- Whether the eviction notice dated November 19, 2024 issued under Section 8(4) of the Prevention of Money Laundering Act, 2002 ("PMLA") read with Rule 5(2) of the Money Laundering (Taking Possession of Attached or Frozen Properties Confirmed by The Adjudicating Authority) Rules, 2013 ("the Rules") was valid and within jurisdiction.

- Whether such a notice can be issued prior to a formal order of confiscation by the Special Court under Section 8(6) of the PMLA.

- Whether the petitioner was entitled to challenge the eviction notice before the High Court under Article 226 of the Constitution of India despite the pendency of an appeal before the Appellate Tribunal under Section 26 of the PMLA.

- Whether the eviction notice complied with the requirement of disclosing exceptional circumstances justifying possession under Section 8(4) of the PMLA as interpreted by the Supreme Court in Vijay Madanlal Choudhary and Others v. Union of India and Others (2023).

- Whether non-compliance or belated compliance with Rule 5(1) of the Rules vitiates the eviction notice issued under Rule 5(2).

- Whether the delay of approximately two years and nine months in issuing the eviction notice was fatal to its validity.

- Whether the petitioner's constitutional right to property under Article 300A of the Constitution was infringed by the issuance of the eviction notice without due process.

2. ISSUE-WISE DETAILED ANALYSIS

Validity and Jurisdiction of the Eviction Notice under Section 8(4) PMLA and Rule 5(2) of the Rules

The Court examined Section 8(4) of the PMLA which mandates that upon confirmation of a provisional attachment order by the Adjudicating Authority under Section 5(3), the Director or an authorized officer shall forthwith take possession of the attached property as prescribed. Rule 5(2) of the Rules prescribes that where immovable property confirmed by the Adjudicating Authority is occupied by the owner, the authorized officer shall issue a ten-day eviction notice to prevent enjoyment of the property, failing which eviction may be effected with local authority assistance.

The Court found that the eviction notice dated November 19, 2024 was issued consequent to the Adjudicating Authority's confirmation of the provisional attachment order dated August 22, 2022. The notice was thus a statutory consequence of the confirmed attachment order and prima facie conformed with the provisions of Section 8(4) and Rule 5(2). There was no averment or proof that the Deputy Director of the Enforcement Directorate who issued the notice lacked jurisdiction. Therefore, the Court held there was no inherent lack of jurisdiction in issuance of the eviction notice.

Issuance of Eviction Notice Prior to Formal Confiscation Order

The petitioner contended that the eviction notice was issued prematurely before any formal order of confiscation under Section 8(6) of the PMLA and that such action should be an exception, not the rule, citing the Supreme Court's observations in Vijay Madanlal (2023). The petitioner argued that no exceptional circumstances were demonstrated to justify possession prior to confiscation.

The Court acknowledged the Supreme Court's ruling that Section 8(4) should be invoked only in exceptional situations. However, it held that the question of whether exceptional circumstances exist is a factual determination to be made by the Appellate Tribunal in the pending appeal under Section 26 of the PMLA. The Court declined to entertain this issue at the writ stage, deferring it to the statutory appellate forum.

Availability of Writ Jurisdiction Despite Pending Appeal

The respondent Enforcement Directorate argued that the High Court should not entertain the writ petition as the petitioner had an efficacious statutory remedy by way of appeal before the Appellate Tribunal under Section 26 of the PMLA, where the stay application was pending. The Court agreed that the writ jurisdiction under Article 226 is discretionary and may be declined if an efficacious statutory remedy exists.

However, the Court clarified that writ jurisdiction is not ousted by the existence of a statutory appeal, but it may be declined in exercise of discretion. Since the petitioner's challenge was to a notice that is an administrative act without a specific provision for appeal, the petitioner argued that the writ petition was maintainable. The Court, while recognizing the availability of writ remedy, emphasized that the appeal and stay application pending before the Appellate Tribunal were adequate and efficacious remedies.

The Court thus declined to interfere with the eviction notice and directed the Appellate Tribunal to expeditiously dispose of the appeal and stay application, preferably within two months, thereby reinforcing the primacy of the statutory appellate forum.

Requirement to Disclose Exceptional Circumstances in the Eviction Notice

The petitioner contended that the eviction notice was cryptic and failed to disclose any exceptional circumstances justifying possession under Section 8(4) as mandated by the Supreme Court in Vijay Madanlal.

The Court held that the notice under Rule 5(2) of the Rules is not required to disclose reasons or exceptional circumstances. While the Enforcement Directorate must demonstrate exceptional circumstances to justify possession, this is a matter of fact and law to be decided by the Appellate Tribunal during the appeal. The Court found no reason to entertain a separate challenge to the eviction notice on this ground.

Compliance with Rule 5(1) of the Rules

Rule 5(1) requires that the Registrar having jurisdiction over the property be notified to prevent transfer or creation of interest in the property. The petitioner argued that there was no evidence of compliance with this provision.

The Court observed that Rule 5(1) and Rule 5(2) serve different purposes: Rule 5(1) prevents encumbrance or transfer, while Rule 5(2) secures possession. Non-compliance or belated compliance with Rule 5(1) would not invalidate the eviction notice issued under Rule 5(2). Hence, the Court did not find this contention fatal to the notice.

Delay in Issuance of Eviction Notice

The petitioner submitted that the notice was issued after a delay of nearly three years, which should render it invalid.

The Court noted that the statute does not prescribe any mandatory time limit for issuance of such notice. Accordingly, the delay alone could not be a ground for invalidation in the absence of prejudice or statutory prohibition.

Alleged Violation of Constitutional Right to Property

The petitioner contended that issuance of the eviction notice without due process violated Article 300A of the Constitution, which guarantees the right to property.

The Court held that this right can only be curtailed following due process of law. Since the legality of the eviction notice and the existence of exceptional circumstances were yet to be adjudicated by the Appellate Tribunal, no conclusive finding on violation of constitutional rights was made at this stage. The petitioner was free to raise this issue before the Tribunal.

3. SIGNIFICANT HOLDINGS

"Where the provisional order of attachment made under sub-section (1) of section 5 has been confirmed under sub-section (3), the Director or any other officer authorised by him in this behalf shall forthwith take the possession of the property attached under section 5... in such manner as may be prescribed." (Section 8(4) of PMLA)

"Where the immovable property confirmed by the Adjudicating Authority is in the form of a land, building, house, flat, etc., and is occupied by the owner, the authorized officer shall issue a notice of eviction of ten days so as to prevent the person from enjoying such property and after issuing of such notice if the premises is not vacated within the stipulated time, such occupant shall be evicted and the possession shall be taken by seeking the assistance of the local Authorities in terms of section 54 of the Act." (Rule 5(2) of the Rules)

"The Appellate Tribunal would have implied power to grant stay of the order impugned before it... The powers which have been conferred by Section 254 on the Appellate Tribunal with widest possible amplitude must carry with them by necessary implication all powers and duties incidental and necessary to make the exercise of those powers fully effective." (Reliance on Supreme Court precedent in ITO v. M.K. Mohd. Kunhi)

"The question as to whether a particular case was of exceptional nature or not, could be determined only by the appellate authority at the time of considering the merits of the appeal and not by this Court in exercise of its writ jurisdiction." (Adopted from cited High Court precedents)

Core principles established include:

• Eviction notices under Section 8(4) read with Rule 5(2) are statutory consequences of confirmed attachment orders and prima facie valid if issued by authorized officers.
• The existence of exceptional circumstances justifying possession prior to confiscation is a factual and legal question to be decided by the Appellate Tribunal, not the High Court in writ jurisdiction.
• The High Court's writ jurisdiction under Article 226 is discretionary and may be declined in favor of efficacious statutory remedies such as appeals before the Appellate Tribunal.
• Non-disclosure of exceptional circumstances in the eviction notice itself is not fatal; such matters are to be examined in appellate proceedings.
• Delay in issuing eviction notice is not fatal in absence of statutory time limits or prejudice.
• Compliance with procedural safeguards under Rule 5(1) and Rule 5(2) serve different purposes and non-compliance with one does not invalidate the other.

Final determinations:

• The eviction notice dated November 19, 2024 issued under Section 8(4) of the PMLA and Rule 5(2) of the Rules is prima facie valid and within jurisdiction.
• The petitioner's challenge to the eviction notice is premature before the High Court given the pending appeal and stay application before the Appellate Tribunal under Section 26 of the PMLA.
• The question of exceptional circumstances justifying possession prior to confiscation and the legality of the eviction notice are to be adjudicated by the Appellate Tribunal.
• The writ petition under Article 226 is dismissed with a request for expeditious disposal of the appeal and stay application by the Appellate Tribunal.

1. ISSUES PRESENTED AND CONSIDERED

(i) Whether a second application for regular bail in a money-laundering prosecution should be entertained where an earlier bail rejection on merits has attained finality and the applicant fails to demonstrate any change in circumstances (factual or legal) warranting re-consideration.

(ii) Whether reliance on the Supreme Court decision concerning inadmissibility of certain statements recorded under Section 50 of the Prevention of Money Laundering Act, 2002 constitutes a change in legal circumstance in the applicant's case so as to revisit bail, and whether such decision applies to the applicant's factual situation.

(iii) Whether, in the facts found from the prosecution materials, the applicant satisfies the twin conditions for bail applicable to money-laundering offences, and whether long incarceration/delay in trial alone can justify bail in such a special offence.

2. ISSUE-WISE DETAILED ANALYSIS

A. Successive bail application-requirement of change in circumstances

Legal framework (as discussed by the Court): The Court proceeded on the basis that bail in money-laundering matters is controlled by the stringent statutory regime requiring satisfaction of the special bail conditions, and that when bail has earlier been rejected on merits, a subsequent bail plea requires a demonstrated change of circumstance (factual or legal) justifying re-consideration.

Interpretation and reasoning: The Court examined its earlier order rejecting bail and noted that the earlier rejection was after considering the prosecution complaint/ECIR materials and the applicant's alleged role, and after concluding that the statutory rigours (including the twin conditions) were not met. The Court accepted the objection that the earlier merit-based adjudication stood against re-opening the matter, unless the applicant could show a subsequent and material change. The Court identified the only potentially new ground urged as a later Supreme Court decision about Section 50 statements, and assessed whether that ground actually altered the applicant's position.

Conclusion: The Court held that the applicant failed to establish any change of circumstance (factual or legal) sufficient to justify reconsideration of bail after the earlier rejection on merits, and therefore declined bail.

B. Applicability of the Supreme Court ruling on Section 50 statements (claimed change in law)

Legal framework (as discussed by the Court): The Court analysed Section 50 and the evidentiary status of statements recorded thereunder, and considered the applicant's reliance on a Supreme Court ruling holding that when a person is in custody and a statement is recorded by the same investigating agency, such statement is inadmissible against the maker due to concerns of free will and fairness. The Court also noted precedent within its reasoning that Section 50 statements are generally treated as admissible and capable of making out a "formidable case" regarding involvement.

Interpretation and reasoning: The Court found that the applicant cited the Supreme Court observation selectively and that the Supreme Court's holding was tied to a specific factual situation: a person already in custody in another case investigated by the same agency, from whom statements were recorded for a new matter where arrest was not yet shown. The Court contrasted that scenario with the applicant's facts as found from the record: the applicant's statement under Section 50 was recorded on 13.04.2023, and he was arrested subsequently on 14.04.2023; another statement was recorded later on 22.04.2023. On this basis, the Court concluded that the precise custody-related infirmity addressed by the Supreme Court decision was not attracted on the applicant's facts. The Court further treated Section 50 statements (and other materials) as admissible/credible for the limited purpose of forming a prima facie view at the bail stage and held that the prosecution had relied on such statements and documents to show involvement.

Conclusion: The Court held that the relied-upon Supreme Court ruling on inadmissibility did not apply to the applicant's situation and therefore did not constitute a legal change of circumstance justifying a different bail outcome.

C. Satisfaction of the twin conditions for bail under the money-laundering regime; effect of long custody/delay

Legal framework (as discussed by the Court): The Court discussed the definition of "proceeds of crime" and the offence of money-laundering as a continuing activity, and emphasised the stringent bail threshold requiring the Court to be satisfied that there are reasonable grounds for believing the accused is not guilty and not likely to commit an offence while on bail. The Court also addressed the submission that long incarceration/delay in trial alone can justify bail, and considered the proposition that for special/scheduled offences, seriousness and societal impact are relevant and delay alone is insufficient.

Interpretation and reasoning: Referring to the earlier bail-rejection reasoning and the prosecution materials summarised therein, the Court noted that the allegations against the applicant included participation in a land-related racket involving forged/manipulated records and the use of bank accounts for placement/layering/integration of alleged proceeds, including substantial credits and significant cash withdrawals, and transactions linked with other accused. The Court treated these materials as forming the basis for its earlier conclusion that the statutory rigours were not satisfied and found that this position remained unchanged. On the custody argument (about 24 months), the Court held that long incarceration or delay in trial alone cannot justify bail in such special offences; it balanced personal liberty against societal impact and accepted the assurance that efforts would be taken to expedite trial.

Conclusion: The Court held that the applicant still did not meet the twin conditions for bail and that long custody/delay in trial alone did not warrant release. Bail was therefore refused and the application dismissed.

Issues: (i) whether the petitioner was entitled to regular bail under the Prevention of Money Laundering Act, 2002 by satisfying the mandatory twin conditions; (ii) whether bail could be granted on the ground of parity with a co-accused.

Issue (i): whether the petitioner was entitled to regular bail under the Prevention of Money Laundering Act, 2002 by satisfying the mandatory twin conditions.

Analysis: The petition was considered in the light of the statutory scheme of money-laundering, including the definition of proceeds of crime, the offence under Section 3, the punishment under Section 4, the evidentiary value of statements recorded under Section 50, and the stringent bail restriction under Section 45. The material collected in investigation, including statements and recovered documents, was treated as prima facie showing the petitioner's role in preparing and using fake deeds, falsifying records, and handling proceeds of crime. The Court held that the petitioner had not shown reasonable grounds for believing that he was not guilty and had not satisfied the further requirement that he would not commit an offence while on bail.

Conclusion: The claim for regular bail failed on merits and was rejected.

Issue (ii): whether bail could be granted on the ground of parity with a co-accused.

Analysis: Parity was held to depend on similarity of role and factual involvement, not merely on the fact that another accused had obtained bail. On the materials placed, the petitioner's alleged role in preparing fake deeds and assisting in the acquisition and laundering of proceeds of crime was found distinguishable from the co-accused relied upon for parity.

Conclusion: Parity was not available to the petitioner.

Final Conclusion: The regular bail plea was declined because the statutory bail safeguards under the money-laundering law were not met and the plea of parity did not assist the petitioner.

Ratio Decidendi: In bail matters under the Prevention of Money Laundering Act, 2002, the Court must be satisfied on a prima facie basis that the accused satisfies the mandatory twin conditions under Section 45, and parity can succeed only where the role and factual involvement of the accused are materially similar.

Regarding the legal framework and precedents, the Court extensively analyzed Section 17 of PMLA, which empowers authorized officers to conduct search and seizure upon recording "reasons to believe" in writing that a person has committed money laundering or is in possession of proceeds or records related to such offence. The Court relied on the Supreme Court's decision in Vijay Madanlal Choudhary v. Union of India, which upheld the vires of Section 17 and clarified that ECIR is an internal document not mandatorily disclosed to the accused. The Court also referred to Arvind Kejriwal v. Directorate of Enforcement to distinguish the procedural rigor between search under Section 17 and arrest under Section 19 of PMLA, emphasizing that the higher threshold applicable to arrest cannot be transposed to search operations. The judgment in Radhika Agarwal v. Union of India was cited to elucidate the contours of "reasons to believe," concluding that judicial review is limited to verifying whether reasons were recorded in writing and formed on some information in possession, without delving into the sufficiency or adequacy of materials at the preliminary stage.

Applying these principles, the Court found that the ED had valid "reasons to believe" supported by multiple FIRs registered by the Tamil Nadu Department of Vigilance and Anti-Corruption alleging corruption and illegal gratification within TASMAC, which constitute scheduled offences under PMLA. The reasons were recorded in writing and submitted in sealed cover, satisfying the procedural requirement of Section 17. The Court rejected the petitioner's contention that the FIR or ECIR must be disclosed, reiterating the established position that such documents are internal investigative records whose premature disclosure could jeopardize investigations. The Court also noted that the deletion of the proviso in Section 17 (post-2019 amendment) removed the requirement of prior FIR registration or Magistrate's report for conducting searches under PMLA.

On the question of jurisdiction and consent, the Court held that PMLA is a special, self-contained legislation applicable throughout India, and the concept of federalism cannot be invoked to restrict the ED's powers to investigate offences of money laundering even within State Government entities. The Court rejected the argument that the ED must obtain consent from the State Government or limit its investigation to officers notified under Section 54(1)(j). It clarified that Section 54 imposes a duty on State authorities to assist the ED but does not restrict the ED's independent powers under Sections 17 and 50. The Court underscored that requiring prior consent would defeat the very purpose of surprise searches essential to effective investigation.

Regarding the applicability of PMLA to TASMAC, the Court observed that TASMAC is a company incorporated under the Companies Act and wholly owned by the State Government. Since Section 2(1)(s)(iii) of PMLA includes companies within the definition of "person," the statute applies to TASMAC without any need for reading down. Moreover, Section 70 of PMLA provides for prosecution of companies and persons in charge thereof for offences committed under the Act, reinforcing applicability.

The Court addressed allegations of harassment, illegal detention, denial of food and rest, and infringement of fundamental rights during the search. It found no credible material or complaints substantiating these claims. The Panchnama, signed by independent witnesses, recorded that the search was conducted peacefully without coercion or damage. The Court emphasized that detaining employees temporarily inside premises during search is a normal and necessary procedure to prevent evidence tampering or destruction and does not amount to unlawful detention or arrest. It rejected the petitioners' attempt to equate detention during search with arrest, citing authoritative distinctions between custody, detention, and arrest as clarified in Supreme Court precedents. The Court also highlighted that some employees voluntarily remained on premises and that adequate rest and medical accommodations were provided. Allegations of harassment were deemed vague and unsupported, and the Court noted that individual aggrieved persons are free to approach courts separately if fundamental rights are violated.

On the right to privacy, the Court reiterated that privacy is not absolute and is subject to reasonable restrictions under law, particularly for crime detection. It relied on the Supreme Court's landmark judgment in K.S. Puttaswamy v. Union of India, which recognized privacy as an intrinsic part of Article 21 but allowed lawful intrusions for legitimate State aims under fair, just, and reasonable procedures. The seizure of mobile phones and digital evidence was held to be a reasonable restriction directly connected to investigation of money laundering offences. The Court rejected the petitioner's argument that seizure violated freedom of speech or movement, analogizing it to lawful impounding of vehicles under other statutes.

Regarding procedural safeguards, the Court noted that Section 17 and the Prevention of Money Laundering (Forms, Search and Seizure or Freezing and the Manner of Forwarding the Reasons and Materials to the Adjudicating Authority, Impounding and Custody of Records and the Period of Retention) Rules, 2005, prescribe the manner of conducting searches, including production of authorization and cooperation by persons in charge. The Court found that the ED complied with these requirements, including showing and explaining the search authorization to TASMAC officials and independent witnesses, who signed the documents. The petitioners' claim that officials were forced to acknowledge the search warrant was rejected as it is the duty of public servants to cooperate with lawful investigations.

The Court also addressed the petitioners' contention that the search and seizure operation was politically motivated or intended to harass. It held that courts are not forums to adjudicate political motives and must focus on the materials and offences alleged. The Court underscored the importance of upholding the rule of law and ensuring that investigations into serious economic offences like money laundering are not obstructed by frivolous litigation or baseless allegations.

In conclusion, the Court dismissed all three writ petitions, holding that the search and seizure under Section 17 of PMLA were lawful, valid, and conducted in accordance with procedural safeguards. The Court affirmed the ED's jurisdiction and powers to investigate money laundering offences in a State Government company without prior consent of the State. It rejected claims of harassment, illegal detention, and violation of fundamental rights due to lack of evidence and procedural compliance. The Court emphasized the necessity of cooperation by public servants in investigations and cautioned against attempts to derail the criminal justice process through unsubstantiated allegations. The ED was permitted to proceed with further actions under PMLA.

Significant holdings include the following verbatim excerpts and principles:

"Section 17 in explicit terms has clearly mentioned under clause (a), that on authorisation, the concerned officer can enter and search any building based on adequate reasons of suspicion that such records or documents are kept... The vires of this provision is not the point of contention in the present case."

"The comparison as submitted by the learned Senior counsel for the petitioner between Section 17 and Section 19 in no terms can be entertained as the grounds and powers of arrest is completely different from search and seizure as contemplated under Section 17 of the Act."

"The judicial review powers of the Courts is limited only to the extent as to whether the reasons to believe is recorded in writing before conducting search. The scope of Judicial review is limited to this alone and cannot go beyond or examine the subjective satisfaction of the investigating officer."

"The Court did not go into the merits of the reasons but merely verified whether the reasons to believe authorising the search is recorded in writing and after being satisfied with the same returned the sealed cover to the Learned Special Public Prosecutor."

"The concept of federalism cannot be applied here. Our Constitution is quasi federal in nature but the traces of federalism is applied only for the benefit of the people and not to their detriment. PMLA are legislation to prevent crimes affecting National economic growth."

"Detaining employees temporarily inside premises during search is a normal and necessary procedure to prevent evidence tampering or destruction and does not amount to unlawful detention or arrest."

"Right to privacy under Article 21 is not absolute and would be subject to reasonable restrictions under the law, one such reasonable restriction being crime detection."

"The seizure of mobile phone is directly and inextricably related to the investigation and search under PMLA for the purpose of collection of evidence for gathering material to unearth the offence of money laundering and prosecute the offenders."

"The Court cannot entertain vague and unsupported allegations of harassment or coercion during lawful search operations."

"The ED is at liberty to proceed with all further actions under PMLA."

The core legal questions considered by the Court are:

• Whether the Directorate of Enforcement (ED) has the power under Section 8(4) of the Prevention of Money-Laundering Act, 2002 (PMLA) and the related Rules of 2013 to direct a bank to transfer the amounts held in Fixed Deposits (FDs) along with accrued interest in the name of the Enforcement Directorate during the pendency of adjudication and confiscation proceedings.
• Whether the provisional attachment and subsequent confirmation of attachment of the FDs by the Adjudicating Authority under the PMLA permits the ED to take possession by way of transfer of the FD amounts before the conclusion of proceedings before the Special Court.
• The scope and limits of the powers conferred on the ED and subordinate officers under Chapter III of the PMLA, specifically Sections 8(1), 8(3), 8(4), 8(5), and 8(7), in relation to attachment, adjudication, and confiscation of property.
• Whether the Prevention of Money-Laundering (Taking Possession of Attached or Frozen Properties Confirmed by the Adjudicating Authority) Rules, 2013, or the Prevention of Money-Laundering (Issuance of Provisional Attachment Order) Rules, 2013, empower the ED to direct transfer of attached property amounts during ongoing proceedings.

2. ISSUE-WISE DETAILED ANALYSIS

Issue 1: Power of ED under Section 8(4) PMLA and related Rules to direct transfer of FD amounts during pendency of proceedings

Relevant legal framework and precedents: Section 8 of the PMLA, 2002, under Chapter III, governs attachment, adjudication, and confiscation of property involved in money laundering. Sub-section (1) empowers the Director or an officer not below the rank of Deputy Director to provisionally attach property believed to be proceeds of crime for a maximum of 180 days. The provisional attachment must be confirmed by the Adjudicating Authority under sub-section (3), after which the attachment continues during investigation or trial. Sub-section (4) mandates that upon confirmation of attachment, the Director or authorized officer shall "forthwith take possession" of the attached or frozen property in the prescribed manner. Sub-section (5) and (7) provide for confiscation orders by the Special Court after trial.

The Prevention of Money-Laundering (Taking Possession of Attached or Frozen Properties Confirmed by the Adjudicating Authority) Rules, 2013, particularly Rules 4(4) and 4(5), prescribe the procedure for taking possession of attached or frozen properties.

Court's interpretation and reasoning: The Court noted that the power to attach property provisionally and confirm such attachment is clearly delineated under Section 8. However, the phrase "take possession" under sub-section (4) does not explicitly authorize the ED to direct the transfer of the amounts held in Fixed Deposits to the Enforcement Directorate's name during the pendency of adjudication or trial. The Court emphasized that possession of movable property such as FDs does not necessarily mean transfer of title or ownership, especially before confiscation orders are passed by the Special Court.

The Court further observed that the power exercised by the Deputy Director (a subordinate officer) must conform strictly to the procedure prescribed under Chapter III of the PMLA. The direction to the bank to transfer the FD amount along with accrued interest by way of a Demand Draft to the ED was found to exceed the statutory mandate.

Key evidence and findings: The provisional attachment order dated 06.02.2024 was confirmed by the Adjudicating Authority on 30.07.2024. The ED issued a communication directing the bank to transfer the FD amounts. The petitioner challenged this direction, contending that the ED lacked power to effect such transfer during pendency of proceedings.

Application of law to facts: The Court applied the statutory scheme of Section 8 and the relevant Rules to the facts and concluded that the ED's direction to transfer the FD amounts was not supported by the PMLA or the Rules. The attachment confirmed by the Adjudicating Authority only freezes the property and does not vest ownership or possession in the ED to the extent of transferring funds before final confiscation.

Treatment of competing arguments: The ED relied on Section 8(4) and Rules 4(4), 4(5) of the 2013 Rules to justify the direction. The Court rejected this interpretation, noting the absence of any express power to transfer funds and the procedural safeguards embedded in the PMLA to protect the rights of the attached party pending final adjudication.

Conclusion: The direction by the ED to transfer FD amounts along with interest to its name during pendency of the appeal and trial was held to be unsustainable and beyond the scope of statutory powers.

Issue 2: Scope of attachment, adjudication, and confiscation under Section 8 and interplay with Special Court proceedings

Relevant legal framework and precedents: Section 8(3)(b) provides that the order passed by the Adjudicating Authority becomes final only after an order of confiscation is passed by the Special Court under sub-section (5) or (7). The confiscation order is made only after trial and conviction for money laundering. Until then, the attachment remains provisional or confirmed but not final.

Court's interpretation and reasoning: The Court emphasized the sequential process envisaged by the statute: provisional attachment -> confirmation by Adjudicating Authority -> trial and confiscation by Special Court. The Court underscored that the confirmed attachment order does not transfer ownership or possession rights to the ED but merely freezes the property to prevent its dissipation.

Key evidence and findings: The petitioner had challenged the attachment order and had an appeal pending before the Appellate Tribunal. The Court acknowledged the ongoing appellate proceedings and the safeguards available to the petitioner.

Application of law to facts: The Court held that the attachment order remains in force during investigation or trial but does not authorize the ED to dispose of or transfer the property before final confiscation. The procedural protections ensure that the petitioner's rights are preserved until the Special Court's determination.

Treatment of competing arguments: The ED's attempt to expedite possession by transfer of funds was rejected as inconsistent with the statutory scheme and the principle of fair adjudication.

Conclusion: The confirmed attachment order is effective to freeze the property but does not authorize transfer or disposal of the property before final confiscation by the Special Court.

Issue 3: Validity of relying on the Prevention of Money-Laundering (Issuance of Provisional Attachment Order) Rules, 2013 to justify transfer of property

Relevant legal framework and precedents: The Prevention of Money-Laundering (Issuance of Provisional Attachment Order) Rules, 2013, regulate the procedure for issuing provisional attachment orders under the PMLA. Rule 5 of these Rules was specifically considered.

Court's interpretation and reasoning: The Court found no provision in these Rules that permits the ED to direct transfer of attached property amounts to itself during pendency of proceedings. The Rules focus on procedural aspects of attachment and do not confer substantive rights to possession or ownership before final confiscation.

Key evidence and findings: The ED's reliance on Rule 5 to justify the transfer direction was not supported by the text or intent of the Rules.

Application of law to facts: The Court held that the Rules cannot be interpreted to override the statutory safeguards and the scheme of Chapter III of the PMLA.

Treatment of competing arguments: The ED's argument was rejected as lacking statutory foundation.

Conclusion: The Rules do not empower the ED to transfer attached property amounts during ongoing adjudication or trial.

3. SIGNIFICANT HOLDINGS

The Court held:

"Since the fixed FDRs, which is a movable property and the power has been exercised by the Deputy Director, an Officer subordinate to the Director of Enforcement, who is bound by the procedure that is specifically set out in Chapter III of the PMLA in relation to the attachment, adjudication and confiscation, since the FDR's of the petitioners has already faced an attachment, we find that the direction issued to transfer the amount in the name of the Directorate of Enforcement to be unsustainable."

"We are unable to trace any such power, to direct transfer of the property while the proceedings are pending before the Special Court, in the name of the Enforcement Director and we do not think that Rule 5 of the Rules of 2013, in any case, permit such a course of action to be adopted."

"Since we find no justification for the aforesaid action... we deem it appropriate to quash and set aside the said direction, though we make it clear that in so far as the order of attachment, which is already pending before the appellate Authority, the final decision shall be taken by the Authority, with all the remedies that are available to be invoked by the petitioner."

Core principles established include:

• The ED's power to attach property under the PMLA is limited to provisional attachment and confirmation by the Adjudicating Authority, and does not extend to transferring ownership or possession of attached property before final confiscation by the Special Court.
• The phrase "take possession" under Section 8(4) does not authorize transfer of funds in Fixed Deposits to the ED during pendency of proceedings.
• The procedural safeguards under the PMLA and Rules ensure protection of the rights of the attached party until final adjudication.
• Directions issued by the ED to banks to transfer attached FD amounts along with interest to the ED's name during pendency of trial are beyond the statutory powers and unsustainable.

Final determinations on each issue:

• The direction issued by the ED to the bank to transfer the FD amounts along with accrued interest to the Enforcement Directorate was quashed and set aside.
• The attachment order confirmed by the Adjudicating Authority remains in force, and the petitioner's appeal against it is pending, with all remedies available.
• The ED must adhere strictly to the procedural framework prescribed under the PMLA and cannot take possession of attached property by way of transfer before final confiscation.

Issues: (i) Whether a complaint filed after the commencement of the Bharatiya Nagarik Suraksha Sanhita, 2023 in respect of offences alleged to have been committed earlier is governed by the Bharatiya Nagarik Suraksha Sanhita, 2023 or by the Code of Criminal Procedure, 1973; (ii) Whether cognizance taken and process issued without giving the proposed accused an opportunity of hearing was sustainable under the applicable procedural law.

Issue (i): Whether a complaint filed after the commencement of the Bharatiya Nagarik Suraksha Sanhita, 2023 in respect of offences alleged to have been committed earlier is governed by the Bharatiya Nagarik Suraksha Sanhita, 2023 or by the Code of Criminal Procedure, 1973.

Analysis: Section 531 of the Bharatiya Nagarik Suraksha Sanhita, 2023 saves only those appeals, applications, trials, inquiries and investigations that were pending immediately before the commencement of the new Code, and requires such matters to continue under the Code of Criminal Procedure, 1973. The governing test is the stage of proceedings as on the date of commencement, not merely the date of the alleged offence or the prior registration of an FIR. Once the earlier stage had concluded and the complaint itself was instituted after the new Code came into force, the subsequent proceedings were required to be governed by the Bharatiya Nagarik Suraksha Sanhita, 2023.

Conclusion: The complaint was governed by the Bharatiya Nagarik Suraksha Sanhita, 2023, and not by the Code of Criminal Procedure, 1973.

Issue (ii): Whether cognizance taken and process issued without giving the proposed accused an opportunity of hearing was sustainable under the applicable procedural law.

Analysis: Section 223 of the Bharatiya Nagarik Suraksha Sanhita, 2023 requires that, before cognizance is taken in the manner contemplated by that provision, the accused must be afforded an opportunity of hearing. The impugned order had proceeded on the footing of Section 200 of the Code of Criminal Procedure, 1973, which does not embody that safeguard. Since the complaint was to be dealt with under the Bharatiya Nagarik Suraksha Sanhita, 2023, the omission to hear the proposed accused before issuing process rendered the order contrary to the statutory mandate.

Conclusion: The order taking cognizance and issuing process was unsustainable.

Final Conclusion: The impugned order was set aside and the matter was remitted for fresh consideration under the procedural framework of the Bharatiya Nagarik Suraksha Sanhita, 2023.

Ratio Decidendi: For determining whether pending criminal proceedings fall under the repealed Code or the new Sanhita, the decisive factor is the stage of the proceedings immediately before commencement of the new law, and where the new law applies it must be followed in its mandatory pre-cognizance safeguards.

Issues: Whether the High Court had territorial jurisdiction to entertain the writ petition challenging the arrest and remand orders passed in connection with the PMLA proceedings.

Analysis: The arrest had been effected at New Delhi, the ECIR had been registered at New Delhi, and the subsequent remand and judicial custody orders were passed by the Special Court at Ghaziabad after the registration of the predicate FIR at Saharanpur and the filing of the PMLA complaint. The petitioner's alleged acts were not confined to Himachal Pradesh, since the materials showed activity in Uttar Pradesh as well, including acquisition and use of proceeds of crime, and the dispute as to the place of commission of the offence raised factual questions going to territorial jurisdiction. Applying the principles governing ordinary place of inquiry and trial, offences committed partly in different local areas, and offences where act and consequence arise in different jurisdictions, the Court held that the challenge to the arrest order could not be adjudicated in this writ petition before the Himachal Pradesh High Court.

Conclusion: The High Court lacked territorial jurisdiction to examine the challenge, and the petition was not maintainable before it.

1. ISSUES PRESENTED AND CONSIDERED

(i) Whether, on the materials placed by the investigating agency, the Court could be satisfied that the applicant was not guilty of the offence of money-laundering and not likely to commit any offence while on bail, so as to satisfy the mandatory "twin conditions" for bail under Section 45 of the 2002 Act.

(ii) Whether the applicant's objection that he was not named as an accused in the scheduled/predicate offence (and was allegedly not a buyer/seller/attorney-holder) negated his prosecutability for money-laundering or materially strengthened his claim for bail.

(iii) Whether bail could be granted on the ground of parity with other accused who had been granted bail, when the allegations and role attributed to the applicant were asserted to be different.

2. ISSUE-WISE DETAILED ANALYSIS

Issue (i): Satisfaction of Section 45 "twin conditions" for bail under the 2002 Act

Legal framework (as discussed by the Court): The Court examined the statutory scheme of the 2002 Act, including the meaning of "proceeds of crime" and the scope of "offence of money-laundering," and reiterated that Section 45 imposes mandatory conditions for grant of bail. The Court also noted the presumptive burden operating in proceedings relating to proceeds of crime, and the overriding effect of the 2002 Act over general bail principles under ordinary criminal law.

Interpretation and reasoning: The Court assessed the prosecution complaint and the material referred therein, including the investigation narrative attributing to the applicant participation in manufacturing forged deeds, tampering with land records, and facilitating the acquisition and disposal of land as "proceeds of crime." The Court noted assertions of recovery/verification of multiple fake deeds, reliance on statements recorded during inquiry, and banking transactions said to link the applicant to receipt of funds connected with the alleged fraudulent land transfer. On this material, the Court formed a "reason to believe" that prima facie the applicant's involvement was substantiated by tangible and credible evidence indicating engagement in activities connected with proceeds of crime (including acquisition/possession and projecting/claiming as untainted).

Conclusion: The Court held that the applicant failed to satisfy the mandatory twin conditions under Section 45. Consequently, no exceptional ground was found to exercise discretion to grant bail, and bail was rejected.

Issue (ii): Effect of applicant not being an accused in the scheduled offence / claim of no direct transactional role

Legal framework (as discussed by the Court): The Court treated money-laundering as an independent offence concerned with processes/activities connected with "proceeds of crime" derived from criminal activity relating to a scheduled offence. It expressly held that a person proceeded against for money-laundering need not be an accused in the predicate offence.

Interpretation and reasoning: The Court rejected the contention that absence of the applicant's name in the predicate case or the assertion that he was not a buyer/seller/attorney-holder automatically negated culpability under the 2002 Act. The Court reasoned that, on the prosecution material, the applicant's alleged role was not merely peripheral but related to preparation of forged deeds and facilitation of record manipulation, which the Court treated as direct involvement in processes connected with proceeds of crime. The Court therefore treated the "not named in scheduled offence" argument as misplaced at the bail stage, given the specific allegations and material collected in the prosecution complaint.

Conclusion: The Court concluded that non-implication in the predicate offence did not, by itself, entitle the applicant to bail, and did not undermine the prima facie case of money-laundering alleged against him on the materials relied upon.

Issue (iii): Parity with co-accused granted bail

Legal framework (as discussed by the Court): The Court held parity is applicable only where the role and factual position are materially similar; bail cannot be granted by a simplistic comparison. Parity analysis must focus on the role attributed to the applicant vis-à-vis those granted bail.

Interpretation and reasoning: On a comparative assessment, the Court found the applicant's alleged role (instrumental in manufacturing multiple fake deeds and being part of a syndicate involved in fraudulent acquisition/transfer of land) to be qualitatively different from the roles of those granted bail (including a purchaser-role allegation in one case, facilitation through official machinery in another, and bail granted to others on considerations not equally applicable). The Court also noted that bail in another case was linked to probable delay in trial, whereas the applicant was alleged to be actively instrumental in document fabrication and repeated similar conduct, and was described as a habitual offender involved in other land-related matters under investigation.

Conclusion: The Court held that the applicant could not claim bail on parity because the allegations and role attributed to him were different in nature and gravity from those of the co-accused who had secured bail.

Issues: Whether the petitioner was entitled to regular bail in a prosecution under the Prevention of Money Laundering Act, 2002, having regard to the statutory twin conditions under Section 45, the alleged role in supplying blank pages and original volumes for fake deeds, the bank-account trail, and the plea of parity.

Analysis: The prosecution material was examined on the basis of the supplementary complaint and the statements recorded under Section 50 of the Prevention of Money Laundering Act, 2002. The allegations showed that the petitioner, working at the office of the Registrar of Assurances, was said to have assisted co-accused persons in removing or supplying original volumes and blank pages, enabling preparation and re-insertion of fake deeds into official records. The complaint also referred to substantial credits and cash deposits in the petitioner's bank accounts, treated as proceeds linked to the alleged laundering activity. The statutory scheme was considered, including the definitions of proceeds of crime and money laundering, the continuing nature of the offence, the presumption under Section 24, and the mandatory twin conditions under Section 45 requiring reasonable grounds to believe that the accused is not guilty and is not likely to commit any offence while on bail. The plea that the petitioner was not an accused in the scheduled offence was rejected as legally untenable because money laundering is treated as an independent offence. The plea of parity was also rejected because the petitioner's alleged role was found to be distinct from the co-accused who had been granted bail. The Court further noted the gravity of economic offences and the prima facie material against the petitioner.

Conclusion: The petitioner failed to satisfy the twin conditions for bail under Section 45 of the Prevention of Money Laundering Act, 2002, and the bail request was rejected.

Issues: (i) Whether prolonged incarceration and the likely delay in conclusion of the trial justified grant of bail notwithstanding the rigours of Section 45 of the Prevention of Money Laundering Act, 2002; (ii) Whether the applicants had made out a prima facie case on merits, including on the applicability of the monetary threshold and the evidentiary value of the approver's statement and electronic records; (iii) Whether there was a credible likelihood of tampering with evidence or witnesses so as to deny bail.

Issue (i): Whether prolonged incarceration and the likely delay in conclusion of the trial justified grant of bail notwithstanding the rigours of Section 45 of the Prevention of Money Laundering Act, 2002.

Analysis: The right to personal liberty under Article 21 of the Constitution of India was held to remain operative even in prosecutions under special statutes carrying stringent bail conditions. The Court found that the progress of both the PMLA prosecution and the scheduled offence was unlikely to culminate within a reasonable time, having regard to the volume of records, number of witnesses, and the structural dependence of the PMLA case on the outcome of the scheduled offence. It was also found that the delay was not attributable to the applicants. In these circumstances, continued pre-trial detention would risk converting incarceration into punishment.

Conclusion: The issue was decided in favour of the applicants, and the rigours of Section 45 were held to yield to Article 21.

Issue (ii): Whether the applicants had made out a prima facie case on merits, including on the applicability of the monetary threshold and the evidentiary value of the approver's statement and electronic records.

Analysis: The Court held that at the bail stage the inquiry is confined to a prima facie assessment on broad probabilities and not a meticulous evaluation of guilt. The absence of a specific bribery charge in the scheduled offence did not negate the possibility of proceeds of crime, since the predicate offences included cheating and criminal conspiracy. However, the Court found that the approver's statement and the Excel sheets, in the form then presented, were not sufficiently conclusive to justify continued detention. The Court further held that the monetary threshold under the proviso to Section 45 was not available to the applicants on the material placed by the prosecution, but that did not displace the overall prima facie assessment in favour of bail.

Conclusion: The issue was decided in favour of the applicants, and the Court held that they had prima facie satisfied the twin conditions for bail.

Issue (iii): Whether there was a credible likelihood of tampering with evidence or witnesses so as to deny bail.

Analysis: The alleged threats to the approver were found to lack contemporaneous corroboration, prompt complaint, or supporting material. The Court noted that the investigation was substantially complete and that the prosecution concern could be addressed through suitable bail conditions. On that basis, the apprehension of interference was treated as insufficient to deny liberty at the bail stage.

Conclusion: The issue was decided in favour of the applicants, and the alleged risk of tampering was not accepted as a ground to refuse bail.

Final Conclusion: The applicants were found entitled to regular bail, because the constitutional protection of personal liberty outweighed the statutory bail rigour on the facts of the case, and the material on record did not justify continued custody.

Ratio Decidendi: In prosecutions under the PMLA, where continued pre-trial detention is excessive and trial is unlikely to conclude within a reasonable time, Article 21 may override the statutory rigour of Section 45; at the bail stage, the Court assesses only prima facie material on broad probabilities, and unsupported apprehensions of witness interference cannot by themselves defeat bail.

The core legal issues considered in this judgment are:

- Whether Article 22(2) of the Constitution of India mandates the production of an arrested person before the "nearest Magistrate" within 24 hours of arrest, or if production before the "jurisdictional Magistrate" suffices when achievable within the stipulated time.

- Whether the remand order issued by the Chief Judicial Magistrate (CJM), Patna, is amenable to writ jurisdiction, particularly when statutory requirements under the Prevention of Money Laundering Act (PMLA) were allegedly not considered.

2. ISSUE-WISE DETAILED ANALYSIS

Article 22(2) and Production Before Magistrate:

- Legal Framework and Precedents: Article 22(2) of the Constitution requires that a person arrested be produced before the nearest Magistrate within 24 hours, excluding travel time. Section 187 of the BNSS (akin to Section 167 Cr.P.C.) supports this requirement.

- Court's Interpretation and Reasoning: The Court interpreted "nearest Magistrate" as the Magistrate geographically closest to the place of arrest, not necessarily the jurisdictional Magistrate. The Court emphasized the constitutional safeguard intended to prevent unnecessary detention.

- Key Evidence and Findings: The petitioner was arrested in Kolkata and flown to Patna, where he was produced before the CJM, Patna, within 24 hours. The Court found that the production before the jurisdictional Magistrate within the stipulated time did not violate Article 22(2).

- Application of Law to Facts: The Court applied the constitutional provision and found that the production within 24 hours before the jurisdictional Magistrate was sufficient, as the travel time was accounted for.

- Treatment of Competing Arguments: The petitioner argued for a strict interpretation of "nearest Magistrate," while the respondent contended that production before the jurisdictional Magistrate within 24 hours was compliant. The Court favored the latter interpretation.

- Conclusions: The Court concluded that the requirement of Article 22(2) was not violated as the petitioner was produced within 24 hours before the jurisdictional Magistrate.

Remand Order and Writ Jurisdiction:

- Legal Framework and Precedents: The PMLA and Section 19 require an arrested person's production before a Magistrate with reasons to believe in the person's guilt. The Court also considered precedents regarding the scope of writ jurisdiction over judicial orders.

- Court's Interpretation and Reasoning: The Court held that the writ jurisdiction is not typically applicable to challenge remand orders unless they violate fundamental rights or statutory provisions.

- Key Evidence and Findings: The petitioner challenged the remand order on grounds of non-compliance with Section 19 of the PMLA. The Court found that the CJM, Patna, had considered the necessary documents and reasons for arrest.

- Application of Law to Facts: The Court found no violation of statutory or constitutional provisions in the remand order, as the CJM had the necessary information to justify the remand.

- Treatment of Competing Arguments: The petitioner argued that the CJM failed to consider the statutory requirements of the PMLA, while the respondent maintained that the remand was valid. The Court agreed with the respondent.

- Conclusions: The Court concluded that the remand order was valid and not amenable to writ jurisdiction, as no fundamental rights were violated.

3. SIGNIFICANT HOLDINGS

- The Court held that "nearest Magistrate" in Article 22(2) does not exclusively mean the geographically closest Magistrate but includes the jurisdictional Magistrate if production within 24 hours is feasible.

- The Court established that writ jurisdiction is not applicable to challenge remand orders unless there is a clear violation of constitutional or statutory rights.

- The Court determined that the remand order issued by the CJM, Patna, was valid, as it complied with the necessary legal requirements under the PMLA.

- The Court emphasized the importance of producing an arrested person within 24 hours to safeguard personal liberty, aligning with the constitutional mandate.

- The petitioner's writ petition was dismissed as it lacked merit, and the Court found no violation of constitutional or statutory provisions in the arrest and remand process.

Issues: (i) Whether the applicant satisfied the twin conditions for grant of bail under Section 45 of the Prevention of Money Laundering Act, 2002. (ii) Whether sanction for prosecution was necessary before proceeding against a public servant accused of money laundering.

Issue (i): Whether the applicant satisfied the twin conditions for grant of bail under Section 45 of the Prevention of Money Laundering Act, 2002.

Analysis: The bail plea was examined on the basis of the ECIR, the prosecution complaint, and the applicant's recorded role in facilitating clearance of delivery orders after receipt of illegal levy in the coal transportation racket. The material was found to disclose a specific and prima facie role in the alleged laundering activity. In light of the statutory rigour of Section 45, the Court held that the applicant was not entitled to be released unless there were reasonable grounds for believing that he was not guilty and was not likely to commit any offence while on bail. The Court found that those twin requirements were not satisfied and that long incarceration, by itself, could not override the seriousness of the allegations and the prima facie material.

Conclusion: The applicant did not satisfy the twin conditions under Section 45 of the Prevention of Money Laundering Act, 2002 and was not entitled to bail.

Issue (ii): Whether sanction for prosecution was necessary before proceeding against a public servant accused of money laundering.

Analysis: The plea for sanction was rejected on the ground that the alleged conduct was not an act done in the course of official duty and, prima facie, related to participation in the crime itself. On that basis, the Court held that absence of sanction did not vitiate the prosecution for the purposes of bail consideration.

Conclusion: Sanction for prosecution was not required on the facts presented.

Final Conclusion: The bail application failed on merits because the Court found prima facie involvement in the alleged offence and non-fulfilment of the statutory bail threshold, while also rejecting the objection based on want of sanction.

Ratio Decidendi: In a prosecution under the Prevention of Money Laundering Act, 2002, bail can be granted only if the statutory twin conditions are satisfied on prima facie material, and a sanction objection does not avail where the alleged acts are not shown to be part of official duty.

The core legal issue considered in this judgment is whether the Petitioner should be granted an extension of interim bail on humanitarian grounds, despite alleged violations of bail conditions. The specific questions include:

• Whether the humanitarian circumstances presented by the Petitioner justify an extension of interim bail.
• Whether the alleged non-compliance with bail conditions by the Petitioner affects his eligibility for bail extension.

ISSUE-WISE DETAILED ANALYSIS

Humanitarian Grounds for Bail Extension

• Relevant Legal Framework and Precedents: The Petitioner filed the application under Section 528 read with Section 483 of the Bharatiya Nagarik Suraksha Sanhita, 2023, and Section 45 of the Prevention of Money Laundering Act, 2002. The legal framework allows for bail on humanitarian grounds in exceptional circumstances.
• Court's Interpretation and Reasoning: The Court considered the humanitarian grounds presented, including the recent death of the Petitioner's father and the need to perform post-cremation rituals. The Court acknowledged the emotional and financial responsibilities the Petitioner bears towards his family.
• Key Evidence and Findings: The Petitioner's counsel presented evidence of the Petitioner's family situation, including the death of his father, the unemployment of his sister, and the emotional fragility of his mother.
• Application of Law to Facts: The Court applied the legal framework to the facts, determining that the humanitarian circumstances warranted a limited extension of bail.
• Treatment of Competing Arguments: The Court balanced the humanitarian needs against the Respondent's argument regarding the Petitioner's non-compliance with bail conditions.
• Conclusions: The Court concluded that a two-week extension of interim bail was justified on humanitarian grounds, subject to existing bail conditions.

Non-Compliance with Bail Conditions

• Relevant Legal Framework and Precedents: Bail conditions are imposed to ensure compliance with legal obligations and prevent misuse of bail privileges.
• Court's Interpretation and Reasoning: The Court acknowledged the Respondent's contention that the Petitioner violated bail conditions by failing to report to the police station as required.
• Key Evidence and Findings: The Respondent provided evidence from the Visitors' Register indicating the Petitioner's failure to report to the police station on multiple occasions.
• Application of Law to Facts: The Court considered the Petitioner's non-compliance but weighed it against the humanitarian grounds presented.
• Treatment of Competing Arguments: The Court recognized the Petitioner's argument that the non-compliance was due to the emotional impact of his father's death and the need to manage family affairs.
• Conclusions: The Court decided to extend bail despite the non-compliance, emphasizing the importance of humanitarian considerations.

SIGNIFICANT HOLDINGS

• Verbatim Quote: "In these prevailing circumstances and on humanitarian grounds coupled with the fact that the Petitioner would be required to carry out post-cremation rituals and to support his Mother emotionally and financially, the interim Bail granted to the Petitioner is hereby extended for a further period of 2 weeks from today."
• Core Principles Established: The judgment underscores the principle that humanitarian considerations can justify bail extensions even in the face of non-compliance with bail conditions.
• Final Determinations on Each Issue: The Court determined that the Petitioner should be granted a two-week extension of interim bail, subject to the same conditions previously imposed, with the caveat that any further violations could lead to immediate legal action by the Respondent.

The core legal questions considered by the Court include:

• Whether the impugned search and seizure conducted under Section 17 of the Prevention of Money Laundering Act, 2002 (PMLA) was valid, specifically whether there was a 'reason to believe' justifying such action.
• The legality and validity of the statements recorded under Sections 17(1)(f) and 50 of the PMLA.
• The scope and standard of judicial review applicable to the formation of 'reason to believe' at the investigation stage under Section 17 of the PMLA.
• The correctness of the learned Single Judge's application of Section 19 principles at the investigation stage under Section 17.
• The extent of the powers of the Enforcement Directorate (ED) to issue summons under Section 50 of the PMLA and whether such summons require credible evidence of commission of an offence.
• The impact of the impugned judgment on ongoing investigations and the principle of allowing uninterrupted investigation under the rule of law.
• The question of whether the impugned order should be stayed pending appeal, given its cascading effect on other investigations.

2. ISSUE-WISE DETAILED ANALYSIS

Validity of Search and Seizure under Section 17 of PMLA and 'Reason to Believe'

The Court examined the legal framework under Section 17 of the PMLA, which permits search and seizure if the officer has 'reason to believe' that any person is in possession of proceeds of crime. The learned Single Judge had held that the impugned search and seizure and subsequent statements were invalid for absence of 'reason to believe'.

The appellant-agency contended that the learned Single Judge erred by applying the principles of Section 19 (which relates to attachment of property) at the investigation stage under Section 17. It was submitted that at the investigation stage, the threshold is lower and 'information' in possession suffices to constitute 'reason to believe'; judicial review should not demand 'reasonable evidence' or proof beyond prima facie material.

The Court noted reliance on Supreme Court precedents, particularly the decision in Vijay Madanlal Choudhary, which clarified that the 'reason to believe' is a subjective satisfaction based on material in possession and that its sufficiency or adequacy is not subject to detailed judicial scrutiny at the nascent investigation stage. The Court also referred to Radhika Agarwal, which emphasized that judicial review of subjective satisfaction in special Acts like PMLA is limited and should not hinder early investigation steps.

Applying these principles, the Court found that the learned Single Judge misdirected himself by requiring a higher standard of evidence and by reading into the statute words not present. The existence of prima facie material and information sufficed to constitute 'reason to believe' for initiating search and seizure.

Validity of Statements Recorded under Sections 17(1)(f) and 50 of PMLA and Summons Issuance

The learned Single Judge had ordered retraction of statements recorded under Section 17(1)(f) and quashed summons and statements under Section 50. The appellant argued that the summons under Section 50 can be issued to any person, accused or witness, for collection of information and evidence, and do not require credible evidence of commission of offence at the stage of inquiry. The Court referred to Supreme Court observations in Vijay Madanlal that summons under Section 50 are issued in aid of inquiry and are not formal accusations, and the person summoned does not acquire the status of accused at that stage.

The Court also relied on a Division Bench decision of this High Court which held that the expression 'any person' in Section 50(2) is wide and includes persons who may not be accused but are relevant to the investigation. Therefore, the learned Single Judge erred in quashing the summons and statements on the ground that credible evidence was lacking.

Application of Law to Facts and Treatment of Competing Arguments

The appellant-agency submitted that the investigation involved serious allegations of large-scale illegal allotment of sites by Mysore Urban Development Authority officials, amounting to proceeds of crime exceeding Rs. 5000 crores. The petitioner was a former Commissioner of MUDA during whose tenure the illegal allotments occurred. The agency had sufficient reasons to believe that the petitioner was in possession of proceeds of crime, justifying search and seizure and recording of statements.

The respondent-petitioner and his counsel argued that the allegations were baseless, that allotment of sites was made pursuant to policy decisions and did not involve criminality, and that the PMLA was being misused to harass innocent persons. They supported the learned Single Judge's order and contended that the 'reason to believe' was not established, and that the investigation lacked foundation.

The Court observed that while these contentions go to the merits of the case, the present proceedings were focused on the question of stay of the impugned order and not on merits. The Court refrained from expressing any opinion on the correctness of the learned Single Judge's judgment.

Impact of the Impugned Judgment on Other Investigations and Principle of Uninterrupted Investigation

The appellant highlighted that the impugned judgment had a cascading effect, leading to multiple courts staying summons and investigations in at least seven other cases connected to the alleged scam. This had resulted in a halt of investigations and impeded the enforcement agency's ability to discharge its statutory duties.

The Court noted that the impugned order was an inter-partes judgment and could not be treated as a judgment in rem binding on other investigations or persons. It emphasized the settled principle that investigation into alleged criminal activity must be permitted to proceed uninterrupted under the rule of law. The Court held that the enforcement agency must be allowed to continue investigations against other accused and persons, notwithstanding the impugned order.

The Court clarified that the agency could utilize all documents, materials, and statements gathered during the search and seizure at the petitioner's residence for the purpose of ongoing investigations, without prejudice to the petitioner's rights in the appeal.

Stay of the Impugned Judgment

The Court considered the application for stay of the learned Single Judge's order. It observed that the appeal was already admitted and listed for hearing, and that granting an interim stay would amount to allowing the appeal at the interlocutory stage, which is impermissible. The Court declined to stay the entire impugned judgment and order but issued directions to ensure that investigations were not stalled in other connected cases.

3. SIGNIFICANT HOLDINGS

"The criteria or parameters of judicial review over the subjective satisfaction applicable in Service related cases, cannot be made applicable to the cases of arrest made under the Special Acts. The scrutiny on the subjective opinion or satisfaction of the authorized officer to arrest the person could not be a matter of judicial review, in as much as when the arrest is made by the authorized officer on he having been satisfied about the alleged commission of the offences under the special Act, the matter would be at a very nascent stage of the investigation or inquiry. The very use of the phrase 'reasons to believe' implies that the officer should have formed a prima facie opinion or belief on the basis of the material in his possession that the person is guilty or has committed the offence under the relevant special Act. Sufficiency or adequacy of the material on the basis of which such belief is formed by the authorized officer, would not be a matter of scrutiny by the Courts at such a nascent stage of inquiry or investigation." (Paragraph 10, Radhika Agarwal)

"In respect of such action, the designated officials have been empowered to summon any person for collection of information and evidence to be presented before the Adjudicating Authority. It is not necessarily for initiating a prosecution against the noticee as such. The power entrusted to the designated officials under this Act, though couched as investigation in real sense, is to undertake inquiry to ascertain relevant facts to facilitate initiation of or pursuing with an action... The summoning person need not be an accused, but the summons is issued even to a witness in the furtherance of inquiry so conducted by the authorised officials." (Paragraph 431, Vijay Madanlal Choudhary)

Core principles established include:

• The 'reason to believe' required for search and seizure under Section 17 of PMLA is a subjective satisfaction based on information in possession and is not subject to detailed judicial scrutiny at the investigation stage.
• Summons under Section 50 of the PMLA can be issued to any person, accused or witness, without the necessity of credible evidence of commission of offence at the stage of inquiry.
• Investigations under the PMLA must be permitted to proceed uninterrupted and cannot be stalled by inter-partes judgments which are not binding in rem.
• Interim stay of a judgment that effectively grants principal relief is generally impermissible when an appeal is admitted and pending.

Final determinations:

• The Court refused to stay the entire impugned judgment and order but allowed the Enforcement Directorate to continue investigation against other accused and persons in accordance with law.
• The impugned order shall not bar the investigating agency from utilizing materials and statements collected during the search and seizure for further investigation.
• The correctness of the impugned judgment and order is left open for consideration in the pending appeal.

Issues: Whether the Special Judge could take cognizance of the money-laundering complaint against a public servant without previous sanction for prosecution, and whether the alleged acts had the requisite nexus with official duty.

Analysis: The complaint was directed against a person holding a public office at the relevant time. The governing test is whether the alleged offence was committed while acting or purporting to act in the discharge of official duty, and whether the alleged act bears a reasonable connection with that duty. Section 65 of the Prevention of Money Laundering Act, 2002 makes the Code of Criminal Procedure applicable to proceedings under the Act so far as there is no inconsistency, and the Supreme Court has held that Section 197 of the Code of Criminal Procedure, 1973 applies to a complaint under Section 44 of the Prevention of Money Laundering Act, 2002. Since the material allegations themselves were linked to the petitioner's official position, the requirement of prior sanction was attracted. The sanction had not been obtained when cognizance was taken.

Conclusion: Cognizance against the petitioner without prior sanction was unsustainable and was set aside; liberty was left to proceed afresh after production of the sanction order.

Final Conclusion: The revision succeeded on the sanction issue, and the impugned cognizance order was quashed insofar as it concerned the petitioner, with permission to revive proceedings in accordance with law after obtaining the requisite sanction.

Ratio Decidendi: Where the accused is a public servant and the alleged conduct is reasonably connected with official duty, prior sanction is a condition precedent to cognizance of a complaint under the Prevention of Money Laundering Act, 2002 by virtue of Section 65 and the applicable criminal procedure law.

Issues: (i) Whether prosecution under Section 3 of the Prevention of Money Laundering Act, 2002 could continue after the sole accused in the predicate offence died and the criminal case for the scheduled offence abated; (ii) whether the petitioner was entitled to restoration of the attached property under Section 8(8) of the Prevention of Money Laundering Act, 2002.

Issue (i): Whether prosecution under Section 3 of the Prevention of Money Laundering Act, 2002 could continue after the sole accused in the predicate offence died and the criminal case for the scheduled offence abated.

Analysis: Offences under Section 3 of the Prevention of Money Laundering Act, 2002 are independent and stand-alone, but they still require the existence of a scheduled offence and proceeds of crime. Where the scheduled offence ends in acquittal, discharge, or quashing of the proceedings in their entirety, the prosecution for money laundering cannot survive because the foundational scheduled offence no longer exists. On the facts, however, the complaint under the Act was filed against other accused for alleged concealment and use of proceeds of crime, and the continuation of proceedings was not defeated merely because the sole accused in the predicate case had died and the police report recorded abatement.

Conclusion: The prosecution under Section 3 of the Prevention of Money Laundering Act, 2002 was maintainable and the contention based on abatement failed.

Issue (ii): Whether the petitioner was entitled to restoration of the attached property under Section 8(8) of the Prevention of Money Laundering Act, 2002.

Analysis: Restoration under Section 8(8) is available only to a claimant with a legitimate interest who has suffered a quantifiable loss as a result of the offence of money laundering, acted in good faith, and is not involved in the offence. The petitioner's claim rested on an assignment of receivables arising from a commercial transaction, but the loss of the original contracting party could not be equated with a quantifiable loss suffered by the assignee for the purpose of restoration. The petitioner therefore did not satisfy the definition of claimant under the Restoration Rules, and the ancillary procedural requirements for considering restoration did not arise.

Conclusion: The petitioner was not entitled to restoration of the attached property under Section 8(8) of the Prevention of Money Laundering Act, 2002.

Final Conclusion: The challenge to the Special Court's order failed on both the maintainability of the money-laundering prosecution and the claim for restoration of the attached property, leaving the attachment undisturbed.

Ratio Decidendi: Proceedings under the money-laundering law may continue so long as the scheduled offence and proceeds of crime remain legally subsisting, and restoration of attached property is confined to a bona fide claimant who proves a quantifiable loss and a legitimate pre-existing interest in the property.

The core legal questions considered in this judgment include:

• Whether the provisional attachment order dated 07.03.2024 under Section 5 of the Prevention of Money Laundering Act, 2002 (PMLA) is valid and lawful.
• Whether the petitioner can challenge the provisional attachment order through a writ petition under Article 226, given that an appeal is pending before the appellate tribunal under Section 26 of PMLA.
• Whether the authority can exercise multiple options under Sections 5, 17, or 18 of PMLA once one of the options has been exercised.

ISSUE-WISE DETAILED ANALYSIS

1. Validity of the Provisional Attachment Order

The relevant legal framework involves Section 5 of PMLA, which allows the attachment of property involved in money laundering. The court noted that the provisional attachment order dated 07.03.2024 was issued under this section and subsequently confirmed by the adjudicating authority under Section 8 of the Act.

The court's interpretation emphasized that the provisional attachment is part of the legal process under PMLA, which includes confirmation by the adjudicating authority and the possibility of appeal before the appellate tribunal.

Key evidence included the fact that the adjudicating authority had confirmed the provisional attachment order, and the petitioner had already filed an appeal against this confirmation, which was pending.

The court applied the law to the facts by recognizing the procedural steps followed under PMLA and the existence of an ongoing appeal process, which rendered the writ petition under Article 226 inappropriate at this stage.

2. Maintainability of the Writ Petition

The court considered whether a writ petition is maintainable when an appeal is pending. The legal framework includes Article 226 of the Constitution, which provides for writ jurisdiction, and Section 26 of PMLA, which outlines the appellate process.

The court reasoned that since the appeal process under PMLA was actively being pursued by the petitioner, the writ petition was not maintainable. The court referenced legal precedents that discourage parallel proceedings when a statutory appeal is available and being utilized.

Competing arguments included the petitioner's contention that the provisional attachment was an abuse of process, while the respondent argued for adherence to the statutory appeal process.

The court concluded that the writ petition was not maintainable due to the pending appeal, but granted the petitioner liberty to raise all relevant points before the appellate tribunal.

3. Exercise of Multiple Options under PMLA

The petitioner argued that once the authority exercises an option under Sections 5, 17, or 18 of PMLA, it cannot resort to other options. The court examined this argument but did not provide a detailed analysis, as it deferred the matter to the appellate tribunal where the appeal was pending.

The court acknowledged the petitioner's right to raise this point in the appellate proceedings, indicating that the issue requires consideration within the statutory appeal framework.

SIGNIFICANT HOLDINGS

The court held that the writ petition was not maintainable due to the ongoing appeal process under Section 26 of PMLA. It emphasized the importance of following the statutory appeal process and discouraged the use of writ jurisdiction when an appeal is pending.

Verbatim quotes of crucial legal reasoning include the court's statement that "the writ petition challenging the provisional order dated 07.03.2024 is not maintainable, as the same is subject matter of the appeal before the appellate tribunal under Section 26 of PMLA."

Core principles established include the adherence to procedural steps outlined in PMLA and the discouragement of parallel proceedings when a statutory appeal is available.

The court's final determination was to dismiss the writ petition as not maintainable, granting the petitioner liberty to pursue all arguments before the appellate tribunal. The court also closed the miscellaneous application and noted that any interim orders merged with the final order.

1. Whether the NCLT had jurisdiction to vacate or set aside the provisional attachment order and its confirmation passed under the PMLA 2002 in relation to properties involved in money laundering.

2. The effect and scope of the overriding clauses contained in Section 238 of the IB Code 2016 and Section 71 of the PMLA 2002 on conflicting orders passed under these statutes.

3. Whether the order of the NCLT approving the resolution plan under Section 31 of the IB Code 2016 could lawfully include properties provisionally attached under the PMLA 2002.

4. The maintainability of the writ petition challenging the NCLT order, considering the availability of alternative remedies and limitation periods.

5. Whether principles of natural justice were violated by the NCLT in passing the impugned order without impleading or affording an opportunity of hearing to the Enforcement Directorate (E.D.), the attachment authority under PMLA.

6. The consequences of allowing the resolution plan to proceed in respect of properties alleged to be involved in money laundering, particularly in light of pending appeals before the PMLA Appellate Tribunal.

Issue-wise Detailed Analysis

1. Jurisdiction of NCLT to Vacate Attachment Orders under PMLA 2002

The PMLA 2002 is a special legislation aimed at preventing money laundering, providing for attachment and confiscation of properties involved in such offences. Section 5 empowers the Enforcement Directorate (E.D.) to provisionally attach properties suspected to be involved in money laundering. Such attachment must be confirmed by the adjudicating authority under Section 8. Appeals against confirmation orders lie before the PMLA Appellate Tribunal under Section 26, with further appeals to the High Court under Section 42.

In contrast, the IB Code 2016 regulates insolvency resolution and liquidation processes for corporate debtors, with the NCLT empowered to approve resolution plans under Section 31. Section 238 contains an overriding clause stating that the IB Code shall prevail over any inconsistent laws.

The Court emphasized that both PMLA and IB Code are special enactments with overriding clauses but operate in distinct spheres. The NCLT is a tribunal of limited jurisdiction, empowered only to exercise authority conferred by the IB Code. It is not a plenary court and cannot assume jurisdiction to nullify or set aside orders passed under other statutes, including the PMLA 2002.

Applying this framework, the Court found that the NCLT order dated 24.02.2022 vacating the attachment order under PMLA was beyond its jurisdiction. The attachment had been provisionally made by the E.D. under Section 5 and confirmed by the adjudicating authority under Section 8 of the PMLA. The correctness and validity of that confirmation were under challenge before the PMLA Appellate Tribunal, which had passed a status quo order. The NCLT's order effectively nullified these proceedings and the status quo order, raising a serious jurisdictional question.

The Court held that the attachment and confirmation under PMLA form a self-contained code, and only the appellate mechanisms under PMLA are competent to entertain challenges. Therefore, the NCLT lacked inherent jurisdiction to vacate or set aside the attachment order passed under PMLA.

2. Effect of Overriding Clauses in IB Code and PMLA

Section 238 of the IB Code provides that its provisions shall have overriding effect notwithstanding anything inconsistent in other laws. Similarly, Section 71 of the PMLA declares that its provisions shall have overriding effect over other laws.

The Court observed that while both statutes contain overriding clauses, they apply in different fields-PMLA governs attachment and confiscation of proceeds of crime, while IB Code regulates insolvency resolution. The overriding clause in IB Code cannot be interpreted to confer plenary jurisdiction on NCLT to override or nullify orders passed under PMLA, especially when PMLA provides a special adjudicatory mechanism and appellate remedy.

The Court thus concluded that the overriding effect of IB Code does not extend to permitting NCLT to vacate attachment orders confirmed under PMLA, which is a special law with its own adjudicatory and appellate structure.

3. Maintainability of Writ Petition and Alternative Remedies

The respondents contended that the writ petition filed under Article 227 was not maintainable as the petitioner failed to challenge the NCLT order within the statutory limitation period by way of appeal before the National Company Law Appellate Tribunal (NCLAT). They argued that the petitioner had full notice of the NCLT proceedings but did not participate or avail statutory remedies timely.

The Court distinguished this case from others by noting that the challenge was not merely to the correctness of the NCLT order but to its very jurisdiction to pass the impugned order. When an order is challenged on the ground of inherent lack of jurisdiction, it goes to the root of the matter and is void ab initio. Such a challenge is maintainable notwithstanding failure to exhaust alternative remedies or limitation periods applicable to appeals on merits.

The Court thus held that the writ petition was maintainable on the ground of jurisdictional challenge despite the availability of alternative remedies.

4. Violation of Principles of Natural Justice

The petitioner argued that the NCLT passed the order vacating attachment without impleading the E.D. or affording it an opportunity of hearing, rendering the order void. The respondents countered that the petitioner had liberty to intervene in the proceedings and had received notices from the resolution professional.

The Court found that no notice was issued by the NCLT to the petitioner before passing the impugned order, and the petitioner was not made a party. Mere liberty to intervene does not substitute for formal impleadment and opportunity of hearing. An order passed without jurisdiction and without hearing the affected party is a nullity. Therefore, the NCLT order was liable to be set aside on this ground as well.

5. Consequences of Vacating Attachment and Approving Resolution Plan

The Court noted that allowing the resolution plan to proceed with the subject property, which is alleged to be involved in money laundering, risks frustrating the pending appeals before the PMLA Appellate Tribunal and the trial itself. The property could be sold or disposed of, defeating the purpose of attachment and confiscation under PMLA.

Given the status quo order already passed by the PMLA Appellate Tribunal, the Court found it appropriate to maintain the interim order preserving the attachment and restraining disposal of the property pending final adjudication.

6. Treatment of Competing Arguments and Precedents

The Court considered the submissions relying on the Supreme Court decision in Embassy Property Developments Private Limited, which emphasized the limited jurisdiction of tribunals and the need to respect the statutory schemes of different enactments.

It also referred to decisions like Manish Kumar and Welspun Steel Resources, noting that those cases did not address the specific jurisdictional conflict between PMLA and IB Code involved here.

The Court rejected the respondents' argument that non-participation by the petitioner in the NCLT proceedings barred challenge, emphasizing that jurisdictional challenges are exceptions to such procedural bars.

Conclusions

The Court concluded that the NCLT lacked jurisdiction to vacate the attachment order passed under PMLA 2002, especially when the attachment had been confirmed by the adjudicating authority and was under challenge before the PMLA Appellate Tribunal. The overriding clause in the IB Code does not empower the NCLT to nullify orders under PMLA. The failure to implead and hear the petitioner before passing the impugned order vitiated the order further. The writ petition challenging the NCLT order on jurisdictional grounds was maintainable despite alternative remedies and limitation periods. The interim order staying the NCLT order was rightly granted and ought not to have been vacated. The vacating order was set aside and the interim stay reinstated.

Significant Holdings

"The NCLT being a tribunal of limited jurisdiction under the IB Code 2016 does not have plenary jurisdiction to quash or set aside orders passed by authorities under the PMLA 2002, which is a special enactment with a self-contained code for attachment and confiscation of properties involved in money laundering."

"The overriding clause in Section 238 of the IB Code 2016 cannot be interpreted to confer jurisdiction on the NCLT to nullify or vacate attachment orders confirmed under the PMLA 2002, especially when such orders are under challenge before the PMLA Appellate Tribunal."

"An order passed without impleading the affected party and without affording opportunity of hearing is a nullity, and such procedural infirmity coupled with lack of jurisdiction renders the order void ab initio."

"Where a challenge is raised on the ground of inherent lack of jurisdiction, the writ petition is maintainable notwithstanding the availability of alternative remedies or limitation periods applicable to appeals on merits."

"Allowing disposal of property attached under PMLA in insolvency proceedings risks frustrating the purpose of the PMLA and pending appeals; therefore, interim preservation of status quo is necessary."

Accordingly, the Court set aside the order vacating the interim stay and confirmed the interim stay order restraining the operation of the NCLT order vacating the attachment, thereby preserving the status quo pending final adjudication on merits.

Issues: (i) Whether the legal representative of a deceased appellant could continue the appeal under Section 72 of the Prevention of Money Laundering Act, 2002 without being defeated by a limitation period not expressly prescribed for such substitution; (ii) whether the Appellate Tribunal could apply Order XXII of the Code of Civil Procedure, 1908 and Article 120 of the Limitation Act, 1963 to dismiss the legal representative petition and treat the appeal as abated; (iii) whether dismissal of the legal representative petition and the appeal was sustainable in the light of principles of natural justice.

Issue (i): Whether the legal representative of a deceased appellant could continue the appeal under Section 72 of the Prevention of Money Laundering Act, 2002 without being defeated by a limitation period not expressly prescribed for such substitution?

Analysis: Section 72 expressly provides for continuation of proceedings where an appellant dies during the pendency of an appeal, and permits the legal representatives to continue the appeal in the place of the deceased appellant. The provision does not prescribe any period of limitation for filing an application to come on record. The statutory scheme therefore indicates a legislative intent to preserve the appeal and not to terminate it merely because the appellant died during pendency.

Conclusion: The legal representative was entitled to continue the appeal, and the absence of an express limitation period prevented rejection of the application on that ground.

Issue (ii): Whether the Appellate Tribunal could apply Order XXII of the Code of Civil Procedure, 1908 and Article 120 of the Limitation Act, 1963 to dismiss the legal representative petition and treat the appeal as abated?

Analysis: The Appellate Tribunal is not bound by the procedure laid down in the Code of Civil Procedure, 1908, and its powers are confined to regulating its own procedure subject to the Act. In the absence of rules or regulations making Order XXII applicable, and in view of the specific enabling provision under Section 72, importing Article 120 of the Limitation Act, 1963 and treating the application as barred was unwarranted. The general limitation framework applicable to civil court proceedings cannot be superimposed on a special statutory appeal where the statute itself provides for continuation of proceedings.

Conclusion: The Tribunal erred in applying Order XXII of the Code of Civil Procedure, 1908 and Article 120 of the Limitation Act, 1963, and the finding of abatement was unsustainable.

Issue (iii): Whether dismissal of the legal representative petition and the appeal was sustainable in the light of principles of natural justice?

Analysis: Since the statute conferred a right to continue the appeal and no procedural rule or limitation provision barred the application, rejection of the substitution request on technical grounds defeated the statutory remedy. A liberal construction was required so that the appeal could be decided on merits after hearing the legal representative and the respondent. The impugned dismissal, therefore, did not accord with the statutory scheme or fair procedure.

Conclusion: The dismissal of the legal representative petition and the appeal was not sustainable.

Final Conclusion: The appeal succeeded, the order rejecting substitution and declaring the appeal abated was set aside, the legal representative was brought on record, and the matter was remitted for decision on merits after hearing both sides.

Ratio Decidendi: Where a special statute expressly permits the legal representative of a deceased appellant to continue an appeal and does not prescribe a substitution period, a tribunal cannot import civil procedure or general limitation rules to defeat that statutory right.

Issues: Whether regular bail should be granted in a prosecution under the Prevention of Money Laundering Act, 2002 in view of the statutory twin conditions, the alleged role of the petitioner in dealing with proceeds of crime, and the plea of parity.

Analysis: The petition was considered against the statutory scheme of the Prevention of Money Laundering Act, 2002, particularly the definitions of proceeds of crime and money-laundering, the continuing nature of the offence, the presumption under the Act, and the mandatory bail restrictions. The material relied upon in the prosecution complaint and the recorded statements was treated as prima facie indicating that the petitioner was involved in illegal dealings in non-saleable land, cash transactions, and transactions through family members, all said to be connected with proceeds of crime. The contention that the petitioner was not shown as an accused in the predicate offence was rejected on the ground that money-laundering is an independent offence. The plea of parity was also declined because the role attributed to the petitioner was held to be materially different from the co-accused who had earlier obtained bail. The seriousness of the alleged economic offence and the absence of reasonable grounds to believe that the petitioner was not guilty were also weighed against grant of bail.

Conclusion: The application for regular bail was rejected and the petitioner was not found entitled to bail.