2019 (4) TMI 136 - AT - Money Laundering

Tribunal overturns order in money laundering appeal due to lack of evidence and connection to alleged offenses.

The Tribunal set aside the Adjudicating Authority's order in an appeal under Section 26 of the Prevention of Money Laundering Act, 2002. The appellant's ... Prevention of Money Laundering - no cogent evidence provided by the ED in order to show that the appellant has any link and nexus with any alleged accused parties - HELD THAT:- No plea of the appellant has been referred wherein it was stated that the appellant was the buyer of the property and Mrs. Nirmala Jain was the seller of the said property and due to personal reasons on the part of the seller the sale of the property did not take place in favour of the appellant. Thus, her name should be deleted as respondent. The appellant thus before this Tribunal claiming no right in the property. She was arrayed as defendant no. 50 in the application. Respondent says that since she is claiming no right and title in the property, her name may be deleted. Even, no prosecution complaint has been filed under section 8(3)(a) of the Act. Ninety days period has already been expired. Therefore, the impugned order against the appellant is set-aside by allowing the present appeal. Issues:1. Appeal filed under Section 26 of Prevention of Money Laundering Act, 2002 against an order passed by the Adjudicating Authority.2. Lack of specific allegations against the appellant in the original application.3. Failure of the Adjudicating Authority to provide information on seized papers/documents/articles related to the appellant.4. Appellant's contention of no cogent evidence linking them to the alleged accused parties.5. Request for deletion of appellant's name as a respondent due to lack of connection to the property in question.6. Consideration of the prosecution complaint filing period under section 8(3)(a) of the Act.Analysis:1. The appeal was filed under Section 26 of the Prevention of Money Laundering Act, 2002 against an order by the Adjudicating Authority. The appellant argued that no specific allegations were made against them in the original application, except for a property transaction that did not materialize due to personal reasons of the seller. The Enforcement Directorate failed to provide any seized papers/documents/articles related to the appellant, which hindered the appellant's ability to defend themselves effectively.2. The appellant maintained that there was no substantial evidence linking them to the accused parties mentioned in the application. Despite submitting explanations to the Enforcement Directorate, the appellant was still included as defendant no. 50 in the application, without any reference to the failed property transaction that would have absolved them from involvement. The appellant sought deletion of their name as a respondent due to the lack of connection to the property transaction.3. The Adjudicating Authority's failure to provide crucial information on the seized documents/articles further complicated the appellant's defense. The appellant's repeated requests for copies of these materials went unanswered, undermining their ability to present a comprehensive reply and defend their position effectively.4. The Tribunal noted that the impugned order, spanning 123 pages and involving fifty respondents, did not adequately address the appellant's contentions. The Tribunal found merit in the appellant's argument regarding the lack of evidence connecting them to the alleged offenses and the failed property transaction, leading to the decision to set aside the impugned order and allow the appeal.5. Additionally, the counsel for the respondent acknowledged the appellant's claim of no right or title in the property and suggested the deletion of the appellant's name as a respondent. Considering the expiration of the ninety-day period for filing a prosecution complaint under section 8(3)(a) of the Act, the Tribunal decided to set aside the impugned order against the appellant, ultimately ruling in favor of the appellant.