TaxTMI 
TaxTMI 
2026 (7) TMI 1546
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....rt "the Act of 2002"), a challenge has been made to the order dated 01.06.2023 passed by Adjudicating Authority. 2. The present appeals are arising out of Provisional Attachment Order No. 05/2022 dated 06.12.2022 issued by the Deputy Director, Directorate of Enforcement, Kolkata under Section 5(1) of the Prevention of Money Laundering Act, 2002 (PMLA), whereby movable and immovable properties of the appellants, valued at Rs. 7,93,20,546/- were provisionally attached. Brief facts of the Case: 3. It is a case where an FIR No. RC0102022A0006 dated 09.06.2022 was registered by the Central Bureau of Investigation, ACB, Kolkata, pursuant to the directions issued by the Hon'ble Calcutta High Court in WPA No. 9979 of 2022. The FIR was registered for offences punishable under Section 7, 7A and 8 of the Prevention of Corruption Act, 1988 and Section 120-B, 420, 467, 468, 471 and 34 of the Indian Penal Code, 1860 in connection with large-scale irregularities and corruption in the recruitment of Assistant Teachers through the Teachers Eligibility Test (TET), 2014 (hereinafter referred to as "TET, 2014) conducted by the West Bengal Board of Primary Education. 4. The allegation i....
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.... funds from Teacher Training Institutes under various pretexts. Collection of such amounts through entities including M/s Educlasses Online and M/s Acuere Consultancy Services. These transactions constituted proceeds of crime generated from the criminal activities relating to the scheduled offences. 8. During the course of investigation, searches conducted under the provisions of the Act of 2002 resulted in seizure of incriminating documents, digital devices and records. Analysis of the seized material revealed details of candidates who had been benefited from the illegal selection process and evidence relating to collection and laundering of funds generated through corrupt practices. The investigation further disclosed that proceeds of crime had been routed through various bank accounts and investments. The attached properties represented assets derived or obtained, directly or indirectly, from criminal activity relating to the scheduled offences. 9. Being satisfied that the attached properties constituted proceeds of crime within the meaning of Section 2(1)(u) of the PMLA and were liable for attachment under Section 5(1) of the Act, the Deputy Director provisionally attache....
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....self-financed D.El.Ed. institutions were compelled to make payments of Rs. 50,000/- each to M/s Acuere Consultancy Services, another entity of Shri Souvik Bhattacharya, purportedly for consultancy services. According to the investigation, approximately Rs. 2.64 crore was collected from such institutions despite no consultancy services being rendered. 13. Further investigation revealed that Shri Manik Bhattacharya, along with his wife Smt. Satarupa Bhattacharya and son Shri Souvik Bhattacharya, allegedly opened and operated numerous bank accounts, including several joint accounts with the relatives and other individuals. These accounts were used for depositing, transferring and layering funds generated from the illegal activities. The investigation further disclosed that certain accounts were opened and operated under suspicious circumstances, including a joint account maintained in the name of Smt. Satarupa Bhattacharya along with a person who had already expired. The substantial amounts were deposited in those bank accounts and subsequently invested in fixed deposits and other financial instruments. 14. The funds generated through illegal selection of the candidates, collect....
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....k Bhattacharya and other family members, opened and operated multiple joint bank accounts in the names of relatives and associates. Substantial cash deposits and fund transfers were routed through such accounts and subsequently invested in fixed deposits and other financial instruments. 18. Shri Souvik Bhattacharya projected himself as a secondary account holder in several accounts. The investigation revealed that the accounts remained under his effective control and operation and were utilized for concealment and layering of proceeds of crime. Role of Appellant No. 3 - Smt. Satarupa Bhattacharya 19. Smt. Satarupa Bhattacharya, wife of Shri Manik Bhattacharya, knowingly assisted for possession, concealment and laundering of proceeds of crime generated through the illegal activities attributed to Shri Manik Bhattacharya. The investigation revealed that she, along with Shri Manik Bhattacharya and other family members, induced relatives and associates to open multiple joint bank accounts without disclosing the true purpose for which such accounts were being maintained. According to the Directorate of Enforcement, these accounts remained under the control and operation of Smt.....
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....oceeds of crime. The reasons for attachment have been recorded by the Deputy Director in Paragraph 9 of the Original Complaint dated 06.12.2022. The allegations contained therein are factually incorrect, unsupported by evidence and liable to be rejected for the following reasons: Allegation regarding Multiple Bank Accounts in the Names of Family Members: 25. It was submitted that the allegation that several bank accounts in the names of family members to siphon the money deposited therein is based solely on suspicion and conjecture. The bank accounts in question were opened after due compliance with KYC requirements and were jointly held by the Appellants, namely Dr. Manik Bhattacharya, Smt. Satarupa Bhattacharya and Shri Souvik Bhattacharya. Most of the bank accounts were in existence since 1998, much prior to the alleged occurrence of any scheduled offence. No material has been produced to establish that any alleged proceeds of crime were deposited in such accounts. Mere existence of multiple bank accounts does not constitute an offence, nor can attachment be sustained merely on suspicion in the absence of cogent material linking the funds therein to the proceeds of crime. ....
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....ry Education to verify the same. Upon consideration of the verification report submitted by the Board, the Hon'ble High Court, vide order dated 21.09.2023, concluded that the candidates referred to by the Enforcement Directorate were neither illegally qualified nor appointed. The said proceedings were conducted in the presence of both the Enforcement Directorate and the CBI. No appeal was preferred against the said order and the findings have attained finality. In view thereof, the foundational allegation of corruption in respect of the said candidates stands negated by judicial determination. Violation of Principles of Natural Justice before the Adjudicating Authority: 28. The appellant in person further submitted that the proceedings before the Learned Adjudicating Authority stand vitiated on account of violation of the fundamental principle of audi alteram partem. The Relied Upon Documents (RUDs) were supplied to the Appellants in jail only on 17.06.2023 through a pen drive, whereas the impugned order had already been passed on 01.06.2023. Consequently, the Appellants were denied a meaningful opportunity to inspect, verify and rebut the documents relied upon by the pro....
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.... attached bank accounts prior to 14.09.2016 have also been attached and treated as proceeds of crime. It is inconceivable that funds existing prior to the alleged commission of the offence could constitute proceeds derived from that offence. The attachment of such pre-existing funds is contrary to law and violates the principles laid down by the Hon'ble Supreme Court in Pavana Dibbur v. Union of India (2023) 15 SCC 91. Illegal Attachment of Accounts of M/s Acuere Consultancy Services and M/s Educlasses Online: 31. The appellant in person submitted that whatsoever have been recorded in Original Complaint for attachment of the accounts of M/s Acuere Consultancy Services and M/s Educlasses Online is contrary to the material on record. In the case of M/s Acuere Consultancy Services, the amounts received were contractual payments pursuant to agreements executed for implementation of the Integrated Teacher Education Programme (ITEP) launched by the Government of India. All payments were received through banking channels. The taxes were duly paid on it and the amounts remain in escrow owing to non-execution of contractual obligations arising from orders passed by the Hon'ble....
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....ave been established against him, attachment of his accounts is wholly arbitrary and liable to be set aside. 36. The appellants submitted that he is not required to raise any other issue than raised above and when the facts of the case don't prove it to be the case of money laundering; rather, a total ignorance of the material available on record by the adjudicating authority while passing the impugned order, it deserves to be set aside. Submissions of the Respondents: 37. The learned counsel for the respondents contested the appeals on all the issues raised by the appellants. Elaborate arguments were made and would be referred while addressing each issue raised by the appellants in the appeals. It is to avoid repetition of the same facts and for the sake of brevity. Finding of the Tribunal: 38. I have considered the rival submissions of the parties and scanned the matter carefully. 39. The present case is arising out of FIR dated 09.06.2022 registered by the CBI, ACB, Kolkata pursuant to the directions of the Hon'ble Calcutta High Court in WPA No.9979/2022. It was for the offences under Section 7, 7A and 8 of the Prevention of Corruption Act, 1988 and Section 120-B,....
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....ed by the order passed by the Adjudicating Authority confirming the provisional attachment of the properties, the appellants preferred appeals and argued the matter in person. 43. The brief facts have already been stated above and would be elaborated while recording finding on each ground raised by the appellants for challenge to the impugned order. 44. The appellants in person submitted that they were not named as an accused for predicate offence and even not named in the charge sheet filed by the CBI. It is coupled with the fact that no money trail exists vis-à-vis the proceeds of crime in the hands of the appellants said to have been derived out of the selection of primary teachers in TET, 2014. According to the appellants, the respondents could not have attached the properties only for the reason that Calcutta High Court directed the CBI to investigate the matter in regard to the selection of candidates, who were either not eligible or unsuccessful in TET, 2014. In view of the above, the prayer was made to cause interference in the impugned order. 45. The first issue raised by the appellants was contested by the respondents. It was submitted that, apart from the....
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.... Judge cancelling the appointments of 32000 candidates was set aside. 49. The learned counsel for the respondents contested the issue elaborately. I have gone through the judgment dated 03.12.2025 passed by the Calcutta High Court to find out the truthness of the statement of the appellants about their exoneration in the selection of primary teachers. At the outset, I find statement of the appellants to be misleading and contrary even to the paras referred by him. The perusal of the judgment of the Calcutta High Court in the case of The West Bengal Board of Primary Education (supra) would reveal cancellation of the appointments of 32,000 primary teachers appointed pursuant to the selection under the Recruitment Rules, 2016 while the allegation against the appellants is in reference to selection of candidates in TET, 2014. The TET is Teachers Eligibility Test conducted of the candidates for eligibility to appear in the selection for the posts of Primary Teacher. However, it is subject to the training. The selection to the posts of Primary Teacher took place under the Recruitment Rules of 2016 and narrated in Para 5 of the judgment (supra) rendered by the Division Bench which is q....
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.... of allegation. The petitioners therein prayed for the relief for themselves at par with the appointment of untrained candidates under the recruitment process of 2016. Para 173 of the said judgment is quoted hereunder to show the aforesaid: "173. Indisputably, the writ petitioners emerged to be successful in TET, 2014 and accordingly they had participated in the recruitment process of 2016. In the writ petition, there is no pleading that the selection procedure as prescribed under the RR, 2016 had not been adhered to or that no aptitude test was held. There is no allegation that the petitioners were denied participation in the 2016 recruitment process after they had emerged to be successful in TET, 2014. There is also no averment that no interview or no aptitude test was held. No ground to that effect had been taken in the writ petition. On the rudiments of such averments and grounds, the writ petitioners have sought for issuance of necessary direction upon the respondents to grant them the benefit as granted to other untrained candidates appointed by the Board in the 2016 recruitment process. There was no challenge against the appointment of untrained candidates and the p....
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....ere not called in the interview. On behalf of the Board, it was submitted that the petitioners have prayed for publication of some information which are already in public domain except 'the petitioners breakup of marks'. Leave was granted to the petitioners to file a supplementary affidavit enclosing the call letters for interview and the documents as regards their training. Thereafter, on 20.12.2022 the Court recorded that 'though the petitioners got higher marks before addition of 119 marks against interview and aptitude test comparing to some candidates who have been given appointments against 2016 recruitment process even after adding their marks for personality test and aptitude test, they have not been given appointments'. In the said order, it was also recorded that the petitioners have prepared a tabular chart of 139 candidates who have got higher marks than the last employed candidate but they have not been given appointment. The supplementary affidavits were taken on record and the Board was directed to verify the marks of the petitioners along with that of the 139 candidates and to come up with the particulars as regards the marks obtained by the last candidate of differ....
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....rs 4,5,6,7,8 and 9 in the list. In the order it was further observed that questions would be put to the interviewers and the proceeding of asking questions to the interviewers would be done in camera. Thereafter on 21.02.2023 the Court observed that the real question was as to whether aptitude test of the candidates was taken or not. The answers given by 30 interviewers were incorporated in the said order with a further observation that 'no question was asked by the appearing parties to the above interviewers'. The Court thereafter noted that there were no formal engagement letters for acting as interviewers and they were called over 121 phone. There was also no guideline towards awarding of marks for aptitude test and that 'a large number of interviewers were not intimated by the Board/DPSC's that there is one aptitude test, a different test altogether; also beside interview' and that one interviewer (Md. Maruf Alam) stated that he took the aptitude test and that an aptitude test means confidence and body language of a candidate. On the next date of hearing, i.e., on 05.04.2023, the Court suo motu directed the Superintendent of Presidency Correctional Home for physical production ....
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....be proportional. Mere suspicion, howsoever high, cannot be a substitute of actual proof and writ Court ought not to interfere with the selection made by expert bodies upon assessing the comparative merits of 125 the candidates. The investigation by CBI & ED could not have been the basis towards cancellation of the recruitment process more so when in the writ petition no appointment of any candidate amongst the 32,000 appointees could be cited as an instance of biased or illegal selection and that as such the fourth finding is not sustainable. The material on record does not prove the chain of circumstances pointing out the guilt of the appellants beyond the shadow of reasonable doubt. Proof beyond reasonable doubt cannot be stretched morbidly to embrace every hunch and hesitancy. The fifth finding has been arrived at being oblivious of the fact that similar ground as urged in the earlier writ petitions had been turned down and no appeal had been preferred against the said judgments delivered in the cases of Monika Das (Supra) and Md. Rabiul Sk. (Supra). The sixth finding that no selection committee was constituted for the purpose of selection by the Board is not sustainable inasmuc....
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.... above, it was noted that in none of the writ petitions before Single Bench, a challenge to the appointment of 32000 candidates was made. It was coupled with the fact that nothing was placed on record to prove chain of circumstances pointing out the guilt of the appellants before the Division Bench, who were selected on the posts of Primary Teacher. The contradiction in the argument about the constitution of the Committee/Board and aptitude test was also taken into consideration for selection of teachers in the selection of 2016. The petitioners before the learned Single Judge did not plead allegation against any one, rather the Division Bench found that there was no allegation to this effect and, therefore, could not have been accepted. The matter before the Division Bench was different so as the context than the case before me. The Division Bench has not given clean chit to the appellants herein, rather the case was not brought for the aforesaid with necessary consideration. The Division Bench has addressed the issue in regard to appointments of 32,000 Primary Teacher cancelled by the Single Bench. It was not in regard to TET, 2014. The appellant in person herein further made a r....
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....the facts about the framing of the charge against the accused which include Shri Manik Bhattacharya. Thus, I do not find any substance in the argument in reference to the judgment of the High Court in the case of The West Bengal Board of Primary Education (supra). 58. Coming to the next issue, the appellants in person submitted that the proceedings for provisional attachment of the property should originate strictly as per Section 5(1) of the Act of 2002 which mandates recording of valid and tangible "reasons to believe" before attachment of any property alleged to be proceeds of crime. The "reasons to believe" have been given in Para 9 of the original complaint dated 06.12.2022 but are factually incorrect, unsupported by any evidence and thus liable to be rejected for the reason that there is no bar under any law for opening of the multiple bank accounts by a person in his own name or in the name of family members. It is coupled with the allegation of siphoning of money using those bank accounts. In fact, the bank accounts were opened after due compliance of KYC requirement and were jointly held by the appellants, namely, Shri Manik Bhattacharya, Smt. Satarupa Bhattacharya and ....
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....tion 18, the evidence on which he relies and other relevant information and particulars, and to show cause why all or any of such properties should not be declared to be the properties involved in money-laundering and confiscated by the Central Government: Provided that where a notice under this sub-section specifies any property as being held by a person on behalf of any other person, a copy of such notice shall also be served upon such other person: Provided further that where such property is held jointly by more than one person, such notice shall be served to all persons holding such property". 60. The appellants herein failed to disclose the source for deposit of the cash amount in the bank accounts despite onus of proof on them as per Section 8(1) of the Act of 2002 coupled with Section 24 of the said Act. It is more so when as per the statement of the witnesses recorded under Section 50 of the Act of 2002, it was found that the entry about receipt of proceed was maintained and found with the person, namely, Tapas Kumar Mondal and Kuntal Ghosh. The amount of Rs. 3.25 Crores was received on behalf of the appellant Shri Manik Bhattacharya and, therefore, th....
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....us candidates had approached him for redressal of the problems related to TET-2012 & TET-2014. This shows a deep rooted and long-standing nexus and conspiracy between the highly influential and powerful persons like Manik Bhattacharya and Sujoy Krishna Bhadra for getting undeserving and unmeritorious candidates to be selected in TET. 62. The facts given above show deep involvement of the appellants along with others in commission of offence of money laundering. They had acted on behalf of the appellant Dr. Manik Bhattacharya and thereby were in possession of the list of 325 students otherwise there was no reason to possess the list of all those candidates appeared in TET, 2014. 63. The statement of the appellants that result of 325 candidates remains unchanged except of 2 candidates is without any basis and erroneously made in reference of the judgment of Delhi High Court without giving details of the said judgment because judgment in the case of The West Bengal Board of Primary Education (supra) does not refer to the selection of 325 candidates in TET, 2014 and thus the argument in reference to non-receipt of Rs. 3.25 Crores by the appellants cannot be accepted, otherwise th....
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....ent referred to above which was to be handed over by the owner of the respective D.El.ED colleges to Shri Gautam Dass, one of the staff working with Shri Manik Bhattacharya and it was finally transferred to Shri Manik Bhattacharya. In view of the above, I do not find any substance in the argument and otherwise the matter is pending trial. 66. The appellants next contended about the violation of the principles of natural justice by the Adjudicating Authority. It is with an allegation that accused Manik Bhattacharya was supplied relied upon documents on 17.06.2023 and that too in the pen drive where the appellant had no facility to take out hard copy of those documents and at the same time, the impugned order was passed on 01.06.2023. I find no substance in the argument and is otherwise defended by the respondents in detail pointing out that not only relied upon documents were supplied but based on the aforesaid, a detailed reply to the notice was given coupled with the contest of the notice effectively thus the allegation for violation of principles of natural justice cannot sustain. 67. The appellants then submitted that there was no schedule offence so as to result in the pr....
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....igh Court in the case of Dilbag Singh @ Dilbag Sandhu Vs. Union of India & Ors. (CWP 22688-2024) dated 13.11.2024. The relevant paras of the judgment in the case of Dilbagh Singh (supra) are quoted hereunder: "3.2. In light of the Division Bench's judgment in Seema Garg's case (supra), this Bench would have been obligated to either follow it or refer the matter to a Larger Bench. However, the Supreme Court in Vijay Madanlal Chaudhary's case (supra) has interpreted the provision in para 298, which is extracted as under: "It was also urged before us that the attachment of property must be equivalent in value of the proceeds of crime only if the proceeds of crime are situated outside India. This argument, in our opinion, is tenuous. For, the definition of "proceeds of crime" is wide enough to not only refer to the property derived or obtained as a result of criminal activity relating to a scheduled offence, but also of the value of any such property. If the property is taken or held outside the country, even in such a case, the property equivalent in value held within the country or abroad can be proceeded with. The definition of "property" as in Section ....
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....icated diversion of the property, which is required to be prevented. Consequently, the definition of proceeds of crime has undergone transformative changes from time to time so as to include all the complex acts involved in the offence of money laundering. 3.5. In Axis Bank's case (Supra), the Delhi High Court has dissected the definition in three parts while covering tainted property and untainted property held in India; and the 'proceeds of crime' taken out of the country or any other property of equivalent value thereof. However, this Court is of the considered view that the definition can be divided into two broader categories namely tainted properties and untainted properties. The first part provides about the tainted properties derived or obtained directly or indirectly by any person as a result of criminal activity relating to a scheduled offence. Thereafter, the untainted properties are further divided into two parts; the first part deals with a situation where the property derived or obtained from 'proceeds of crime' is not traceable. In the aforesaid situation the competent authority is authorized to attach or confiscate any other property of ....
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....brought to the notice of the Division Bench in Seema Garg's case (supra). In Abdullah Ali Balsharaf's case (supra), Delhi High Court inadvertently overlooked the sub-category (i) of second part of definition of 'proceeds of crime'. Similarly, Andhra Pradesh High Court in Kumar Pappu Singh's case (supra) was not properly assisted. Furthermore, the attention of Patna High Court was not drawn to part 2(i) in HDFC Bank's case (supra). Similar is the position in M/s. Himachal Amta Power Limited's case (supra). In this case, the attention of the Bench was not drawn to the second broader category of the definition. In Hemanshu Rajnikant Shah's case (supra) the Court relied upon Seema Garg's case (supra) and held that the properties acquired before the alleged crime and before the enforcement of the '2002 Act' cannot be attached. 3.9. On the other hand the judgments passed in Vijay Madanlal Chaudhary's case (supra), Axis Bank's case (supra) and Prakash Industries case (supra) completely answer the question in favour of ED. 3.10. The petitioner's counsel has also heavily relied upon Pavana Dibbur's case (supra). T....
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....he position regarding consultancy charges from each education institution. It is very peculiar that the institutions and the students to be governed by the West Bengal Board of Primary Education would engage only the son of main accused. It is either for consultancy or for the online classes. The investigation revealed that no effective consultancy was provided by the entity owned by Shri Souvik Bhattacharya while a sum of Rs. 50,000 was charged from each D.El.Ed institutions. A group of association was created representing D.El.Ed institutions and it was at the instance of Tapas Kumar Mondal. He asked the then Education Centre for the payment of Rs. 50,000 in favour of M/s Acuere Consultancy Services. Shri Manik Bhattacharya was present in the meeting of the institutions. An institution which did not submit payment was purposely kept pending for registration. During the course of investigation, Shri Tapas Kumar Mondal acknowledged the aforesaid and otherwise one cannot conceive an idea that more than 500 institutions would engage an entity for consultation with a fixed amount of Rs. 50,000/- and that too when the entities were not having previous experience. The fact speaks about ....