2026 (2) TMI 1212 - AT - Money Laundering

Provisional attachment under PMLA: unexplained cash and lack of documentary proof upheld as basis for confirming attachment.

Provisional attachment under the Prevention of Money Laundering Act was examined with focus on the noticee's statutory burden to disclose lawful sources; ... Disproportionate assets - provisional attachment - burden of proof u/s 24 - valuation of property as on date of acquisition - treatment of unexplained cash deposits as proceeds of crime - standard for confirmation of provisional attachment - HELD THAT:- It is a case where an FIR was registered by the Vigilance Police Station, Bhubaneswar, Odisha for the offence under Section 13(2) read with Section 13(1)(b)/12 of the Prevention of Corruption Act, 1988 against Shri Ajay Kumar Das and Smt. Sanghamitra Das. Shri Ajay Kumar Das was found in possession of the assets disproportionate to his known sources of income and thus committed misconduct as a public servant. The salary of the three daughters has been taken to be Rs. 75,46,379/- as against the salary taken by the respondents to a sum of Rs. 25,00,000/-. The burden of proof was on the appellant in the light of Section 24 of the Act of 2002 which they utterly failed. He has failed to produce documents to show monthly or yearly income of the daughters so as to take total value to be of Rs. 75,46,379/-. There is a small discrepancy in the car loan amount but not so relevant because the difference is only of Rs. 19,000/-. The appellant has taken income from other sources for the family members at a sum of Rs. 12,63,808/- without disclosure of the source and proof of its receipt since the calculation in the statement quoted above was just to demolish the case of the respondents without any material to stand. Similar is the position for income on maturity of the insurance policies. In the light of the discussion made above, we do not find any reason to cause interference in the impugned order because the total income of the appellant Ajay Kumar Das and his family was properly determined. If that would have been so, cognizance would have been taken by the predicate offence agency or the court on filing of the charge sheet but no order has been placed on record to show determination of the amount in the hands of the appellant’s, demonstrating higher income. The discrepancy in the income has been taken for the sake of it and that too without producing all relevant documents and to illustrate we have referred to the salary bank account which has been produced but only of few years leaving others to quantify the amount of salary. The allegation of discrepancy in the calculation is also not made out. In fact, there is no inconsistency in the valuation of the immovable property as reflected in the FIR and the Provisional Attachment Order. Even assuming, for the sake of argument, that any discrepancy exists, the assessment of disproportionate assets contained in provisional Attachment Order would prevail for the purpose of scrutiny of the order under the Act of 2002. The facts on record further shows many cash deposit in the bank account of the appellants’ family member, which include even in the bank account of Ajay Kumar Das. No explanation for deposit of amount in cash has been given along with the disclosure of the source. The appellants have raised issues about calculation of the assets and the expenditure but failed to give source for deposit of cash in the bank accounts from time to time. It is even if the cash amount was deposited by the close relative of the main accused Ajay kumar Das, then their source for acquisition of cash. It is more so when the cash deposited was not on one or two occasions but many occasions and that has been taken note by the respondents to find out disproportionate assets to the known sources of income. It is alleged that value of few properties has been taken on a lower value while causing Provisional Attachment Order. If value of certain properties has been taken on lower side, then the amount of disproportionate assets would increase on taking their higher value, because allegation against the appellant is for holding assets disproportionate to the source of income and if value of the properties is taken on a higher side, the amount of disproportionate assets would also go up. Valuation of property as on date of acquisition - disproportionate assets. - HELD THAT:- According to the appellant, the value of the property should be as on the date of acquisition and not at the time when the Provisional Attachment Order was caused meaning thereby the appellant was paying for taking lesser value of the properties by taking it as on the date of acquisition and not subsequently. The argument is in contrast to the arguments earlier dealt with in preceding paras where the allegation has been made that certain properties have been valued at a lower cost in the Provisional Attachment Oder. The counsel for the appellants while making reference of the defect in calculation to determine assets disproportionate to the known sources of income furnished the amount towards the income but as has been stated by us earlier, it remains without proof. Thus, we do not find a case to cause interference in the impugned order. Accordingly, appeals fail and are dismissed. Issues: Whether the Appellate Tribunal should interfere with the Adjudicating Authority's confirmation of the Provisional Attachment Order made under the Prevention of Money Laundering Act, 2002.Analysis: The Tribunal examined the material on record relating to the computation of alleged disproportionate assets, documentary proof produced by the appellants, bank account entries and cash deposits, and the appellants' failure to discharge the statutory burden to disclose and prove lawful sources. The Tribunal considered the legal framework under the Prevention of Money Laundering Act, 2002 including the noticee's obligation to disclose sources and the relevance of unexplained cash deposits and corroborative documentary evidence in determining proceeds of crime. The Tribunal also considered challenges to valuation and to the methodology of computing income and expenditure, and noted that claimed incomes and receipts were not substantiated by complete bank statements or other documentary proof. The Tribunal found that discrepancies alleged by the appellants did not demonstrate absence of reason to believe or show that the Adjudicating Authority proceeded mechanically; unexplained cash payments and failure to produce supporting documents justified treating the amounts as proceeds of crime for provisional attachment purposes.Conclusion: The confirmation of the Provisional Attachment Order by the Adjudicating Authority is upheld; the appeals are dismissed and no interference is warranted.