Mandatory disclosure of relied-upon documents under PMLA failure to supply foundational material vitiates freezing and seizure action.

Non-supply of the relied upon documents, including the material forming the recorded reasons to believe, violated the mandatory disclosure requirement under the PMLA and denied fair notice to the appellant. The Tribunal held that the statutory scheme and governing precedent required service of all foundational materials with the show-cause notice and during adjudication; since the notice was not accompanied by those documents and some core materials, including FIRs used to initiate action, were never furnished, the defect was fatal. The freezing and seizure directions were therefore set aside.

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Issues: Whether the impugned freezing and retention order could be sustained when the documents relied upon for the show-cause notice and the recorded reasons to believe were not supplied to the appellant, and whether such non-supply vitiated the proceedings under the PMLA.

Analysis: The Tribunal held that the statutory scheme and the governing precedent require the authority to serve all relied upon documents, including the material forming the basis of the reasons to believe, along with the show-cause notice and to ensure fair disclosure during adjudication. On the record, the show-cause notice was not accompanied by the relied upon documents, and some foundational materials, including FIRs relied upon for initiation of action, were never supplied even later. The Tribunal treated this omission as fatal because the undisclosed materials were central to the formation of the case against the appellant and not merely ancillary.

Conclusion: The non-supply of the relied upon documents violated the mandatory procedure and rendered the impugned order unsustainable; the appeal was therefore allowed and the freezing and seizure directions were set aside.

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