Money-laundering proceedings may survive later inclusion of scheduled offences, and attachment stands without proof of lawful source of funds.

Money-laundering proceedings can continue where the laundering activity under the Prevention of Money Laundering Act, 2002 occurred after the relevant IPC offences were brought into the Schedule, because the decisive focus is the commission of money-laundering linked to proceeds of crime, not the date of the predicate offence. Provisional attachment of property in a sister's name was sustained where the claimant failed to prove an independent lawful source of funds and the statutory presumption under section 24 operated against the appellants. The narrower alleged crime period was rejected on the facts, with the proceeds of crime traced over later financial years.

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Issues: (i) Whether proceedings under the Prevention of Money Laundering Act, 2002 could be sustained when the scheduled IPC offences were added to the Schedule after the alleged predicate offence period. (ii) Whether provisional attachment of a flat standing in the sister's name, purchased before the asserted crime period, was sustainable in the absence of proof of independent source of funds.

Issue (i): Whether proceedings under the Prevention of Money Laundering Act, 2002 could be sustained when the scheduled IPC offences were added to the Schedule after the alleged predicate offence period.

Analysis: The relevant inquiry was held to be the commission of the act of money-laundering under Section 3 of the Prevention of Money Laundering Act, 2002 and not merely the date on which the scheduled offence was committed. The offence was treated as a continuing activity connected with the proceeds of crime, and the later inclusion of IPC offences in the Schedule did not invalidate the proceedings where laundering activity continued after such inclusion.

Conclusion: The challenge on the ground of absence of a predicate offence at the relevant time was rejected.

Issue (ii): Whether provisional attachment of a flat standing in the sister's name, purchased before the asserted crime period, was sustainable in the absence of proof of independent source of funds.

Analysis: The material showed that the business and collection of deposits commenced from 2006 onwards and the proceeds of crime were assessed over financial years 2006-07 to 2009-10. The asserted narrower crime period was not accepted. The appellant failed to show any lawful source for the purchase of the flat, and the statutory presumption under Section 24 of the Prevention of Money Laundering Act, 2002 operated against the appellants.

Conclusion: The provisional attachment of the flat was upheld.

Final Conclusion: The Tribunal upheld the confirmation of provisional attachment and found no merit in the statutory and factual challenges raised by the appellants.

Ratio Decidendi: For proceedings under the Prevention of Money Laundering Act, 2002, the decisive date is the commission of money-laundering activity connected with proceeds of crime, not the date of the underlying scheduled offence, and property may be attached where the claimant fails to establish a lawful source despite the statutory presumption.

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