TaxTMI 
TaxTMI 
2025 (11) TMI 956
X X X X Extracts X X X X
X X X X Extracts X X X X
....ties worth of Rs. 6,88,70,759/- have been provisionally attached under Section 5(1) of the Act of 2002. The details of the properties in the hands of many persons have been given in the impugned order. However, we would restrict these appeals in regard to the properties of the appellants leaving other properties. The properties were including seizure of the cash of Rs. 11 Lakhs by the Assam Rifles from the possession of appellant No. 3 Zingshongam Muinao Rs. 15 Lakhs from the possession of Shri Vimal Kumar Jain, who is not appellant before us Rs. 1,32,72,800/- seized by the Assam Rifles from the house premise of Rayilung Nsarangbe and Mrs. Ruth Chawang, appellants. It is apart from the funds in the bank accounts, mutual funds and the insurance funds in the name of the appellants. 3. It is a case where Assam Rifles registered an FIR on 05.07.2020 with Dimapur Police Station, District Dimapur, Nagaland for the offence under Sections 120-B, 384,406,420,465, 468,471,506,34 IPC,1860. It was even for the offence under Sections 25(1A), (1B) (a) of Arms Act and for the offence under Explosives Substances Act, UA (P), Indian Passport Act and Indian Wireless Telegraphy Act, 1933. The char....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ion. The respondents accordingly caused Provisional Attachment Order and sent it to the Adjudicating Authority for its confirmation. After service of notice under Section 8(1) of the Act of 2002, the Adjudicating Authority passed the impugned order after considering the reply filed by the appellants and arguments. A challenge to the impugned order has been made by the appellants. Arguments of counsel for the appellants: 5. The learned counsel for the appellants submitted that the impugned order passed by the Adjudicating Authority is not sustainable having been passed beyond the period of 180 days from the date of passing the Provisional Attachment Order. Giving details of the order, it was submitted that Provisional Attachment Order was caused on 11.08.2021 while it was confirmed by the Adjudicating Authority on 25.05.2022 i.e. beyond the period of 180 days. In view of the provisions of Section 5(1) of the Act of 2002, it ceased to exist if the confirmation is not made within a period given under Section 5(1) and 5(3) of the Act of 2002 and on the aforesaid ground itself, the impugned order deserves to be set aside. 6. The learned counsel for the appellants further submitted....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ellant out of the execution of work by them. 10. The learned counsel for the appellants thereafter referred to the amount secured out of the sale consideration of the properties inherited by them for which copy of the sale deed has been referred. They sold various lands under their title and for that received a sum of Rs. 3,50,00,000/- pursuant to the sale agreement dated 02.05.2019 and thereafter a sum of Rs. 1,50,00,000/- Crores on sale agreement dated 02.07.2020. The sale transaction was reflected in the bank account of the appellant Ruth Chawang but ignored by the respondents. After arrest of the appellant, his wife withdrew Rs. 4 Crores and offered to his nephew who was required to hand it over to an organization. The aforesaid issues have not been dealt with by the Adjudicating Authority while passing the impugned order otherwise the appellant having disclosed the sources, the Adjudicating Authority should not have confirmed the Provisional Attachment Order. In the light of the argument made above, the prayer is to cause interference in the impugned order. 11. The learned counsel for the appellants did not raise any other argument despite an opportunity given by the Tri....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the amount of Rs. 60 Lakhs in two trenches have been given apart from other amount received from time to time. At the time of search of the premises of the appellants, an amount of Rs. 1,32,72,800/- was found and seized of which no sources could be disclosed. 15. The counsel for the appellants vehemently contested the case by referring to the material disclosing source to acquire the properties. It is not only out of the contract work undertaken by Ruth Chawang but sale of the land and thereby it was submitted that despite disclosure of the source of income, the Provisional Attachment Order was caused. It is alleged to avoid an exercise of seizure under Section 17(1) and 17(4) of the Act of 2002. Therefore, the allegation for mala fide of respondents has been made. It is apart from the fact that the impugned order was passed beyond a period of 180 days thus by virtue of Section 5(3) of the Act of 2002, it ceased to exist. We would deal with each issue separately and at the first instance, we would be dealing with the issue in regard to the passing of the order by the Adjudicating Authority beyond a period of 180 days. 16. It is a fact that the Provisional Attachment Order pas....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r special laws in respect of all judicial or quasi-judicial proceedings. II. Consequently, the balance period of limitation remaining as on 03.10.2021, if any, shall become available with effect from 01.03.2022. III. In cases where the limitation would have expired during the period between 15.03.2020 till 28.02.2022, notwithstanding the actual balance period of limitation remaining, all persons shall have a limitation period of 90 days from 01.03.2022. In the event the actual balance period of limitation remaining with effect from 01.03.2022 is greater than 90 days, that longer period shall apply. IV. It is further clarified that the period from 15.03.2020 till 28.02.2022 shall also stand excluded in computing the periods prescribed under Sections 23(4) and 29A of the Arbitration and Conciliation Act, 1966. Section 12A of the Commercial Courts Act, 2015 and provisos (b) and (c) of Section 138 of the Negotiable Instruments Act, 1881 and any other laws, which prescribe period(s) of limitation for instituting proceedings, outer limits (within which the court or tribunal can condone delay) and termination of proceedings". 17. The perusal of the orde....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ction 167(2) Code of Criminal Procedure; and the observations of this Court in the said case cannot operate in relation to the procedural law concerning civil litigation and more particularly, in relation to the right of filing written statement in a civil suit. The learned Counsel would further submit that the decision in the case of Sagufa Ahmed (supra) is of no application to the present case because the observations therein came to be made in the setup of the facts that time for filing the appeal had expired even prior to the order dated 23.03.2020 passed by this Court in SMWP No. 3 of 2020. **** 14.4. Even when it appeared to almost all the concerned that normalcy was around the corner, the sneaky spread of virus continued for one reason or the other or in one way or the other; and this led to a huge surge in COVID-19 cases across the country. This phenomenon came to be generally known as the second wave of pandemic. In the given scenario, the Supreme Court Advocates-on-Record Association moved an application in SMWP No. 3 of 2020, seeking restoration of the order dated 23.03.2020 while highlighting the surge of COVID-19 cases in Delhi and the difficulties being fa....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... shall also stand excluded in computing the periods prescribed Under Sections 23(4) and 29A of the Arbitration and Conciliation Act, 1996, Section 12A of the Commercial Courts Act, 2015 and provisos (b) and (c) of Section 138 of the Negotiable Instruments Act, 1881 and any other laws, which prescribe period(s) of limitation for instituting proceedings, outer limits (within which the court or tribunal can condone delay) and termination of proceedings. We have passed this order in exercise of our powers Under Article 142 read with Article 141 of the Constitution of India. Hence it shall be a binding order within the meaning of Article 141 on all Courts/Tribunals and Authorities. This order may be brought to the notice of all High Courts for being communicated to all subordinate courts/Tribunals within their respective jurisdiction. Issue notice to all the Registrars General of the High Courts, returnable in 6 weeks. List the Miscellaneous Application on 19th July, 2021. **** 19.2. Further, on 10.07.2020, this Court enlarged the scope of initial order in relation to the timelines fixed in Section 29-A and Section 23(4) of the Act of 1996. Signifi....
X X X X Extracts X X X X
X X X X Extracts X X X X
....hority vide order dated 22.08.2022 as the same was passed after the lapse of 180 days. Further, the Petitioner contends that Adjudicating Authority cannot rely on In re: Limitation (supra) in calculating the period of 180 days in light of the Apex Court's decision in S. Kasi (supra). ii) In W.P. No. 34627 of 2022, the provisional attachment order therein i.e., PAO No. 01 of 2021 was passed on 01.02.2021. Pursuant to which an original complaint under Section 5(5) of the PMLA was filed on 19.02.2021 and show cause notice under Section 8(1) of the PMLA was issued by the Adjudicating Authority on 03.03.2021. A hearing under Section 8(2) of the PMLA was conducted on 05.07.2021 and 06.07.2021. However, no confirmation order was passed till date. The Petitioner contends that as 180 days have lapsed since the passing of the provisional attachment order, the Adjudicating Authority cannot pass an order confirming the provisional attachment. iii) On the other hand, the ED in both W.P. Nos. 34238 of 2022 and 34627 of 2022 contends that due to Covid-19 pandemic the provisional attachment of properties could not have been confirmed within 180 days. However, in In re: Limitation....
X X X X Extracts X X X X
X X X X Extracts X X X X
....C (Cri) 801] is restored and in continuation of the subsequent orders dated 8- 3-2021 [Cognizance for Extension of Limitation, In re, (2021) 5 SCC 452 : (2021) 3 SCC (Civ) 40 : (2021) 2 SCC (Cri) 615 : (2021) 2 SCC (L&S) 50], 27-4-2021 [Cognizance for Extension of Limitation, In re, (2021) 17 SCC 231 : 2021 SCC OnLine SC 373] and 23-9-2021 [Cognizance for Extension of Limitation, In re, 2021 SCC OnLine SC 947], it is directed that the period from 15-3-2020 till 28-2-2022 shall stand excluded for the purposes of limitation as may be prescribed under any general or special laws in respect of all judicial or quasi-judicial proceedings. 5.2. Consequently, the balance period of limitation remaining as on 3-10-2021, if any, shall become available with effect from 1- 3-2022. 5.3. In cases where the limitation would have expired during the period between 15-3-2020 till 28-2-2022, notwithstanding the actual balance period of limitation remaining, all persons shall have a limitation period of 90 days from 1-3-2022. In the event the actual balance period of limitation remaining, with effect from 1-3-2022 is greater than 90 days, that longer period shall apply. 5.4. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....writing, provisionally attach such property for a period not exceeding one hundred and eighty days from the date of the order, in such manner as may be prescribed: Provided that no such order of attachment shall be made unless, in relation to the scheduled offence, a report has been forwarded to a Magistrate under Section 173 of the Code of Criminal Procedure, 1973 (2 of 1974), or a complaint has been filed by a person authorised to investigate the offence mentioned in that Schedule, before a Magistrate or court for taking cognizance of the scheduled offence, as the case may be, or a similar report complaint has been made or filed under the corresponding law of any other country: Provided further that, notwithstanding anything contained in first proviso, any property of any person may be attached under this section if the Director or any other officer not below the rank of Deputy Director authorised by him for the 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 money laundering is not attached immediately under this Chapter, the non....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ourt in the Suo Motu writ petition mention specific provisions in specific statutes such as Sections 23(4) and Section 29A of The Arbitration and Conciliation Act, 1996, Section 12A of the Commercial Courts Act, 2015 and Section 138 provisos (b) and (c) of the Negotiable Instrument Act, 1881. On an examination of the specific statutes mentioned by the Supreme Court, it will be seen that all these statutes prescribed provide for specific time frame for instituting a suit, filing a claim/counter claim or an application in furtherance of a remedy provided under the statute. The intention was hence to preserve the right of a litigant to seek a remedy under the Act and not to deprive a litigant of such right of remedy where the litigant has not been able to physically come to the Court or to the Tribunal to file the proceeding in aid of the right. 16. The right thus conferred by the Supreme Court is in relation to the prescribed period of limitation in instituting a proceeding. **** 18. Section 5(3) is a clear embargo on the order of attachment continuing to have effect after the expiry of 180 days. Section 5(1) designates the authority and the steps to be tak....
X X X X Extracts X X X X
X X X X Extracts X X X X
....o the present case. The Supreme Court recognised that the 23rd March, 2020 order in the Suo Motu writ petition was for the benefit of those whose remedy may be barred by time because of not being able to physically come to Court to file proceedings. The Supreme Court made a distinction between the benefit given to litigants and extension of time for filing of a chargesheet by the police as contemplated under Section 167(2) of the Cr.P.C. The Court also noted the element of personal liberty of a person which was required to be protected. Although, the right of the petitioners before the Court is more to do with the right not to be deprived of property save by authority of law - Article 300A, the petitioners have established a case where such right is under threat by the action of the ED. The litigants have been conferred a benefit under Section 5(1)(b) and 5(3) of the PMLA on the failure of the Authority to take action within the specified time frame. If the Authority does fail to take requisite steps, the right to relief arises immediately after exhaustion of the 180 days window and once such right is given to a litigant, it cannot be taken away. This Court respectfully di....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t the scope of In re: Limitation (supra) cannot be unnecessarily narrowed and in relation to S. Kasi (supra) held that the same stands on different footing as it dealt with Article 21 of the Constitution of India. The relevant paragraphs are extracted below: 27.7. We are not elaborating on other directions issued by this Court but, when read as a whole, it is but clear that the anxiety of this Court had been to obviate the hardships likely to be suffered by the litigants during the onslaughts of this pandemic. Hence, the legal effect and coverage of the orders passed by this Court in SMWP No. 3 of 2020 cannot be unnecessarily narrowed and rather, having regard to their purpose and object, full effect is required to be given to such orders and directions. [ To complete the scenario, we may indicate in the passing that even after we had heard this matter, there had been re-surge of Covid-19 cases with spread of a new variant of the virus. The drastic re-surge in the number of Covid cases has led this Court to again deal with the matter in SMWP No. 3 of 2020 on an application bearing No. 21 of 2022; and by the order dated 10- 1-2022 [Cognizance for Extension of Limitation, In....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he above judgment. The issue that was dealt with by the Apex Court in S. Kasi case pertains to the scope of Section 167(2) of Cr.P.C. which is directly referable to Article 21 of the Constitution of India viz., personal liberty of a person. The same cannot be equated while dealing with a property right under Article 300-A of the Constitution of India and the judgment of the Apex Court in S. Kasi case cannot be applied to a case involving property right of an individual or a corporate. 14. Our reasoning supra is also supported by the judgment of the Apex Court in Prakash Corporates v. Dee Vee Projects Limited [(2022) 5 SCC 112]. The Apex Court has explained the scope of the order passed in S. Kasi case and has categorically held that the same cannot be applied in a matter involving proceedings before a Court. The second respondent was exercising a quasi-judicial function and the ratio in S. Kasi case cannot be applied to such a quasi-judicial authority. In any case, we keep this issue open to enable the petitioner to agitate the same before the Appellate Tribunal. xxiv) This Court also disagrees with the view adopted in Vikas WSP Ltd. (supra), Gobindo Das (supra) a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s to compute the period of 180 days. While computing such period, the period from15.03.2020 to 28.02.2022 shall be excluded". 18. In the light of the judgments referred to above, the period for termination of proceedings till 28.02.2022 cannot be counted. In the instant case, the Adjudicating Authority passed the order on 06.12.2021 despite adverse situation due to the covid-19. In the light of the findings recorded by Supreme Court and Telangana High Court, we are unable to accept even second ground raised by the appellant company". 17. In the light of the order referred to above where this Tribunal has taken a view after considering the judgment of the Apex Court and various High Courts that the period from15.03.2020 to 28.02.2022 is to be excluded to determine the period of 180 days for termination of the proceedings and with its exclusion. Recently, Delhi High Court in the case of Directorate of Enforcement & Anr. Vs M/s Vikas WSP Ltd & Ors [LPA 362/2020, CM APPL. 11287/2021] has taken the same view thus the impugned order passed by the Adjudicating Authority on 25.05.2022 remains within a period of 180 days. Thus, we do not find that the first argument raised by th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....longing to the person of the tribal area. The counsel for the appellants could not make reference of any such provision and otherwise we find that corresponding documents to support receipt of the consideration have not been submitted to the extent required. 22. The appellants have claimed that they have received money from the sale of various properties. Firstly, appellant no. 1 & 2, received consideration for sale of inherited land situated in Puizam in Benreu Village, Peren, Nagaland. It was sold via sale agreement dated 02.07.2020 for an amount of Rs. 1,50,00,000/-. With regard to this property, the Appellant no. 1 has only annexed an unregistered Sale deed but bank account statement to prove the requisite transactions have not been annexed. In the absence of authentic documentary evidence, the veracity of this claim remains doubtful. 23. Secondly, the appellant claimed to have sold his land situated in Paikhoun Village, Peren, Nagaland to a society for a consideration of Rs. 3,50,00,000/- via Sale Agreement dated 02.05.2019. On perusal of the annexed documents, we find that the amount is duly reflected in the bank account of appellant no. 2 at Federal Bank, Dimapur beari....