Court grants Rs. 25 crores loan under Emergency Credit Line Guarantee Scheme with second charge on property. Attachment order maintained.

The Court granted permission for a Rs. 25 crores loan under the Emergency Credit Line Guarantee Scheme, with a second charge on the property, considering the urgency, property valuation, and potential threat to the hotel's operation. The Enforcement Directorate's attachment order was maintained, and relevant documents were directed to be submitted to the Appellate Tribunal for further consideration.

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Issues:
1. Non-functionality of the Appellate Tribunal under the Prevention of Money Laundering Authority, 2002 due to vacancies.
2. Provisional attachment of a hotel property by the Enforcement Directorate.
3. Petitioner seeking permission to avail additional credit facility under the Emergency Credit Line Guarantee Scheme.
4. Requirement of approval from the Appellate Tribunal for the loan facility due to the property attachment.
5. Valuation of the property by Yes Bank and need for permission to create a second charge for the loan facility.
6. Granting permission for the loan facility considering the property valuation and ED's attachment.

Issue 1: Non-functionality of the Appellate Tribunal
The petitioner filed a writ petition under Article 227 due to the non-functionality of the Appellate Tribunal under the Prevention of Money Laundering Authority, 2002, caused by unfilled vacancies, hindering the processing of the petitioner's appeal against a provisional attachment order issued by the Enforcement Directorate.

Issue 2: Provisional attachment by Enforcement Directorate
The Enforcement Directorate provisionally attached a hotel property, Holiday Inn, due to money laundering allegations, with an attachment amount of Rs. 120,20,46,003, confirmed by the Adjudicating Authority. The petitioner sought permission to avail of an additional credit facility under the Emergency Credit Line Guarantee Scheme, necessitating approval from the Appellate Tribunal due to the property's attachment.

Issue 3: Permission for additional credit facility
The petitioner requested direction for the Enforcement Directorate to allow them to avail of the additional credit facility sanctioned by Yes Bank under the Emergency Credit Line Guarantee Scheme, despite the property attachment, to mitigate the adverse impact of the COVID-19 pandemic on the hospitality sector.

Issue 4: Requirement of Appellate Tribunal approval
Due to the property attachment, the petitioner needed approval from the non-functional Appellate Tribunal to create a second charge for the loan facility sanctioned by Yes Bank, which valued the property at Rs. 342.4 crores, significantly higher than the attachment amount.

Issue 5: Valuation and approval for loan facility
Yes Bank's valuation of the property at Rs. 342.4 crores, acceptance of the loan, and the petitioner's urgency to secure the loan to ensure the hotel's operations led the Court to grant permission for availing the loan under the ECLGS scheme, safeguarding the Enforcement Directorate's attachment rights.

Issue 6: Granting permission for loan facility
Considering the urgency, property valuation, and potential threat to the hotel's operation, the Court granted permission for a Rs. 25 crores loan under the ECLGS scheme, with a second charge on the property, while maintaining the Enforcement Directorate's attachment order and directing submission of relevant documents to the Appellate Tribunal for further consideration.

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