TaxTMI 
TaxTMI 
2025 (6) TMI 1273
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.... Polished Diamonds Pvt. Ltd., 13,05,99,000/- 2. Office No. CE 5053 & 5054, Bharat Diamond Bourse, Bandra Kurla Complex, Mumbai, registered in the name of M/s SJR Commodities & Consultancies Pvt. Ltd. 11,02,83,000/- Total 24,08,82,000/- 2. As per the facts of the case, Central Bureau of Investigation, Bank Securities & Frauds Cell, Mumbai registered a case vide RC-BSM2014 E0004 dated 26.03.2014 on the basis of written complaint filed by Ashok Bansal, AGM, PNB against Jatin Rajnikant Mehta, Shri Ramesh Indulal Parikh, Shri Ravichandran Ramsami, Shri Harish Ratilal Mehta, Shri Pranav Ramesh Dalal, Vinod Kumar Rajendra Jain, Shri Bahilalbhai Kantilal Patel, Shri Hari Mohan Namdev, Shri Haytham Salman Ali Abu Obaidah, M/s Winsome Diamonds and Jewellery Ltd. (WDJL) and M/s Forever Precious Jewellery Diamond Ltd. (FPJDL) for commission of offence under Section 120B IPC read with 420 IPC and substantive offence thereunder: CBI BS &FC, Mumbai also registered several other FIR's for acts of criminal conspiracy for committing fraud with various banks on the basis of complaint filed by respective banks namely Oriental Bank of Commerce, State Bank of Hyderabad,....
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....Sonia J. Mehta with the help of their key employees started to import raw gold from bullion banks and from private entities to factories situated at SEZ, Chennai and Cochin, converted them into coins and pendants and sold them in open market in order to siphon off gold in the garb of export to UAE based buyers. The complete cycle of import of gold and realization of sale proceeds was taking hardly 5-6 days, whereas they availed credit facilities upto 270 days in order to round trip the funds and show high turnover. On the basis of high turnover, they managed to avail enhanced working capital, induced the bank to part with the fund and siphoned off the money in the guise of loss in derivative trading by the buyers abroad and the proceeds were routed through bank accounts of various foreign companies and were ultimately routed into the accounts of various companies owned and controlled by Mrs. Sonia Mehta and Shri Suraj Mehta. As a result of criminal conspiracy and cheating by M/s WDJL, M/s. FPJDL and their Directors, Promoter Sh. Jatin, Mehta, Smt. Sonia Mehta, Shri Suraj J. Mehta, Mr. Haytham Salman Ali Abu Obaidah of UAE and unknown Public servants, have committed the offence of M....
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....exports proceeds. According to CBI Charge Sheet, the POC was further layered through various overseas companies and ultimately converged in Bank Accounts of M/s Al Noora Jewellery FZE, UAE, Alma Diamonds, Hongkong and others entities owned by Mrs. Sonia Mehta, wife of Shri Jatin R. Mehta and Shri Suraj Mehta, son of Shri Jatin R. Mehta. Therefore, on the basis of the material collected during the course of investigation and placed on record, it was imperative that the immovable properties as mentioned in the schedule, provisionally attached, considering the same in terms of 'value thereof', under Section 2(1)(u) read with Section 5(1) of the PMLA, 2002. (B) Brief facts regarding attachment of properties at Bharat Diamond Bourse, Bandra Kurla complex, a Mumbai registered in the name of M/s SRV Polished Diamonds Pvt. Ltd and M/s SJR Commodities and Consultancies Pvt. Ltd. Investigation has revealed that Shri Jatin R. Mehta was also having several group companies and the share holding pattern was as such that Jatin Mehta, his family members and other group companies are the shareholders in every Group Company. One of the Group Companies was M/s SRV Polished Diamond Compa....
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....Name of Shareholder No. of Shares 1. Jatin R. Mehta 2037 2. Diadern Investment & Finance Pvt. Ltd. 2300 3. SJR Commodities & Consultancies Pvt. Ltd. 13 4. Jatin R. Mehta (HUF) 14600 5. Bombay Diamonds Company Pvt. Ltd. 100 6. Kohinoor Diamonds Pvt. Ltd. 24050 7. Firstrate Diamonds Pvt. Ltd. 6900 Total 50000 Subsequently, 01.04.2013 share holding pattern was changed as under investigation has revealed that in the during 2012-13, Mrs. Sonia Mehta, Shri Suraj Mehta and Shri Vishal Mehta were the shareholders in M/s SRV Polished Diamond Company Pvt. Ltd., but subsequently they transferred their shares in the name of their group companies. Share holdings of M/s SRV Polished Diamonds Pvt. Ltd. from 01.04.2013 to 31.03.2015 was as under: - Sr. No. Name of Shareholders No. of Shares 1. Jatin R. Mehta (HUF) 14600 2. L.S. Bhansali 50 3. Suraj Jewellery India Pvt. Ltd. 50 4. Professional Diamonds Pvt. Ltd. 24050 5. Suraj Diamond Industries Pvt. Ltd. 2050 6. Euro Auto Pvt. Ltd. (99% share held by Shri Jatin R. Mehta) 4600 7. Suraj Diamond Pvt....
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....4/28/2015 SRV POLISHED DIAMOND COMPANY PVT. LTD 30849.61 PDC INTERNATIONAL FZE 5/19/2015 SRV POLISHED DIAMOND COMPANY PVT. LT 35173.38 PDC LTD 7/28/2015 SRV POLISHED DIAMOND COMPANY PVT LT 146571.20 PDC LTD 8/31/2015 SRV POLISHED COMPANY PVT LT 188889.79 PDC LTD 8/31/2015 SRV POLISHED COMPANY PVT LT 35622.61 PDC INTERNATIONAL FZE 8/31/2015 SRV POLISHED COMPANY PVT LT 79934.86 PDC INTERNATIONAL FZE TOTAL 762041.45 During the course of investigation, it was revealed that following immovable properties situated at Bharat Diamond Bourse, BandraKurla Complex, Mumbai, are presently owned by M/s SRV Polished Jewellers Pvt. Ltd. (a) Office No. CE 5051, bearing 2458 shares under C/0577 share certificate and C- 324, C-325, C-326, C-417 to C-422, car parking space bearing shares 900 under share certificate No. P/0431 to P/0439, which was transferred vide Deed of Transfer No. 4/4010/2014 dated 11.06.2014 by M/s Su-Raj Diamond Industries Ltd. to M/s SRV Polished Diamonds Co. Pvt. Ltd. (b) Office No. CE 5052, bearing 2379 ....
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....ri Prashant Kelkar vide his e-mail dated 10.09.2018 provided details of shareholding patters since 2010 in respect of M/s SJR Commodities and Consultancies Pvt. Ltd., which is also one of the group companies of Shri Jatin R. Mehta. From the said e-mail it appears that the share holding pattern of M/s SJR Commodities and Consultancies Pvt. Ltd., as on 01.04.2012 was as under: S. No. Name of Shareholder No. of Shares 1. Jatin R. Mehta (HUF) 3934 2. Gunvanti Rajnikant Mehta 7510 3. Kohinoor Diamonds Pvt. Ltd. 11000 4. Bombay Diamonds Co. Pvt. Ltd. 06 5. Forever Diamonds Pvt. Ltd. 1000 6. Firstrate Diamonds Pvt. Ltd. 1050 TOTAL 24500 Subsequently, 01.04.2013 share holding pattern was changed as under and further continued: Sr. No. Name of Shareholder No. of Shares 1. Jatin R. Mehta (HUF) 11444 2. Suraj Diamond Dealers Pvt. Ltd. 1000 3. Suraj Jewellery India Pvt. Ltd. 11000 4. Euro Auto Pvt. Ltd. (99% share held by Sh. Jatin R. Mehta) 06 5. SRV Polished Diamond Companies Pvt. Ltd. 1050 TOTAL 24500 Again, as on 01.04.2017, shareholding....
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....ltancies Pvt. Ltd. which are group companies of Shri Jatin R. Mehta, have been provisionally attached, invoking section 2(1)(u) of PMLA, 2002. In the aforesaid case it appears that the proceeds of crime totaling to US $1,261,379,563 have been exported out of India in form of gold and diamond studded jewelry, by Jatin Mehta & his family members. As no remittance is received against the said exports, thus, the entire proceeds of crime in this case lie outside India. The said amounts have been siphoned off to foreign shores by Shri Jatin Mehta & his family members in conspiracy with Sh. Haytham Salman Ali Abu Obaidah in the guise of exports proceeds. According to CBI Charge Sheet, the POC was further layered through various overseas companies and ultimately converged in Bank Accounts of M/s Al Noora Jewellery FZE, UAE, Alma Diamonds, Hong kong and others entities owned by Mrs. Sonia Mehta, wife of Shri Jatin R. Mehta and Shri Suraj Mehta, son of Shri Jatin R. Mehta. Analysis of share holding pattern of the above discussed companies as well as the property transactions/ transfer of flats by Mrs. Sonia Mehta shows that the change in shareholding pattern/ownership was affected only to....
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....e operating activities was Rs. 20,12,76,000/- out of which the Fixed assets, which includes the impugned commercial offices, were purchased. The Ld. Counsel for the appellants further argued that on 24.03.2014, FIR was registered by CBI BS&FC, Mumbai against M/s WINSOM Diamond and Jewellery Ltd., M/s Forever Precious Jewellery & Diamonds Ltd, Shri Jatin R Mehta and other directors for commission of fraud. The said FIR is silent regarding the name of M/s SRV Polished Diamonds Pvt. Ltd. and M/s M/S SJR COMMODITIES & CONSULTANCIES PVT. LTD as an accused. He further pointed out that when ECIR was recorded by ED on 31.12.2014, even then the name of present appellants is not mentioned in the ECIR. He further pointed out that on 26.06.2016, CBI registered another FIR against M/s Forever Precious Jewellery & Diamonds Ltd, Shri Jatin R Mehta and other directors, but even in the said subsequent FIR the present two appellant companies are not named therein. He further pointed out that the said two appellant companies are also not named in the charge sheet filed by the CBI on 07.06.2008. He further contended that in-spite of no allegation against the present appellants, ED wrongly attached the....
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....rt of goods and remittance of consideration in respect thereto goes through the scrutiny of various authorities such as Custom Department, Bankers, Reserve Bank of India etc. The appellant companies have placed on record various documents in support of genuine purchase and remittance in respect thereto. a) Submission with regard to pre-conditions to invoke provisions of S.5 (1) of the act. b) submission with regard to mandatory requirement of recording 'reason to believe'. c) submission with regard to requirement of establishing direct nexus or live link. d) Reliance was placed on (i) Mahanivesh Oils & Foods Pvt. Ltd. in (2016) SCC Online Del 475. (ii) J Sekar Vs. UOI in W.P. (C) 5320/2017 dated 11.01.2018 (iii) ITO Vs. Lakhmani Mewal Das 103 ITR 437 (SC) (a) Submission with regard to proceeds of crime (b) Reliance placed on (i) Vivek Mathias 96 taxmann.com 388 (ii) Jagati Publications Ltd. 92 taxmann.com 51 (iii) Himachal EMTA Power Ltd. in W.P. (C) 5537/2018 a) Submission that the Sale Deed would prevail over the order of provisional attachment b) Reliance placed on (i) Hamda Ammal v. Avadippa Pathar (1991) 1 SCC 715 (ii) Vannarakkal Kallalathil Sreedharan Chandramaath Balakrishn....
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....es & Consultancies Pvt. Ltd., as an accused and even the name of present appellants is not mentioned in the ECIR and the chargesheet? It is firstly argued that the Appellants were not named in the CBI charge-sheet or in the prosecution complaint filed under the PMLA, 2002. The law on this issue now stands settled by the landmark judgment of the Hon'ble Supreme Court in the case of Vijay Madanlal Choudhary and Ors. vs. Union of India (UOI) and Ors. MANU/SC/ 0924/2022. The relevant text from the judgment is quoted hereunder: "65......... The sweep of Section 5(1) is not limited to the Accused named in the criminal activity relating to a scheduled offence. It would apply to any person (not necessarily being Accused in the scheduled offence), if he is involved in any process or activity connected with the proceeds of crime. Such a person besides facing the consequence of provisional attachment order, may end up in being named as Accused in the complaint to be filed by the authorised officer concerning offence Under Section 3 of the 2002 Act. 69. We find force in the stand taken by the Union of India that the objectives of enacting the 2002 Act was the attachment an....
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....vening period, we are of the considered view that the said properties are rightly attached by the ED and confirmed by the Adjudicating Authority. This issue is accordingly decided against the appellants and in favour of ED. 9. Issue no. iv) to vi) are taken up together being interconnected, i.e., iv) Whether the impugned properties are acquired by the appellants using their legitimate source of income and thus, not 'proceeds of crime? v) Whether the provision of value thereof for attaching the properties equivalent the value held within the country will be applicable with the retrospective effect, since it was inserted in the year 2015? vi) Whether the property can be attached as 'equivalent in value held within the country i.e. under third limb of the definition of proceeds of crime, despite the fact that appellant is not an accused and in the light of retrospective application of the third limb, as it was inserted in 2015? To analyze these issues, it would be gainful to refer to the definition of "proceeds of crime" given under Section 2(1)(u) of the Act of 2002 and is quoted as under- "2. Definitions -(1) In this Act, unless the context ....
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....le to proceed against the latter provided it is being attached as equal to the "value of any such property" or "property equivalent in value held within``` the country or abroad". However, both the italicised categories would be liable to be invoked in cases where the actual tainted property cannot be traced or found out. It is only where the respondents are unable to discover the tainted property that they can take the statutory recourse to move against properties which may fall within the ambit of ―value of any such property or "property equivalent in value held within the country or abroad". To the aforesaid limited extent, properties purchased prior to 01 July 2005 may also become vulnerable and subject to action under the Act. However, enforcement action against such properties would have to satisfy the tests and safeguards as propounded in Axis Bank with the learned Judge observing that in such a situation it would have to be established that the person accused of money laundering had an interest in such property at least till the time that he indulged in the proscribed criminal activity. The learned Judge further observed that bona fide rights acquired by third parties....