Provisional Attachment under PMLA upheld where transactional evidence showed collusive transfers and absence of bona fide purchase.

Provisional attachment under the Prevention of Money Laundering Act is sustainable where credible material shows property transfers were collusive and intended to frustrate confiscation; the tribunal applied the principle that a general power of attorney does not by itself transfer title and evaluated timing of sale registrations, absence of contemporaneous consideration, and inconsistent ownership assertions as evidence of concealment or transfer risk, concluding the statutory prerequisites for provisional attachment were met and that the appellant did not prove bona fide purchaser status, with the appeal dismissed.

---

---

Issues: (i) Whether the Appellate Tribunal should set aside the Adjudicating Authority's order confirming Provisional Attachment Order No.02/2022 issued under the Prevention of Money Laundering Act, 2002 in respect of properties alleged to be proceeds of crime, and whether the appellant qualifies as a bona fide purchaser entitled to relief.

Issue (i): Whether the attachment of the impugned properties under PMLA, 2002 was unsustainable and whether the appellant is a bona fide purchaser entitled to have the attachment vacated.

Analysis: The legal framework comprises Sections 5 and 8(1) of the Prevention of Money Laundering Act, 2002, and the procedure under Section 26(1) for appeals against Adjudicating Authority orders. Section 5 permits provisional attachment of proceeds of crime in possession of any person where such proceeds are likely to be concealed, transferred or dealt with so as to frustrate confiscation proceedings. The material facts found and relied upon include: multiple FIRs and charge-sheets indicating the principal accused was a habitual offender; that certain properties were sold shortly before the PAO; that sale deeds were registered without payment of consideration at the time of registration; the seller's denials of ownership both before and after the sale; and the timing and source of alleged payment occurring only after notice under Section 8(1). The Appellate Tribunal evaluated the credibility of documentary and transactional evidence, including the nature of transfer by power of attorney, the sequence of events showing sale shortly before attachment, absence of contemporaneous payment to the alleged seller, and inconsistencies in ownership assertions. The Tribunal considered established principle that a GPA does not in itself confer transferable title and that provisional attachment may be exercised irrespective of whether the person in possession is the accused in the scheduled offence, citing relevant precedent principles. On these facts, the Tribunal concluded there was credible material to infer that the transactions were collusive and intended to frustrate attachment, and that the prerequisites for provisional attachment under Section 5 were satisfied.

Conclusion: The attachment of the impugned properties was sustainable under the Prevention of Money Laundering Act, 2002; the appellant has not established status as a bona fide purchaser disentitling the Enforcement Directorate from proceeding with attachment. The appeal is dismissed.

Ratio Decidendi: Section 5 of the Prevention of Money Laundering Act, 2002 authorises provisional attachment of proceeds of crime in the possession of any person, irrespective of whether that person is charged with a scheduled offence, where material exists to show the proceeds are likely to be concealed, transferred or dealt with so as to frustrate confiscation proceedings.

---