9911796707
TMI Blog2024 (9) TMI 1687X X X X Extracts X X X X X X X X Extracts X X X X ..... ayantilal Sandesara and he did not interact with any other person for legal advice which included even any officer of the legal department - The amount received by the appellant was not a small amount rather it was Rs. 2,07,25,500/- even as per the statement of the appellant. The aforesaid amount towards alleged legal advice could not be substantiated and therefore respondents rightly arrived at the conclusion it to be the proceeds of crime transferred to the appellant by none else but the main accused thus, on the facts on record, this is not a case in favour of the appellant. >Section 8(3)(a) of the Act provides for thecurrency to the order of attachment during the investigation to be completed within 365 days or the pendency of the proceeding in a court relating to any offences under the Act of 2002. The period of interim order precluded the respondents to file the prosecution complaint cannot be taken to the benefit of the appellant and thereby we are unable to accept the arguments of the appellant regarding lapse of the order of provisional attachment or as to its confirmation. The explanation to Section 8(3) of the Act, 2002 has been ignored by the appellant which excludes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... >1 >5-48, Ground Floor, Greater 1 Kailash I, New Delhi - 110048 >Sh. Irfan Ahmed Siddiqui >30,00,000 >30,00,000 >2 >C-21, Lower Ground Floor, Panchsheel Enclave, New Delhi - 110017 >Sh. Irfan Ahmed Siddiqui >60,00,000 >60,00,000 >3 >Flat No. 401, 4th Floor, Sharnam Sunrise, Plot/Block No. 70, Survoday Co-op Society Ltd. Gujarat >Sh. Irfan Ahmed Siddiqui >24,51,000 >24,51,000 >4 >99,000 Shares of JOVOF DESIGNING COUTURE TECHNOLOGIES PVT. LTD. >Sh. Irfan Ahmed Siddiqui >9,90,000 >9,90,000 >5 >10,000 Shares of Yes to shine Private Limited >Sh. Irfan Ahmed Siddiqui >1,00,000 >1,00,000 >6 >Saving Bank, A/C No. 0065001050556 with ICICI Delhi Bank, Vasant Vihar Branch, New Delhi >Sh. Irfan Ahmed Siddiqui >37,040 >37,040 >7 >Saving Bank ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... others. The appellant is not named as the accused therein. On registration of the FIR, the ECIR was recorded by the respondent. The investigation was thereupon made by the CBI in reference to FIR and the respondent pursuant to the ECIR. >The FIR against M/s SBL and others was registered followed by ECIR on the allegation that they committed an offence and even criminal conspiracy with dishonest intention to cheat Andhra Bank and availed loan of more than Rs. 5000 crores with the motive not to repay it. The appellant is not one of the accused but said to be recipient of part of the proceeds of crime and accordingly property referred above were attached. The fact however needs to be elaborated in reference to commission of crime by M/s SBL and others in references to their outstanding liabilities as on 26.11.2010 which was of Rs. Rs. 20,890 crores. It is apart from the outstanding amount against the other entities of M/s SBL. The company was represented the market capitalization of their companies, the share in India and abroad and even their dishonest intention to cheat the bank. The area of manipulation of the main accused has been reflected in the impugned order and for ready r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... effect to the impugned order herein so as the Provisional Attachment Order, however, challenge to the impugned order has been made for confirmation of the attachment of the property worth of Rs. 2,41,96,621/-. The learned counsel for the appellant submits that only for the reason that professional assistance was extended to the main accused would not mean that the professional charges for the work to be treated as proceeds of crime. It is more so when the accused company and the appellant entered into retainership agreement 01.10.2009. Though the agreement was terminated on 01.08.2011 and 21.11.2011. The FIR was registered much subsequent to it in the year 2017. The appellant had in fact gave advance notice for termination of retainership agreement yet the appellant had received the retainership fee amounting to Rs. 2,00,72,500/- and not Rs. 2,39,98,500/-. The consultancy fee received by the appellant has been considered to be proceeds of crime and accordingly attached. The order or the attachment so as to its confirmation have been made in ignorance of the fact that any corporate entity or for that any client could take legal assistance from the professional person and if any amo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me. To analyse the arguments, we have gone through the material produced by both the parties and finding recorded by the Adjudicating Authority. >The appellant come out with the case that whatever amount was received by them from the main accused which included M/s SBL was towards the professional fee and donation. The appellant however could not refer to any material or evidence to prove any professional advice to the accused company rather in the statements recorded u/s 50 of the Act, 2002, it has been stated by the appellant that he never met the legal team of the accused company. No material has been produced to show any professional advice or service by the appellant. It is also a fact that retainership agreement was terminated by the appellant lastly in the year 2011. The appellant said to have entered into agreement for it on 04.10.2009. The amount was yet sent to the appellant. >The fact is that no evidence exist to show any legal advice to the accused company and in fact the appellant could not produce any evidence to support his claim for receipt of the amount towards the professional charges. It is when the statement of the appellant was recorded u/s 50 of the Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d record a finding to that effect, whereupon such attachment or retention or freezing of the seized or frozen property or record shall-- >(a) continue during investigation for a period not exceeding three hundred and sixty-five days or the pendency of the proceedings relating to any offence under this Act before a court or under the corresponding law of any other country, before the competent court of criminal jurisdiction outside India, as the case may be; and >(b) become final after an order of confiscation is passed under sub-section (5) or sub-section (7) of section 8 or section 58B or sub-section (2A) of section 60 by the Special Court; Explanation.--For the purposes of computing the period of three hundred and sixty-five days under clause (a), the period during which the investigation is stayed by any court under any law for the time being in force shall be excluded." >The bare perusal of the provision quoted above would reveal that if any interim order has been passed then period aforesaid is to be excluded from the total period of 365 days. Section 8(3)(a) of the Act provides for thecurrency to the order of attachment during the investigation to be completed wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that such an action can be initiated only on the basis of material in possession of the authorised officer indicative of any person being in possession of proceeds of crime. The precondition for being proceeds of crime is that the property has been derived or obtained, directly or indirectly, by any person as a result of criminal activity relating to a scheduled offence. The sweep of section 5(1) is not limited to the accused named in the criminal activity relating to a scheduled offence. It would apply to any person (not necessarily being accused in the scheduled offence), if he is involved in any process or activity connected with the proceeds of crime. Such a person besides facing the consequence of provisional attachment order, may end up in being named as accused in the complaint to be filed by the authorised officer concerning offence under section 3 of the 2002 Act." >The argument has been made in ignorance of the Judgment of the Apex Court in Vijay Madanlal Chaudhary (supra). Section 8(3)(a), does not mandate filing of complaint against the person whose property has been attached or seized. It does not mandate even investigation against the person whose property has be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by him for the purposes of this section has reason to believe (the reasons for such belief to be recorded in writing), on the basis of material in his possession, that if such property involved in moneylaundering is not attached immediately under this Chapter, the nonattachment of the property is likely to frustrate any proceeding under this Act: >Provided also that for the purposes of computing the period of one hundred and eighty days, the period during which the proceedings under this section is stayed by the High Court, shall be excluded and a further period not exceeding thirty days from the date of order of vacation of such stay order shall be counted." >The provision quoted above has been framed with the object sought to be achieved. The attachment of the property can be if any person is in possession of the property as given under Section 5(1)(a) and as per Section 8(3)(a), the continuation of the attachment during the period of investigation for a period of 365 days or pendency of the proceedings relating to any offence under the Act. Section 8(3)(a) again does not refer to the investigation against the person whose property has been attached so as the criminal pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e hands of a person other than the accused, it can not be attached or seized and if at all it is attached or seized,the investigation has to be completed against such person within 365 days. This would be nothing but showing requirement to complete the investigation against a person who is not even an accused and need not to be. The seizure or attachment is because the property or related document may be with a person other than an accused. The issue was elaborately discussed by this Tribunal in the case of Ayush Kejriwal vs. The Deputy Director, Directorate of Enforcement, Kolkata, FPA-PMLA4358/KOL/2021. The relevant para of the said judgment is quoted herein: >"23. It is submitted that the appellant is not an accused in the FIR or ECIR thus the documents belonging to him could not have been subjected to seizure. The argument aforesaid has been raised in ignorance of the judgment of the Apex Court in Vijay Madanlal Choudhary (supra). While dealing with the issue in reference to the definition of "proceeds of crime", it was categorically held that the second proviso addresses the broad object of the Act of 2002 to reach the proceeds of crime in whosoever name they are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... property of proceeds of crime. Such interpretation would further the legislative intent in recovery of the proceeds of crime and vesting it in the Central Government for effective prevention of money-laundering. >69. We find force in the stand taken by the Union of India that the objective of enacting the 2002 Act was the attachment and confiscation of proceeds of crime which is the quintessence so as to combat the evil of money laundering. The second proviso, therefore, addresses the broad objective of the 2002 Act to reach the proceeds of crime in whosoever name they are kept or by whosoever they are held. To buttress this argument, reliance has been placed on the dictum in Attorney General of India (supra) and Raman Tech. and process Engg. Co. vs. Solanki Traders". >The object of the Act is to freeze proceeds of crime and as discussed in the preceding paras, the property gifted to the appellant would fall within the realm of proceeds of crime. The use of the terms "any person" in Section 5(1)(a) read with "such proceeds of crime" in sub -clause (b) of Section 5(1) includes any person not necessarily an accused. In case, the argument of the appellant is to be accepted, t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
