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2018 (10) TMI 329 - AT - Money LaunderingOffence under PMLA - attachment orders - Held that:- From the language of the second proviso, it appears that only in particular types of cases, such power can be exercised as stated in the proviso itself otherwise in remaining/routine matters, the power should be exercised under first proviso. The second proviso should be invoked very carefully only in those cases where it shows that (if not invoked), the attachment proceedings would likely to frustrate the proceedings under this act. Thus, the due compliance has to be made by ED who only can attach the property once full satisfaction of circumstances of second proviso are available. The said proviso can be invoked in case of urgent matters and immediately. Otherwise, in normal cases, the ED should wait till the report under Section 173 of Cr. P.C. is filed before the Magistrate. The question of urgency did not arise on the date of passing the provisional attachment order as the property in question is under construction where the stakes of hundreds flat owners are involved and after taking the possession, they would reside there and it is a mortgaged property. The financial institutions are secured creditors. The 2nd proviso mandates that in case the property is not attached immediately, the non-attachment of the property is likely to frustrate any proceeding under this Act. Prima facie, such situation is not available as per material placed on record nor it is mentioned in the impugned order. At the time of hearing of appeal, this tribunal will re-examine as to whether the mandatory compliance has been made in the present case or not and if the compliance of second proviso has been made on the date of passing the provisional attachment order (which the relevant date), then the objection may be over-ruled.If not, then the provisional attachment ordercould not have been passed as per law. Even the confirmation order ipso facto would also be set aside. As enquired from the learned counsel for respondent no. 1 to produce the copy of the reasons to believe which is mandatory under 2nd proviso of Section 5(1) of the Act. He submits that the copy of reasons to believe is not available with him. It must have been sent to the Adjudicating Authority. He is also not aware the language of the reasons to believe if passed under the 2nd proviso of the Act. Appellate Authority is directed to produce the trial record along with the copy of the reasons to believe in the sealed cover on the next date of hearing. In the interest of justice, the equity in favour of the appellant who are offering the alternative property which is approx. ₹ 119 crores as per the prevailing circle rate of area. The respondent no. 1 is always at liberty to point out if the said alternative is not free from any incumbrances. The prayer made is allowed. As direct respondent no. 1 to accept the alternative land at Sekkadu Village, Avadi Taluk, Tiruvallur District ad-measuring 10.21 acres in place of the property attached. Direction is passed to release the property forthwith which was attached under the provisional attachment order admeasuring about 10.46 acres in Guindy Village, Chennai at VGN Fairmont, Thiru Vi Ka Industrial Estate, Guindy, Chennai-32, while exercising my discretion available under Section 35(1) of the Act as prima facie it is found that the property was not purchased from the money of proceed of crime.
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