Prior mortgage does not bar PMLA attachment, while secured creditors may still seek release or sale before the Special Court.

A prior mortgage does not by itself prevent attachment of property under the Prevention of Money Laundering Act, 2002, and properties acquired before the scheduled offence may still be treated as value thereof. At the same time, a secured creditor retains the statutory remedy to approach the Special Court for release, sale, or other appropriate dealing with the secured asset under the money-laundering framework. The parties' rights in the criminal trial remain preserved, and the secured creditor may seek auction sale of the mortgaged property by filing the required affidavit or undertaking. The attachment was therefore left undisturbed while statutory remedies were kept open.

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Issues: Whether properties mortgaged and assigned to a secured creditor, though attached under the Prevention of Money Laundering Act, 2002, could be claimed by the secured creditor and dealt with in terms of the statutory scheme governing secured debts.

Analysis: The attachment under the money-laundering law was upheld in principle, the Tribunal accepting that even properties acquired before the scheduled offence may be attached as value thereof. At the same time, the Tribunal recognised the appellant's status as a secured creditor and noted that the statutory framework under the Prevention of Money Laundering Act, 2002 permits a secured creditor to move the Special Court for release, sale, or other appropriate dealing with the secured asset under section 8. The Tribunal also preserved the parties' rights in the criminal trial and clarified that the secured creditor may seek auction sale of the mortgaged property by filing the requisite affidavit or undertaking.

Conclusion: The attachment was not set aside, but the secured creditor was granted liberty to pursue its remedies before the Special Court under the money-laundering framework, including for auction sale of the mortgaged properties.

Final Conclusion: The appeal was not allowed on merits, but the appellant secured permission to work out its remedies before the Special Court in accordance with law, while the attachment order was left undisturbed.

Ratio Decidendi: A prior mortgage does not by itself bar attachment under the Prevention of Money Laundering Act, 2002, but a secured creditor may invoke the statutory remedies preserved under section 8 before the Special Court for release or sale of the secured asset.

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