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2012 (7) TMI 1007 - HC - Money LaunderingProvisional order of attachment - offences for which the company and its Directors are sought to be prosecuted - Held that:- The criminal activity alleged against the company and its Directors relates to scheduled offences, at least at the time of the alleged commission and at the time of the lodging of the complaints (though they are not so any more after the amendment). In so far as the Part B offences are concerned, the offences listed therein would come within the meaning of expression "scheduled offence" under Section 2(1)(y) only if the total value involved in such offences is ₹ 30 lakhs and more. This condition is also satisfied in the cases on hand. Therefore, the ingredients of the expression proceeds of crimestand satisfied, in view of the fact (i) that the company is charged of committing scheduled offences and (ii) the property in question is allegedly derived as a result of a criminal activity relating to scheduled offences. Hence I cannot sustain the first contention that since the entire sale consideration for the property was paid by the Bank, it cannot be termed as the proceeds of crime. Prima facie, the property represents the proceeds of crime and it is upto the accused to establish, by evidence, before the criminal court that it is not so. I make it clear that the criminal court should independently go into the question without being influenced by my preliminary finding on this question. The Authority had the leverage and obligation to wait till the disposal of the writ petition or at least till the stay order was vacated. The Courts have repeatedly held that any proceeding initiated, conducted or concluded in violation of an order of interim stay or injunction is non- est in the eye of law. The Adjudicating Authority should have at least waited for this Court to dispose of the writ petition filed by the Bank or in the alternative, directed the impleadment of the Bank as a party. By virtue of the interim order dated 28.2.2012, this Court has permitted the Bank to proceed with the auction sale of the property under the SARFAESI Act, 2002. The action of the Adjudicating Authority in proceeding with the hearing of the original complaint despite being aware of the interim stay order and also proceeding to pronounce a final order on 26.6.2012, is clearly in defiance of the interim stay order of this Court. Therefore, the whole proceedings are vitiated and even the order dated 26.6.2012 passed during the pendency of these writ petitions is illegal and are liable to be set aside as null and void. In view of the above, both the writ petitions are allowed, the provisional order of attachment dated 22.2.2012 as well as all further proceedings pursuant thereto including the original complaint and the order of confirmation dated 26.6.2012, are set aside as illegal. I am conscious of the fact that the order of confirmation dated 26.6.2012 was passed during the pendency of these writ petitions and that the same is not under challenge. But it hardly matters, in view of the fact that once the provisional order of attachment dated 22.2.2012 goes, there is nothing for the Adjudicating Authority to confirm. There will be no order as to costs. However, the findings recorded herein shall not have a bearing on the criminal prosecution. Consequently, connected miscellaneous petitions are closed.
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