Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2026 Supreme(Online)(ATFP) 321

APPELLATE TRIBUNAL FOR FORFEITED PROPERTY
V. Anandarajan, Member
Shruti Rampal – Appellant
Versus
Deputy Director Directorate of Enforcement – Respondent
MP-PMLA-2717/AHD/2025|MP-PMLA-2716/AHD/2025|MiscFPA-PMLA-1309/AHD/2025

Advocates:
For the Appellants/Petitioners: Harshit Sethi, Mansi Tipathi, Kartik Yadav
For the Respondents: Abhimanyu Kaul

The indefinite retention of assets under anti-money laundering legislation requires clear evidence establishing a nexus between the property and the proceeds of a scheduled crime. An ongoing investigation does not justify the mechanical freezing of assets without a reasoned finding of their involvement in criminal activity.

Headnote:(A) Prevention of Money Laundering Act, 2002 - Sections 8, 17, 24 - Retention of seized properties - Ongoing investigation - Proof of proceeds of crime - The requirement to establish the existence of 'proceeds of crime' as a foundational fact is an essential prerequisite for the sustained retention of seized assets (Para 27). The authority is obligated to provide cogent reasons connecting the seized property to the alleged offence, and retention cannot be justified solely on the ground that an investigation is pending (Paras 51, 52).

(B) Principles of Natural Justice - Communication of reasons - Statutory provisions requiring written reasons for actions by an authority must be communicated to the affected party to ensure fairness and prevent the vitiation of proceedings (Paras 13, 24).

(C) Burden of Proof - Section 24 of the Act does not create an automatic or universal presumption that all property possessed by a person is linked to a scheduled offence; the investigative agency must first discharge the initial burden of demonstrating a valid link before shifting the burden to the individual (Paras 31, 50).

Facts of the case:
The appeal was filed against an order confirming the retention of frozen bank accounts. The authority justified the retention based on an ongoing investigation into an offence involving copyright violation and illegal broadcasting. The appellant contended that the bank accounts held legitimate funds and were unrelated to any illicit activities, further claiming that the initial freezing order did not comply with mandatory procedural requirements.

Findings of Court:
The authority failed to provide an independent, reasoned finding that the assets were involved in money laundering, instead relying mechanically on the fact that an investigation was currently in progress. It was noted that the authority failed to link the specific funds to the alleged proceeds of crime.

Issues: Whether the retention of property under the Act is permissible based solely on the pendency of an investigation; Whether the authority properly established the nexus between the seized assets and the alleged scheduled offence.

Ratio Decidendi: The power to retain seized assets necessitates a reasoned determination that such property is connected to 'proceeds of crime'. The authority cannot exercise this power by merely reiterating statutory text or justifying it through the status of the investigation. Proving the foundational fact of the existence of 'proceeds of crime' is a mandatory requirement before invoking the presumption of money laundering.

Result: Appeal allowed. Impugned order set aside.

Table of Content
1. factual background of the pmla appeal proceedings. (Para 1 , 2 , 3 , 4 , 5)
2. challenges regarding procedural fairness and mechanical orders. (Para 6 , 7 , 8 , 9 , 10 , 11 , 12 , 13 , 14 , 15 , 16)
3. arguments on burden of proof and statutory compliance. (Para 17 , 18 , 19 , 20 , 21 , 22 , 23 , 24 , 25 , 26 , 27 , 28 , 29 , 30 , 31 , 32 , 33 , 34 , 35 , 36)
4. respondent defense regarding ongoing investigation and betting. (Para 37 , 38 , 39 , 40)
5. court scrutinizes evidence nexus to proceeds of crime. (Para 41 , 42 , 43 , 44 , 45 , 46 , 47 , 48 , 49 , 50)
6. retention requires specific findings of money laundering. (Para 51 , 52 , 53)
7. appeal allowed and frozen bank accounts released. (Para 54 , 55)

The present appeal arises from order dated 13.05.2025 of the Ld. Adjudicating Authority (AA) established under the Prevention of Money Laundering Act, 2002 (PMLA) in Original Application (OA No.14/25) confirming the retention of three frozen bank accounts of the appellant herein, and also allowing retention/continued freezing of other properties and records seized from other persons with which we are not concerned in the present appeal. The appellant Ms. Shruti Rampal was Respondent No. 9 before the Ld. AA.

2. The facts of the case briefly are that an FIR bearing No. 11191067240082 dated 12.06.2024 was registered by Cyber Crime Police Station, Ahmedabad under section 379 of IPC and under various provisions of the Copyright Act, 1957 and the Information Technology Act, 2000 on the complaint filed on behalf of M/s Star India Pvt Ltd. The allegation was that the website https://magicwin.games had unauthorizedly hosted/stream-broadcast ICC Men’s T20 World Cup, 2025 cricket matches for which rights had been given by the International Cricket Council (ICC) to M/s Star India Pvt Ltd. Magicwin is a website compatible with any internet browser, including mobile phones, smart TVs and computers. It was gathered by the complainant that Magicwin had illegally broadcast some of the cricket matches of ICC Men’s T20 World Cup 2024 causing huge financial loss to the company which officially held the broadcast rights. It was also alleged in the FIR that the website of Magicwin provides match details such as match viewing facility of different games along with payment options through various modes such as UPI-based applications.

3. On the basis of the aforesaid FIR which disclosed offence punishable under Section 63 of the Copyright Act, 1957 which constitutes a scheduled offence under the PMLA, the Enforcement Directorate (ED) registered an Enforcement Case Information Report (ECIR No. AMZO/14/2024 dated 02.08.2024) against the owner of Magicwin and others.

4. During the investigation, it was also found that Magicwin was also involved in betting on online live cricket matches and other games. In the course of the investigations undertaken by ED under the PMLA, 47 searches were conducted on various dates and an Original Application was filed. Further searches were conducted at 23 premises on 10.12.2024, 13.12.2025 & 24.12.2024 wherein various incriminating documents, records, digital devices and properties were seized/frozen. Subsequent to the searches conducted on the aforesaid three dates, another Original Application numbered as OA 14/2025 dated 08.01.2025 was filed before the Ld. AA on. Adjudication under section 8 of the Act conducted by the Ld. AA culminated in the passing of the impugned order dated 13.05.2025 confirming the retention/continuation of the seized/frozen properties, documents, digital devices and bank accounts etc, including the bank account of the appellant.

5. Aggrieved by the said order of the ld. AA, the appellant has filed the present appeal impugning the said order on various factual and legal grounds as discussed below.

Arguments from the Appellant’s Side

6. It is contended that the impugned order is absolutely cryptic, mechanical and does not deal with any submission made by the appellant. Despite the

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2026 Supreme(Online)(ATFP) 321

APPELLATE TRIBUNAL FOR FORFEITED PROPERTYV. Anandarajan, MemberShruti Rampal – AppellantVersusDeputy Director Directorate of Enforcement – RespondentMP-PMLA-2717/AHD/2025|MP-PMLA-2716/AHD/2025|MiscFPA-PMLA-1309/AHD/2025

Cases Referred (3)

APPELLATE TRIBUNAL FOR FORFEITED PROPERTY
V. Anandarajan, Member
Shruti Rampal – Appellant
Versus
Deputy Director Directorate of Enforcement – Respondent
MP-PMLA-2717/AHD/2025|MP-PMLA-2716/AHD/2025|MiscFPA-PMLA-1309/AHD/2025