AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2025 (3) TMI 1644
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....ovisional Attachment Order dated 21.12.2021. 2. It is a case where the allegation was made against the accused for inducing the public to invest certain amount through Power bank App by assuring to remit interest on daily or weekly basis on the investment. The accused entities closed their purported business after collecting huge sum of money from gullible public. They neither paid interest nor the principal amount thereby withholding the investment made by public through Powerbank and Sunfactory App which resulted in commission of cheating. The offences under Section 420 IPC were alleged, which was a Scheduled Offence. Accordingly, the ECIR was recorded. 3. The investigation in pursuance to the ECIR was conducted and it was found tha....
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.... be proceeds of crime. It was submitted that the deposits made by Shri Das/Paradox Trading were in 3 tranches of 11.5 crores, 4.8 crores and 3.72 crores, totaling a sum of Rs. 19.67 Crores. The Provisional Attachment Order is for a sum of Rs. 29.28 Crores over and above the amount deposited by Shri Das/Paradox. The argument of the appellant is that funds deposited by Shri Das/Paradox Trading have been converted into VDAs and have been subsequently transferred by Shri Das outside BitBNS and thus such funds were in the actual possession and control of Shri Das. The attachment of the bank account of the appellant company is without understanding its business model, its user registration, funds related process and the transactions related to Sh....
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.... held by the appellant company in the nature of escrow, as is the prevalent practice across online platforms. This is essential to ensure that if a user intends to withdraw the flat currency, the appellant company would be able to honor its commitment and remit the funds to such user's bank account. Thus, the appellant company was merely acting as custodian of the deposits of its users. The funds were shown as a liability in BitBNS's books and it never had the ownership or control over such funds. There was no statutory or regulatory obligation on the appellant company, as a crypto exchange, to ascertain the source of funds of its users. The appellant company ensured that funds were received from, and remitted to proper banking channel afte....
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....direct/indirect relationship with the 13 entities accused in the predicate offence. Those entities were neither the users of appellant company nor any transaction had been existed between them and the appellant company. The funds of Shri Das/Paradox Trading were having nexus with those 13 entities and for that reason only the appellant company has not been made accused of the predicate offence, rather it has a two-degree separation/distance from the 13 entities. The respondents still attached the bank account of the appellant company not involved in any manner for commission of crime. Argument of the counsel for the respondents 11. The appeal has been contested by the learned counsel for the respondents. It was submitted that a sum of....
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.... Das/Paradox Trading for providing the platform for purchase and sell. It was the platform where anyone can enter for VDA's and sale and purchase. The appellant company is having around 40 million users. In fact, the appellant company was functioning as a transaction facilitator having no control over the use of VDAs by users post-purchase. The appellant company only connects a purchaser with a seller, providing the users with the technology and logical support. The respondents failed to consider the aforesaid aspect and furthermore the amount deposited by Shri Das/Paradox Trading was converted into VDAs and was subsequently transferred outside BitBNS. Thus, the proceeds of crime was not lying with the appellant company. The detailed facts ....