High Court rejects petition to prevent asset seizure under Money Laundering Act, directs appeal process

The High Court declined to entertain the petition seeking to prevent the Directorate of Enforcement from seizing assets under the Prevention of Money Laundering Act. The Court noted the delay in proposed action and the pending appeal before the Appellate Tribunal addressing similar issues. The Court directed the Tribunal to expedite the appeal within eight weeks and granted the petitioner liberty to apply if further action is taken. The petition was disposed of, emphasizing the importance of addressing the issues through the appellate process. Compliance was ordered immediately, with pending applications also disposed of.

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Issues:
1. Petition to direct Directorate of Enforcement not to conduct seizure/attachment actions under PMLA.
2. Quashing of Seizure Memo and related orders under PMLA.
3. Delay in proposed action by Directorate of Enforcement.
4. Appeal pending before Appellate Tribunal similar to issues raised in the petition.

Analysis:
1. The petitioner filed a petition seeking directions to prevent the Directorate of Enforcement from seizing or attaching any property under the Prevention of Money Laundering Act, 2002 (PMLA) based on an ECIR dated 29.12.2014. The petitioner argued that no proceeds of crime were derived from the alleged predicate offence. The respondent, Directorate of Enforcement, had registered the ECIR based on a FIR filed by the CBI, alleging misrepresentation by the petitioner company in obtaining a coal block allotment. However, a closure report was filed stating no offence was committed by the petitioner, pending consideration before the Special Judge, CBI.

2. The petitioner also sought the quashing of the Seizure Memo dated 23.11.2016 under Section 17(1) of PMLA, along with related orders. The petitioner contended that the initial action was illegal. The High Court noted the difficulty in understanding the proposed action by the Directorate of Enforcement after a significant delay of over four years since the filing of the FIR. Despite being inclined to entertain the petition, the Court observed that an appeal had already been filed before the Appellate Tribunal, addressing similar issues as raised in the petition. Consequently, the Court decided not to entertain the petition.

3. While refusing to entertain the petition, the High Court directed the Appellate Tribunal to expedite the consideration of the petitioner's appeal, preferably within eight weeks. The Court granted liberty to the petitioner to apply if the Directorate of Enforcement takes further action. The petition was disposed of accordingly, with pending applications also being disposed of.

4. The judgment emphasized the importance of expeditious consideration of the petitioner's appeal by the Appellate Tribunal, given the similarities in the issues raised in the appeal and the dismissed petition. The Court's decision not to entertain the petition was based on the pendency of the appeal, ensuring that the issues could be addressed through the appellate process. The petitioner was granted the opportunity to seek redress in case of any further action by the Directorate of Enforcement. The order was issued for immediate compliance, with the judgment being concluded and applications disposed of accordingly.

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