2019 (5) TMI 1465 - HC - Money Laundering

Appeal Denied: Seized Jewelry Released, Security Offer Accepted

The High Court dismissed the appeal challenging the Single Judge's order and upheld the conditional release of seized jewellery under the Prevention of ... Offence under PMLA - Retention of property after search - seeking release of jewellery, which was seized during the search operation of 22.09.2014 conducted on the respondents herein - HELD THAT:- Admittedly the respondents herein are not party to the proceedings initiated against the husband/father of the respondents herein respectively. We are also of the view that the appellants have not sought any extension under Section 20(3) of the PMLA for further retention of the jewellery. Learned ASG submits that a notice was issued subsequently and the effect of which would be decided by the Single Judge. We are prima facie satisfied that no prejudice in any manner will be caused to the appellant if the jewellery is released, for the reason that before the Single Judge, the respondents have volunteered to furnish a fixed deposit receipts in the amount ₹ 1,23,22,317/- and ₹ 29,64,387/- respectively and also furnish an undertaking that they would not transfer, part with or encumber in any manner or alienate jewellery returned to them and this undertaking has been accepted by the Court. We are informed that the undertaking has been furnished. Additionally, we direct the Department to take pictures of the jewellery in the presence of the respondents herein and the pictures would be duly signed by both the parties for the purposes of proper identification. The jewellery would be returned to the respondents against a proper receipt to be issued by the appellants. Appeal dismissed. Issues involved:Challenge to order dated 10.12.2018 passed by a Single Judge regarding release of seized jewellery under the Prevention of Money Laundering Act, 2002 (PMLA) and related legal provisions.Detailed Analysis:1. Challenge to Single Judge's Order:The appeal challenged an order passed by a Single Judge concerning the release of seized jewellery under the PMLA. The respondents had challenged an order by the Appellate Tribunal under the PMLA. One of the parties filed a review petition before the Tribunal. The petitioners sought the release of jewellery in exchange for a Fixed Deposit as per valuation by the appellants. The Additional Solicitor General argued against splitting the order and delaying tactics by the parties.2. Legal Arguments and Provisions:The respondents' counsel argued that no prejudice would be caused, and legal issues could be kept open. They agreed to protect the Department's rights by furnishing a Fixed Deposit receipt. Reference was made to Sections 9 and 10 of the PMLA. It was contended that the jewellery should be returned as no notice was issued under Section 17(4) or Section 20 of the Act. Section 20(3) was highlighted, stating that property should be returned after a specified period unless permitted otherwise.3. Examination of Single Judge's Order:The Single Judge's order noted that no order of seizure was passed against the petitioners. It highlighted the need for applications under relevant sections of the PMLA and the issuance of notices. The Court found merit in the petitioners' contentions and directed the return of jewellery upon furnishing security. The Court ensured the respondents' interests were protected while allowing the conditional return of jewellery.4. Decision and Dismissal of Appeal:The High Court dismissed the appeal, stating that no prejudice would arise from releasing the jewellery. The respondents' offer to furnish security and an undertaking was accepted. The Court directed the Department to document the jewellery and return it to the respondents. The appeal was rejected, with an order for compliance within 10 days.In conclusion, the High Court upheld the Single Judge's order for the conditional release of seized jewellery under the PMLA, emphasizing the protection of the parties' rights and compliance with legal provisions.