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Madhya Pradesh High Court · body

2021 DIGILAW 420 (MP)

Abhay Nigam v. Union of India

2021-04-06

VIVEK RUSIA

body2021
ORDER 1. The petitioners have filed the present petition challeing the provisional attachment order dated 25.2.2021 passed by Dy. Director, Directorate of Enforcement, Ministry of Finance, New Delhi, against respondent No.3 and seeking release of public amenities such as road, garden, STP plant, club, electricity grid, etc. from the purview of the aforesaid attachment order. 2. According to the petitioners, they have purchased the plots in the colony developed by respondent No.3 in the name of “Empire Wild Flower” by investing their lifetime savings. Before purchasing the said plots, the petitioners have got verified all the documents pertaining to the ownership of respondent No.3, diversion order dated 14.7.08 (revised on 9.10.2011); development permission granted by Joint Director, Town & Country Planning dated 21.8.2014 (revised on 29.1.2018); registration certificate as colonizer; registration with RERA; and development permission granted by Indore Municipal Corporation on 30.4.2014. Therefore, there was no iota of doubt in the mind of the petitioners in respect of any illegality in the development of aforesaid colony by respondent No.3. According to the petitioners, when they approached respondent No.3 for execution of sale-deed, provisional attachment order dated 25.2.2021 came to their notice. Respondent No.3 also informed that respondent No.2 has restrained to execute any sale-deed, but vide order dated 21.1.2021 this Court in W.P. No.16452/2020 has granted permission to execute the sale-deed. The petitioners are aggrieved by the order of provisional attachment qua the area available to the public use and amenities like road, garden, STP plant, club, electricity grid, etc. which comes to 72899 Sq.mtrs., hence the present petition before this Court. 3. Shri Ravindra Singh Chhabra, learned counsel appearing for the petitioners, submits that respondent No.3 has executed the sale-deeds in favour of the petitioners in respect of the plots situated in the colony viz. Empire Wild Flower Colony, but in the provisional attachment proceedings, only the list of 98 plot-owners were disclosed, therefore, while passing the order of provisional attachment, the total area 18233 Sq.mtrs. has been excluded out of total area of the project i.e. 22,815 Sq.mtrs. But, there is no such pleading to this effect in the entire writ petition. 4. Shri Milind Phadke, learned Assistant Solicitor General appearing for respondent No.1, Union of India, submits that the Dy. has been excluded out of total area of the project i.e. 22,815 Sq.mtrs. But, there is no such pleading to this effect in the entire writ petition. 4. Shri Milind Phadke, learned Assistant Solicitor General appearing for respondent No.1, Union of India, submits that the Dy. Director has passed the impugned order in exercise of powers conferred under second proviso to sub-section (1) of section 5 of the Prevention of Money Laundering Act, 2002 (“PMLA Act” for short) all the movable and immovable properties belonging to respondent No.3 for a period of 180 days and the said order shall cease to have effect after expiry of 180 days or on the date of order of the adjudicating authority made u/s. 8(3) of the PMLA Act, whichever is earlier. He submits that the petitioners are having remedy to approach the adjudicating authority u/s. 8 of the PMLA Act because they are aggrieved by the impugned order of provisional attachment. Therefore, the aforesaid order is a temporary order and it is subject to the approval by the adjudicating authority u/s. 8 of the PMLA Act. Under proviso to sub-section (2) of section 8 also, if the property is claimed by a person, other than a person to whom the notice had been issued, such person shall also be given an opportunity of being heard to prove that the property is not involved in money-laundering. I have heard the learned counsel for the parties at length and perused the material available on record. 5. Section 6 and 8 of the PMLA Act are reproduced below : “5. Attachment of property involved in money-laundering. I have heard the learned counsel for the parties at length and perused the material available on record. 5. Section 6 and 8 of the PMLA Act are reproduced below : “5. Attachment of property involved in money-laundering. [(1)Where the Director or any other officer not below the rank of Deputy Director authorised by the Director for the purposes of this section, has reason to believe (the reason for such belief to be recorded in writing), on the basis of material in his possession, that- (a) any person is in possession of any proceeds of crime; and (b) such proceeds of crime are likely to be concealed, transferred or dealt with in any manner which may result in frustrating any proceedings relating to confiscation of such proceeds of crime under this Chapter, he may, by order in 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 or 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-attachment of the property is likely to frustrate any proceeding under this Act.] Provided also that for the purposes of computing the period of one hundred and eighty days, the period during which the proceedings under this section is stayed by the High Court, shall be excluded and a further period not exceeding thirty days from the date of order of vacation of such stay order shall be counted.]; (2) The Director, or any other officer not below the rank of Deputy Director, shall, immediately after attachment under sub-section (1), forward a copy of the order, along with the material in his possession, referred to in that sub-section, to the Adjudicating Authority, in a sealed envelope, in the manner as may be prescribed and such Adjudicating Authority shall keep such order and material for such period as may be prescribed. (3) Every order of attachment made under sub-section (1) shall cease to have effect after the expiry of the period specified in that sub-section or on the date of an order made under 4[sub- section (3)] of section 8, whichever is earlier. (4) Nothing in this section shall prevent the person interested in the enjoyment of the immovable property attached under sub-section (1) from such enjoyment. Explanation.--For the purposes of this sub-section, "person interested", in relation to any immovable property, includes all persons claiming or entitled to claim any interest in the property. (5) The Director or any other officer who provisionally attaches any property under sub-section (1) shall, within a period of thirty days from such attachment, file a complaint stating the facts of such attachment before the Adjudicating Authority.” “8. Adjudication. -- (1) On receipt of a complaint under sub-section (5) of section 5, or applications made under sub-section (4) of section 17 or under sub-section (10) of section 18, if the Adjudicating Authority has reason to believe that any person has committed an 1[offence under section 3 or is in possession of proceeds of crime], it may serve a notice of not less than thirty days on such person calling upon him to indicate the sources of his income, earning or assets, out of which or by means of which he has acquired the property attached under sub-section (1) of section 5, or, seized 2[or frozen] under section 17 or section 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. (2) The Adjudicating Authority shall, after- (a) considering the reply, if any, to the notice issued under sub-section (1); (b) hearing the aggrieved person and the Director or any other officer authorised by him in this behalf; and (c) taking into account all relevant materials placed on record before him, by an order, record a finding whether all or any of the properties referred to in the notice issued under sub-section (1) are involved in money-laundering : Provided that if the property is claimed by a person, other than a person to whom the notice had been issued, such person shall also be given an opportunity of being heard to prove that the property is not involved in money-laundering. (3) Where the Adjudicating Authority decides under sub- section (2) that any property is involved in money-laundering, he shall, by an order in writing, confirm the attachment of the property made under sub-section (1) of section 5 or retention of property or 3[record seized or frozen under section 17 or section 18 and record a finding to that effect, whereupon such attachment or retention or freezing of the seized or frozen property] or record shall- (a) continue during investigation for a period not exceeding three hundred and sixty-five days or the pendency of the proceedings relating to any offence under this Act before a Court or under the corresponding law of any other country, before the competent Court of criminal jurisdiction outside India, as the case may be; and (b) become final after an order of confiscation is passed under sub-section (5) or sub-section (7) of section 8 or section 58B or sub-section (2A) of section 60 by the [Special Court]; Explanation.--For the purposes of computing the period of three hundred and sixty-five days under clause (a), the period during which the investigation is stayed by any Court under any law for the time being in force shall be excluded. (4) Where the provisional order of attachment made under sub-section (1) of section 5 has been confirmed under sub- section (3), the Director or any other officer authorised by him in this behalf shall forthwith take the [possession of the property attached under section 5 or frozen under sub-section (1A) of section 17, in such manner as may be prescribed : Provided that if it is not practicable to take possession of a property frozen under sub-section (1A) of section 17, the order of confiscation shall have the same effect as if the property had been taken possession of.] (5) Where on conclusion of a trial of an offence under this Act, the Special Court finds that the offence of money- laundering has been committed, it shall order that such property involved in the money-laundering or which has been used for commission of the offence of money-laundering shall stand confiscated to the Central Government. (6) Where on conclusion of a trial under this Act, the 6. In view of the aforesaid, this petition is disposed of with liberty to the petitioners to remedy available to them in law.