TaxTMI 
TaxTMI 
2026 (6) TMI 181
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....ion before the Tribunal. 3. Since the substitution in the form of Demand Draft would not affect the value of the property under the provisional attachment, rather would have proper safeguard for the purpose, the provisional attachment was caused. The application for substitution of immovable property with Demand Draft of equivalent value to the property may be accepted. The reference of certain judgements of Supreme Court and High court was given to support the arguments. 4. The counsel for the appellant conceded that many other arguments have been raised in the application but goes on the merit of the case thus would be raised at the time of final hearing. The prayer was however to allow the application. 5. The application has been opposed by the counsel for the respondent. It is submitted that there is no provision for substitution of the immovable properties other than in two contingency given under Regulation 5 of the Prevention of Money-Laundering (Taking Possession of Attached or Frozen Properties confirmed by the Adjudicating Authority) Rules, 2013. 6. A case under Rule 5 of Rules of 2013 is not made out. This Tribunal in the case of M/s. Agribiotech Industries L....
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....r for substitution of attached immovable property was not allowed in absence of any provision under the Act 2002, and Rules made there under. The judgment aforesaid is of three Members Bench thus, binding on this Tribunal. It is further stated that the order of this Tribunal in the case of VGN Property Developers Private Ltd. (Supra) has been stayed by the Madras High Court on a challenge by the Enforcement Director. The stay against the order was granted on 10.10.2018 in Civil Miscellaneous Appeal No 2361/18 In view of the above, the judgment in the case of VGN Property Developers Pvt. Ltd. (Supra) may not be relied. The learned counsel for the respondents further submitted that the order of the Delhi High Court for substitution of the attached property with other property is without analyzing the provisions of the Act and Rules relevant to the case and same is the position of the order passed by the Apex Court in the case of Esskay Properties and Investment Private Ltd. (Supra). The High Court and the Supreme Court are otherwise having extra ordinary jurisdiction though they should also pass orders within the framework of law. In any case, such a jurisdiction do....
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.... its value, the authorized officer shall sell such property with the leave of the concerned Special Court or Adjudicating Authority, as the case may be, and deposit the sale proceeds in the nearest Government Treasury or branch of the State Bank of India or its subsidiaries or in any nationalised bank in fixed deposit and retain the receipt thereof: Provided that where the owner of the property furnishes the fixed deposit receipt of a nationalised bank equivalent to the value of property in the name of Director of Enforcement, the authorised officer may accept and retain such fixed deposit receipt as security and send a report to the Special Court or Adjudicating Authority, as the case may be, for information and appropriate action: Provided further that where the movable property is a mode of conveyance of any description, the authorised officer, after obtaining its valuation report from the Motor Licensing Authority or any other authority, as the case may be, may accept and retain the fixed deposit receipt of a nationalised bank equivalent to the value of the movable property as security in the name of Director of Enforcement and send a report to the Special Court or Adjudicating....
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....lat, etc., and is given on lease or rent to a third party which is registered in accordance with the provisions of section 17 of the Registration Act, 1908, the authorized officer shall issue a direction to the occupant to pay the lease amount or rent in the form of Demand Draft payable to the Directorate of Enforcement; (4) Where the immovable property confirmed by the Adjudicating Authority is in the form of a land, building, house, flat, etc., and is given on lease or rent to any third party where the registration is optional in accordance with the provision of section 18 of the Registration Act, 1908, the authorized officer shall proceed to get the premises vacated and the possession shall be taken by seeking the assistance of local Authorities in terms of section 54 of the Act; (5) Where the immovable property confirmed by the Adjudicating Authority is in the form of a land, building, house, flat, etc., and is under joint ownership, the authorized officer may accept the equivalent value of fixed deposit to the extent of the value of the share of the concerned person in the property estimated by the authorized officer, to be involved in money laundering; and ....
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....itted that no response was given to either of the two letters/representations of the applicant/appellant as the matter was sub judice before this Tribunal. Further, the PML Act and Rules also did not allow any such substitution of FDRs in lieu of the land attached. 26. The counsel submitted that immovable properties of the appellant under the PML Act as well as Rules framed thereunder to release the attached immovable properties of the appellant in lieu of fixed deposits. He submitted that as such the application is misconceived, untenable and not maintainable and thus liable to be dismissed being devoid of merit. 27. We have heard the arguments of both the parties. The plea of the applicant is that the four immovable properties valued at Rs. 5.6 crores and one fixed deposit of Rs. 3 crores which have been attached are not proceed of crime but they have been attached for the value thereof so that assets equal to proceeds of crime i.e. Rs. 8.6 crores are available for proceedings relating to confiscation under PMLA and if the four immovable properties are allowed to be replaced by fixed deposits of equivalent value, the purpose of the attachment will be served in f....
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....ction 35 (1) of the Act to grant such an interim relief. The appellant also questions the manner, in which, the proceedings were taken up by the Tribunal and such other issues, which also touch upon the jurisdiction of the Appellate Tribunal for granting such a relief. As observed by us earlier, in the detailed order dated 09. 10. 2018 extracted above, we were of the considered view that the appellant made out a prima facie case for admitting the appeal and for grant of appropriate interim orders. 12. The learned Senior Counsel appearing on behalf of the first respondent submits that the appeal before the Appellate Tribunal was to be heard on 09. 10. 2018. However, on account of a mentioning made by the appellant/Department, the appeal has not been heard. 13. We made it clear that we are testing the correctness of the interim orders passed by the Appellate Tribunal and more particularly the power of the Appellate Tribunal to pass such interim orders permitting substitution of a property both on the jurisdictional aspect as well as on the factual aspect relatable to the jurisdictional aspect. Therefore, it is always open to the parties to pursue the main appeal bef....