2022 (4) TMI 1586

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....respondent in I.A.No.1 of 2021, seeking stay of the operation of the orders dated 26.07.2019 in FPA-PMLA-1579/HYD/2016 passed by the Appellate Tribunal under the provisions of Prevention of Money Laundering Act, 2002 (for short the Act of 2002'). 3. I.A. No. 1 of 2021: It is the case of the petitioner that appeal i.e., CMSA No. 26 of 2019 is filed by the respondent-Directorate of Enforcement challenging the judgment dated 26.07.2019 (as modified by the order-dated 06.08.2019) passed by the Appellate Tribunal, PMLA, New Delhi, in FPA-PMLA-1579/HYD/2016 in the matter of M/s. Bharathi Cement Corporation Private Limited v. Joint Director, Directorate of Enforcement; that the appeal is at the stage of admission; that the petitioner furnished the Bank guarantee bearing No.0505519I3G0002680 dated 21.08.2019 for an amount of Rs. 152,84,61,315/- in favour of the Joint Director, Directorate of Enforcement, in due compliance with the Judgment dated 26.07.2019 passed by the Appellate Tribunal and towards release of the Fixed Deposits belongs to the petitioner. Despite having received the bank guarantee, the respondent failed to release the Fixed Deposits to the petitioner. The respon....

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.... pendency of appeal would make the appeal infructuous, which would amount to denial of justice and would cause grave and irreparable loss to the respondent. 5. Heard Sri C.V. Mohan Reddy, learned Senior Counsel for the petitioner for Sri Maddy Rajesh, learned counsel for the petitioner and Sri T. Surya Karan Reddy, learned Additional Solicitor General of India for Smt. Anjali Agarwal, learned Standing Counsel for the respondent and perused the material on record. 6. Sri C.V. Mohan Reddy, learned Senior Counsel for the petitioner submits that the respondent provisionally attached funds of the petitioner amounting to Rs. 152,84,61,315/- in Fixed Deposits vide Provisional Attachment Order bearing No.02/2016, dated 29.06.2016, which is confirmed by the Adjudicating Authority vide order dated 23.11.2016. After expiry of the statutory period of limitation for preferring an appeal from the said date, the officials of the respondent encashed the fixed deposits and intimated the same on 16.12.2016. Aggrieved by the same, the petitioner filed appeal before the Appellate Tribunal, New Delhi vide appeal bearing No. FPA PMLA 1579-/HYD/2016 for setting aside the order dated 23.11.2016. The....

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....e question of law involved in this petition, as there is no provision in the Act of 2002 for accepting Bank Guarantee in lieu of FDRs, which are proceeds of Crime. 8. It is to be seen that along with the appeal, the respondent filed I.A.No. 2 of 2019 seeking stay of judgment dated 26.07.2019 passed by the Appellate Tribunal, New Delhi and no interim stay was granted by this Court till date. 9. According to learned Additional Solicitor General of India for the respondent, there are several allegations against the petitioner flouted by Sri Y.S. Jagan Mohan Reddy, in matter of obtaining lease in favour of M/s. Bharathi Cements Corporation Private Limited by influencing the Government Officials during the regime of Dr. Y. S. Rajasheker Reddy, the then Chief Minister of erstwhile Andhra Pradesh State. By virtue of orders dated 10.08.2011 in W.P.Nos.794 & 6604 of 2011 passed by this Court, CBI, ACB, Hyderabad Branch registered a case vide FIR No. RC 19 (A)/2011-CBI-HYD on 17.08.2011 under Section 120-B read with Sections 420, 409, 410 & 477-A of IPC 1860 & Section 13 (2) read with 13 (1) (c) & (d) of Prevention of Corruption Act, 1988 against Sri Y.S. Jagan Mohan Reddy and others. ....

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....opment and Regulation) Act, 1957, the total period for which a Prospecting Licence may be granted to any party including extensions cannot exceed maximum period of five years. However, in the case of Gujarat Ambuja, it crossed more than five years. As per the provisions of MMDR Act, no further extension of the period beyond five years of prospecting license is permitted. Admittedly, no application for renewal of prospecting licence was made by Gujarat Ambuja after 12.09.2005, as such, the question of preferential right for grant of Mining Lease in favour of Gujarat Ambuja does not arise in respect of the subject lease. It is also observed by the Tribunal that the First Revision Application filed by Gujarat Ambuja, challenging the rejection of its renewal application/cancellation of Prospecting Lincense was dismissed on merits vide final order dated September 8, 2006. After rejection of Gujarat Ambuja's Prospecting License on 31.10.2005, a Gazette Notification for re-grant of the prospecting lincense area under the applicable rules was published on 21.11.2005 by the competent authority. However, Gujarat Ambuja choose to apply for stay under rule 55 (5) of the Mineral Concession ....

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....eal can be elaborately considered in appeal. 13. It is vehemently argued by the learned Additional Solicitor General of India for the respondent that the proceeds of crime cannot be converted into Bank Guarantee in lieu of FDRs. In this context, it is relevant to examine the definition of the expression "Proceeds of Crime' under Section 2(1)(u) of the Act, which shows that the property derived or obtained directly or indirectly by any person as a result of a criminal activity relating to a scheduled offence or the value of any such property. In order to fix the property sought to be attached within the definition of 'proceeds of crime', it should have been derived or obtained directly or indirectly as a result of a criminal activity relating to a scheduled offence. But as already discussed supra, the amount so attached by the respondent officials, which was kept in FDRs, was not even declared as proceeds of crime' by the Tribunal. The appellate Tribunal after considering the issue elaborately held that there is no illegality in granting mining lease in favour of petitioners. What all the petitioner is seeking is to receive the Bank Guarantee in lieu of FDRs, whic....