Housewife's challenge to provisional property attachment under PMLA Section 5 dismissed for lack of jurisdictional grounds

The Delhi HC dismissed a writ petition challenging provisional attachment order under PMLA Section 5. The petitioner, a housewife, contested attachment of property allegedly being proceeds of crime related to 17 fake bills of entry for foreign remittances through ICICI Bank. The court held that HC should not interfere under Article 226 unless there is patent lack of jurisdiction, which was absent here. The Adjudicating Authority has proper jurisdiction to determine if properties constitute proceeds of crime. The court noted that discharge of some accused individuals and death of another does not affect proceedings against the petitioner, as PMLA offences are distinct from IPC offences and companies remain accused for predicate offences.

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Issues Involved:
1. Challenge to Provisional Attachment Order (PAO)
2. Allegations of Conspiracy and Fraud
3. Involvement of Petitioner's Family and Companies
4. Legal Provisions under PMLA, 2002
5. Jurisdiction and Alternative Remedies

Summary:

1. Challenge to Provisional Attachment Order (PAO):
The Petitioner approached the Court challenging the Provisional Attachment Order (PAO) No. 3/2023 dated 06.10.2023 issued by the Respondent.

2. Allegations of Conspiracy and Fraud:
The PAO was based on FIRs registered by the Detection of Crime Branch, Surat Police, alleging that various companies and their directors prepared fake bills of entry to make illegal foreign remittances. The chargesheets filed indicated a well-planned conspiracy involving the creation of different companies and the use of forged documents to open bank accounts and transfer funds.

3. Involvement of Petitioner's Family and Companies:
The investigation revealed that the Petitioner's husband and son were directors and shareholders of M/s Kross Diamonds Pvt. Ltd., which was implicated in the fraudulent activities. The Petitioner, a housewife, was initially a director and later a shareholder of the company. The PAO detailed significant amounts transferred from M/s Kross Diamonds Pvt. Ltd. to other entities based on forged documents.

4. Legal Provisions under PMLA, 2002:
Proceedings were initiated under the Prevention of Money Laundering Act, 2002 (PMLA). Section 5 of PMLA allows for provisional attachment if there is reason to believe that proceeds of crime are likely to be concealed or transferred. Sections 8(1) and 8(2) outline the adjudication process, requiring the Adjudicating Authority to serve notice, consider replies, and hold hearings before confirming the attachment.

5. Jurisdiction and Alternative Remedies:
The Court emphasized that when a statute provides a specific procedure for addressing grievances, the High Court should not interfere under Article 226 of the Constitution unless there is a patent lack of jurisdiction. The Petitioner's arguments were primarily factual and could be addressed by the Adjudicating Authority and the Appellate Tribunal under PMLA. Citing several precedents, the Court reiterated that the existence of an alternative remedy precludes the High Court from exercising its jurisdiction unless exceptional circumstances are demonstrated.

Conclusion:
The Court dismissed the writ petition, stating that the Petitioner should seek remedy through the statutory mechanisms provided under PMLA, 2002. The Court found no grounds to bypass the alternative remedies and interfere under Article 226 of the Constitution.

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