M/s Olympus Granites Pvt. Ltd. S. Nagarajan v. The Deputy Director Directorate of Enforcement Chennai

Headnote:(A) Prevention of Money Laundering Act, 2002 - Sections 2(1)(u), 3, 8, 26 - Definition of ‘proceeds of crime’ includes property of equivalent value where tainted property cannot be traced - Attachment of property acquired prior to commission of scheduled offence permissible if it represents value of proceeds of crime - Offence of money laundering is independent and continuous; relevant date for applicability of scheduled offence is when proceeds are projected as untainted property - ED not required to reinvestigate predicate offence but may rely on FIR and chargesheet - ‘Reason to believe’ for attachment must be recorded and can be satisfied by material in FIR and investigation. (Paras 6, 7, 8)

(B) Evidence - Burden of proof - Appellants failed to discharge burden of showing properties were not proceeds of crime - Mere denial of involvement in predicate offence insufficient. (Para 6)

Facts of the case:
The appellants, a company and its director, were accused in an FIR for illegal quarrying of granite from government land adjacent to their leased area, causing loss of Rs.256.44 crores. Based on the FIR and chargesheet, the Directorate of Enforcement (ED) recorded an ECIR and attached several properties including land and fixed deposits under PMLA. The Adjudicating Authority confirmed the provisional attachment order. Aggrieved, the appellants appealed.

Findings of Court:
The Tribunal held that the ED had sufficient material to form ‘reason to believe’ from the FIR and chargesheet, and the Adjudicating Authority gave a reasoned order. The property purchased before the scheduled offence could still be attached as ‘value of proceeds of crime’ under the second limb of the definition. The offence of money laundering being continuous, the relevant date is when the proceeds are projected as untainted, not the date of the predicate offence. The presence of non-scheduled offences among multiple predicate offences does not vitiate PMLA proceedings. The appeals were dismissed.

Issues: The main issues were whether there was material for illegal quarrying; whether the appellants were involved in scheduled offences; whether there was ‘reason to believe’ for attachment; whether property acquired before the scheduled offence is immune; whether the predicate offences were inserted in the schedule after the incident; and whether illegal mining is a scheduled offence.

Ratio Decidendi: The court ruled that (1) the ED can rely on FIR and chargesheet to form reason to believe, (2) property equivalent in value to proceeds of crime can be attached even if acquired before the predicate offence, (3) the offence of money laundering is independent and continuous, so the date of projecting proceeds as untainted is relevant for schedule applicability, and (4) multiple predicate offences including scheduled ones sustain PMLA action even if one is not scheduled.

Result: Appeals dismissed. Pending applications disposed of.

Legal Category Hierarchy

1. Appeals under Section 26 of PMLA against order confirming attachment of properties in money laundering case. (Para 2 )

2. Appellants challenged attachment on grounds of lack of scheduled offence, retrospective application, and insufficient evidence; respondent supported attachment. (Para 3 , 4 )

3. Appeals dismissed as devoid of merits; attachment confirmed. (Para 9 )

4. Can the Enforcement Directorate rely on FIR and charge sheet to form reason to believe for attachment under PMLA without reinvestigating the predicate offence?

Yes, ED is not required to reinvestigate the predicate offence; it can rely on FIR and police report to form reason to believe for attachment. (Para 6 )

5. Can properties acquired prior to the commission of the scheduled offence be attached as proceeds of crime under PMLA?

Yes, if the actual proceeds of crime cannot be traced, properties of equivalent value can be attached even if acquired earlier, as per the definition of proceeds of crime. (Para 7 )

6. What is the relevant date for determining whether an offence is a scheduled offence for money laundering prosecution?

The relevant date is when the proceeds of crime are projected as untainted property, not the date of commission of the predicate offence; money laundering is a continuing offence. (Para 8 )

FINAL ORDER

19.11.2025

Dictated by: Rajesh Malhotra

Present Appeals under Section 26 of Prevention of Money Laundering Act, 2002 are filed by the Appellants against the order dated 11.10.2019 passed by the Adjudicating Authority in Original Complaint No. 1141/2019 whereby the properties attachment by ED vide PAO No. 06/2019 dated 23.06.2019 were confirmed. The details of the said properties are as under:

i. Land totally measuring 3 Acres at Survey No. 259/4B 2 at Keelavalavu Village acquired vide Document No. 4244/2007 dated 20.09.2007 by M/s OGPL (D-1) for a value of Rs. 6,00,000/- and have a guide line value of Rs. 9,00,000/-.

ii. Land totally measuring 51 Cents at Survey No. 259/4B 2 at Keelavalavu Village acquired vide Document No. 3200/2009 dated 25.06.2009 by M/s OGPL (D-1) for a value of Rs. 1,02,000/- and having a guide line value of Rs. 1,50,000/-.

iii. Land and Building at Survey No. 5/7 at Manalur, Door No. 1/64 totally measuring 54 Cents acquired by document no. 3690/2008 dated 12.09.2008 of SRO, Madurai North Joint – I for a value of Rs. 7,25,000/- and a guideline value of approximately Rs. 15,00,000/- (D-2)

iv. Agricultural land at Survey No. 80/1 of Chinthamani Village, totally measuring 93 cents acquired by document no. 3854/2009 dated 03.06.2009 of SRO, Madurai South Joint -I for a value of Rs. 1,86,000 and a guideline value of approximately Rs. 2,80,000/-. (D-2)

v. Agricultural land at Survey No. 92/2A, 92/2A3, 93/2A of Chinthamani Village, totally measuring 107.5 cents acquired by document no. 3855/2009 dated 03.06.2009 of SRO, Madurai South Joint - I for a value of Rs. 2,15,000 and a guideline value of approximately Rs. 3,25,000/- (D-2)

vi. Agricultural land at Survey No. 96/4 of Chinthamani Village, totally measuring 52 cents acquired by document no. 3856/2009 dated 03.06.2009 of SRO, Madurai South Joint-I for a value of Rs. 1,04,000 and a guideline value of approximately, Rs. 1,60,000/- (D-2)

vii. Agricultural land at Survey No. 96/2, 96/2B and 96/3 of Chinthamani Village, totally measuring 1.60 Acres acquired by document no. 3858/2009 dated 03.06.2009 of SRO, Madurai South Joint-I for a value of Rs. 3,20,000 and a guideline value of approximately Rs. 4,80,000/-(D-2)

viii. Agricultural land at Survey No. 92/2, 92/2A 92/2A2 of Chinthamani Village, totally measuring 15 ½ cents acquired by document no. 3859/2009 dated 03.06.2009 of SRO, Madurai South Joint-I for a value of Rs. 31,000 and a guideline value of approximately Rs. 47,000/- (D - 2))

ix. Agricultural land at Survey No 92/2, 92/2A, 92/2A21, 92/2B and 92/2B1A of Chinthamani Village, totally measuring 73 cents acquired by document no. 3860/2009 dated 03.06.2009 of SRO, Madurai South Joint - I for a value of Rs. 1,50,000 and a guideline value of approximately Rs. 2,20,000/- (D-2)

x. Agricultural land at Survey No 80/8, 80/8B, 80/9A and 80/9B of Chinthamani Village, totally measuring 35 cents acquired by document no. 3861/2009 dated 03.06.2009 of SRO, Madurai South Joint - I for a value of Rs. 70,000 and a guideline value of approximately Rs. 1,05,000/- (D-2)

xi. Agricultural land at Survey No 92/3 and 92/3A of Chinthamani Village, totally measuring 30 ½ cents acquired by document no. 3866/2009 dated 03.06.2009 of SRO, Madurai South Joint I for a value of Rs. 6,00,000 and a guideline value of approximately Rs. 13,28,000/-. (D-2)

xii. Agricultural land at Survey No 93/1 and 93/1B of Chinthamani Village, totally measuring 28 cents acquired by document no. 10502/2010 dated 06.12.2010 of SRO Madurai South Joint -I for a value of Rs. 56,000 and a guideline value of approximately Rs. 84000/-(D-2)

xiii. Agricultural land at Survey No 93/1 and 93/1A of Chinthamani Village, totally measuring 28 cents acquired by document no. 10503/2010 dated 06.12.2010 of SRO, Madurai South Joint - I for a value of Rs. 56,000 and a guideline value of approximately Rs. 84,000/- (D-2)

xiv. Agricultural land at Survey No 80/5 of Chinthamani Village, totally measuring 2 Acres and 3 cents acquired by

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2025 Supreme(Online)(ATFP) 13103

APPELLATE TRIBUNAL FOR FORFEITED PROPERTY
Balesh Kumar, Member, Rajesh Malhotra, Member
M/s Olympus Granites Pvt. Ltd. S. Nagarajan v. The Deputy Director Directorate of Enforcement Chennai
FPA-PMLA-3366/CHN/2019

Legal Category Hierarchy

Table of Contents

4. Can the Enforcement Directorate rely on FIR and charge sheet to form reason to believe for attachment under PMLA without reinvestigating the predicate offence?

5. Can properties acquired prior to the commission of the scheduled offence be attached as proceeds of crime under PMLA?

6. What is the relevant date for determining whether an offence is a scheduled offence for money laundering prosecution?

2025 Supreme(Online)(ATFP) 13103

APPELLATE TRIBUNAL FOR FORFEITED PROPERTYBalesh Kumar, Member, Rajesh Malhotra, MemberM/s Olympus Granites Pvt. Ltd. S. Nagarajan v. The Deputy Director Directorate of Enforcement ChennaiFPA-PMLA-3366/CHN/2019

Legal Category Hierarchy

Table of Contents

4. Can the Enforcement Directorate rely on FIR and charge sheet to form reason to believe for attachment under PMLA without reinvestigating the predicate offence?

5. Can properties acquired prior to the commission of the scheduled offence be attached as proceeds of crime under PMLA?

6. What is the relevant date for determining whether an offence is a scheduled offence for money laundering prosecution?

APPELLATE TRIBUNAL FOR FORFEITED PROPERTY
Balesh Kumar, Member, Rajesh Malhotra, Member
M/s Olympus Granites Pvt. Ltd. S. Nagarajan v. The Deputy Director Directorate of Enforcement Chennai
FPA-PMLA-3366/CHN/2019