any person is in possession of any proceeds of crime; and (b) such proceeds of crime are likely to be concealed, transferred or dealt with in any manner which may result in frustrating any proceedings relating to confiscation of such proceeds of crime under this Chapter, he may, by order in writing, provisionally attach such property for a period not exceeding one hundred and eighty days from the date of the order, in such manner as may be prescribed: Provided that no such order of attachment shall be made unless, in relation to the scheduled offence, a report has been forwarded to a Magistrate under Section 173 of the Code ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f thirty days from such attachment, file a complaint stating the facts of such attachment before the Adjudicating Authority. viii) Section 5(1) of the PMLA provides that the authorized officer can provisionally attach properties for a period not exceeding 180 days. The third proviso to Section 5(1) of the PMLA states that if the proceedings initiated under the PMLA are stayed by the High Court, then such period during which the stay operates shall be excluded in computing the 180-day period. Further, Section 5(3) of the PMLA states that a provisional attachment order passed under Section 5(1) of the PMLA shall cease to have effect after the expiry of 180 days from the date of provisional attachment. ix) A conjoint reading of Sections 5(1) & 5(3) of the PMLA indicates that the period of 180 days within which a confirmation order shall be passed is mandatory. This view is fortified in light of the decision in Vijay Madanlal Choudhary v. Union of India MANU/SC/0924/2022 wherein the Apex Court dealing with constitutionality of various provisions of the PMLA held that the period of 180 days is in the form of a procedural safeguard. The relevant paragraph is extracted below: 287. B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... viso to Section 5(1) of the Act. xi) The decision in Karvy Realty (supra) confirmed by a division bench of this Court vide order dated 13.02.2023 in W.A. No. 194 of 2023. xii) According to this Court, in appropriate cases, certain period can be excluded while computing the 180 day period under Section 5(3) of the PMLA. It is important to note exclusion of certain period is different from extending the period. In the present case, the Apex Court exercising its inherent powers under Article 142 of the Constitution of India excluded the period from 15.03.2020 to 28.02.2022 in computation of limitation. Therefore, the period from 15.03.2020 to 28.02.2022 shall be excluded while computing the period of 180 days under Section 5(3) of the PMLA. xiii) As stated above, the Petitioners relying on the decision in S. Kasi (supra) and other decisions of the High Courts in Vikas WSP Ltd. (supra), Gobindo Das (supra) and Hiren Panchal (supra) contend that the decision in In re: Limitation(supra) is not applicable to PMLA proceedings. This Court cannot accept the said contention of the Petitioners. xiv) In S. Kasi (supra), the question before the Apex Court was whether the decision in In r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rty of a person enshrined under Article 21 and reflected in other statutes including Section 167 CrPC. 28. We, thus, are of the clear opinion that the learned Single Judge in the impugned judgment [S. Kasi v. State, MANU/TN/7730/2020] erred in holding that the Lockdown announced by the Government of India is akin to the proclamation of Emergency. The view of the learned Single Judge that the restrictions, which have been imposed during the period of Lockdown by the Government of India should not give right to an accused to pray for grant of default bail even though charge-sheet has not been filed within the time prescribed under Section 167(2) of the Code of Criminal Procedure, is clearly erroneous and not in accordance with law. 29. We, thus, are of the view that neither this Court in its order dated 23-3-2020 [Cognizance for Extension of Limitation, In re, MANU/SC/0505/2020 : (2020) 19 SCC 10] can be held to have eclipsed the time prescribed under Section 167(2)CrPC nor the restrictions which have been imposed during the Lockdown announced by the Government shall operate as any restriction on the rights of an accused as protected by Section 167(2) regarding his indefeasible r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oes not extend to PMLA proceedings in computation of 180 days within which provisional attachment of properties has to be confirmed by the Adjudicating Authority. The Court therein also held no period of limitation is prescribed under Section 5(1) & 5(3) of the PMLA and after the lapse of 180 days, the Adjudicating Authority becomes functus officio. Further, had the legislature or the Government thought it fit, they would have expressly extended the period within which provisional attachment of properties could have been confirmed. However, the Court left the question regarding the applicability of In re: Limitation (supra) in computation of 180 days open. The relevant paragraphs are extracted below: 23. Therefore, a reading of sub-section (1) of Section 5 with Section 2(1)(d) of the Act leaves no manner of doubt that the effect of the Provisional Attachment Order is deprivation of the right to property. 25. In the present case, the Act clearly deprives the person against whom the Provisional Attachment Order is passed of his right to deal in the property against which the attachment is ordered. Such deprivation can therefore, be for a maximum of 180 days and no further, except ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are not a universal extension of time across the board, be it limitation or period prescribed for doing a particular thing, or as in the present case, the period of validity of an order. 32. The above distinction is also apparent to the Government of India as it promulgated The Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance, 2020 on 31.03.2020, extending the time limit for completion of any proceedings or passing of any order etc. specified in the Acts specified therein. However, the Prevention of Money Laundering Act, 2002 is not one of the "specified Acts" under the Ordinance. Therefore, the respondents cannot take benefit of even this Ordinance. On the other hand, the Ordinance clearly shows that the reliance of the respondents on the orders of the Supreme Court is liable to be rejected. 35. The above judgment clearly highlights the reason and the limit of the order dated 23.03.2020 passed by the Supreme Court. It also highlights that the said order was never meant to curtail any provision of other statute which is enacted to protect the personal liberty of a person. In my opinion, in a similar manner, the order dated 23.03.2020 was not meant to deny an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich has expired its validity on 9th June, 2021, has no force after expiry of 180 days from the date of passing of such order in view of not passing any formal order under Section 8 (3) of the said Act extending the validity of the same by the Respondent No. 2 and the action of Respondent No. 3 in not allowing the petitioner to operate its bank and postal accounts in question after the expiry of the period validity of 180 days from the date of the order passed under Section 5 (1) of the aforesaid Act, such action of the Respondent Enforcement authority, is arbitrary and illegal. 14. In view of the discussion made above this Writ Petition is allowed by declaring that the impugned order of provisional attachment of Bank accounts and postal accounts in question dated 11th December, 2019 passed under Section 5 (1) of The Prevention of Money Laundering Act, 2002 after expiry of 180 days on 9th June, 2021 is ceased to have any effect or force as a consequence of failure on the part of the Respondent Enforcement authority/Adjudicating authority in passing further order under Section 8 (3) of The Prevention of Money Laundering Act, 2002 extending or confirming order dated 11th December, 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nuing to have effect after the expiry of 180 days. Section 5(1) designates the authority and the steps to be taken for proceeding against any person who is in possession of any proceeds of crime. The section is hence concerned with the procedure to be undertaken for provisional attachment of a property subject to the fulfillment of the other conditions in Section 5. A prescribed procedure 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 end-point 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce such right is given to a litigant, it cannot be taken away. This Court respectfully disagrees with the views expressed in Vikas WSP Ltd. (supra), Gobindo Das (supra) and Hiren Panchal (supra) in relation to applicability of In re: Limitation (supra). xviii) According to this Court, the decision in S. Kasi (supra) cannot be relied upon by the Petitioners to contend that In 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 pers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cessary in the peculiar facts of a particular case so as to invoke the option available under sub-section (4) of Section 8. 305. Indisputably, statutory Rules have been framed by the Central Government in exercise of powers under Section 73 of the 2002 Act regarding the manner of taking possession of attached or frozen properties confirmed by the Adjudicating Authority in 2013, and also regarding restoration of confiscated property in 2019. Suffice it to observe that direction under Section 8(4) for taking possession of the property in question before a formal order of confiscation is passed merely on the basis of confirmation of provisional attachment order, should be an exception and not a rule. That issue will have to be considered on case-to-case basis. Upon such harmonious construction of the relevant provisions, it is not possible to countenance challenge to the validity of sub-section (4) of Section 8 of the 2002 Act. xxi) Therefore, provisions prescribing timelines and which deal with police investigation upon which a person's liberty is dependent has to be strictly construed. On the other hand, where timeline is prescribed for attachment of properties and due to un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, in S. Kasi case [S. Kasi v. State, MANU/SC/0491/2020 : (2021) 12 SCC 1] , this Court also noticed that a coordinate Bench of the same High Court had already held [Settu v. State, MANU/TN/3790/2020] that the said order dated 23-3-2020 [Cognizance for Extension of Limitation, In re, MANU/SC/0505/2020 : (2020) 19 SCC 10 : (2021) 3 SCC (Cri) 801] did not cover the offences for which Section 167 CrPC was applicable but, in the order [S. Kasi v. State, MANU/TN/7730/2020] 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 applied to the present case relating to the matter of filing written statement by the defendant in a civil suit. xxiii) Further, a Division Bench of Madras High Court in S. Prasanna v. The Deputy Director, Directorate of Enforcement, Government of India MANU/TN/8962/2022 held that the decision in S. Kasi (supra) is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laint 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 2022 (supra) wherein the Court at Para 5.4 (extracted supra) held that where time period is prescribed for termination of proceedings, the period from 15.03.2020 to 28.02.2022 shall be excluded. In the present case, Section 5(3) of the PMLA states that provisional attachment of propertie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the proceedings and was more persuaded by section 5(1) (b) and 5 (3) of the Act of 2002, whereas the judgement of the Apex Court in suo moto petition covers the issue entirely and elaborate judgement on it has been given by the Telangana High Court in the case referred to above. 25. The counsel for the appellant has further referred to the judgement of the Division bench of Kolkata High Court in the case of Directorate of Enforcement Vs. Union of India (supra). The perusal of the para 22 referred by the appellant would reveal that despite a judgement of the Apex Court to extend the period for termination of proceeding under any statute where it has been provided, the counsel appeared before the Division Bench could not bring it to the notice and otherwise this Tribunal would be bound by the judgements of the Apex Court in the case of suo moto petition (supra) and M/s Prakash Corporates (supra) and more so when it has now been elaborately clarified by the Telangana High Court in the case of Hygro Chemicals Pharmtek Pvt. Limited Vs. Union of India & Ors [MANU/TL/1003/2023] where Judgements of other High Courts have been considered and would cover first issue raised by the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erent rates were fixed for 'Agricultural' and 'Non Agricultural' land proposed to be acquired. It is a case of causing huge loss to the tune of Rs. 500 crores (approximately) to the Government Treasury by the petitioners and others by forgery, manipulation of Government records, preparing back dated orders so that compensation may be granted at a much higher rate. 5. Initially, an FIR No. 32 of 2017 was lodged at Police Station Pantnagar, District Udham Singh Nagar under Sections 34, 120B, 167, 218, 219, 409, 420, 465, 466, 467, 468, 471, 474 IPC against un-named concerned Revenue Officers/Officials, land owners, farmers, officers/ officials of NHAI and others. The FIR was lodged by Pratap Singh Shah, Additional District Magistrate, Finance and Revenue, Udham Singh Nagar. According to it, the compensation for the land had been determined 8-10 times higher by way of showing the land, that was acquired for widening of NH-74 and notified as 'Agricultural' in Gazette Notification issued under Section 3D of the NH Act, as 'Non Agricultural'. For this purpose, the land owners, farmers in a conspiracy with Revenue Officers/Officials got the land use chang ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purpose seeking information was mandatory or else the petitioner would have been blamed for dereliction of duties. (iv) The petitioner simply proposed the compensation, which was submitted to the National Highways Authority of India and in the note sheet of the National Highways Authority of India, this fact is mentioned that there is a change of nature of land in the notification under Section 3D of the NH Act and in the proceedings under Section 3G of the NH Act. The petitioner did not conceal anything. The Project Director has approved the offer. The note sheet of the NHAI also reveals that the NHAI has approved the offer subject to the verification of legality of Section 143 proceedings. (v) In para 9.8 of the counter affidavit, the respondent has stated that the petitioner is to be blamed for generating 'Proceeds of Crime' on the basis of back dated orders. It is submitted that the petitioner was posted as a competent authority from 18.01.2016 to 15.03.2017. According to the prosecution itself, the back dated orders were reflected in the record on 30.09.2010 and their entries were made on 04.07.2015. It is argued that the petitioner did not commit any offence. If ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alf of the petitioner Dinesh Pratap Singh. 58. Learned Senior Counsel would also raise the following points in his submission:- (i) At the stage of determining compensation under Section 3G of the NH Act, the competent authority is not empowered to re-examine the nature of land, which had already attained finality at the stage of Section 3D notification. (ii) The principles of law as cited on behalf of the petitioners are not applicable in the instant case. In the case of Anurag Srivastava (supra), the Hon'ble Court only gave liberty to the petitioner of that case to raise his objections with regard to the land use. But, it is argued that as such no law has been laid down. (iii) Petitioner Dinesh Pratap Singh should not have sought report from the Revenue Authorities with regard to the land use, because no farmer had raised any objection with regard to the nature of land at the stage of either Section 3C or Section 3G of the NH Act. (iv) Petitioner Dinesh Pratap Singh sought information with a mala fide intention to pay an excess compensation to the farmers. It is argued that the entire material that has been filed along with the complaints reveal that prima facie c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... one or more of the following processes or activities connected with proceeds of crime, namely:- (a) concealment; or (b) possession; or (c) acquisition; or (d) use; or (e) projecting as untainted property; or (f) claiming as untainted property, in any manner whatsoever; (ii) the process or activity connected with proceeds of crime is a continuing activity and continues till such time a person is directly or indirectly enjoying the proceeds of crime by its concealment or possession or acquisition or use or projecting it as untainted property or claiming it as untainted property in any manner whatsoever." 71. A bare perusal of these provisions makes it abundantly clear that the 'Proceeds of Crime' are derived or obtained from the scheduled offence. It also includes a property, which may directly or indirectly be derived or obtained as a result of any criminal activity related to the scheduled offence. It is not only possession of the 'Proceeds of Crime', which alone is an offence of money laundering. Section 3 of the PML Act has a wide amplitude. It makes various other activities related to it as money laundering, which includes concealment, possession, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of money- laundering against him or any one claiming such property being the property linked to stated scheduled offence through him." 73. The question for consideration is as to whether a prima facie case is made out in the instant matter? 74. Needless to say, summoning of a person is not a routine act. After all liberty of a person is somehow curtailed by requiring him to appear and face the trial. In the case of Pepsi Foods Ltd. and another v. Special Judicial Magistrate and others, (1998) 5 SCC 749, the Hon'ble Supreme Court observed the consequence of summoning and the role of the Magistrate. In para 28, Hon'ble Court observed as hereunder:- "28. Summoning of an accused in a criminal case is a serious matter. Criminal law cannot be set into motion as a matter of course. It is not that the complainant has to bring only two witnesses to support his allegations in the complaint to have the criminal law set into motion. The order of the Magistrate summoning the accused must reflect that he has applied his mind to the facts of the case and the law applicable thereto. He has to examine the nature of allegations made in the complaint and the evidence both oral and doc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 143 of the ZA Act, 1950 were prepared; back dated entries were made; they were entered into computer systems and an excessive compensation was procured in the name of farmers, which was deposited and transferred in the accounts of various individual entities in order to layer and integrate the 'Proceeds of Crime' generated through criminal activities related to the scheduled offence. 78. The complaint of Special Sessions Trial No. 14 of 2022, which is Annexure No. 15 to the petition, at para 8.2.2, the case has been summarised by the complainant. It is as hereunder:- "8.2.2. That during the course of investigation under PMLA so far, it is revealed; (a) that the land of Jagdish Arora s/o Nihal Chand was acquired by the NHAI for the four-laning/widening of NH-74. The said land was located at Khasra No. 191 and having area of 0.6203 hectare in village Ghadi Hussain, Jaspur, Udham Singh Nagar; (b) that the nature of the land was mentioned and notified as agriculture in the Notification No. S.O. 1218(E) dated 07.05.2014 (Annexure B-25) issued u/s 3D of NH Act, 1956; (c) that Jagdish Arora s/o Nihal Chand neither submitted any objection u/s 3C nor any claim u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e B-28) maintained with State Bank of India, Jaspur, Udham Singh Nagar, Uttarakhand. (i) that the above said fact clearly proves that the said land of Jagdish Arora was clearly agriculture in nature at the time of land acquisition for widening of the National Highway. (j) that, Jagdish Arora, in connivance with artatap Singh (the then CALA/SLAO, Udham Singh Nagar/Nainita), Bhole Lal (the then Naib Tehsildar, Tehsil Jaspur), Vikash Chauhan (Reader/Peshkar in SDM Court Jaspur), Anil Kumar (Sangrah Amin attached with Registrar Kanungo, Tehsil Jaspur) & middlemen and others illegally managed to get the forged back dated order u/s 143 of the U.P.Z.A. & L.R. Act, 1950 passed and its subsequent entries in the revenue records and thereafter got the compensation at non-agriculture rate on the basis of the said back dated order." 79. It may be noted that the petitioner Dinesh Pratap Singh was the competent authority under the provisions of the NH Act at the relevant time. The petitioner Arpan Kumar was a Data Entry Operator; the petitioner Jagdish Arora was the farmer involved; the petitioner Barinder Singh was the person who layered and integrated the 'Proceeds of Crime'; the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Crime' generated through criminal activities related to a scheduled offence. (Para 9.5 of the complaint) 85. It is the case against the petitioner Vikas Kumar, who was working as a Reader in the SDM Court, Jaspur that he made back dated entries of the back dated orders under Section 143 of the ZA Act, 1950. He was actively involved in the process of activities connected with generation of 'Proceeds of Crime' generated through criminal activities related to scheduled offence. (Para 9.7 of the complaint) 86. The averments as made in the complaint definitely make out a prima facie case against all these petitioners. The cognizance and summoning order passed on 06.09.2022 is quite in detail. The court below has taken into consideration the material placed before it. Having considered the material, cognizance has been taken and the petitioners and others have been summoned. This Court does not see any illegality in the summoning order. Therefore, there is no reason to interfere in the cognizance and summoning order dated 06.09.2022 passed in SST No. 14 of 2022. SPECIAL SESSIONS TRIAL No. 15 of 2022 87. In this case, cognizance and summoning order was passed on 06.09 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d also their case files were not available in his chargelist handed over by him upon his transfer, that the entries of above mentioned cases were entered back dated after his transfer from S.D.M. Court, Kashipur. (g) The above said facts clearly prove that the said land of Balwant Singh was clearly agricultural in nature at the time of land acquisition for widening of National Highway. (h) That, as per police chargesheet, Barinder Singh along with his grandfather Balwant Singh managed to get back dated order of section 143 of UPZA & LR Act, 1950 passed on 30.09.2010 in case no. 22/517 in connivance with Bhagat Singh Fonia (the then Assistant Collector First Cass/SDM, Kashipur, Udham Singh Nagar); that subsequently they, under a conspiracy with Dinesh Pratap Singh (CALA)/SLAO) and Sanjay Kumar Chauhan (Reader/Peshkar in SDM Court, Kashipur) and others, illegally managed to get the forged back dated orders u/s 143 of U.P.Z.A. & L.R. Act 1950 passed and its subsequent entries in the revenue records and thereafter got the excess compensation fraudulently at non agriculture rate on the basis of the said back dated order for the land which were being acquired for four-laning/widening ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he role of the petitioner Balwant Singh is stated. He is a farmer. His land was notified as 'Agriculture Land' under Section 3D of the NH Act. Under a conspiracy with the other petitioners and co-accused, he had obtained forged back dated orders under Section 143 of the ZA Act, 1950. He had received excessive compensation, which was utilized for buying movable and immovable properties in his name and in the name of his family members, which was withdrawn in cash in order to layer and integrate the 'Proceeds of Crime' generated through criminal activities related to the scheduled offence. 89. The petitioner Barinder Singh had received an excessive compensation, transferred the amount in his account also, which was utilized for buying movable and immovable properties in his name and withdrawing a huge cash amount in order to layer and integrate the 'Proceeds of Crime'. (Para 9.2 of the complaint) 90. It is the case against the petitioner Arpan Kumar that he had played an important role in facilitating the farmers in getting compensation at 'Non-Agricultural' rate fraudulently. He had received Rs. 10,00,000/- from the petitioner Barinder Singh, whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Singh, Vikas Kumar, Bhole Lal and other co- accused. In fact, the role of revenue officers/officials is almost identical in the case of each farmer. The complaint in S.S.T. No. 16 of 2022 is a part of Annexure 15. In para 8.2.2, the summary of the case is given, which is as hereunder: "8.2.2. That during the course of investigation under PMLA, 2002 so far, it is revealed: (a) That the lands of Charan Singh s/o Khan Chand was acquired by the NHAI fr the four-laning/widening of NH-74 (Haridwar to Kashipur Section). The said land was located at Khasra No.194 & 219 in village Garhi Hussain, Jaspur, Udham Singh Nagar and having area of 0.3000 hectare & 0.6062 Hectare respectively. (b) That the nature of the land was mentioned as agriculture in the Notification No. S.O. 1218 (E) dated 07.05.2014 (Annexure B-19) issued u/s 3D of NH Act, 1956. (c) That Charan Singh s/o Khan Chand neither submitted any objection u/s 3 C nor any claim u/s 3G (3) of NH Act, 1956 regarding his land which was being acquired for widening-four-laning of NH-74 as per information received from the office of the Special Land Acquisition Officer, Udham Snigh Nagar/Nainital vide letter dated 29.06.2021 (Annex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xure B-34) for the land at Khasra No.194 of 219 situated in Garhi Hussain, Jaspur, Udham Singh Nagar, at non-agriculture rate; (j) That Charan Singh received compensation of Rs. 8,03,76,699/- on 24.08.2016 and Rs. 3,97,77,317/- on 07.09.2016 fraudulently at non- agriculture rate for his lands acquired for four-laning-widening of NH- 74; that the compensation amount was credited, in his account no. 976010019749913 (Annexure B-22) maintained with Axis Bank, Bhaisia, Gadarpur, Udham Singh Nagar, Uttarakhand, after deducting TDS. (k) The above said facts clearly proves the malafide intentions of Charan Singh, Dinesh Pratap Singh (the then CALA/SLAO, Udham Singh Nagar/Nainital), Bhole Lal (the then Naib Tehsildar, Tehsil Jaspur), Vikas Chauhan (Reader/Peshkar in SDM Court Jaspur), Anil Kumar (Sangrah Amin attached with Registrar Kanungo, Tehsil Jaspur), of causing huge financial losses to the Govt. Treasury and corresponding financial gains to themselves." 97. Individual role of the petitioners is given in para 9 of the complaint. The role of the petitioner Dinesh Pratap Singh is given in para 9.4, the role of the petitioner Bhole Lal is given in para 9.5 and the role of the petit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er interested persons submitted their claim u/s 3G (3) of the NH Act, 1956 vide application dated 13.06.2014 inter alia stating that the applicant used their land for agriculture for the livelihood of their family. The said information has been received from the office of the Special Land Acquisition Officer, Udham Singh Nagar/Nainital vide letter dated 29.06.2021 (Annexure B- 26). (d) that the NHAI conducted Joint Measuring Survey (JMS) for the said land which were being acquired for the widening/four-laning of NH-74; that the said land was also mentioned as agriculture as per Joint Measuring Survey (JMS) Report as per information received from the office of Project Director, Nazibabad, NHAI vide letter dated 11.08.2021 (Annexure B-27). (e) that Smt. Yukta Mishra, the then SDM, Jaspur submitted an enquiry report dated 17.03.2017 & 20.03.2017 (Annexure B-23) to the then Kumaon Commissioner regard the discrepancies found in the record of said lands in revenue documents of SDM Court and Tehsil. (f) that Shri Satpal, Reader/peshkar in SDM Court, Jaspur lodged an FIR against Vikas Chauhan, the then reader/peshkar in SDM Court Jaspur for not handing over the case files of order of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and others illegally managed to get the forged back dated order u/s 143 of the U.P.Z.A. & L.R. Act, 1950 passed and its subsequent entries in the revenue records and thereafter got the compensation at non- agriculture rate on the basis of the said back dated order." 100. The role of individual petitioner is given in para 9 of the complaint. In the instant case, the petitioners Ramesh Kumar and Om Prakash are farmers. Their land was notified as 'Agricultural Land' under Section 3D of the NH Act. They had never filed any objections either under Section 3C or 3G of the NH Act. Their role is given in paras 9.1 and 9.2 of the complaint respectively. The role of the petitioners Dinesh Pratap Singh, Arpan Kumar, Bhole Lal and Vikas Kumar is given in paras 9.4, 9.3, 9.5 and 9.7 of the complaint respectively. They all were revenue officers/official at the relevant time. Their role is identical to the acts attributed to them in other complaints, which has already been discussed hereinbefore. 101. The averments as made in the complaint definitely make out a prima facie case against all these petitioners. The cognizance and summoning order passed on 14.10.2022 is quite in detail. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion (directly or indirectly). To illustrate, bribe or illegal gratification received by a public servant in form of money (cash) being undue advantage and dishonestly gained, is tainted property acquired "directly" by a scheduled offence and consequently "proceeds of crime". Any other property acquired using such bribe as consideration is also "proceeds of crime", it having been obtained "indirectly" from a prohibited criminal activity within the meaning of first limb of 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, befo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en if the intent of the legislature was to include any property in the hands of a person within the ambit of the expression proceeds of crime‖, there would be no need to create three limbs of definition of proceeds of crime. 79. Regard must also be had to the fact that the legislation itself is dealing with contingencies where proceeds of crime are layered and their origins camouflaged and masked enabling the accused to project or claim it to be untainted property. The Act clearly as does Axis Bank take into consideration a situation where a person who has obtained proceeds of crime by commission of a scheduled offence has managed to ensure that a property directly or indirectly connected to criminal activity is rendered untraceable. It is to confer authority upon the Directorate to proceed further in such a situation that Section 2(1)(u) uses the expression or the value of any such property. The safeguard which stands constructed in Section 2(1)(u) in such a contingency is that in case the Directorate does proceed against any other property, it must be equivalent in value to the illegal pecuniary benefit or gain that may have been obtained as a result of criminal activity. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons rendered by the Andhra Pradesh High Court in Kumar Pappu Singh Vs. Union of India and the Patna High Court in HDFC Bank Limited Vs Government of India, Ministry of Finance. 81. The Court also takes note of the position that although SLP (Crl) No. 28906/2019 is pending before the Supreme Court against the decision rendered in Axis Bank, the judgement of this Court has not been stayed or placed in abeyance. The interim order of 30 August 2019 passed in the aforesaid Special Leave Petition only requires parties to maintain status quo. Insofar as the judgement of the Punjab and Haryana High Court in Seema Garg is concerned, although SLP (C) No.14713-14715/2020 preferred against the same came to be dismissed, while doing so the Supreme Court recorded that the petition was being rejected in the peculiar facts and circumstances of the case. The dismissal of the aforesaid Special Leave Petition cannot in any case be interpreted or understood as being an affirmation of the view as expressed by the Punjab and Haryana High Court. 105. It would be pertinent to recall that properties which were acquired prior to the enforcement of the Act may not be completely immune from action under t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f "proceeds of crime". The second limb, "the value of any such property" would apply when the proceeds of crime are not available, siphoned off or vanished. In that case, the attachment can be of the property of equivalent value. 39. The appellant has referred to the facts of the case to indicate that out of many properties attached by the respondents, one property was existing in the name of forefathers since 1960 and it came to the appellant pursuant to the gift made by his mother and brother and otherwise part of the property came to his share, which was not the proceeds of crime. 40. In the similar manner, reference of the property acquired by Smt. Alka Singh has been given. She said to have acquired property No. 65-A, Rajpur Road, Dehradun along with Sh. Narender Singh, brother of Dinesh Pratap Singh. The attachment of the properties has been made for a sum of Rs. 44,10,000/- whereas it was submitted the appellant Smt. Alka Singh purchased the said property along with Narender Singh for a total consideration of Rs. 1.25 crores. Appellant Alka Singh paid Rs. 66,94,000/- through the disclosed source as it was through banking channels. It was out of the loan taken by the appell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acquire the property and that too worth of crores by the two appellants, it was rightly attached by the respondents. Since, total value of the proceeds was available with the appellant having vanished, the other properties and "the value of any other property" was attached. 43. We don't find any substance even in the third issue and is accordingly rejected. Issue D 44. The appellant has submitted that basic ingredient of section 3 of the Act of 2002 is not made out whereas according to the respondent and in the opinion of the Tribunal the ingredient of section 3 has been satisfied which would reveal from the Judgement of the Uttarakhand High Court in the case of the appellant himself. A detail judgment adverse to the appellant in reference to all the issues raised before us has been dealt with. 45. Therein the case under the Act of 2002 was found against the appellant. Relevant paras have been quoted earlier. 46. Thus, even the fourth issue has no substance. Accordingly, we don't find any substance even in the fourth issue. Issue E 47. The appellant has submitted that reasons to believe were not recorded while passing the order under section 5(1) of the Act of 2002. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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