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IN THE HIGH COURT OF MADHYA PRADESH
Mohammad Rafiq, CJ and Sujoy Paul, J.
Abhay Nigam & Others v. Union of India & Others
Writ Appeal No.483 of 2021(Indore): against the order
dated 6.4.2021passed in Writ Petition No. 7819 of 2021;
Decided on 18.6.2021
(1) Prevention of Money Laundering Act, 2002 -- Ss. 5 and 8 --order of attachment of property -- S. 8 (1) makes it obligatory for adjudicating authority to examine complaint -- if he has "reason to believe" that any person has committed offence, he may serve notice calling upon him to indicate sources of income, earning orassets - he may also issue show cause notice -- after obtaining reply, adjudicating authority is required to consider reply, hear aggrieved person and after taking into account all relevant materials, pass order recording finding whether all or any of properties referred to in notice issued under sub-section (1) are involved in money laundering. (1993) Supp. (2) SCC 497 and (2008) 14 SCC 186 distinguished. [Para 10]
(2) Prevention of Money Laundering Act, 2002 -- Ss. 5 and 8 -- order of attachment of property -- "provisional" in nature -- thus "reason to believe" therefor is also tentative/provisional in nature -- is subject to confirmation by adjudicating authority. [Para 11]
(3) Interpretation of Statute -- golden principle -- interpretation must depend upon text and context -- neither can be ignored -- both are important -- statute is best interpreted when we know why it was enacted -- adopting principle of literal construction of statute alone, in all circumstances without examining context and scheme of statute, may not sub-serve purpose of statute. (1987) 1 SCC 424 and (1977) 2 SCC 256 followed. [Para 12]
(4) Constitution of India -- Art. 226 -- Prevention of Money Laundering Act, 2002 -- S. 5 (1) -- maintainability of writ petition -- availability of alternative remedy -- order of attachment of property -- three tiers of redressal mechanism provided -- order of provisional attachment is not final order -- appellants have remedy to raise all pleas, including that of jurisdiction of attaching authority and discrimination, before adjudicating authority -- writ petition not maintainable. (2015) SCC Online Del. 7625, 2019 SCC Online Del. 8855, 2014 SCC Online Guj. 2790, Criminal Appeal No. 143 of 2018 and Criminal Miscellaneous Appeal No. 2262 of 2018 relied on. Special Director Appeal (Cri.) No. 35 of 2004, Civil Appeal No. 1281 of 2018, (2014) 1 SCC 603, (2019) 11 JT 488 and Civil Appeal No. 3221 of 2010 referred to. [Paras 13 & 20]
(5) Benami Transactions (Prohibition)Act, 1988 -- Ss. 24 and 26 -- Prevention of Money Laundering Act, 2002 -- Ss. 5 and 8 -- scheme ingrained in Ss.24 and 26 of Act of 1988 compared with PML Act -- scheme almost parimateria- "adjudicating authority" is best suited and statutorily obliged to consider validity of provisional attachment order. Writ Petition No. 10280 of 2017, Writ Appeal No. 704 of 2017, Writ Petition No. 3957 of 2019 and Writ Petition No. 3963 of 2019 relied on. [Para 18]
¼1½ èku&'k¨èku fuokj.k vfèkfu;e] 2002 & èkkjk 5 rFkk 8 & laifRr dh dqdÊ dk vkns'k & èkkjk 8¼1½ f'kdk;r dh iM+rky djuk U;k;fu.kkZ;d çkfèkdj.k d¢ fy, ckè;dj cukrh gS & ;fn mld¢ ikl ^^;g fo'okl djus dk dkj.k gS^^ fd fdlh O;fDr us vijkèk fd;k gS] r¨ og mlls vk;] miktZu ;k vkfLr;¨a d¢ lzksr crkus dh ekax djrs gq, lwpuk dh rkehy dj ldrk gS & og dkj.k crkv¨a lwpuk Òh tkjh dj ldrk gS & mrj vfÒçkIr djus d¢ i'pkr~ U;k;fu.kkZ;d çkfèkdj.k }kjk mÙkj ij fopkj fd;k tkuk] O;fFkr O;fDr d¨ lquk tkuk rFkk leLr lqlaxr lkexzh ij euu djus d¢ i'pkr~ ;g fu"d"kZ vfÒfyf[kr djrs gq, vkns'k ikfjr fd;k tkuk visf{kr gS fd mièkkjk ¼1½ d¢ vèkhu tkjh lwpuk esa fufnZ"V laifÙk;¨a esa ls lÒh ;k d¨Ã] èku&'k¨èku esa varofyZr gS ;k ughaA ¼1993½ lIyhŒ ¼2½ ,l lh lh 497 rFkk ¼2008½ 14 ,l lh lh 186 çÒsfnrA ¼iSjk 10½
¼2½ èku&'k¨èku fuokj.k vfèkfu;e] 2002 & èkkjk 5 rFkk 8 & laifRr dh dqdÊ dk vkns'k & ^^vuafre^^ çÑfr dk gS & vr% mld¢ fy, ^^fo'okl djus dk dkj.k^^ Òh rkRdkfyd@vuafre çÑfr dk gS & U;k;fu.kkZ;d çkfèkdj.k }kjk iqf"V d¢ vè;èkhu gSA ¼iSjk 11½
¼3½ fofèk dk fuoZpu & Lof.kZe fl)kar & fuoZpu ikB v©j lanÒZ ij fuÒZj g¨uk vko';d & n¨u¨a esa ls fdlh dh mis{kk ugha dh tk ldrh & n¨u¨a egRoiw.kZ gSa & dkuwu dk fuoZpu rc loZJs"B g¨rk gS tc gesa Kkr g¨ fd og D;¨a vfèkfu;fer fd;k x;k & lanÒZ v©j dkuwu dh ;¨tuk dk vè;;u fd, fcuk] leLr ifjfLFkfr;¨a esa] d¢oy dkuwu d¢ 'kkfCnd vFkkZUo;u dk fl)kar viukus ls dkuwu dk ç;¨tu iw.kZ ugha Òh g¨ ldrkA ¼1987½ 1 ,l lh lh 424 rFkk ¼1977½ 2 ,l lh lh 256 vuqlfjrA ¼iSjk 12½
¼4½ Òkjr dk lafoèkku & vuqPNsn 226 & èku&'k¨èku fuokj.k vfèkfu;e] 2002 & èkkjk 5¼1½ & fjV ;kfpdk dk pykus ;¨X; g¨uk & vkuqdfYid mipkj dh miyCèkrk & laifRr dh dqdÊ dk vkns'k & çfrr¨"k.k ra= d¢ rhu l¨iku micafèkr & vuafre dqdÊ dk vkns'k vafre vkns'k ugha g¨rk & vihykFkÊx.k d¨ leLr vfÒokd~ ftuesa dqdÊ djus okys çkfèkdkjh dh vfèkdkfjrk v©j foÒsn lfEefyr gSa] U;k;fu.kkZ;d çkfèkdj.k d¢ le{k djus dk mipkj miyCèk & fjV ;kfpdk pykus ;¨X; ughaA ¼2015½ ,l lh lh vkWuykbu fnYyh 7625] 2019 ,l lh lh vkWuykbu fnYyh 8855] 2014 ,l lh lh vkWuykbu xqtjkr 2790] nkafMd vihy Øekad 143 lu~ 2018 rFkk nkafMd çdh.kZ vihy Øekad 2262 lu~ 2018 voyafcrA vihy ¼fØŒ½ Øekad 35 lu~ 2004] flfoy vihy Øekad 1281 lu~ 2018- ¼2014½ 1 ,l lh lh 603] ¼2019½ 11 ts Vh 488 rFkk flfoy vihy Øekad 3221 lu~ 2010 fufnZ"VA ¼iSjk 13 ,oa 20½
¼5½ csukeh laO;ogkj ¼çfr"ksèk½ vfèkfu;e] 1988 & èkkjk 24 rFkk 26 & èku&'k¨èku fuokj.k vfèkfu;e] 2002 & èkkjk 5 rFkk 8 & lu~ 1988 d¢ vfèkfu;e dh èkkjk 24 v©j 26 esa varfuZfgr ;¨tuk dh rqyuk èku&'k¨èku fuokj.k vfèkfu;e ls dh xà & ;¨tuk yxÒx lefo"k;d & vuafre dqdÊ vkns'k dh fofèkekU;rk ij fopkj djus d¢ fy, ^^U;k;fu.kkZ;d çkfèkdj.k^^ lokZfèkd mi;qDr v©j dkuwuh :i ls ckè; gSA fjV ;kfpdk Øekad 10280 lu~ 2017] fjV vihy Øekad 704 lu~ 2017] fjV ;kfpdk Øekad 3957 lu~ 2019 rFkk fjV ;kfpdk Øekad 3963 lu~ 2019 voyafcrA ¼iSjk 18½
ORDER
Paul, J. -- 1. In this Writ Appeal filed under section 2 of Madhya Pradesh Uchha Nyayalaya (Khand Nyaya Peeth Ko Appeal) Adhiniyam, 2005, the appellants have called in question the legality, validity and propriety of order passed by the writ Court in WP No.7819/2021 dated 6.4.2021.
2. In nut shell, the appellants’ case is that they have purchased plots in Empire Wild Flower Colony through various registered sale deeds and registered agreement to sell. The appellants invested their lifetime savings for purchase of plots after seeking permission of different statutory bodies such as Town & Country Planning, Indore Municipal Corporation, RERA etc. The respondents issued the impugned provisional attachment order dated 25.2.2021 whereby plots aforesaid purchased by appellants were attached. However, no such action was taken against 98 similarly situated plot holders which amounts to hostile discrimination with appellants. As a consequence of attachment of their property, the appellants are deprived to enjoy their property which hits Article 300 A of the constitution.
3. Shri R.S. Chhabra, learned counsel for appellants urged that the plots in question were not purchased by using proceeds of crime and, therefore, the provisions of The Prevention of Money Laundering Act, 2002 (for short “PML Act”) are not applicable to them. Sec.8 can be made applicable only against the person against whom complaint has been made u/S.5(5) or an application has been preferred u/S.17(4) or 18(10) of the said Act whereas no such complaint or application was preferred by anybody. In this backdrop, alternative remedy was not an absolute bar for the appellants.
4. By taking this Court to the pleadings of writ petition (para 5.7), it is urged that learned Single Judge has erred in holding that there was no pleading regarding those 98 plots for which sale deeds have been executed, but no action has been taken in relation to said plots. Lastly, it is submitted that Sec.5(1) of the PML Act contains an expression “reason to believe” which is different from “reason to suspect”. In order to believe something there must be some definite material and mere suspicion cannot be the foundation of “reason to believe”. Reliance is placed on the judgment of Supreme Court in the case of Jyoti Prasad v. State of Haryana [(1993) Supp. (2) SCC 497] and Mohd. Aslam Merchant v. Competent Authority [(2008) 14 SCC 186].
5. On the strength of aforesaid arguments, Shri Chhabra, learned counsel for appellants submits that order of learned Writ Court may be set aside and Writ Appeal may be allowed. In support of aforesaid submissions, Shri Chhabra has also filed written submissions and supplementary submission.
6. Shri Phadke, learned Asstt. Solicitor General appearing for the respondents supported the impugned order and submits that learned Single Judge has rightly held that appellant has an inhouse remedy under the PML Act. The impugned order of attachment of property is only a “provisional order”. The appellants can take all possible grounds before the adjudicating authority who will look into the matter and will decide the same in accordance with law. The contentions are supported by filing written arguments. Reliance has been placed by Shri Phadke on following judgments : The Deputy Director Directorate of Enforcement Delhi v. Axis Bank & Others (CRI.A143/2018 & Cri.M.A.2262/2018), Special Director & Another v. Mohd. Ghulam Ghouse & Another [Appeal (Cri.) No.35/2004], Authorized Officer, State Bank of Travancore & Another v. Mathew K.C. (Civil Appeal No.1281/2018), Commissioner of Income Tax & Others v. Chhabil Dass Agrawal [(2014) 1 SCC 603], Genpact India Private Limited v. Deputy Commissioner of Income Tax & Another (2019) 11 JT 488 and Raj Kumar Shivhare v. Assistant Director Directorate of Enforcement & Another (Civil Appeal No.3221/2010).
7. Parties confined their arguments to the extent indicated above.
8. We have heard learned counsel for parties at length and perus
The court emphasizes that when statutory remedies are available, the extraordinary jurisdiction under Article 226 of the Constitution should not be exercised unless there are exceptional reasons to d....
The court emphasized the availability of an alternate efficacious remedy within the scope of the PMLA Act and upheld the decision to relegate the Appellant/Bank to the Adjudicating Authority.
Section 5 of the PMLA Act, empowers attachment and provisional attachment to protect the proceeds of crime being frustrated from confiscation by way of concealment, transfer etc.
The main legal principle established is that properties to be proceeded against under PMLA must be connected to the criminal activity, and ex facie illegal acts can be interfered with under Article 2....
Properties acquired prior to the commission of a predicate offence cannot be attached under the Prevention of Money-Laundering Act, as they do not constitute proceeds of crime.
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