TaxTMI 
TaxTMI 
2015 (12) TMI 1733
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....re taken up for final disposal. As both the appeals arise out of same impugned order and all the pleas and contentions raised on behalf of the parties are also common in both the appeals, therefore, these appeals are being disposed of by way of this common order. Brief Facts 1. FIR No. 239/2010, dated 11-9-2010 and FIR No. 61/2011, dated 3-3-2011 were registered by police on the complaint filed by Shri N. Sreedaran and Shri Tapan Bhandari respectively alleging that Shri John Micheal had collected money totaling Rs. 1,14,39,708/- and Rs. 30,28,032/- respectively from them and their friends and cheated them by providing forged sale deeds relating to allotment of BDA sites in lieu of legal sale deeds for which the said consideration was paid. The Inspector of Police, Ramamurthynagar Police Station, Bangalore filed charge Sheet No. 1/2013, dated 25-2-2013 before the Additional Metropolitan Magistrate, Bangalore under Sections 420, 468 and 471 of IPC, 1860 on the basis of above said FIRs. As the offence alleged to have been committed under Sections 420 and 471 of IPC are scheduled offences under Prevention of Money Laundering Act, 2002 (in short PMLA), the respondent registered a....
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....ounts and Smt. Manjula Micheal in her statement dated 15-2-2012 stated that she does not have any bank account. 4. Shri Tapan Bhandari, in his statement dated 9-1-2012 has stated inter alia that he had filed a complaint dated 19-2-2011 through E-mail with Commissioner of Police, Bangalore regarding cheating committed by Shri John Micheal; that FIR No. 61, dated 3-3-2011 was registered by the Police Authorities of Ramamurthynagar Police Station under Sections 468, 471 and, 420 of IPC, 1860; that during the years 2006-08, he had paid a total sum of Rs. 30,82,032/- by means of cash and a HSBC cheque dated 5-7-2008 for Rs. 6,80,940/- to Shri John Micheal in connection with allotment of BDA sites at Bangalore from the Chief Minister's discretionary quota in the names of himself and his wife Smt. Chhanda Bhandari and that Shri John Micheal had provided three forged sale deeds for the said BDA sites through Shri N. Sreedaran. Shri Tapan Bhandari also furnished photocopies of the aforesaid three forged sale deed dated 9-1-2012. 5. During the course of investigation, Shri John Micheal was also examined by respondent under Section 50 of PMLA on 30-1-2012, 5-2-2013 and 3-12-2013. ....
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....s located at Site numbers 3 and 4, Jinkethimmanahalli, T.C. Palya Post, Bangalore; that site No. 4 is a vacant plot registered in his wife's name; that site no. 3 is registered in his name purchased in the year 2005 on which he constructed a house at ground floor and first floor by spending an amount of Rs. 12,00,000/-; and that the source for this construction is out of his own income. Shri John Micheal, when specifically questioned as to whether he has any proof or evidence to show that the house site and the construction thereon was out of his known sources of income, he categorically stated that he does not have any proof or evidence to show that the source of money for purchasing the said house site and construction thereon is out of his own income. 8. During the course of investigation under PMLA, Smt. Manjula Micheal, w/o Shri John Micheal was examined by respondent under Section 50 of PMLA on 15-2-2012 and 4-8-2014. Smt. Manjula Micheal, in her statement dated 15-2-2012 inter alia confirmed the statement dated 30-1-2012 of her husband Shri John Micheal and stated that she does not have any individual income as she is not employed or doing any business. She has also af....
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.... submitted that FIR No. 61/2011, dated 3-3-2011 was registered on the complaint of Shri Tapan Bhandari, who was never examined by the police authorities, therefore, the very basis for registration of FIR on the basis of complaint of Shri Tapan Bhandari does not survive and any action initiated by the respondent under PMLA is not sustainable, as such compliant/FIR could not have formed the basis for having reasons to believe and initiations of attachment proceedings under the provisions of Sections 5 and 8 of PMLA. 13. The counsel for the appellants submitted that the offences under Sections 420, 468 and 471 of IPC are alleged to have been committed during the period from years 2005 to 2008 which is prior to the dated 1st June, 2009 when the offences under Sections 420 and 471 of IPC were included in the Schedule to the PMLA vide Prevention of Money Laundering (Amendment) Act, 2009. He argued that since the offences alleged to have been committed under Sections 420 and 471 of IPC were not in the Schedule of offences to PMLA during the period from 2005 to 2008, the respondent had no jurisdiction to commence any proceedings under PMLA and pass a Provisional Attachment Order. The....
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....urvive and the respondent had jurisdiction to initiate attachment proceedings under the provisions of PMLA. He submitted that the respondent had recorded statement of Shri Tapan Bhandari on 9th January, 2012 under Section 50 of PMLA and Shri Tapan Bhandari had produced various documents before the respondent. He submitted that the statement of Shri Tapan Bhandari on 9th January, 2012 along with documents submitted by him forms part of relied upon documents filed with the Original Complaint before the Adjudicating Authority. He submitted that a copy of the Original Complaint along with relied upon documents was supplied to appellants at the time of adjudication before the Adjudicating Authority. 17. The counsel submitted that the properties attached i.e. residential site along with residential building constructed thereon registered in the name of Shri John Micheal and one Motor car Maruti Wagon R VXI registered in the name of Smt. Manjula Micheal were acquired by the appellants out of proceeds of crime and the appellants have failed to produce any evidence or any relevant information before the Adjudicating Authority to indicate sources of income, earnings or assets out of wh....
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....bhakara Gupta and Anr. v. Union of India and others. In this case, the petitioner had contended that under the Schedule to the PML Act, offences under Sections 120B and 420 of Indian Penal Code were not included at the time when the said offences were alleged to have been committed by the Petitioner No. 1 and hence, the question of proceeding against the petitioners under the provisions of the PML Act, would not arise. It was contended by the learned Counsel for the Petitioners that the crime was registered against the 1st Petitioner on 9-1-2009 under Section 420 of Indian Penal Code and as on that date, the said offence under Section 420 of Indian Penal Code was not forming part of the Schedule appended to the PML Act and thus the question of registering a case under the PML Act against the 1st petitioner, would not arise. The learned Counsel in the said case had further submitted that the CBI had filed its charge sheet against the 1st petitioner (arraying him as A-10) on 22-11-2009 and the charge sheet clearly mentioned that the 1st petitioner therein has been charged for the offence said to have been committed by him under Section 120B r/w Section 420 of Indian Penal Code only a....
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....d to the resolution S-17/2, was adopted by the General Assembly of the United Nations at its seventeenth special session on the 23rd February, 1990. Further, the Political Declaration adopted by the special session of the United Nations General Assembly held between 8th to 10th June, 1998, calls upon the Member States to adopt national money laundering legislation and programme. 9. As a part of this commitment, this enactment has been made by the Parliament, providing for a completely self contained code of procedure for recognizing and penalizing the offence of money laundering and also to tackle the proceeds of crime if they eventually percolate into various financial streams of the country, thus, impacting fiscal and economic agendas set forth by the State for its governance. It would be further appropriate to notice that the Financial Action Task Force on Money Laundering (FATF), an inter-governmental body was established by the G-7 Summit that was held in Paris in 1989 and it was assigned with the task of setting standards and promotion of policies to combat the issues relating to money-laundering and terrorist funding, during 1990 drew up forty recommendations - as init....
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....result of criminal activity relating to a scheduled offence or the value of any such property; (v) "property" means any property or assets of every description, whether corporeal or incorporeal, movable or immovable, tangible or intangible and includes deeds and instruments evidencing title to, or interest in, such property or assets, wherever located. 12. Since the definition of "proceeds of crime" in turn used the expression "scheduled offence", it would also be appropriate to notice as to how the said expression has been defined in Section 2(y): (y)  "scheduled offence" means - (i) the offences specified under Part A of the Schedule; or (ii) the offences specified under Part B of the Schedule if the total value involved in such offences is thirty lakh rupees or more. 13. From a conjoint reading of the expressions "proceeds of crime" and "scheduled offence" as defined, the offence must be one that should find a mention either under Part A or Part B of the Schedule appended to the PML Act. Para 1 of Part A of the Schedule listed out the offences under the Indian Penal Code. It is not in dispute that by the P....
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....f the society. 16. Before analysing the provisions contained in Section 5 included under Chapter III of the PML Act, it will be appropriate to notice the definition assigned to the word "attachment" under Section 2(1)(d), which is to the following effect: (d) "attachment" means prohibition of transfer, conversion, disposition or movement of property by an order issued under Chapter III; Sub-section (1) of Section 5 authorises the Director, appointed in terms of sub-section (1) of Section 49 of the said Act by the Central Government, if he has reason to believe, on the basis of material in his possession that, - (a) any person is in possession of any proceeds of crime; (b) such person has been charged of having committed a scheduled offence; and (c) such proceeds of crime are likely to be concealed, transferred or dealt with in any manner which may result in frustrating any proceedings relating to confiscation of such proceeds of crime under this Chapter; by order in writing, to provisionally attach such property for a period not exceeding one fifty days from the date of the order. 17. However,....