TaxTMI 
TaxTMI 
2019 (1) TMI 830
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.... filed u/s 26 of Prevention of Money Laundering Act, 2002 against the order dated 29th November, 2018 in O.C. no. 989/2018. 2. Issue notice in the appeal as well as stay application for 18th March, 2019. Let the replies be filed within six weeks with an advance copy to the counsel for the appellant who may file the rejoinders three weeks thereafter. Parties will also file the written synopsis by the next date of hearing. 3. The learned counsel for the appellants are pressing for interim order. The prayer is strongly opposed by counsel for respondent. Heard both the parties. 4. The main case of the appellant in appeal no. 2751/DLI/2018 is that; a. The appellant, being a secured creditor, has charge along with other lenders of the consortium, over the JMFARC Mortgaged Properties and Respondent no. 1 had no right to attach the same under the Provisions of the PMLA, since the provisions of the SARFAESI Act override the provisions of the PMLA in this regard. The appellant, being a secured creditor has priority over other rights to sell the property and recover the monies due to it and the same cannot be scuttled by attaching the secured assets under the PMLA, especially in the ab....
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....n'ble NCLT also appointed the Appellant as the Interim Professional ("IRP‖)to conduct the CIRP Process of DIPL. b. Subsequently, pursuant to the resolution passed by the Committee of creditors ("COC‖) constituted during the CIRP process of SBL, in their first meeting held on July 26, 2018, the Appellant was confirmed as the Resolution Professional ("RP‖) c. Presently. CIRP Process of SBL is at the stage of receiving the resolution plans and the last date for submission of resolution plans is January 02, 2019; d. The CIRP process of SBL is due to end on March 08, 2019. e. The CIRP process under the Insolvency Code is a time bound process. As per section 12 of the Insolvency Code, a period of only 180 (One Hundred and Eighty) days provided for completion of the CIRP process. The said period is, however, further extendable by a period 90 days pursuant to an order of the Hon'ble NCLT upon an application made to that effect under section 12(3) of the Insolvency Code. Therefore, in any case, the entire CIRP Process is to be completed within a total period of 270 days. The said period of 270 days will be completed on March, 08, 2019. 6. Mr. Nitesh Rana, appeared....
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....ver its dues by proceeding against the mortgaged/hypothecated properties under the provisions of SARFESI Act, 2002 and the RDDBFI Act 1993, as the Directorate of Enforcement would have no lien over the property which already stands legally transferred to the bank. This Tribunal has perused and examined the material available on records and has also heard the arguments of the learned counsel for both the parties. 12. The Respondent-Deputy Director is relying upon the non-obstante clause in Section 71 of PMLA to claim priority over their debts due to the Appellant Bank. Section 71 of PMLA reads as under:- "The provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force." 13. There is no denial on behalf of respondent that appellant is a Secured Creditor and is entitled to priority over all other debts and all revenues, taxes, cesses and other rates payable to the Central Government or State Government or Local Authority. 14. The amended provisions of Section 26E of the SAR-FAESI Act, 2002 as amended by the Enforcement of Security Interest and Recovery of Debts Laws and Miscellaneous Provisions (....
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....aid case of Solidaire India Ltd. vs. Fairgrowth Financial Services Ltd. has approved the decision of the Special Court rendered by the Hon'ble Mr. Justice Variava, as he was then of the Bombay High Court reported in (1997) 89 Comp cases 547 clarifying that the non-obstante clause in the later enactment will prevail over the non-obstante clause in the earlier enactment. 20. The following is the relevant portion of the decision of the Special Court, as appearing at Para 10 of the said Supreme Court Judgment:- "Where there are two special statues which contain non-obstante clauses, the later statute must prevail. This is because at the time of enactment of the later statute, the Legislature was aware of the earlier Legislation and its nonobstante clause. If the legislature. still confers the later enactment with a non-obstante clause, it means that the Legislature wanted that enactment to prevail. If the Legislature does not want the later enactment to prevail, then it could and would provide inthe later enactment that the provisions of the earlier enactment continue to apply." 21. The afore-stated principle laid down by the Hon'ble Supreme Court has been followed by the F....
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....hority is satisfied as to the bona fide acquisition of property, it should relieve such property from provisional attachment by declining to pass anOrder of confirmation of the provisional attachment. 25. The following is the relevant portion of the Para 103 of the said decision passed by the Hon'ble Andhra Pradesh High Court :- "103. Since proceeds of crime is defined to include the value of any property derived or obtained directly or indirectly as a result of criminal activity relating to a scheduled offence, where a person satisfies the adjudicating authority by relevant material and evidence having a probative value that his acquisition is bona fide, legitimate and for fair market value paid thereof the adjudicating authority must carefully consider the material and evidence on record (including the Reply furnished by a noticee in response to a notice issue under Section 8(1) and the material or evidence furnished along therewith to establish his earnings, assests or means to justify the bona fides in the acquisition of the property); and if satisfied as to the bona fide acquisition of the property, relieve such property from provisional attachment by declining to pass ....
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....s the appellant banks are now the legal transferees of the said properties. 65. From the entire gamut of the matter, we are of the view that there is no nexus whatsoever between the alleged crime and the two banks who are mortgagees of all the properties which were purchased before sanctioning the loan. Thus no case of money-laundering is made out against banks who have sanctioned the amount which is untainted and pure money. They have priority as secured creditors to recover the loanamount/debts by sale of assets over which security interest is created, which remains unpaid." This Tribunal in the above Judgment dated 14.07.2017 has also relied upon its own earlier Judgment dated 22.06.2017 in the case Indian Performing Right Society Ltd. vs. The Deputy Director, Directorate of Enforcement ,Mumbai, wherein the Tribunal held as follows :- "55. Whether innocent party whose properties i.e.movable or immovable are attached can approach the Adjudicating Authority for release of attached property. "The Scheme of Prevention of Money Laundering Act clearly provides the mechanism whereby the innocent parties can approach the Adjudicating Authority for the purpose of release of prop....
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....h February, 2019:- (i) Accused A6 Nitin Jayantilal Sandesara; (ii) Accused A7 Chetan Jayaantilal Sandesara; (iii) Accused A8 Dipti Chetan Sandesara & (iv) Accused A9 Hiteshkumar Narendrabhai Patel 36. It is also admitted position that the said group of companies have not only taken the loan from the appellant in the present case, but also taken the loans from various banks, including Dena Bank, Oriental Bank of Commerce, Federal Bank, most of them are Public Sector Banks. They have mortgaged various properties and the loans. 37. It is a matter of surprise that how these persons after looted the huge amount from the banks, have left the country without completion of investigation against them. This Tribunal is of the view that stringent and shocked action should be taken against them who are enjoying the lavish life in the foreign countries by cheating the public amount. 38. It is nothing less than a case of daylight robbery by the Sandesara Group of companies, including Sterling Biotech Limited and their respective owners. As mentioned, large number of properties have been mortgaged with the above mentioned banks and financial institutions, who are admittedly the secured....