Recorded satisfaction for provisional attachment under money laundering law must rest on objective material, not statutory repetition.

A writ petition challenging provisional attachment under the Prevention of Money Laundering Act was held maintainable despite alternative statutory remedies because the grievance concerned a jurisdictional defect. The court held that the second proviso to Section 5(1) requires recorded satisfaction, based on material in possession, that immediate attachment is necessary to prevent frustration of proceedings. A bare repetition of statutory language, without objective material showing an imminent risk to the proceedings, does not satisfy that requirement. The provisional attachment was therefore set aside, and liberty was reserved to proceed afresh if the statutory conditions are properly met.

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Issues: (i) Whether the writ petition was maintainable despite the statutory remedies under the Prevention of Money Laundering Act, 2002; (ii) Whether the provisional attachment order passed under the second proviso to Section 5(1) of the Prevention of Money Laundering Act, 2002 was vitiated for want of the requisite recorded satisfaction based on material showing immediate necessity of attachment.

Issue (i): Whether the writ petition was maintainable despite the statutory remedies under the Prevention of Money Laundering Act, 2002.

Analysis: The existence of remedies before the Adjudicating Authority and the Appellate Authority did not, by itself, bar writ jurisdiction where the challenge was to a jurisdictional defect. A complaint that the competent authority had not complied with the mandatory procedure under the second proviso to Section 5(1) of the Act raised a question that was not capable of effective redress in the confirmation proceedings under Section 8.

Conclusion: The writ petition was maintainable and could be entertained.

Issue (ii): Whether the provisional attachment order passed under the second proviso to Section 5(1) of the Prevention of Money Laundering Act, 2002 was vitiated for want of the requisite recorded satisfaction based on material showing immediate necessity of attachment.

Analysis: The second proviso to Section 5(1) required the competent authority to form and record reasons, on the basis of material in possession, that immediate attachment was necessary because non-attachment was likely to frustrate proceedings under the Act. The recorded reasons in the impugned order were held to be a general reproduction of statutory language and did not disclose objective material linking the properties to an imminent risk of frustration of proceedings. The Court held that the material relied upon showed, at best, the alleged commission of offences, but not the distinct statutory satisfaction required for exercise of power under the second proviso.

Conclusion: The provisional attachment order was invalid and liable to be set aside.

Final Conclusion: The impugned provisional attachment and the consequential proceedings founded on it were quashed, while liberty was preserved to proceed afresh in accordance with law if the statutory requirements are duly satisfied.

Ratio Decidendi: When a statute conditions provisional attachment on a recorded, material-based satisfaction of immediate necessity, a mere reiteration of statutory language without objective nexus to frustration of proceedings renders the attachment unsustainable; such a jurisdictional defect can be examined in writ jurisdiction notwithstanding alternative remedies.

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