TaxTMI 
TaxTMI 
2022 (8) TMI 170
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....e bank account of petitioner and to permit the petitioner to operate the said bank account. 3. The brief facts of the case are that the 1st respondent- Directorate of Enforcement, Hyderabad Zonal Office (1st respondent) has lodged an F.I.R. vide No.ECIR/HYZO/11/2021, dated 30.03.2021, alleging multilevel fraud done by the petitioner, viz., M/s. Indusviva Health Sciences Private Limited & others, for investigation under the provisions of Prevention of Money Laundering Act, 2002 (for short, 'the PMLA Act') on the basis of an F.I.R. No.124/2021 dated 20.02.2021 registered by the Gachibowli Police Station, Cyberabad, under Sections 406 & 420 of Indian Penal Code, 1860 and Sections 3, 4, 5 and 6 of Prize, Chits Money Circulation Scheme (Banning....
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....ther operational and incidental expenses. The freezing of bank accounts of the petitioner without any notice and without any justifiable reason was grossly prejudicing the business operations of the petitioner-Company. Thus, there was no basis whatsoever to continue the freezing of the bank accounts. There was no nexus between the alleged offence and seizure of entire bank accounts of the petitioner. The 1st respondent had unnecessarily and highhandedly freezed the bank accounts, the said action was affecting the livelihood of thousands and prayed for allowing the writ petition. 5. On the other hand, learned Standing Counsel for the 1st respondent submitted that the investigation revealed that the petitioner-Company was a multi-level marke....
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....ied finished products to petitioner-Company. The amounts / part of proceeds of crime were paid by the petitioner-Company to the said offices for purchasing products which was a routine to divert the funds. As a result of investigation conducted by the 1st respondent, proceeds of crime to a tune of Rs.66.30 crores out of total proceeds of crime worth Rs.1500 crores was attached, and the remaining proceeds of crime was yet to be recovered and efforts were being made by the 1st respondent to identify the proceeds of the crime and to provisionally attach them under Section 5(1) of the PMLA Act. 7. It was further contended by the counsel for 1st respondent that charge-sheet was also filed in F.I.R.No.124 of 2021 and the trial was under-way in t....
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....ordered defreezing of accounts frozen by the police. 11. On the other hand, learned Standing Counsel for 1st respondent- Directorate of Enforcement submitted that in exercise of powers under Sub-Section (1) of Section 5 of the PMLA Act, provisional attachment order was issued to certain banks; that the facts were wrongly represented by the applicant that the accounts had been freezed, and that the order of attachment was already under adjudication before the adjudicating authority and filing the writ petition was not an appropriate measure. 12. Section 5 of the PMLA Act deals with attachment of property involved in money laundering, which is reproduced hereunder : "5. Attachment of property involved in money-laundering.- (1) Wher....
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....e purposes of this section has reason to believe (the reasons for such belief to be recorded in writing), on the basis of material in his possession, that if such property involved in moneylaundering is not attached immediately under this Chapter, the nonattachment of the property is likely to frustrate any proceeding under this Act.] [Provided also that for the purposes of computing the period of one hundred and eighty days, the period during which the proceedings under this section is stayed by the High Court, shall be excluded and a further period not exceeding thirty days from the date of order of vacation of such stay order shall be counted.] (2) The Director, or any other officer not below the rank of Deputy Director, shall, immed....
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....in a period of (30) days from such attachment. 14. It was also submitted by the learned counsel for the 1st respondent that a complaint was also filed before the adjudicating authority which was numbered as O.C.No.1643 of 2022 and notice was also issued by the adjudicating authority to the petitioner on 01.04.2022, and that the petitioner also filed a reply before the authorities. 15. Since the issue of provisional attachment is before the adjudicating authority, it is considered fit to direct the petitioner-Company to raise all the contentions before the adjudicating authority with regard to the validity of the provisional attachment. 16. Meanwhile, in the facts and circumstances of the case and in the interest of justice, it is ....