2019 (8) TMI 1380 - AT - Money Laundering

Appellant Discharged in PMLA Case after Asset Scrutiny. Enforcement Directorate's Appeal Adjourned.

The High Court discharged the appellant from PMLA Case No. 3 of 2014. The appellant's financial transactions and investments were scrutinized for ... Offence under PMLA - HELD THAT:- The Aim and Object of the Prevention of Money Laundering Act, 2002 is to find out property derived or obtained by any person as a result of criminal activity relating to a scheduled offence and to attach, freeze and confiscate the same subject to the trial under the Prevention of Money Laundering Act, 2002, so that the property cannot be laundered further, which is derived or obtained as a result of criminal activity. Recover the Proceeds of Crime from the person alleged to have holding the same. Without prejudice to the rights and contention of the appellant, the appellant is ready and willing to secure the interest of Enforcement Directorate by “Fixed Deposit Receipt” of any Nationalized Bank equivalent to an amount with the respondent by way of F.D. No doubt, this tribunal has allowed the similar prayer in number of appeals and even in few appeals, the respondent has given his consent. Issues:1. Allegations against the appellants regarding financial transactions and investments.2. Case of the appellant in appeal no. FPA-PMLA-1048/AHD/2015.3. Case of the appellant in appeal no. FPA-PMLA-821/AHD/2015.4. Appellant's status in relation to FIRs and police reports.5. High Court's judgment discharging the appellant from PMLA Case No. 3 of 2014.6. Enforcement Directorate's Special Leave Petition and Supreme Court's notice.7. Aim and Object of the Prevention of Money Laundering Act, 2002.8. Appellant's willingness to secure Enforcement Directorate's interest.9. Tribunal's decision to adjourn the appeals pending the Supreme Court's order.Allegations against the Appellants:The judgment detailed financial transactions and investments made by the appellants, involving significant amounts received from various sources and transferred to different entities. The transactions were scrutinized for potential money laundering activities, highlighting the movement of funds between family members and investments made with different companies.Case of the Appellant in FPA-PMLA-1048/AHD/2015:The appellant's case revolved around the purchase of land and the alleged use of proceeds of crime to pay land development charges to the Surat Municipal Corporation. The appellant claimed that the funds used were received from family members and not derived from criminal activities. The provisional attachment of the land by the Deputy Director was contested, emphasizing the source of the funds used for the payment.Case of the Appellant in FPA-PMLA-821/AHD/2015:In this case, the appellant's purchase of a flat in Mumbai and the alleged use of proceeds of crime to pay the sale consideration to Fancy Builders Pvt. Ltd. were examined. The appellant denied receiving proceeds of crime and asserted that the amount utilized was received from family members. Similar to the previous case, the attachment of the flat by the Deputy Director was challenged based on the source of the funds.Appellant's Status in Relation to FIRs and Police Reports:The judgment noted that the appellant was not listed as an accused in the FIRs related to the scheduled offence, nor in the police report filed under the Criminal Procedure Code. Additionally, the High Court's decision to discharge the appellant from PMLA Case No. 3 of 2014 was highlighted, indicating a legal development favoring the appellant.Enforcement Directorate's Special Leave Petition and Supreme Court's Notice:The Enforcement Directorate's Special Leave Petition filed in connection with the appellant's case was mentioned, along with the Supreme Court's notice. The order passed by the High Court discharging the appellant was not stayed by the Supreme Court, indicating ongoing legal proceedings at a higher judicial level.Aim and Object of the Prevention of Money Laundering Act, 2002:The judgment elaborated on the purpose of the Prevention of Money Laundering Act, emphasizing the identification and recovery of proceeds of crime derived from criminal activities. The Act aims to prevent further laundering of such funds and secure assets linked to criminal conduct through legal procedures.Appellant's Willingness to Secure Enforcement Directorate's Interest:The appellant expressed readiness to secure the Enforcement Directorate's interest by offering a Fixed Deposit Receipt from a Nationalized Bank equivalent to the disputed amount. This gesture aimed to address concerns regarding the alleged proceeds of crime and demonstrate cooperation with the authorities.Tribunal's Decision and Adjournment:Considering the pending Special Leave Petition filed by the Enforcement Directorate, the tribunal decided to adjourn the appeals sine-die until the Supreme Court issues its order. The appellant was granted liberty to submit an application following the Supreme Court's decision, indicating a procedural step to await the higher court's ruling.