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Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
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AI Drafter - (New and Powerful) ✕ Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
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Issues: Whether provisional attachment under the Prevention of Money-laundering Act, 2002 could survive after the predicate offences were quashed, and whether in the absence of a scheduled offence there could be any money-laundering proceedings.
Analysis: The relief was examined in the light of the settled principle that the expression "proceeds of crime" is the foundation of proceedings under the Prevention of Money-laundering Act, 2002. Once the predicate offences were quashed by the competent Court, the basis for treating the property as arising from criminal activity relating to a scheduled offence ceased to exist. The reasoning accepted that, without a scheduled offence, the alleged link between the property and money-laundering could not be sustained, and the provisional attachment and consequential complaint could not stand.
Conclusion: The provisional attachment and the consequential complaint were liable to be set aside, and the attachment was required to be released.
Final Conclusion: The writ petition succeeded because the foundation for action under the Prevention of Money-laundering Act, 2002 disappeared once the predicate offences were quashed.
Ratio Decidendi: Proceedings under the Prevention of Money-laundering Act, 2002 cannot be sustained in the absence of a subsisting scheduled offence, because the existence of "proceeds of crime" derived from criminal activity relating to such offence is a jurisdictional prerequisite.
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