Court voids Provisional Attachment Order, allows petitioner access to accounts. Authorities can proceed with final adjudication.

The court allowed the writ petition, declaring that the Provisional Attachment Order dated 11th December 2020 ceased to have any effect after 9th June 2021. The Enforcement authorities were directed to allow the petitioner to operate their bank and postal accounts. The court clarified that this order does not prevent the authorities from passing a final adjudication order in the pending proceeding in accordance with the law.

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Issues Involved:
1. Whether the Enforcement authorities can benefit from the Supreme Court's order extending the period of limitation due to COVID-19.
2. Whether the Enforcement authorities are justified in not allowing the petitioner to operate their bank accounts without a formal order extending the Provisional Attachment Order.

Issue-wise Detailed Analysis:

1. Benefit from Supreme Court's Order:
The petitioner challenged the Provisional Attachment Order dated 11th December 2020, arguing that it lost its validity after 180 days (9th June 2021) as no formal extension was granted under Section 8(3) of the Prevention of Money Laundering Act, 2002 (PMLA). The petitioner contended that the Enforcement Directorate (Respondent No. 3) became functus officio post the expiry of the 180-day period, and there is no provision for automatic extension under the Act.

The Enforcement authorities defended their inaction by claiming an automatic extension based on the Supreme Court's order dated 23rd March 2020 in Suo Moto Writ Petition (Civil) No. 3 of 2020, which extended the period of limitation due to COVID-19. They argued that this order applied to the validity of the Provisional Attachment Order.

The court examined whether the Enforcement authorities could be considered litigants or advocates under the Supreme Court's order. The court noted that the order aimed to assist litigants and advocates facing difficulties in filing proceedings physically due to COVID-19. The court concluded that the Adjudicating Authority (Respondent No. 2) could not be considered a litigant or advocate, as it was not required to file any application or initiate any proceeding for confirming or extending the attachment order. The court relied on the Supreme Court judgment in S. Kasi vs. State, which clarified that the extension of limitation was meant for litigants and not for authorities like the Enforcement Directorate.

2. Justification for Not Allowing Operation of Accounts:
The court addressed whether the Enforcement authorities were justified in not allowing the petitioner to operate their bank accounts without a formal order extending the Provisional Attachment Order. The court emphasized that the Provisional Attachment Order under Section 5(1) of the PMLA ceases to have effect after 180 days unless extended by a formal order under Section 8(3). Since no such order was passed, the attachment order expired on 9th June 2021.

The court found the Enforcement authorities' action of not allowing the petitioner to operate their accounts after the expiry of the attachment order to be arbitrary and illegal. The court declared that the attachment order ceased to have any effect after 9th June 2021 due to the lack of a formal extension. Consequently, the petitioner should be allowed to operate their bank and postal accounts.

Conclusion:
The court allowed the writ petition, declaring that the Provisional Attachment Order dated 11th December 2020 ceased to have any effect after 9th June 2021. The Enforcement authorities were directed to allow the petitioner to operate their bank and postal accounts. The court clarified that this order does not prevent the authorities from passing a final adjudication order in the pending proceeding in accordance with the law.

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