TaxTMI 
TaxTMI 
2025 (6) TMI 1362
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....e Adjudicating Authority confirming the Provisional Attachment Order dated 28.03.2022 (in short "PAO"). Brief facts of the case: 2. An FIR was registered by Central Bureau of Investigation (Bank Securities and Fraud Branch), New Delhi against M/s Educomp Solutions Ltd. (ESL), Shri Shantanu Prakash, MD / Guarantor of ESL, Shri Jagdish Prakash, Guarantor of ESL, M/s Edu Smart Services Private Limited (Corporate Guarantor, ESPL), Shri Vijay Kumar Choudhary and many others for commission of offence under Section 120B read with Sections 420, 467, 468 & 471 of Indian Penal Code, 1860 and under Section 13(2) read with Section 13(1)(d) of Prevention of Corruption Act, 1988. The allegation was for obtaining credit facilities from the banks in the ....
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.... a sum of Rs. 90,31,07,608/- was transferred to the appellant, M/s Educomp Professional Education Limited (hereinafter referred to "appellant company") in the garb of investment in the equity. The said amount was, however, utilized to acquire three immovable properties located in district Ranga Reddy, Andhra Pradesh (now Telangana). The properties were purchased in the prohibited area declared by the erstwhile Government of Andhra Pradesh vide G.O. dated 25.09.1994. Since there was diversion of fund, thus allegation was made against ESL and ESPL. The funds were then used for different purpose than for which it was sanctioned and accordingly the properties purchased by the appellant's company has been attached, though, prior to the attachmen....
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....d. Counsel for the appellants submitted that the Writ Petitions are pending before the High Court on challenge to FIR/ECIR where even interim order has been passed and therefore the respondent committed illegality in issuing PAO to attach the properties which cannot be said to be the proceeds of crime. 7. It was submitted that the properties purchased by the appellant was even prior to crime period, thus, would not fall under the definition of "proceeds of crime" and therefore a challenge to the impugned order has been made on the aforesaid ground. It was further stated that the sources of purchase of properties were declared by the appellant and in view of the above also, there was no reason to attach the properties. 8. Ld. Counsel for t....
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....and involved in crime has been given. However, we need to concentrate on the issue raised by the appellant which is in reference to the FIR dated 10.02.2020. It is a fact that the loan was not taken by the appellant but was taken by its parent company, ESL which passed on to M/s ESPL. The amount secured was used for purchase of properties, though, the loan was not sanctioned to ESL for purchase of properties and thus an allegation of diversion of the funds was also made and for that purpose we are not required to go into the background of the affairs of ESL and ESPL against whom FIRs were registered earlier and had been settled other than the present one. 11. The allegation made by the respondent is that the amount transferred by ESL is no....
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....ering and the proceeds of crime. 12. It was argued that the properties were purchased prior to commission of crime, though, factually it may not be correct, otherwise, even properties purchased prior to commission of crime can be attached in a given case to secure proceeds of crime for confiscation. The issue has been dealt by this Tribunal in order dated 14.10.2024 in Sadananda Nayak Versus The Deputy Director, Directorate of Enforcement, Bhubaneswar reported in FPA-PMLA-5612/BBS/2023 where the judgment of various High Courts were considered holding that the property acquired even prior to commission of crime can be attached for value thereof. It would be only when the proceeds out of crime is not available in the hands of the accused or ....