Point of Law - definition of corresponding law inserted by Act 2 of 2013 cannot be used in aid of interpreting the expression ‘corresponding law’ or ‘the relevant provisions of the corresponding law’ as used in Sub-section 2 of Section 2 of PMLA which is existing in the statute from the date of its inception.

ORDER :

Petitioners are knocking at the doors of Writ Court for laying a challenge to the proceedings taken up under the provisions of Prevention of Money Laundering Act, 2002 ('Act' for short) and to the Provisional Attachment Order dated 28.9.2021 made by the respondent at Annexure-A; after service of notice, the respondent having entered appearance through his Senior Panel Counsel, opposes the Writ Petition making submission in justification of the impugned order.

2. Brief facts:

(a) The Anti Corruption Bureau, Srinagar, Jammu & Kashmir, registered Crime No.17/2019 on 6.8.2019 against the petitioners for the offences punishable u/ss 5(1)(d) r/w section 5(2) of Jammu & Kashmir Prevention of Corruption Act, 2006 r/w section 120B of the Ranbir Penal Code, 1989 (hereafter ‘1989 Code’); the essential allegation is that during the period between 2002 and 2017, a company by name M/s S.A.Rawther Spices Pvt. Ltd, had obtained financial assistance, in all amounting to Rs.308.13 crore from the J&K Bank, Bangalore; the loan account became NPA during September 2017 and the net amount that remained un-repaid was quantified at Rs.285.81 crore plus unapplied interest of Rs.66.91 crore.

(b) In or around the same period, the company had also borrowed Rs.16.5 crore from HDFC Bank and Rs.25 crore from RBL Bank by providing the very same property by way of security, when the said properties were already mortgaged to the J&K Bank; the branch head of the said bank had recommended for releasing three of the mortgaged properties and in connivance with other officials at Head Quarters of the said bank, by taking some other unworthy properties in lieu thereof and thereby, caused a huge loss of crores of rupees of public money; they had also diverted the funds to other entities with intent to defraud.

(c) The then Branch Manager in connivance with Managing Director of the Company managed to over evaluate the market price of the substitute properties fraudulently so that the properties were earlier mortgaged were released and that a huge sum of Rs.352.72 crore therefore remained unrealized; as a consequence, the J&K, ACB registered Crime No.17/2019 on 6.8.2019 for the offence of money laundering u/s. 3 of the Act, punishable u/s 4 thereof; this led to the Directorate of Enforcement recording an Enforcement Case Information Report vide No.ECIR/BGZO/02/2020 dated 2.1.2020 and thereby, initiated the investigation under the Act; the respondent having been prima facie convinced of illegal diversion of funds, misutilization of credit facilities, substitution of sub-standard security properties etc., formed an opinion that the acts alleged in the FIR that eventually registered into registration of Crime No.17/2019 inter alia amounted to offences specified in Schedule-A to the Act, as defined u/s 2(1)(x), 2(1)(y), 2(ia) and 2(2) thereof; petitioners are complaining against all this by invoking writ jurisdiction constitutionally vested in this court.

3. Having heard the learned counsel for the parties and having perused the Petition Papers, this Court declines to grant indulgence in the matter for the following reasons:

A. Objects & Reasons of PML Act:

Petitioners at paras 3 & 4 of their petition although have raised as many as five questions of law, learned Sr. Advocate Mr.Kiran S. Javali appearing for them consciously confined his case only to one submission that: for proceedings to be initiated under the Act, the accused ought to have derived or obtained "proceeds of crime" in relation to a "scheduled offence" as per Sec.2(1)(u) of the Act; the term "scheduled offence" is defined u/s 2(1)(y); it refers to Schedule to the Act wherein it refers to offences specified in Part A, B and C of the Schedule; he argues that as the 1989 Code does not find a place in the Schedule to the Act, the institution of subject proceedings is without jurisdiction and opposed to the intent of the Statute; this contention at the first blush appears to be simple; however, a deeper examinat