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2018 (10) TMI 1012 - AT - Money LaunderingOffence under PMLA - Provisional Attachment Order - SARFESI act - whether the banks should wait till the trial is over or recover the amount by enforcing the decree forthwith once decree is become final? - Held that:- In the case of Attorney General of India and Ors. [1994 (5) TMI 235 - SUPREME COURT] while dealing with the matter under Conservation of Foreign Exchange and Prevention of Smuggling Activities Act has defined the illegally acquired properties and held that such properties are earned and acquired in ways illegal and corrupt, at the cost of the people and the state, hence these properties must justly go back where they belong. In the present case as the money belongs to the Appellant bank it is public money. In view of settled law on the subject the appellant bank is the rightful claimant who have already obtained decree against the borrower from DRT under the SARFAESI Act and has a priority rights to recover the loans amount forthwith. The Respondent No.1 is not having any lien over the said properties as the Appellant banks are now the Legal transferee of said properties. The Respondent No. 1 may not retain the said property till the trial is over. They have no legal title and the property is to be returned to the persons lawfully entitled to recover the debts as they are the victim. Being a victim party u/s 8(8) of the Act, second proviso which is incorporated very recently in April, 2018, the banks are entitled to dispose of the properties if they are victim and sufferer due to non-return of loan amount by the borrowers. There is no nexus whatsoever between the alleged crime and the banks who are merely the secured creditor and were not aware that the borrowers would avoid returning the loan-amount. Prima facie, no case of money-laundering is made out against banks. The banks have priority rights on assets of the secured creditors to recover the loan amount/debts by sale of assets over which security interest is created. As far as the appeal is concerned, the same will be considered on the next date of hearing. At present, this Tribunal is only concerned with the interim order as prayed by the appellants. In view of facts and nature of the present case, that once the banks are secured creditors and have obtained the final decree from the court which has attained finality, the banks are bound to receive the default loan amount from Vijay Mallya and his companies. He was/is the active person of the companies. The loans amount has to be paid by the borrowers. It is a banks money. It must come to the banks. These are public sector banks. The decretal amount is recoverable in law being pubic money. Thus, till the next date of hearing, Vijay Mallya is restrained not to deal with and alter the status of the movable and immovable properties as per Schedule A to C and Schedule-A and shall not create third party interest in any manner directly or indirectly till the next date. The respondent no.1 shall also maintain the status quo with regard to the properties, the details of which are mentioned in the impugned orders in both appeals till the next date.
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