Provisional attachment under money-laundering law sustained where recorded reasons and failure to prove lawful source justified confirmation.

In a money-laundering proceeding, provisional attachment was sustained because the recorded reasons to believe were found sufficient on the material showing seizure of the cash from the appellant and its reference in the later FIR and charge-sheet. The appellant's challenge failed because the explanation on the source of funds was unsupported, and he did not discharge the statutory burden to show that the cash was not proceeds of crime. The confirmation of attachment was therefore upheld and the appeal failed in full.

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Issues: (i) Whether the provisional attachment of the cash amount was justified on the basis of recorded reasons to believe under the money-laundering law. (ii) Whether the appellant discharged the burden of showing that the amount was not proceeds of crime.

Issue (i): Whether the provisional attachment of the cash amount was justified on the basis of recorded reasons to believe under the money-laundering law.

Analysis: The amount in question was reflected in the later FIR and charge-sheet, and the material before the Authority showed that it had been seized from the appellant's possession during investigation. The reasons recorded by the respondent and the Adjudicating Authority were found to be sufficient for invoking attachment under the relevant provision. The appellant's reliance on decisions explaining the expression "reason to believe" was held to be inapplicable on the facts, since the basis for attachment was specifically explained.

Conclusion: The attachment was held to be justified and the challenge on the ground of absence of reason to believe failed.

Issue (ii): Whether the appellant discharged the burden of showing that the amount was not proceeds of crime.

Analysis: The appellant asserted that the cash had been seized in another case and that he had been acquitted therein, but no satisfactory material was produced to establish lawful source or to show that the amount was untainted. The record instead supported the conclusion that the appellant could not explain the possession of the cash and did not discharge the burden placed on him under the statute.

Conclusion: The burden was not discharged and the amount was treated as liable to attachment as proceeds of crime.

Final Conclusion: The impugned order confirming attachment was upheld and the appeal failed in its entirety.

Ratio Decidendi: In a money-laundering proceeding, where the authority records sufficient reasons to believe and the person in possession of the property fails to prove a lawful source, the provisional attachment and its confirmation are sustainable.

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