Equivalent-value attachment may be substituted with FDRs where the properties are not alleged proceeds of crime.

Where attachment concerns property of equivalent value rather than proceeds of crime, substitution with fixed deposit receipts may be accepted if it preserves the enforcement interest. The Delhi HC distinguished between assets said to represent proceeds of crime and assets attached only to secure equivalent value, and noted the continuing burden of keeping unused land and buildings under attachment. It accepted the applicants' offer to furnish FDRs of equal value, supported by an undertaking that the Enforcement Directorate would have a lien and could encash the FDRs if the appeal succeeds. The attached properties were therefore directed to be released on those conditions.

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Issues: Whether the attached properties of the applicants, being properties of equivalent value and not alleged to be proceeds of crime, could be released on furnishing fixed deposit receipts in substitution of the attached properties.

Analysis: The release application was considered in the context of the prolonged pendency of the leave to appeal and the nature of the attached assets. The properties were land and buildings lying unused, with maintenance-related burdens continuing to accrue. The Court drew a distinction between attachment of proceeds of crime and attachment of property of equivalent value. It held that while substitution may not ordinarily be appropriate where the property itself is proceeds of crime, a different approach can be adopted where the attachment is only to secure equivalent value. The applicants' offer to furnish FDRs of equivalent amount, together with an undertaking that the Enforcement Directorate would have a lien and could encash the FDRs if the appeal succeeds, was accepted as sufficient protection.

Conclusion: The attached properties were directed to be released on furnishing FDRs of equivalent value, subject to the stipulated lien and undertaking conditions.

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