Under PMLA, property of equivalent value can be attached as proceeds of crime even if acquired prior to the scheduled offence, provided actual illicit proceeds are untraceable or siphoned off.

ORDER

11.12.2025

By a batch of these appeals under Section 26 of the Prevention of Money Laundering Act, 2002 (in short `the Act of 2002’), a challenge has been made to the order dated 10.05.2023 passed by the Adjudicating Authority confirming the Provisional Attachment Order dated 05.12.2022. The provisional attachment was caused for immovable properties of the appellants, finding their involvement in money laundering. Before we refer to the arguments of the respective parties, it would be relevant to give brief facts of the case:

Brief facts of the case:

2. It is a case where an FIR was registered on 20.05.2017 u/s 406, 420, 506 r/w 34 of IPC, 1860 and section 5 of Telangana Deposits of Financial Establishments Act, 1999 and section 4 and 5 of the A.P. Protection of Depositors of Financial Establishments Act, 1999 against Smt. Nowhera Shaik, M/s Heera group of companies and related others. After completing the investigation, chargesheet was filed by WCO, A-Division central crime station, detective department, Hyderabad, Telangana against Nowhera Shaik, Biju Thomas, Molly Thomas, Shaik Abubakar, Khamar Jahan Shaik, Mubarak Jan Shaik. Shaik Naheena, Shaik Mohammad Ashraf, Shaik Ismail, Shaik Abdul Qaiyum. Yaseen Baig. Shaik Abdul Rahaman, Shaik Noorulla, M/s Heera Group of Companies and M/s Suvan Technologies Solutions India Pvt. Ltd. for offences under sections 406, 409, 420 and 506 & 120-B of IPC, 1860, and section 5 of Telangana Depositors Financial Establishments Act, 1999 and section 6 of the Price Chits & Money Circulation Schemes (BANNING) Act, 1978.

3. It was alleged that Smt. Nowhera Shaik and related others have collected Rs. 5600 crores as unauthorized deposits from around 1,72,000 investors (BIG members) across the country. They engaged market executives and direct selling agents for luring the investors into false promises of paying high rate of interest i.e., 3% per month (36% to 40% per year) by hatching various schemes and defaulted in making payments to the investors. Around 250 accounts were opened in various banks across the country and 8 of them in UAE and Saudi Arabia. Smt. Nowhera Shaik and related others have diverted the depositor’s money to their personal accounts through their company bank accounts for wrongful gain and utilized it to purchase movable and immovable properties.

4. On the basis of the facts above, an ECIR was recorded on 05.11.2018.

5. In the investigation role of many others was revealed, the appellant Syed Akhtar is a partner in M/s SA Builder and Developers; a partnership firm engaged in real estate business and was responsible for all the company’s affairs. It is found that M/s Heera Group transferred an amount of Rs. 148.04 crores to M/s SA Builders and Developers between 2015 and 2017 to purchase land in Hyderabad. The value of the land was Rs. 70.91 crores. The amount of Rs. 77.13 crores with the appellants were siphoned off. In addition, Rs. 3 crores were received by the appellants as against the registered value of Rs. 1.5 crores for the property sold to M/s Heera Gold export and import by Mr. Syed Qiaser. Thus, a total proceeds of crime amounting to Rs. 78,63,45,010/- was layered in favour of M/s SA Builders and Developers, Mr. Syed Akhtar and Mr. Syed Afsar.

6. The investigation further revealed that the land was purchased by M/s SA Builders and Developers from M/s Neelanchal Technocrats Pvt. Ltd. using the funds received from Heera Group and proceeds of crime to the tune of Rs. 41.05 crores are lying with M/s Neelanchal Technocrats Pvt. Ltd. since the land was not registered with M/s SA Builders and Developers due to dispute pending in the court. The balance amount of Rs. 37,58,45,010/- is lying with the appellants.

7. On the basis of facts referred above, provisional attachment order has been passed and confirmed by the Adjudicating Authority. Aggrieved by the order of the Adjudicating Authority, appellants have preferred these appeals raising factual and legal issues.

Arguments of c