Tribunal modifies order for appellants to deposit rental income, no coercive action by ED

The Tribunal allowed the Enforcement Directorate's application, modifying the interim order to require the appellants to deposit the actual rental income received from the properties. The appellants were given time to clear arrears and instructed to make future payments promptly. The order remains in force until further notice, and no coercive action shall be taken by the ED. Appeals were scheduled for further hearing on 29th July 2020, with copies of the order provided to both parties.

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Issues Involved:
1. Review of the decision regarding the payment of deposit and monthly rent/user charges for properties let out on rent.
2. Verification of the rental agreements and the actual status of the properties.
3. Compliance with the interim order dated 19.06.2017 and subsequent directions.

Issue-wise Detailed Analysis:

1. Review of the Decision Regarding Payment of Deposit and Monthly Rent/User Charges:
The Enforcement Directorate (ED) filed a miscellaneous petition under Section 35(2)(f) of PMLA, 2002 to review the decision dated 19.06.2017. The original decision required the appellants to pay Rs. 15,000 per month per property as user charges. The ED sought a revision to Rs. 55,000 and Rs. 65,000 per month, respectively, for two specific properties, along with a one-time security deposit of Rs. 3,00,000 for each property. The appellants argued that the properties were either self-occupied or rented out with rental income being used to pay substantial EMIs to HDFC Bank, thus requesting exemption from the increased payments to ED.

2. Verification of the Rental Agreements and Actual Status of the Properties:
The appellants provided rental agreements and affidavits to clarify the status of the properties. Property No. CCE-151 was rented out for Rs. 55,000 per month, and Property No. CCE-141 was rented out for Rs. 65,000 per month. The appellants also mentioned that Property No. CCE-141 was vacated by the tenant and is now self-occupied by a family member. The Tribunal noted discrepancies in the appellants' statements and the actual rental agreements, highlighting that the properties were rented out despite claims of self-occupation.

3. Compliance with the Interim Order Dated 19.06.2017 and Subsequent Directions:
The interim order required the appellants to deposit Rs. 15,000 per month per property and allowed the ED to verify the rental status. The Tribunal found that the appellants did not fully disclose the rental agreements during the initial hearing. Consequently, the Tribunal directed the appellants to deposit the full rental amounts of Rs. 55,000 and Rs. 65,000 per month for the respective properties from the date of confirmation of the Provisional Attachment Order, after deducting amounts already paid under the interim order. The appellants were given eight weeks to pay arrears and instructed to continue monthly payments by the 7th of each month.

Conclusion:
The Tribunal allowed the ED's application, modifying the interim order to require the appellants to deposit the actual rental income received from the properties. The appellants were given time to clear arrears and instructed to make future payments promptly. The order remains in force until further notice, and no coercive action shall be taken by the ED in view of the notice issued under Section 8(4) of PMLA, 2002. The appeals were scheduled for further hearing on 29th July 2020, and copies of the order were provided to both parties.

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