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Issues: (i) Whether the 2009 amendment to the Schedule to the Prevention of Money Laundering Act, 2002 could be applied to deny action in respect of the alleged laundering activity; (ii) whether properties and investments made before the alleged period of offence could be attached as value of proceeds of crime; (iii) whether provisional attachment could be sustained in the absence of a charge-sheet under the scheduled offence; (iv) whether pendency of a criminal revision against framing of charge barred the attachment proceedings.
Issue (i): Whether the 2009 amendment to the Schedule to the Prevention of Money Laundering Act, 2002 could be applied to deny action in respect of the alleged laundering activity.
Analysis: The relevant date for action under the Act is the date on which the property is projected as untainted and the person is alleged to have engaged in the process connected with proceeds of crime. The offence of money laundering is independent of the scheduled offence and may be a continuing offence. The time of commission of the predicate offence is not decisive where the laundering activity itself is alleged to have continued after the relevant offence became scheduled.
Conclusion: The objection based on the 2009 amendment was rejected.
Issue (ii): Whether properties and investments made before the alleged period of offence could be attached as value of proceeds of crime.
Analysis: The definition of proceeds of crime includes not only property derived or obtained from criminal activity, but also the value of such property. Where the tainted property is not available because it has been siphoned off, diverted, or layered, attachment may be sustained against property of equivalent value. The attachment of pre-existing investments was therefore treated as permissible on the footing of equivalent value and tracing of the diverted proceeds.
Conclusion: The challenge to attachment of the pre-existing investments failed.
Issue (iii): Whether provisional attachment could be sustained in the absence of a charge-sheet under the scheduled offence.
Analysis: The second proviso to Section 5(1)(b) permits attachment where the authorised authority has reason to believe, on material in possession, that non-attachment is likely to frustrate proceedings under the Act. The absence of a police report under Section 173 of the Code of Criminal Procedure did not, by itself, invalidate the provisional attachment.
Conclusion: The objection based on absence of charge-sheet was rejected.
Issue (iv): Whether pendency of a criminal revision against framing of charge barred the attachment proceedings.
Analysis: Mere pendency of a challenge to framing of charge did not undo the attachment order. The legal consequences were left to follow the outcome of that criminal proceeding if it were later allowed.
Conclusion: The pendency of the criminal revision did not assist the appellants.
Final Conclusion: The attachment and its confirmation were sustained, and the appeals were dismissed as lacking merit.
Ratio Decidendi: Money-laundering is an independent and continuing offence, and where the tainted property is unavailable, attachment may extend to property of equivalent value; provisional attachment is not defeated merely because the scheduled offence has not yet resulted in a charge-sheet.
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