APPELLATE TRIBUNAL UNDER SAFEMA AT NEW DELHI

1. MP-PMLA-6033/SRT/2019 Stay Jayesh Desai … Appellant

2. MP-PMLA-6079/SRT/2019 Stay FPA-PMLA-3059/SRT/2019 Rajesh Bhanwarlal Jain … Appellant

3. MP-PMLA-6107/SRT/2019 Stay MP-PMLA-6109/SRT/2019 Exem.

FPA-PMLA-3073/SRT/2019 M/s Meridian Jewellery Pvt. Ltd. … Appellant Vesus The Deputy Director, … Respondent Directorate of Enforcement, Surat Advocates/Authorized Representatives who appeared For the Appellants : Mr. Udit Jain, Mr. HardikModh, Advocates For the Respondent : Mr. Aditya Singla, Mr. Sahil Sharma, Advocates

ORDER

31.10.2023 The appeal has been filed under Section 26 of Prevention of Money Laundering Act, 2002 against the order dated 29.03.2019 passed by the Adjudicating Authority confirming the provisional attachment order.

The learned counsel for the appellant Jayesh Desai submitted that the flat attached by the respondent was purchased much prior to the alleged crime and even sold to third party (i.e., appellants namely Rajesh Bhanwarlal Jain and M/s Meridian Jewellery Pvt. Ltd., (in connected appeals) in the year 2012. The name of the appellant Jayesh Desai did not figure in the initial complaints rather it was shown in the last complaint. The allegation against the accused was regarding preparation of 17 fake Bills of Entries and submitted before the ICICI Bank for fraudulent foreign remittance atHongkong and UAE. Based on it FIR was registered on 11.04.2014. In the said FIR, the appellant Jayesh Desai was not named for commission of crime. However, after further investigation, an ECIR was recorded on 17.04.2014. The allegation against the appellant was finally for embezzlement of the amount to which it was actively connected. The Fake Bill of Entries for foreign remittance was given, however allegation is yet to be proved by the prosecution and in any case when the purchase of flat by the appellant Jayesh Desai is much prior to commission of alleged offence, it could not have been subjected to attachment. It is more so when the property was sold by appellant Jayesh Desai on 18th June, 2012 to other appellants. The prayer is accordingly to set-aside the provisional attachment order so also the order passed by the Adjudicating Authority.

The appeal has been contested by the learned counsel for the respondent. It is submitted that the flat in question was attached for the value equivalent to proceeds of crime. It was for the reason that the proceeds of crime were not available or traceable in the hands of the appellant at the time of attachment. Thus, even if the flat in question was purchased much prior to the commission of offence, it was rightly subjected to attachment pursuant to the definition of “Proceeds of Crime” given under Section 2 (1) (u) of the Prevention of Money Laundering Act, 2002. The only argument raised by the learned counsel for the appellant would not survive in the light of definition of proceeds of crime and the judgement of Delhi High Court in the case of Prakash Industries &Anr. v/s Directorate of Enforcement Reported, in 2019 SCC Online Del. 7854 and Deputy Director, Directorate of Enforcement,Delhi vs. Axis Bank reported in 2019 SCC Online Del. 7854. The prayer is accordingly made to dismiss the appeal.

We have considered the rival submission of the learned counsel for the parties and perused the record carefully. The only argument raised by the learned counsel for the appellant Jayesh Desai to question the order of provisional attachment and also the order of the Adjudicating Authority is in reference to the date of alleged commission of offence and the date of purchase of the flat. It is submitted that flat in question was purchased much prior to the alleged commission of offence, thus could not have been subjected to attachment. It is more so, when it was sold to third parties by the sale deed in the month of June, 2012 itself. That is much prior to even registration of FIR. It is with the further statement that name of the appellantJayesh Desai f