2021 (5) TMI 981 - HC - Money Laundering

Money Laundering - freezing of petitioner s bank account - It is the petitioner s case that the impugned order had been passed without providing it with a copy of the show-cause notice or an opportunity to place on record its objections thereto - HELD THAT - In order to avoid any further controversy in this matter, it would be in the interest of justice to grant an opportunity to the petitioner to respond to the Show-Cause Notice. The petitioner is granted 10 days time to respond to the Show-Cause Notice dated 08.10.2020. The Adjudicating Authority will thereafter pass a fresh order in accordance with law, after duly considering the petitioner s response to the show cause notice - Petition allowed.

Summary

Issues:
1. Challenge to order under Prevention of Money Laundering Act, 2002 without receiving Show-Cause Notice.

Analysis:
The petitioner challenged an order passed by the Adjudicating Authority under the Prevention of Money Laundering Act, 2002, confirming a freezing order on the petitioner's bank account. The petitioner contended that the order was issued without providing a copy of the show-cause notice or an opportunity to present objections. The petitioner later discovered the show-cause notice in their spam folder, claiming possession of it. The Court considered the petitioner's grievance and granted an opportunity to respond to the show-cause notice. The respondent did not object to this, acknowledging the lack of service of the notice to the petitioner. Consequently, the impugned order was set aside for the petitioner, granting them 10 days to respond to the show-cause notice dated 08.10.2020. The Adjudicating Authority was directed to issue a fresh order after considering the petitioner's response, with a mandate to decide expeditiously, preferably within four weeks, without delving into the merits of the case.

This judgment highlights the importance of due process and the right to be heard before adverse actions are taken under the PMLA. The Court emphasized the need for fairness and granted the petitioner an opportunity to respond to the show-cause notice, rectifying the procedural lapse. The decision underscores the principle of natural justice and the obligation on authorities to ensure proper communication and opportunity for affected parties to present their case. The directive for an expeditious resolution further promotes efficiency and timely adjudication in matters involving financial implications and legal consequences.