2025 (8) TMI 1350 - HC - Money Laundering

Petition partly allowed; respondent must provide certified copies of petitioner's bills of entry (Jan 2008-Dec 2012) within 45 days

HC allowed the petition in part and directed Respondent No.4 to furnish certified copies of the documents filed by the Petitioner while entering bills of ... Money Laundering - proceeds of crime - Seeking direction to issue the necessary requisition to the Respondent No. 4, seeking the complete details of the Customs Duty deposited - seeking direction to provide to the Petitioner the complete details of all the Bills of Entries alongwith the relevant related data - HELD THAT:- The Petitioner is in a peculiar situation. Respondent Nos.2 and 3 require the Petitioner to submit a written statement supported with documents, in defence of the Company and on the other hand, Respondent No. 4 is not willing to part with the documents notwithstanding that the Petitioner was the representative of those Companies/Industries at the relevant time. The Petitioner need not be made to run from pillar to post seeking no objection of it’s earlier clients between 2008 to 2012. The Respondent No. 4 is directed to tender copies of the documents, duly certified, which were filed by the Petitioner while entering the bill of entries on behalf of its clients for the period 2008 to 2012 (the five Companies with whom the dispute has arisen). The Petitioner shall convey a list of the clients and the period of 2008 to 2012 to Respondent No. 4, vide an application sent via email. On receiving such an application, Respondent No. 4 would prepare the certified copies of the documents with reference to these Companies for the period January-2008 to December-2012, within a period of 45 days. Petition allowed in part. ISSUES PRESENTED AND CONSIDERED 1. Whether a former Custom House Agent (private company) that prepared and filed bills of entry on behalf of clients for the period 2008-2012 is entitled to obtain certified copies of the documents it filed with Customs from the Customs Authority, notwithstanding Customs' contention that those documents pertain to the client companies and cannot be released without their consent. 2. Whether denial of access to such documents by Customs (on the ground of clients' proprietary interests) causes prejudice to the accused in pending PMLA proceedings and, if so, what interim/ancillary directions are appropriate to secure the accused's right to defend. 3. The procedural consequences flowing from disclosure of records to the accused in the context of provisional attachment under the PMLA, including timelines for production of a written reply and the effect on further action by adjudicating or enforcement authorities. ISSUE-WISE DETAILED ANALYSIS Issue 1 - Entitlement to certified copies of documents filed with Customs by the former agent Legal framework: The matter concerns the rights of a party who prepared and submitted official documents (bills of entry) to a public authority to access certified copies of those records maintained by the authority. Under general administrative law principles, a person who is the author/processor of records and whose legitimate interest in those records is material to adjudicatory proceedings may seek certified copies from the public authority that maintains them. No specific statutory embargo on production of such routine customs records to former agents was pleaded in the judgment. Precedent Treatment: No binding precedents were invoked or applied by the Court in the judgment to either restrict or expand the right to obtain certified copies; the Court proceeded on facts and administrative principles. Thus precedential treatment is not followed, distinguished or overruled in the text. Interpretation and reasoning: The Court accepted the factual premise that the petitioner-company had prepared, handled and filed the bills of entry on behalf of the client companies during the relevant period and that the documents passed through the hands of the petitioner. The Court found it inequitable to require the petitioner to obtain no-objection letters from multiple former clients after the lapse of many years and after the petitioner's own records were destroyed pursuant to ordinary preservation rules. The Court balanced the proprietary interest of clients in their records against the accused's right to defend in criminal/money-laundering (PMLA) proceedings and found the latter to demand disclosure. On that basis the Court directed the Customs Authority to prepare and furnish certified copies (or soft copies) of the documents filed by the petitioner for the five specified clients for January 2008-December 2012, subject to payment of routine copying charges. Ratio vs. Obiter: Ratio - The Court's operative principle is that where an entity has processed and filed records with a public authority and needs those records to mount a defense in adjudicatory/criminal proceedings, the authority is obligated to furnish certified copies of the relevant records upon a specific request by the filer, despite the authority's general reluctance based on clients' proprietary claims, particularly where requiring fresh client consent would be impracticable and would prejudice the accused's right to defence. Obiter - Observations about the normal destruction of documents after a preservation period and the petitioner's responsibility to have retained records are explanatory and not essential to the legal holding. Conclusions: Direction to Customs to prepare certified copies of documents filed by the petitioner for the specified clients for 2008-2012 within 45 days after a specific emailed application by the petitioner; payment of specified charges if any; provision for soft copies as an alternative. Issue 2 - Prejudice in PMLA proceedings and interim relief to secure right to defend Legal framework: The accused's right to a fair hearing and to confront allegations by producing documentary evidence is a foundational aspect of criminal/adjudicatory process under PMLA and general principles of natural justice. Authorities conducting PMLA proceedings may require documentary replies, but must ensure accused persons are not rendered unable to present a defense by withholding relevant material needed to prepare such replies. Precedent Treatment: The judgment does not cite authoritative precedents; the reasoning is grounded in fairness and practical administration of justice rather than on distinguished prior rulings. Interpretation and reasoning: The Court recognized the Respondent enforcement/adjudicating authorities' legitimate expectation that the petitioner file a written reply supported by documentary evidence. Simultaneously, the Court found that Customs' refusal to furnish the very documents the petitioner had earlier filed would render the petitioner 'defense-less' and make it impossible to prepare a precise financial response. Consequently, the Court ordered disclosure by Customs and linked the timeline for the petitioner's reply to receipt of those documents, thereby protecting the petitioner's right to mount a meaningful defense. Ratio vs. Obiter: Ratio - Where an accused in PMLA proceedings lacks access to documents necessary for the preparation of a reply due to their retention by a governmental authority, the court may order disclosure and defer further action to allow the accused a reasonable period to file a documentary reply. Obiter - The court's sympathy for routine destruction practices and comments on human impossibility of reconstructing records are ancillary. Conclusions: The petitioner is to file its written reply before the adjudicating authority within 75 days of receipt of the certified documents; further action by concerned authorities is restrained until the petitioner files its reply and the adjudicating authority passes an order. Issue 3 - Procedural sequencing and effect on provisional attachment and further proceedings Legal framework: Administrative action under PMLA (including provisional attachment) proceeds under statutory timelines, but must also respect the accused's right to be heard. Courts can issue interim directions to preserve fairness in ongoing enforcement/adjudicatory processes. Precedent Treatment: No direct precedents addressed; the Court exercised supervisory jurisdiction to tailor appropriate interim directions. Interpretation and reasoning: Given the petitioner's inability to respond without the certified records, the Court prevented further actionable steps arising from the impugned provisional attachment order until the petitioner files its reply and the adjudicating authority passes orders thereon. This approach avoids irreparable prejudice while preserving the statutory process, by temporarily staying further action but not vacating the provisional attachment itself. Ratio vs. Obiter: Ratio - Interim restraint on further proceedings pending production of documents and filing of the petitioner's reply is an appropriate measure to secure fairness where non-disclosure by a record-holding authority would otherwise deny the accused effective opportunity to defend. Obiter - The Court's procedural timetable (45 days for disclosure; 75 days to file reply) is an exercise of judicial case management in the facts of this matter and may be adapted in other cases. Conclusions: Directed timelines - customs to supply certified copies within 45 days of specific application; petitioner to pay copying charges within five days if demanded; petitioner to file written reply within 75 days of receipt; authorities shall not proceed further in the PMLA process until reply is received and adjudication occurs.