BEFORE RAJESH MALHOTRA, MEMBER; SINGLE BENCH: APPELLATE TRIBUNAL UNDER SAFEMA; AT NEW DELHI.

FPA-PMLA-2640/DLI/2018 CITY UNION BANK LTD. … Appellant Versus Deputy Director, Directorate of Enforcement, Delhi, & others …. Respondent Advocates/Authorized Representatives who argued For the Appellant : Sh. V. Anush Raajan, Advocate, AlongwithPrayduman Yadav, Advocate, For the Respondent : Sh. Mrinal Kumar, Advocate.

FINAL ORDER

07.05.2024 Present appeal is filed by appellant bank against the impugned order dated 12.09.2018 passed by Adjudicating Authority in Original Complaint No. 966/2018 whereby the Provisional Adjudication Order no.7/2018 dated 29.03.2018 was confirmed and thereby property of Raj Kumar Jain to the extent of his 50 per cent share, situated at House No. 71, Block B, Pocket 10, Sector 13, Dwarka, New Delhi-110045 was confirmed for attachment.

2. As per the facts of the case, Central Bureau of Investigation, EO- VII registered F.I.R. No. 7(E)/2009/EOU-VII New Delhi on 10.07.2009 against Raj Kumar Jain and officers of State Trading Corporation for commission of offences under Section 120-B IPC read with 409/420/467/468/471 IPC and also read with 13(2) read with 13(1) (d) of Prevention of Corruption Act, 1988 and substantive offences thereunder.

On the basis of said F.I.R., ECIR No. 166/DZ/2009 dated

12.11.2009 was recorded for investigation under Prevention of Money laundering Act, 2002. Accused Raj Kumar Jain, President of M/s Priyanka Overseas Limited committed fraud during the year 2002 to 2005 in pursuance to conspiracy along with other co-accused persons and thereby caused wrongful loss to the State Trading Corporation to the extent of Rs.51,22,54,370/-. During investigation, respondent-ED recorded the statement of many witnesses including the accused persons and thereafter, the property mentioned in para No. 1above was attached vide PAO No. 07/2018 dated 29.03.2018. Thereafter, Original Complaint No. 966/2018 was filed before Ld. Adjudicating Authority and Ld. Adjudicating Authority confirmed the attachment of the property vide impugned order dated 12.09.2018. Aggrieved by the same Defendant No. 4 City Union Bank Ltd. filed the present appeal.

3. During the arguments, Ld. Counsel for the Appellant bank submitted that the attached property was purchased by Raj Kumar Jain and Poonam Mansahani vide agreement to sell dated 11.09.2021 with share to the extent of 50 per cent each. He contended that as per allegation the crime was committed by the accused persons during the period from 2003 to 2005 and hence this mortgaged property being purchased prior to the commission of alleged offence is a clean property, being not purchased from the part of any proceeds of crime. Ld. Counsel for the Appellant bank submitted that loan over the said property was given by appellant bank vide mortgage deed dated 30.06.2015. The loan limits were enhanced subsequently on 29.06.2016 and 30.09.2016, as the mortgaged property was sufficient for releasing the subsequent loan facilities. On account of default in repayment, appellant bank send notices under Section 13(2) of SARFAESI Act on 24.03.2017. As on 07.12.2017 total outstanding loan of Respondent no. 2 & 4 was Rs. 11.204 crores. Appellant bank filed Original Applications under Section 19 of the DRT Act for recovery of loan in March, 2018. He pointed out that on 30.01.2018 for initiating the separate proceedings under SARFAESI Act, the appellant bank approachedLd. Chief Metroploitan Magistrate, Dwarka Courts to takeover the possession of subject property. Application was allowed and Reciever was appointed by the said court to take the possession. He argued that as the subject property was mortgaged with the appellant bank since 2015, against the loan taken by the borrowers and respondent-ED was specifically aware of the fact that the title deeds of the subject property was in the possession of appellant bank under mortgage, and thus, the question of passing PAO does not arise. Ld. Counsel