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2019 (9) TMI 424 - AT - Money LaunderingMoney laundering - proceeds of crime - Retention of continuation of order of freezing / Panchnamma issued under section 17(1A) of PMLA - case of the respondent in the reason to believe as well as in the application filed under Section 17(4) was that it was a tainted amount and it amounts to money laundering - whether 1,43,38,330 shares subscribed in 2003 by foreign remittances through State Bank of India are ‘proceeds of crime” under section 2(1)(u) (notified on 1.7.2005)? HELD THAT:- Tribunal is of the view that at the best, ED might be frozen the amount at the hand of the appellant if any case is made out against the appellant. It is rightly observed by the Hon’ble Court. In the present case, the ED has sought to attach the assets of the Appellants by making out a case of equivalent in value thereof. The same is endorsed by the Adjudicating Authority. For making out such a case, the ED, first of all, has to prime facie establish that the appellants have committed the offences and they have a nexus or a link in relation to criminal activities which is constituting proceeds of crime and the property constituting the value of any such property. The attached property being ‘value of such property’, has to have a link or nexus with the actual property derived from criminal activity and it cannot merely be a ‘property equivalent in value’, attachment of which is only permissible if the proceeds of crime is taken or held outside India. Such conditions are missing from the facts of the present case, nor it is the case of respondent as nothing has been even prima facie established that the appellants are involved in the money laundering. When the case of the ED falls under equivalent in ‘value of any such property’, it cannot take any unrelated property which has no nexus or link with the actual proceeds of crime and attach the same as ‘property equivalent in value’ in the absence of evidence. In the present case, such property means the shares, in question, which were admittedly acquired in the year 2003. The relevant period of bribes was from 2008 onwards and secondary in the year 2003, PMLA was in existence. It is also a matter of fact that Mr. D.P. Singh, advocate for the respondent, has conceded before the Hon’ble Delhi High Court that the shares were not acquired from proceeds of crime.Thus the question of freezing the shares even equivalent in value does not arise.Even there is no material or evidence available prima facie as of today about the involvement of appellants. It is very clear from sub-section(4) of Section 26 that this Tribunal is given power to confirm or modify or setting aside the impugned order. No power is given to pass a decree for recovery of amount. The recovery of amount, interest and to receive the compensation and damages lies with the civil court. There is no evidence available on record against the appellants. They are not charge-sheeted. No prosecution complaint is pending, however, in the interest of justice, equity and fair play and to strike the balance in the present circumstances and the nature of case and in view of investigation is sub-judice by the police under schedule offence against other parties - All the four appeals are partly allowed by modifying the impugned orders, on the compliance is made as per terms mentioned in the preceding paras within the period of one month.
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