Lawful source burden: failure to produce contemporaneous evidence or reliable corroboration supports confirmation of provisional attachment.

Where a person whose property is provisionally attached fails to produce contemporaneous documentary evidence or reliable corroboration for claimed sources of funds, and earlier recorded statements contradict those claims, the attachment may be confirmed; the failure to demonstrate means of acquisition and repayment was treated as insufficient to discharge the burden on the owner, resulting in confirmation. Separately, valid service followed by completion of proceedings within the statutory period while the person remained unrepresented does not itself vitiate confirmation, so the confirmation was upheld on both evidentiary and procedural grounds.

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Issues: (i) Whether the Adjudicating Authority rightly confirmed the provisional attachment of the appellant's immovable property under the Prevention of Money Laundering Act, 2002 despite the appellant's claim of lawful source; (ii) Whether the confirmation order was vitiated by being passed ex parte after the death of the appellant's husband and absence of representation before the Adjudicating Authority.

Issue (i): Whether the provisional attachment was rightly confirmed despite the appellant's assertion that the property was purchased from disclosed friendly loans, savings and stridhan.

Analysis: The Adjudicating Authority and the Tribunal examined documentary evidence and statements recorded under Section 50(2) and (3) of the Prevention of Money Laundering Act, 2002. No documentary loan agreement or bank records were produced to substantiate the claimed friendly loans or savings. Witnesses earlier recorded under Section 50(2) and (3) denied the alleged extensions of loan and explained transfers consistent with channelizing proceeds of crime. The appellant, being a housewife, did not provide evidence of means to acquire the property or repayment details. The Tribunal treated the failure to produce contemporaneous documentary evidence and the contradicted affidavits as insufficient to discharge the burden on the person whose property is attached.

Conclusion: The provisional attachment was rightly confirmed; the appellant failed to satisfactorily disclose or prove lawful source for acquisition of the property and therefore the confirmation is upheld against the appellant.

Issue (ii): Whether the confirmation order dated 27.01.2023 was vitiated as ex parte because the appellant's husband died during proceedings and the appellant was unrepresented before the Adjudicating Authority.

Analysis: The record shows service of notice on the appellant. The Adjudicating Authority was required to decide within the statutory period under Section 5 of the Prevention of Money Laundering Act, 2002 and recorded the appellant's absence before it. The Tribunal found no infirmity in proceeding to finalise the order where the appellant, though served, remained unrepresented and did not avail the opportunity to place evidence or seek adjournment.

Conclusion: The confirmation order was not vitiated on account of being ex parte; the Adjudicating Authority's action in completing proceedings in the appellant's absence after service was proper.

Final Conclusion: The Tribunal dismissed the appeal and declined interference with the Adjudicating Authority's confirmation of the provisional attachment, upholding the attachment on the ground that the appellant failed to establish lawful source of funds and there was no procedural infirmity in the Adjudicating Authority proceeding in the appellant's absence.

Ratio Decidendi: Where a person whose property is provisionally attached fails to produce contemporaneous documentary evidence or reliable corroboration to establish lawful source of acquisition and earlier statements under Section 50 contradict the claimed sources, the Adjudicating Authority may confirm attachment; confirmation is not vitiated if proceedings are completed in the person's absence after valid service of notice and within the statutory period.

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