PMLA Tribunal: SC's COVID Order Extends Asset Attachment Timeline, Rejects Karti Chidambaram's Appeal

NEW DELHI – In a significant ruling on the interplay between statutory deadlines under the Prevention of Money Laundering Act, 2002 (PMLA) and the Supreme Court's pandemic-era orders, the Appellate Tribunal under the Smugglers and Foreign Exchange Manipulators Act (SAFEMA) has dismissed an appeal by Karti P. Chidambaram. The Tribunal upheld the attachment of assets worth ₹22.28 crore, ruling that the Supreme Court's suo motu extension of limitation periods due to COVID-19 squarely applied to the filing of prosecution complaints by the Enforcement Directorate (ED).

The decision, delivered on October 29, 2025, by a Bench comprising Balesh Kumar and Rajesh Malhotra, provides critical judicial clarity on the scope of the apex court's pandemic relief measures. It distinguishes between cases concerning personal liberty, where statutory timelines are sacrosanct, and those involving the attachment of property, thereby reinforcing the ED's powers to continue proceedings delayed by the global health crisis.

The appeal, titled Karti P. Chidambaram v The Deputy Director, Directorate of Enforcement , challenged the March 29, 2019 order of the PMLA Adjudicating Authority, which had confirmed the ED's initial provisional attachment from October 10, 2018. The attached assets include a 50% share in a Jor Bagh flat in New Delhi and seven bank accounts.

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Background: The INX Media Case and the Attachment

The case stems from the long-running INX Media money laundering probe, which alleges that as Finance Minister in 2007, P. Chidambaram presided over irregularities in the Foreign Investment Promotion Board (FIPB) approval granted to INX Media Pvt. Ltd. The ED alleges that his son, Karti P. Chidambaram, facilitated this approval in exchange for kickbacks.

Acting under the PMLA, the ED provisionally attached assets valued at ₹22.28 crore, which was subsequently confirmed by the Adjudicating Authority. The legal battle then shifted to the procedural validity of the continued attachment, focusing on a critical statutory deadline.

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The Core Legal Contention: Expiry of the 365-Day Rule

The crux of the appellant's argument, presented by Advocate Arshdeep Khurana, hinged on a precise interpretation of Section 8(3)(a) of the PMLA. This provision mandates that an order of attachment confirmed by the Adjudicating Authority shall continue during the investigation for a period not exceeding 365 days, or until the pendency of proceedings before a court.

The appellant's legal team meticulously laid out the timeline: * Attachment Confirmation: March 29, 2019 * 365-Day Deadline: March 28, 2020 * Prosecution Complaint Filed: June 1, 2020

Since the prosecution complaint (equivalent to a chargesheet) was filed 430 days after the confirmation—well beyond the 365-day statutory limit—the appellant contended that the attachment had automatically lapsed. It was argued that the ED's failure to adhere to this mandatory timeline extinguished the legal basis for holding the assets.

To bolster this claim, the appellant heavily relied on the Supreme Court's landmark judgment in S. Kasi v. State (2020) . This case, which dealt with default bail under Section 167(2) of the CrPC, held that the Supreme Court's suo motu COVID-19 extension order could not be used to override a statutory right to liberty that had already accrued to an accused. The argument was that, similarly, a right to the release of property had accrued to the appellant once the 365-day period expired, and this vested right could not be retrospectively nullified.

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The ED's Defense: A Shield of Pandemic Proportions

Representing the Enforcement Directorate, Advocate Zoheb Hossain countered that the delay was not a procedural lapse but a direct consequence of the nationwide lockdown imposed to combat the COVID-19 pandemic. The agency's entire case rested on the expansive and overarching nature of the Supreme Court's suo motu order dated January 10, 2022, which excluded the period from March 15, 2020, to February 28, 2022, from the computation of limitation for all judicial and quasi-judicial proceedings.

The ED argued that this order was a blanket protection intended to prevent the miscarriage of justice across all legal domains, including specialized statutes like the PMLA. They maintained that the timeline for filing the prosecution complaint was therefore validly extended, and the attachment remained legally sound.

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Tribunal's Analysis: Distinguishing Liberty from Property

The Tribunal's judgment meticulously dissected the competing arguments, ultimately siding with the Enforcement Directorate. It framed the central issue as whether the attachment became invalid simply because the prosecution complaint was filed after the 365-day period, in light of the extraordinary circumstances of the pandemic.

The Bench made two pivotal observations that formed the bedrock of its decision:

1. The All-Encompassing Scope of the Supreme Court's Order: The Tribunal held that the Supreme Court's order was unambiguous in its wide application. It rejected the appellant's attempt to confine its scope, stating:

“The question that if the Respondent Directorate could file the Prosecution Complaint on 01.06.2020, then why could they not do so within 365 days of the passing of the Impugned Order would not impact the answer to the moot question that the coverage of the Order dated 10.01.2022 was wide enough as to allow the filing of the Prosecution Complaint under PMLA beyond 365 days.”

This interpretation signals that the focus should be on the legal protection granted by the apex court, not on a micro-analysis of an agency's ability to act on a specific day during the lockdown.

2. The Critical Distinction from S. Kasi : Crucially, the Tribunal distinguished the precedent set in S. Kasi , effectively neutralizing the appellant's primary legal weapon. It noted that S. Kasi was fundamentally about personal liberty—a constitutionally guaranteed right that occupies a unique and elevated position in law.

“The judgment in S. Kasi was passed in the context of grant of default bail, which has direct bearing on personal liberty. The present matter relates to continuation of attachment of movable and immovable properties, unlike the issue of personal liberty.”

By drawing this line, the Tribunal established that while procedural timelines affecting liberty must be construed with utmost strictness, the same standard does not necessarily apply to the attachment of property, especially under the extraordinary relief measures provided during the pandemic.

Acknowledging the practical realities on the ground, the Tribunal also gave weight to the challenges faced by investigators during the lockdown. It remarked:

“The enormity of the situation for the Investigating Officer to have completed the investigation during the period of lockdown, when he was not even authorized to visit the witnesses or record their statements, needs to be appreciated.”

Conclusion and Implications for PMLA Jurisprudence

In dismissing the appeal, the PMLA Appellate Tribunal has affirmed that the Supreme Court’s COVID-19 orders provided a robust shield for procedural timelines under economic-offense statutes like the PMLA. The ruling clarifies that the right to have property released due to a procedural delay does not stand on the same pedestal as the right to personal liberty in the context of default bail.

For legal practitioners, this decision serves as a key precedent for cases where PMLA proceedings or other statutory actions were delayed during the pandemic period. It reinforces the ED's position that such delays, when covered by the Supreme Court's blanket extension, do not invalidate substantive actions like asset attachment. The judgment underscores a pragmatic judicial approach that balances strict statutory compliance with the unprecedented operational disruptions caused by the global pandemic.