TaxTMI 
TaxTMI 
2017 (8) TMI 1075
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....aint, a regular case was registered by the CBI. The Enforcement Directorate (ED), registered ECIR dated 19.08.2016. (ii) It was mentioned in the complaint dated 27.07.2016 filed by SBI that SBI and other consortium Banks had advanced various credit facilities such as Rupee Term Loan (RTL), Working Capital Finance (WCF), Fund based (Overdraft/C Limit) as well as non fund based (Bank Guarantee, L/C, Bill discounting etc) to KAL around the year 2004 for meeting its operational expenses and working capital requirements. The said loans were rolled over and renewed from time to time, and that, during the year 2009-2010 KAL requested the banks to restructure the existing loans. (iii) It was further alleged in the complaint that as a part of the restructuring exercise, a Master Debt Recast Agreement dated 21.12.10 (MDRA) and other documents were executed by KAL in favour of the consortium banks. The applicant purportedly executed a corporate guarantee dated 21.12.2010 in favour of the consortium banks guaranteeing due repayment of the outstanding amounts in respect of the restructured facilities in the event of default in repayment by KAL. (iv) The complaint also stated that KAL d....
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....mately belongs to the children and family members of Dr. Vijay Mallya. There are no allegations whatsoever against them. Consequently, there can be no attachment of the property of the Applicant. The shareholding pattern of the Applicant and its shareholders respectively were also annexed with the application, which clearly show that the majority shareholding in the Applicant is held by the children and family members of Dr. Vijay Mallya, indirectly through Talesi Ventures Private Limited. 4. The appellant/applicant inter-alia has submitted that the properties of the applicant have been attached which have nothing to do with the loan granted by the consortium of banks to Kingfisher Airlines Ltd. ("KAL") and that no part of the loan granted to KAL has found its way to the applicant/applicant. 5. In the hearing, Shri Dayan Krishnan, the learned senior Advocate appearing on behalf of the appellant in support of their argument that the applicant/appellant is a separate and distinct legal entity and its property could not be attached on account of alleged defaults by the KAL and Dr. Vijay Mallaya, referred the following decision in the case of Anita Kaur Vs. Universal Weather and ....
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....peration of the related notice be stayed pending decision of the appellant‟s appeal. 8. Mr. Rajeev Awasthi, learned counsel for the respondent accepts the notice. He strongly opposed the said prayer and submitted that he will make his submissions without filing a reply by relying upon the impugned order already placed on record. According to him, in the present case, the appellant is not entitled for any relief. 9. The learned Advocate for the respondent argued that the property attached and confirmed in the impugned order is controlled by Shri Vijay Mallya. He further submitted that as of today , Dr. Vijay Mallya is required to pay sum amounting to approximately Rs. 9,000 Crores to be paid to the various financial institutions. He is running away from the law. He has already been declared as absconder. Non-bailable warrants have been issued against him. His passport has been cancelled. He further referred to various statements recorded during the investigation to show that Dr. Vijay Mallaya was actually controlling the appellant/applicant company. 10. We have considered the rival contentions for purposes of disposal of the stay application. The primary ground of the....
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....ate that M/s Blitz multimedia Pvt Ltd. is involved in the publication of magazines. On being asked, I state that the said company was earlier known as M/s RIFA publication Pvt. Ltd. which was owned by Sh Karanjia. I state that after subsequently renamed to M/s Blitz Multimedia Pvt Ltd. The current shareholders of M/s Blitz multimedia Pvt Ltd. are M/s Talesi Ventures Pvt. ltd. M/s Ganpathi Mallya investment Pvt Ltd, UB Distilleries ltd, Sh. P.A. Murli, Sh. Rami Reddy, Mallay family trust, Sidharth Mallay trust, Leana Mallya trust, Tanya Mallya trust, Sh. anil Pisharody and Mr. P.D. Govindam. The details of their holdings are submitted here with my dated signature. On being asked, I state that I will be furnishing the details of the shareholder of the M/s Blitz Multimedia pvt ltd within 03 days. Q 7 Who are the prompters/Shareholders/owners of M/s Talesi Ventures pvt. Ltd. M/s. Ganpathy mallya and M/s UB Distilleries ltd. etc? A. I state that I am not aware of the promoters of M/s Talesi Ventures pvt ltd. Ganpathy Mallya investments and M/s UB Distilleries ltd. On being asked, I am / also not aware of the trustees of M/s Mallay Family trust, Siddharth mallya trust, Lean a Mally....
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.... (emphasis supplied) 12. It is admitted by the appellant in the application itself that the majority shareholding in the appellant is held by the children and family members of Dr. Vijay Mallaya, indirectly through the Talesi Venture Pvt. Ltd. During the argument it was admitted by the learned senior advocate appearing on behalf of the appellant that Dr. Vijay Mallaya held at least 10% of the shares in the appellant company. Further, from the statement of Sh. N.R. Padmanabhan, Director of the appellant company it is seen that the appellant was controlled by Dr. Vijay Mallaya. 13. Admittedly, the shareholding pattern of the appellant company as mentioned in the Annexure -3 of the application is as follows: Mandwa Farms Private Limited Shareholding pattern as at 31.01.2017: Paid up capital - 1,680 Equity Shares of Rs. 100 each Name of Share holder No. of Shares % to paid- up capital Blitz Multimedia Private Limited 1,640 97,00% VJM Investments Private Limited 50 3.00% VJM INVESTMENT Private Limited Shareholding pattern as at 31.01.2017: Paid up capital - 50,00,000 Equity Shares of Rs. 10 each Name of Share holder No. ....
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....on. He is enjoying the leave outside of India and has been declared an absconder. 15. Due to the said conduct of Dr. Vijay Mallya and his other companies; the appellant/applicant cannot take the shelter of the law whereby the Supreme Court and High Court have held that each company is a legal entity distinct from its share holders as the situation in the present case is different from the case law cited in as much as Dr. Vijay Mallaya was controlling the appellant company and he was actively involved in the day to day conduct of the said business. From the conduct of Dr. Vijay Mallaya as well as his involvement in the appellant company would show that the judgments referred by the learned counsel for the appellant do not help the case of the appellant. 16. In the impugned order two specific instances have been mentioned whereby the complainant apprehended that non-attachment of the property was likely to frustrate the proceedings as Dr. Vijay Mallya is likely to dispose of the said assets including the attached property. In one instance, property village land parcel aggregating to a total area admeasuring 291.37 acres situated in biligeri Village, Coorg, Karnataka, of which an a....
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....crime would be covered as an act of money laundering. Thus in any of the case referred in section 3 of PMLA, in relation to the proceeds of crime would be covered as "money laundering", irrespective of the fact where any such proceeds of crime are already projected as untainted or are in the process of being projected as untainted. The enactment is for tracing and confiscating the properties derived from or involved in money laundering. The definition of the proceeds of crime is deliberately kept very wide. The reason for the same is not far to seek. The nature of activity in relation to dealing with proceeds of crime by the criminals and their associate, would demonstrate the purpose. The proceeds earned from the criminal activity of the scheduled offences are not necessarily kept or found in its original form. Such proceeds are disguised and layered, so that the origin thereof is not seen. The object is also to dispose of the proceeds so as to eliminate the possibility of the investigating agency gathering the evidence of the criminal activities. Thus in a case where the properties are converted, siphoned, extinguished or suppressed, the criminals or their associates cannot be le....
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....es a penalty, the liability for which continues until the rule or its requirement is obeyed or complied with. On every occasion that such disobedience or noncompliance, occurs and reoccurs, there is the offence committed. The distinction between the two kinds of offences is between an act or omission which constitutes an offence once and for all and an act or omission which continues and therefore, constitutes a fresh offence every time or occasion on which it continues. In the case of a continuing offence, there is thus the ingredient of continuance of the offence which is absent in the case of an offence which takes place when an act or omission is committed once and for all." The Bombay High Court further enumerated several judgments on the issue as under:- "In view of the foregoing, it is not necessary to quote from and discuss the judgments in State of Maharashta v. Krishnarao Dudhappa Shinde, reported in (2009) 4 SCC 219, Sajjan singh v. State of Punjab, reported in AIR 1964 SC 464, The state of Bombay (now Maharashta) v. Vishnu Ramchandra, reported in AIR 1961 SC 307, State of Haryana and others v. Jagdish, reported in (2010) 4 SCC 216, J VinodKumar Sudarshan Kelkar V.....