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2014 (11) TMI 1134 - HC - Money LaunderingProvisional Order of Attachment - PMLA - issue of notice - Held that:- If a complaint has been registered against an individual and the complaint is under investigation, his case would at least be covered by second proviso. To say that a person accused of committing an offence will not even come within the meaning of the expression "any person" under the second proviso, would tantamount to placing him in a much better position than a third party who do not commit any offence, but merely came into possession of the property that represents the proceeds of the crime. Therefore, on the first contention raised by the petitioner, hold that if a complaint has been registered against a person and a final report is already filed, his case would be covered by the first proviso. But, if a complaint has been registered against a person and a final report has not yet been filed, he would stand along with any other person against whom no complaint is lodged, but who is covered by the second proviso to Section 5(1) of the Act. Though the second proviso to Section 5(1) enables the Competent Authority to attach "any property of any person", the word "property" should be understood only in the context of the definition under Section 2(1)(v). Consequently, such property should also satisfy the following criteria, namely, (a) that it was derived or obtained directly or indirectly, (b) by any person, and (c) as a result of criminal activity relating to a scheduled offence. Fortunately, the Adjudicating Authority is obliged under the proviso to Sub-section (2) of Section 8 to issue a notice to every person, who claims the property to be his own and to provide an opportunity of being heard even to such a person. Therefore, the Adjudicating Authority is obliged to issue a notice to LIC Housing Finance Limited. They have already issued show cause notices to the writ petitioners, though the petitioner in the second writ petition is not alleged of obtaining the property as a result of any criminal activity, to come within the definition of the expression "proceeds of crime". The Adjudicating Authority has power, why, even an obligation and a statutory duty under Section 8(2) to look into the evidence produced by the petitioner in the second writ petition and LIC Housing Finance Limited and to come to an independent conclusion as to whether the provisional order of attachment is to be confirmed or not. Therefore, I am of the view that the petitioners should submit themselves to the enquiry under Section 8(1). It appears from the show cause notices issued by the Adjudicating Authority, that the first hearing of the case was slated for 10th November 2014. Since that date has expired, the Adjudicating Authority is directed to serve a fresh notice upon the petitioners as well as LIC Housing Finance Limited and all other interested parties, fixing a fresh date of hearing. On the fresh date of hearing, the petitioners as well as LIC Housing Finance Limited and all other interested parties shall appear before the Adjudicating Authority and submit their reply as well as evidence regarding the factual details. Thereafter, the Adjudicating Authority shall take note of what is stated above and record a finding in terms of Section 8(2). With the above limited directions, the writ petitions are disposed of, rejecting the challenge to the provisional orders of attachment and to the show cause notices.
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