TMI Blog2016 (10) TMI 1086X X X X Extracts X X X X X X X X Extracts X X X X ..... the documents referred to in the statement of witnesses in relation to the attachment of properties as covered in the present P.A.O. and relied on in the present original complaint are to be supplied. The prayers made in the above-mentioned appeals are partly allowed by setting aside the impugned orders dated 8-9-2016. The limited prayer is granted by directing the respondent to supply the copies of statement(s) of witnesses recorded by the investigation and pertaining to the attachment of certain properties under the present P.A.O. and relied on in the present original complaint which are in its possession, and the documents shown/tendered during such statement(s) to the appellants within a period of 10 days from today. It is agreed by the learned counsels for the appellants that they will file the reply within 10 days thereafter and would not seek any adjournment in the matter before the Adjudicating Authority so that the Adjudicating Authority would be at liberty to decide the show cause notice issued within the time prescribed under the Act. - FPA-PMLA-1474-1478/MUM/2016 - - - Dated:- 14-10-2016 - Manmohan Singh, Chairman, Shri Kaushal Srivastava and Anand Kishore, Member ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... but the statements supplied to the Appellant are incomplete and other documents shown/produced while such statements were being recorded, have also not been supplied. Further only statements recorded on certain dates of a person have been disclosed while the statements of the same person recorded on subsequent dates have been withheld by the DoE. The Appellant gave the details in paragraph 4 of its application illustrating as to how the DoE has not supplied the complete set of statements and other referred documents. The following instances on behalf of the appellant which read as under :- (a) Statement was recorded of Ms. Mythili Balasubramanian on 11th March, 2015 (filed as Annexure-VI) with the complaint. The said statement in answer to Question-3 refers to letter dated 8-3-2016 given by IDBI furnishing details of applications by KAL. However, copy of the letter dated 8-3-2016 has not been supplied. Similarly the delegation of powers of IDBI is stated to be attached in answer to Question No. 8 but the same is not supplied. Similarly in answer to Question-10 copy of RBI dispensation letters dated 27-8-2010, 13-9-2010 and 22-10-2010 are stated to be attached but have not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt of the statement but has not been supplied. Similarly Question 27 refers to Annexure-B and Question 28 refers to Annexure-C however, these annexures have also not been supplied. The complainant should therefore, be directed to disclose whether the statement as Annexure-VIII is the only statement of Mr. A.K. Ravindranath Nedungadi or there were other statements recorded in respect of investigating into ECIR/03/MBZO/2016 and not only such statements but the documents referred and/or attached with them are also required to be supplied. (d) Statement was recorded of Mr. Yogesh Agarwal on 18th March, 2016, 23rd March, 2016 and 29th March, 2016 (filed as Annexure-IX) with the complaint. The said Statement shows that various documents have been referred on the basis of which the statement has been recorded but none of those documents have been supplied. Further it has not been clarified whether Annexure-IX is the total statement of Mr. Yogesh Agarwal. Answer to Question 4 of statement dated 18-3-2016 shows that Mr. Agarwal refers to a note dated 4-11-2009 which ties, not been supplied. Similarly answer to unnumbered question on 23-3-2016 refers to minutes of meeting dated 27-11- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lainant should therefore, be directed to disclose whether the statement as Annexure-XII is the only statement of Mr. V. Raju or there were other statements recorded in respect of investigating into ECIR/03/MBZO/2016 and not only such statements but the documents referred and/or attached with them are also required to be supplied. (h) Statement was recorded of Mr. Chandrashekhara Reddy Vinta on 16th April, 2016, 7th June, 2016 and (filed as Annexure-XIII) with the complaint. The said statement shows that various documents have been referred on the basis of which the statement has been recorded but none of those documents have been supplied. Further it has not been clarified whether Annexure-XIII is the total statement of Mr. Chandrashekhara Reddy Vinta. The statement of Mr. Vinta dated 28-4-2016 refers in response to Question No. 7 or 11 refers to spiral booklets being supplied by him which is not part of statement. The complainant should therefore, be directed to disclose whether the statement as Annexure-XIII is the only statement of Mr. Chandrashekhara Reddy Vinta or there were other statements recorded in respect of investigating into ECIR/03/MBZO/2016 and not only such s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h statements but the documents referred and/or attached with them are also required to be supplied. (l) Statement was recorded of Mr. R.S. Sridhar on 13th April, 2016 and 28th June, 2016 (filed as Annexure-XVII) with the complaint. The said statement shows that various documents have been referred on the basis of which the statement has been recorded but none of those documents have been supplied. Further it has not been clarified whether Annexure-XVII is the total statement of Mr. R.S. Sridhar. For example in statement dated 13-4-2016 in respect of Question 6 memorandum submitted to Credit Committee has been referred and in answer to Question 7 order dated 4-1-2009 of CMD has been referred but the same is not part of the statement. In statement dated 28-6-2016 Question 1 relates to Corporate Credit Policy 2009. Question 2 refers to appraisal memorandum of M/s. KAL before the Credit Committee which have not supplied with the statement. The complainant should therefore, be directed to disclose whether the statement as Annexure-XVII is the only statement of Mr. R.S. Sridhar or there were other statements recorded in respect of investigating into ECIR/03/MBZO/2016 and not only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n that the statement of witnesses were admittedly recorded on various dates but only part of the same was supplied and remaining was withheld. The statements referred/produced various documents which were the part of the statements, are not supplied and without that the complaint was incomplete and proper reply to the show cause notice could not be given and their right to defend themselves was prejudiced. 6. In reply, it is stated on behalf of respondent that Mr. Nedungadi, was the President CFO of M/s. UB Group and a Director of M/s. Kingfisher Airlines Ltd. It is submitted that M/s. UB Group consists of M/s. UBHL Ltd., which is the parent company with various other companies under its umbrella including M/s. Kingfisher Airlines Ltd. Shri Vijay Mallya, is the Group Chairman, Shri Ravi Nedungadi is the group President CFO and Shri A. Raghunathan (superannuated) is a Consultant/Advisor of M/s. UBHL. Thus, it is evident that Mr. Vijay Mallya is privy to all the documents of M/s. KAL M/s. UBHL. 7. Regarding M/s. P.E. Data Centre Resources Pvt. Ltd., it is submitted that the said company doesn t have any operation and is a dummy company, formed by Shri Anil Pisharody, who ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of further information at this stage will jeopardise the further investigations and future attachment(s) if any. 11. It is submitted that documents mentioned in various statements and listed by the defendants/appellants herein as having not been supplied to them, are enumerated and dealt in the reply, the details of which are given as under :- I. Ms. Mythili Balasubramani : (Executive Director of IDBI Bank) S. No. Description of documents Action 01 (41 of RUD) Q.3 refers to letter dated 8-3-2016, furnishing details of applications by M/s. KAL These loam applications are documents of M/s. KAL who have submitted to IDBI at the time of applying for loan. Thus, all the documents are in the possession of M/s. KAL such, there is no need to supply the same again. 02 (Page 43 of RUD) Q.8 Sanctioning limit of various committees for loans viz. Delegation of power The details of the DOP has already been mentioned in the statement. Further, the same is not relevant. However, a copy of the extract is enclosed. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... may hamper the investigation. Q. 18 Details of payments made to Vijay Mallya from UB Group. Information should be available with M/s. UB Group-UBHL KAL. The same is irrelevant as far as the current Provisional Attachment is concerned. The investigation is going on revealing the sensitive information may hamper the investigation. Q. 19. Details of shares of UBHL which are not under encumbrances The informations are available with M/s. UBHL as the same were provided by them. Further, the details are not relevant to the present PAO. Q. 20. Details of funds transferred from UB group to KAL Information available with UB Group, who had provided the details to us. Q. 21. Copies of balance sheets of UB Group companies The informations are available with them. Q. 22. Details of India Head of Diageo Information available with UB Group. Further, it is not relevan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the discretion/prerogative of the investigating agency to decide as to which statements to be referred or otherwise. 02 Q. 17 Details of overseas companies Information should be available with M/s. UB Group - UBHL KAL. The same is irrelevant as far as the current provisional attachment is concerned. The investigation is going on revealing the sensitive information may hamper the investigation. Q. 18 Details of payments made to Vijay Mallya from UB Group. Information should be available with M/s. UB Group-UBHL KAL. The same is irrelevant as far as the current Provisional Attachment is concerned. The investigation is going on revealing the sensitive information may hamper the investigation. Q. 19. Details of shares of UBHL which are not under encumbrances The informations are available with M/s. UBHL as the same were provided by them. Further, the details are not relevant to the present PAO. Q. 20. Details of funds tra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to this complaint has been supplied 02 Q. 4. Note dated 4-11-09 for releasing of 200 crores The same is within the knowledge of M/s. KAL is irrelevant 03 [Page 89 Q. 2. Copy of Minutes of meeting dated 27-11-09 of the EC of the Board The same are irrelevant. It related to criteria of sanctioning of loan by IDBI 04 [Page 90 Q. Copy of recall letter dated 13-5-2010 Letter is available with M/s. KAL as they have received this letter. Q. Credit Appraisal Report The same is irrelevant to the present PAO 05 [Page 93] Q. 3. Refers to the Appraisal note of R. Sridhar The same is irrelevant to the present PAO V. Mr. Sudersanan Pillai : One of the Dummy Director of the Company controlled by Vijay Mallya Sr. No. Description of documents Action 01 [Page 98] Q. 1. Copies of IT Returns Documents available ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Q. 2. Details of shareholder resignation letter in r/o M/s. EEPL. Q. 3. Details of Acebin Tech its shareholders. Q. 5. Bank statement of EEPL. Q. 6. Copy of balance sheet of EEPL. The details are not relevant to the present Provisional Attachment Order. IX. Mr. Satvinder Singh Gulati : - Head Corporate Affaris of M/s. LKP Finance Ltd. Sr. No. Description of Documents Action taken 01 Q. 4. Details of dealings with group company of UB Group Q. 8. Details of loans taken from other entities. Q. 10. Details of OCDs equity shares purchased/sold of M/s. KAL Q. 14. Refers to 3 letters, however none of these letters has been supplied. Q. 15. Refers to copies of ledger A/cs balance sheet of LKP Finance Ltd. The details are not relevant to the present Provisional Attachment Order. X. Mr. Anil Pisharody :- Employee of Mr. Vijay Mallya One of the Directors of various Companies which are directly/indirectly controlled by Vijay Mallya Sr. No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Credit Committee which is not supplied with the statement Explanation has been given. But no documents have been tendered. No documents have been tendered only explanation has been given. All the documents relevant to the case has been supplied. 12. It was also submitted by the Complainant in the reply that the persons whose statements have been recorded are the employees of Mr. Vijay Mallya, directly or indirectly working in the same Group of Companies under the umbrella of UB Group and M/s. UB Holding Limited and all the documents tendered during the recording of the statement(s) are privy to the Group Companies which are headed/controlled by Mr. Vijay Mallya. 13. In the course of arguments advanced before the Adjudicating Authority on 8-9-2016, it was submitted on behalf of all Appellant that they were ready and willing to pay the Respondent the cost of photocopying the documents and hence, no prejudice would be caused to the Respondent. 14. It is submitted by Mr. Rajeev Awasthi, learned advocate appearing on behalf of respondent that copies of all the relied upon documents mentioned in the Original Complaint have been provided to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8(1) of the PMLA on receipt of the original complaint (O.C.) under Section 5(5) of the Act, if the Adjudicating Authority has reason to believe that a person has committed an offence of Money Laundering as defined in Section 3 of the Act or is in possession of proceeds of crime, he is required to issue notice of not less than 30 days on such person calling upon him to explain the sources of the income, earning or assets out of which or by means of which he has acquired the property attached. Thus, the stage of confirmation of the P.A.O. by the Adjudicating Authority is the first stage under the PMLA where issue of a notice to the concerned person(s) is provided. Section 8(2) of the PMLA provides that adjudication is required to be done by the adjudicating authority taking note of all the relevant materials placed before him on record. 18. It is subsequent to issue of notice under Section 8(1) of the Act, and prior to submission of the reply to the notice that the appellant has sought the copies of the complete documents as referred above. Their contention is that in the absence of the complete documents, their right of giving an effective reply to the charges against them is pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y enquiry, domestic or otherwise, or in any trial, or other proceedings, which are capable of affecting rights, interests and liberties of a citizen, may have either a statutory genesis, including a provision in the Constitution, or may be based on well recognized principles of natural justice, mandatory requirements of a fair trial. 23. The extract of the judgment delivered by Lord Denning in the case of Kanda v. Govt. of Malaya, 1962 AC 322 is reproduced here as under: If the right to be heard is to be a real right which is worth anything, it must carry with it a right in the accused man to know the case which is made against him. He must know what evidence has been given and what statements have been made affecting him: and then he must be given a fair opportunity to correct or contradict them. 24. A Division Bench of the Hon ble Bombay High Court in Writ Petition No. 1703 of 2013 (Lalit Kumar Modi v. Special Director, DoE Anr.) pronounced judgment on 6-2-2014. This judgment follows the Supreme Court judgment in [Kanwar] Natwar Singh v. Director of Enforcement (2010) 13 SCC 255 = 2010 (262) E.L.T. 15 (S.C.), and in effect holds that (A) a noticee is entitled to info ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Petition (Crl.) No. 137/2011 in case of Subhash Popatlal Dave v. UOI [2013 (298) E.L.T. 3 (S.C.)], wherein the Hon ble Supreme Court has held in para 23 of the judgment where it was observed as under :- Therefore, I am of the opinion that those who have evaded the process of law should not be heard by this Hon ble Court to urge that their fundamental rights are in jeopardy. 26. We do agree with Mr. Awasthi that no one should be allowed to escape the process of investigation and a person who has evaded the law cannot claim the protection of the law as a right. However, this submissions have no relevance to the present issue under consideration. 27. His next submission is that some of the documents are already in the possession of the Group Companies of the appellants, therefore, they are not obliged to serve the copies of the same to the appellants, as all of them are controlled by Mr. Vijay Mallya and most of the documents, even if are lying with one of the Companies, the same can be obtained from the other Company. The said submission of Mr. Rajiv Awasthi has no force, as all the Companies are different entities in the eye of law. In case the complaint is filed agains ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rned counsel s for the appellants that they have no objection if the matters be decided by the Adjudicating Authority on or before the expiry of the 180 days period. Therefore, the question of delay does not arise. 29. The applications of the appellants were rejected by the Adjudicating Authority, mainly, on the reason that this is not a criminal trial; this Authority has to prima facie satisfy as to the commission of the scheduled offences/possession of the proceeds of crime or as to whether the defendants/appellants are involved in money laundering or not and that the grievance regarding non-furnishing of documents seems to be initiated as to delay the adjudication. We do not agree with the findings given by the Adjudicating Authority, as the confirmation of attachment of properties is a serious matter. Without giving any opportunity to the accused party to raise its defence in the matter, there would be a grave injustice. We are of the view that no harm would be caused to the Respondent and/or the Adjudicating Authority if the relied upon documents of the subject matter are supplied to the accused party, particularly, when the said party agrees not to delay the adjudicatio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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