Retention and sale of seized movable property under PMLA is permitted where upkeep is disproportionate and safeguards are maintained.

Seized movable property under the Prevention of Money-Laundering Act, 2002 may be retained after confirmation by the Adjudicating Authority, and possession is then to be taken under the prescribed rules. Rule 4(2) of the 2013 Rules allows sale of movable property that is liable to speedy decay or where upkeep is likely to exceed its value, with the sale proceeds to be kept in an interest-bearing fixed deposit. Section 8(6) does not bar this mechanism, because it governs final release after trial rather than interim statutory sale. If the owner does not furnish a fixed deposit receipt for equivalent value under the proviso, sale may proceed with competent approval.

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Issues: Whether the disposal of seized luxury vehicles under the Prevention of Money-Laundering Act, 2002 and the 2013 Rules was lawful, and whether the impugned orders permitting sale of the vehicles suffered from any infirmity.

Analysis: Section 17 of the Prevention of Money-Laundering Act, 2002 empowers search and seizure of proceeds of crime, and Section 17(4) requires the seized property to be placed before the Adjudicating Authority for retention. Once retention is confirmed under Section 8(3), Section 8(4) requires possession to be taken in the manner prescribed. Rule 4(1) of the 2013 Rules contemplates physical possession of movable property, while Rule 4(2) permits sale of movable property that is liable to speedy and natural decay or where maintenance is likely to exceed its value, with the sale proceeds to be deposited in an interest-bearing fixed deposit. The challenge that Section 8(6) bars sale was rejected because that provision operates at the stage of final release after trial and does not prohibit the statutory sale mechanism under Rule 4(2). The petitioner also did not invoke the proviso to Rule 4(2) by furnishing a fixed deposit receipt equivalent to the value of the vehicles.

Conclusion: The sale of the seized vehicles was held to be in accordance with the statute and the 2013 Rules, and the impugned orders were upheld as valid.

Ratio Decidendi: Where movable property seized under the Prevention of Money-Laundering Act, 2002 is confirmed for retention and is liable to decay or disproportionate maintenance expense, it may be sold with leave of the competent authority under Rule 4(2), and the sale proceeds must be safeguarded in an interest-bearing deposit.

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