2025 (7) TMI 1727 - AT - Benami Property

Attachment under Prohibition of Benami Property Act invalid if property already attached under PMLA 2002

M/s Maple Destination and Dream Build Pvt Ltd. And Shri Vikramaditya Singh Versus The Initiating Officer, Chandigarh

The AT under SAFEMA held that attachment of property under the Prohibition of Benami Property Transaction Act, 1988 was improper when the same property ... Benami Property Transaction - attachment of property u/s 24(3) of the Prohibition of Benami Property Transaction Act, 1988 (the Act of 1988) when the same property is already under attachment under the Prevention of Money Laundering Act, 2002 (the Act of 2002). HELD THAT:- Referring to acknowledgment of the Adjudicating Authority about previous attachment of the same property under the Act of 2002 and therefore, there could not have been apprehension for alienation of the property but ignoring the aforesaid, the Initiating authority passed an order of attachment and has been confirmed by the impugned order. We, therefore, find reasons to cause interference in the impugned order when the property of the appellant was subject matter of attachment in the proceedings under the Act, 2002 for which ECIR was recorded on 27.10.2015 followed by an order for provisional attachment of the property and confirmation by the Adjudicating Authority under the Act, 2002, by the order dated 10.08.2017 accordingly, impugned order for the property which was under attachment under the Act of 2002 is quashed. ISSUES: Whether provisional attachment of property under Section 24(3) of the Prohibition of Benami Property Transaction Act, 1988 (the Act of 1988) is permissible when the same property is already under attachment under the Prevention of Money Laundering Act, 2002 (the Act of 2002).Whether the apprehension of alienation of property exists for provisional attachment under Section 24(3) of the Act of 1988 when the property is already attached under the Act of 2002. RULINGS / HOLDINGS: The Court held that provisional attachment under Section 24(3) of the Act of 1988 cannot be sustained where the property is already under attachment under the Act of 2002, as there is no 'apprehension of alienation of the property' during the notice period.The impugned order confirming provisional attachment under the Act of 1988 was quashed because it ignored the prior attachment and confirmation under the Act of 2002, which precludes the need for a separate attachment under the Act of 1988.The Respondent is at liberty to initiate fresh proceedings if permissible, but the current attachment order under the Act of 1988 is invalid due to the existing attachment under the Act of 2002. RATIONALE: The Court applied the statutory framework of Section 24(3) of the Act of 1988, which allows provisional attachment only if the Initiating Officer has an opinion that the person in possession 'may alienate the property during the period specified in the notice.'The Court emphasized the principle that attachment under one statute (Act of 2002) negates the basis for attachment under another statute (Act of 1988) when the apprehension of alienation is absent.The Adjudicating Authority's acknowledgment of prior attachment under the Act of 2002 was critical, and ignoring this fact constituted an error warranting interference.No doctrinal shift or dissent was noted; the decision rests on a strict interpretation of the statutory language and factual context of prior attachment.