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2019 (9) TMI 428 - AT - Money LaunderingMoney Laundering - proceeds of crime - commission of the offence of Money Laundering under Section-3, PMLA - guilty of the offences under sections 120B read with 420, IPC; and were acquitted in respect of charges under section 467, 468 and 471, IPC - allocation of the coal block - HELD THAT:- The investors have invested in the shares of the Appellant company due to the coal allocation and coal linkage (allocation). Adjudicating Authority’s reading of the aforesaid Statements has gone behind the said Statements and amounts to disbelieving the same, without any factual basis or material to the contrary. The aforesaid statements recorded under section 50 of the PMLA have been duly signed and affirmed by the persons giving the statement. The proceedings under Section 50 PMLA are deemed to be judicial proceedings within the meaning of Section 193 and Section 298 of the IPC. The aforesaid Statements have not been disputed by the ED who even has relied upon documents in support of the said OC as well as in Show Cause Notice. The Adjudicating Authority cannot disbelieve the statements of the investors or to interpret them its own matter. The same is not permissible in law - the Adjudicating Authority has gone beyond the material before it to arrive at the finding that the Appellant and/or the other Defendants in the said OC invited investors/public to invest in the Appellant company using the allurement of the allocation of the coal block or its possible allocation, and that therefore, derivation of benefit from such investment would constitute proceeds of crime. The finding in the impugned order was based on materials beyond the record of the present case because there is nothing on record to show that the investors invested in the shares of the Appellant company on being invited by it or by any of the officers of the Appellant company and the allocation or the possibility of allocation of coal block was used as allurement to such investors. There is no conduct, act or omission on the part of the Appellant that has been shown which would lead the ED to believe that the alleged proceeds of crime are likely to be concealed, transferred or dealt with in any manner which may result in frustrating any proceeding under Chapter 2 of PMLA - The transactions pertaining to receipt of ‘SAM’ from various other companies are duly documented, above-board and legal transactions.The proceedings related to the CBI Charge-sheet and the proceedings under the PMLA have been widely reported and publicized in the media, as such, no prudent person would be willing to deal or transact with Defendant No.1 concerning the attached assets. There can be no question of profiteering or benefitting from the coal allocation and thus, no question of any proceeds of crime - appeal allowed.
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