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TMI Blog2025 (4) TMI 453X X X X Extracts X X X X X X X X Extracts X X X X ..... redat Panbazar Police Station, Guwahati, Assam, under sections 120-B, 408, 409, 468 and 471 of IPC, 1860 against Shri Subhra Jyot Bharali, the then Managing Director, Industrial Co-operative Bank Ltd. (hereinafter referred to as ICBL), Guwahati, Assam, Shri Rajeshwar Das, the then Official of ICBL, Guwahati, Assam, Shri Ganesh Deka, the then Official of ICBL, Assam, Shri Rinku Barman, the then Director, ICBL, Guwahati, Assam, Shri Mahit Chandra Gayari, the then Chairman, ICBL, Guwahati, Assam, Shri Naren Chandra Medhi, the then Vice- Chairman, ICBL, Guwahati, Assam, Shri Mukul Talukdar, the then Director, ICBL, Guwahati, Assam, Shri Anil Chandra Kalita, the then Director, ICBL, Guwahati, Assam. 3. It was alleged that Shri Subhra Jyoti Bharali in collaboration and with active help and conspiracy with all other co-accused persons, committed huge financial misappropriation in the ICBL, Guwahati and till 04/09/2019, siphoned off at least Rs. 9,50,61,499.00 (Nine Crores Fifty Lakhs Sixty One Thousand Four Hundred Ninety nine only) in the name of travelling allowances and in the head of Salary, incentive payment to the field executives and collectors. The Chairman viz. Mr. Mahit Chandra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be "proceeds of crime". The respondents failed to consider that what can be attached is the proceeds of crime and not any other property. It may be that a sum of Rs.12,59,10,023/- was withdrawn in cash from accounts maintained in the name of PC & FE with Maligaon branch of ICBL. It is also if the proceeds of crime involved is worked out to be Rs. 32,70,73,612/- said to have been acquired by Subhra Jyoti Bharali by way of mis-appropriation of the money of ICBL and said to have layered the proceed in the name of PCs and FEs and various other related entities of Subhra Jyoti Bharali with ICBL and SB. It is even if after several layering, it was finally integrated into financial system by way of acquisition of a immovable properties in the name of family members of Sarabhjeet Bharali i.e. Shri Gunajit Bharil, Ms. Nambitha Pathak, Babanand Bharil, Himani Roy and by infusion of capital in SKTCPL owned by subhra Jyoti and his family members. 8. The allegation may have been levelled that SKTCL, M/s Shashi Kumar Tea Company Pvt. Ltd. issued the shares in the name of Anjali Dass and Baban and Bharali on 16.02.2019 and was further transferred to minor son and daughter of Subhra Jyoti Bharal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... raised by the appellant, we would refer the argument of the respondent. It is to avoid repetition of one and same facts. 14. The facts relevant to the case have been narrated in the opening paras of this order. The appellants have challenged the impugned order in reference to three legal issues and accordingly we would be dealing with those issues for which it would not be necessary to touch upon the facts of the case unless so required in reference to the legal issues raised by the appellants. The allegation against the appellant has otherwise been narrated coupled with registration of FIR and recording of the ECIR thereupon. First issue:- 15. The learned counsel for the appellants submitted that while the FIR was registered for the offence under section 120 B, 408, 409, 468, 471 IPC, the chargesheet was filed only for the offence under section 120 B and section 408 and 409 and not for section 468 and 471 IPC. Thus, now the chargesheet does not disclose any predicate offence other than 120 B IPC which cannot stand alone and thereby a challenge to the attachment and even the proceeding of under the Act of 2002 has been made. 16. The learned counsel for the appellants raised th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al value of 30.50 crores to secure the proceeds of the crime amount which is more than the aforesaid. The statement of the properties attached by the respondents is given as under:- Property details/reference no in the OC Owner and defendant no. Date of acquisition Whether attachment based on direct involvement of proceeds of crime Whether attachment is as value of the proceeds of crime Value of the property Plot of land measuring 2 Bigha, 2 Katha, 2 Lacha Covered by Dag No. 74, Patta No. 9 of Village - Dalai, Mouza- Chayani, PS- Palashbari, Boko, Kamrup Smt. Nabanita Pathak (D-1) 27.09.2018 Yes No Rs. 8,47,000/- Plot of land Smt. measuring 1 Pathak (D-1) Bigha, 2 Katha and 10 Lechas covered by Dag No. 45, Patta No. 34 of Village- Dalai, Mouza- Chayani, PS- Palashbari, Boko, Kamrup. Smt. Nabanita Pathak (D-1) 30.10.2020 Yes No Rs. 4,50,000/- Plot of land measuring 1 Bigha, 3 Katha covered by Dag No. 85, Patta No. 52 of Village- Dalai, Mouza- Chayani, PS- Palashbari, Boko, Kamrup. Smt. Nabanita Pathak (D-1) 02.07.2019 Yes No Rs. 4,80,000/- Plot of land measuring 3 Bigha 1 Lecha covered by Dag No. 29, Patta No. 35 of Village Dalai, Mouza- Chayani, PS- Palashb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 8 of Village- Dalai, Smt. Nabanita Pathak (D-1) 08.10.2018 Yes No Rs.1,56,000/- Mouza- Chayani, PS- Palashbari Boko, Kamrup TOTAL Rs.30,50,26,937 Approx. 21. The facts available on record shows allegation against the appellants for mis-appropriation of the fund in different period where they siphoned off Rs. 9,50,61,000/- in the name of travelling allowances and in the heads of salary, incentive to the field executive and collectors. There were other withdrawals in the similar manner. The further allegation is of siphoning off the amount by main accused Subhra Jyoti Barali through Maligaon branch of the bank. The reference of aforesaid fact have been given only as illustration otherwise the allegation against the appellant have been elaborately mentioned in the impugned order. If the details of the property attached by the respondent is taken note of, properties were acquired subsequent to the commission of crime. Thus, it is not that the properties attached by the respondents were acquired by the appellant prior to the commission of crime rather the appellant had acquired the properties subsequent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to divide the definition into three parts. The first part refers to the property acquired or derived directly or indirectly out of the criminal activities relating to the scheduled offence. In the first part, all those properties which are acquired directly or indirectly out of criminal activities would be termed to be the proceeds of crime. The properties can be acquired directly or indirectly with the use of proceeds of crime. The use of proceeds directly or indirectly would be relevant part to fall in first part of the definition of 'proceeds of crime‟. To clarify the definition, it may be illustrated. Assuming in a case of dacoit, the accused secured the money and it has been used for the purchase of property, then such a property would fall in the definition of 'proceeds of crime‟ having been obtained out of proceeds of crime. In other case where the property was not acquired or derived by the accused himself but he passed on money out of the crime to another person and he acquired the property, then also it would be considered to be the proceeds of crime to acquire the property. In any case, there should be an element for use of the proceeds directly or indirectl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ional but till then there remains presumption of constitutional validity. 16. At this stage, we may refer to Para 68 of the judgment in the case of Vijay Madanlal Choudhary (supra) which is quoted hereunder. "68. It was also urged before us that the attachment of property must be equivalent in value of the proceeds of crime only if the proceeds of crime are situated outside India. This argument, in our opinion, is tenuous. For, the definition of "proceeds of crime" is wide enough to not only refer to the property derived or obtained as a result of criminal activity relating to a scheduled offence, but also of the value of any such property. If the property is taken or held outside the country, even in such a case, the property equivalent in value held within the country or abroad can be proceeded with. The definition of "property" as in Section 2(1)(v) is equally wide enough to encompass the value of the 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." The perusal of the para quoted above shows that the argument of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cation 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 may be referred to as "the alternative attachable property" or "deemed tainted property". 17. The judgment of the Delhi High Court makes it clear that the definition of "proceeds of crime" has three limbs and in the second limb the properties of equivalent value to the proceeds obtained out of crime can be attached which may have been acquired prior to the commission of crime but it would be when proceeds of crime has been vanished and is not available. It is sought to achieve the object of the Act of 2002. 18. In the light of judgment of the Apex Court in Vijay Madanlal Choudhary (supra), we are unable to apply the judgment of Kerala High Court in the case of Satish Motilal Bidri (supra). The Ld. counsel did not refer the relevant para of the judgment in the case (supra), rather he referred Para 66 of the judgment of the Apex Court in Vijay Madanlal Choudhary (supra) which permits attachment only of the proceeds of crime. There cannot be any dispute that attachment can be only of the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eds of crime. xxxx 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. 80. In the considered opinion of this Court to tie the Directorate's power to move forward in this direction only in cases where property is taken or held outside the country would not only do violence to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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. xxxx 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 the Act in light of what this Court had held in Axis Bank. As was explained by the Court in Axis Bank, the expression proceeds of crime envisage both ―tainted property as well as ―untainted propert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udicating Authority failed to pass confirmation order within a period of 180 days from the date of provisional attachment of the properties. We find that the provisional attachment order was issued on18.08.2022 while the confirmation order was passed by the Adjudicating Authority on 08.02.2023, i.e. within the period of 180 days. The fact however remain that while passing the order on 08.02.2023, a clerical/typographical error remain in the order and therefore a corrigendum was issued on 21.02.2023 which is taken to be an order beyond the period of 180 days. 25. The learned counsel for the respondent referred to section 68 of the Act of 2002 to submit that any mistake/omission would not invalidate the order. Section 68 in The Prevention of Money- Laundering Act, 2002 is quoted hereunder:- 68. Notice, etc., not to be invalid on certain grounds. No notice, summons, order, document or other proceeding, furnished or made or issued or taken or purported to have been furnished or made or issued or taken in pursuance of any of the provisions of this Act shall be invalid, or shall be deemed to be invalid merely by reason of any mistake, defect or omission in such notice, summons, orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act has to be read and treated as a draft assessment order as per Section 143C read with Section 93CA (4) read with Section 143(3) of the Act. In and by the order dated 15.04.2013, the second respondent granted thirty days time to enable the assessee to file their objections. On receipt of the corrigendum dated 15.04.2013, the petitioner company approached the first respondent, but the first respondent declined to issue any direction to the assessment officer on the ground that the first respondent has got jurisdiction only to entertain such an appeal if the order passed by the second respondent is a pre-assessment order. Therefore, it is evident that the first respondent declined to entertain the objections raised by the petitioner company on the ground that the order passed by the second respondent is not a draft assessment order, rather it is a final order. Thus, the first respondent had treated the order dated 26.03.2013 of the second respondent as a final order and therefore it refused to entertain the objections filed on behalf of the petitioner company. 22. As mentioned supra, as per Section 144C(1) of the Act, the second respondent-assessing officer has no right to p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and. A corrigendum of the nature making antedated order to bring it to be within limitation would be a nullity and similarly if the nature of the order from final to draft assessment order would change the substance of the order thus, the corrigendum would be read on the date when it was passed. In the instant case, substance of order has not been changedthe nature of the order rather a typographical/clerical errors has been cured by issuing corrigendum and therein an effort is not to bring the order within the period prescribed under section 5(1) of the Act of 2002, rather it was passed within 180 days. The corrigendum was only to cure the typographical and clerical error. 31. The nature of the order has not been changed, rather the details of the property was wrongly mentioned out of typographical error and has been described in the corrigendum. In fact, the Adjudicating Authority was not required to give description of the properties attached when provisional attachment order was sent for confirmation containing description of the properties. The Adjudicating Authority was required to consider rival submission, to confirm or to deny it. The description of the property was not r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elevance here, where an accidental printing error is sought to be corrected in a statutory notification issued by the Government. It is difficult to deny this right of correction to the Government. Such a power is ancillary and incidental to the substantive power conferred upon the Government to issue a notification by section 4-B. Such a power is necessary for an effective exercise of the substantive power. 33. A further reference of the Judgement in the case of Jubilant Organo sys Limited Vs. Assistant Commissioner of Central Excise and Ors. reported in Manu/KA/1287/2011of High Court Of Karnataka At Bangalore in Writ Petition No. 15575/2010 dated 28.06.2011 is also given. Para 8 to 10 are thus quoted hereunder:- 8. In J.K. Udaipur Udyog Ltd.'s case (supra) the Apex Court has held that the use of the word 'corrigendum' itself indicates, the intention was to correct and to rectify what the State Government thought had been erroneously done. It is clear from the aforesaid judgment that a corrigendum is nothing but a correction and it relates back to the notification itself. 9 . In Mustang Rubbers Industrial Estate's case (supra) relied on by the learned Counsel ..... X X X X Extracts X X X X X X X X Extracts X X X X
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