TMI Blog2015 (12) TMI 1733X X X X Extracts X X X X X X X X Extracts X X X X ..... lowed on this ground. In view of the foregoing, the challenge of the appellants to the impugned order dated 12th November, 2014 passed by the Adjudicating Authority in Original Complaint confirming provisional attachment Order fails and the appeals are dismissed. - M.P.PMLA Nos. 1402-1403/BNG/2015 and F.P.A.PMLA Nos. 767-768/BNG/2014 - - - Dated:- 17-12-2015 - Shri Arun Kumar Agarwal, Acting Chairperson and Dr. Rabi Narayan Dash, Member Shri Kirit S. Javali, Advocate, for the Appellant. Shri Vikas Garg, Advocate, for the Respondent. JUDGMENT [Judgment per : Arun Kumar Agarwal, Acting Chairperson]. - FPA-PMLA-767/BNG/2014 and FPA-PMLA-768/BNG/2014 : The present appeals have been filed challenging the order dated 12th November, 2014 passed by the Adjudicating Authority confirming the provisional attachment Order No. 9/2014, dated, 6th August, 2014 whereby properties of the appellants were provisionally attached and Original Complaint No. 350/2014 dated 19th August, 2014 was filed by the respondent before the Adjudicating Authority praying confirmation of attachment of the properties. With the consent of the counsel for the parties, the appeals were take ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Bhandari, Shir Ivan Raj Samuel, Shri Pradeep Kurwella, Smt. Hima Bindu, Smt. Tanuj Kapileshwari and Shri Ram Kumar also paid amounts to Shri John Micheal through him. He furnished the details of such amounts before the respondent and appended his signatures on the details provided by him along with his letter dated 31-7-2012. It is alleged that Smt. Tanuj Kapileshwari during July, 2007 to July, 2008 paid various amounts totaling to ₹ 28,00,000/- to Shri John Micheal and Sri Ramachandra Kumar Vemuri and Smt. Rupali Ramachandra Kumar Vemuri during October, 2007 and in July, 2008 paid various amounts totaling to ₹ 26,07,000/- to Shri John Micheal which have been credited to the bank accounts of Shri John Micheal with HDFC Bank. It was revealed that the amounts paid by Smt. Tanuj Kapileshwari were withdrawn in bits and pieces by Shri John Micheal and some of the amounts were transferred to the account of his wife, Smt. Manjula Micheal which was also withdrawn in regular intervals in cash. Sri John Micheal, in his statement dated 3-12-2013 while stating about the bank accounts held by him and his wife, Smt. Manjula Micheal, stated that he is the authorised signatory for bo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6, Shri John Micheal stated that he does not want to say anything about the said transactions. 6. In his statement dated 5-2-2013, Shri John Micheal inter alia stated that he owns only one property bearing House No. 3, Khata No. 28/45/1, 3rd Cross, Varanasi Road, Jinkethimmanahalli, T.C. Palya Post, Bangalore; that this plot was purchased in 2005 and a house was built consisting ground floor and first floor on this plot during 2005-06 and that it costed him ₹ 8,10,000/-; that this house was built out of the savings and loans availed by pledging ornaments; that except pawn broker s receipt for ₹ 2,50,000/-, he has no other proof; that he did not file Income-tax Returns. However, he did not produce any receipt given by pawn broker as undertaken by him. 7. Shri John Micheal in his statement dated 3-2-2013 with regard to movable and immovable properties inter alia stated that he has one car vide Registration No. KA 03 MK 998 purchased in the year 2008 in the name of his wife, Smt. Majula Micheal for an amount ₹ 4,00,000/- approximately which was paid in cash; that the source of money for purchase of the car was out of the amounts received by him from Shri N. Sre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l attachment Order No. 9/2014, dated 6th August, 2014. Thereafter an Original Complaint No. 350/2014 was filed before the Adjudicating Authority seeking confirmation of the provisional attachment. The Adjudicating Authority, after consideration of the Original Complaint along with the material produced on record; after considering the reply filed by the parties and after hearing the parties, came to the conclusion that properties provisionally attached are involved in money laundering and confirmed the provisional attachment of property vide order dated 12th November, 2014 which is now being agitating by the appellants herein. 11. Shri Kriti S. Javali, learned counsel for the appellants vehemently contested the impugned order. He submitted that the respondent had no jurisdiction to initiate proceeding for provisional attachment of properties under the provisions of PMLA and the provisional attachment order passed by him is void. He submitted that in the FIR No. 239/2010, dated 11-9-2010, no charge sheet, till date, has been filed by the Police Authorities, therefore, no proceedings under PMLA can be initiated by the respondent as the respondent had not acquired jurisdiction unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h Court of Andhra Pradesh in the case of V. Suryanarayana Prabhakara Gupta and Anr v. Union of India dated 25-8-2011 in W.P. No. 27898 of 2010 where the Hon ble High Court was considering similar situation and held that since provisional attachment order had been passed on dated 22-11-2009 which is subsequent to addition of offence under Sections 420 and 120B of IPC in the Schedule of offences under PMLA with effect from 1-6-2009, the action initiated against the petitioner could not be faulted and the writ petition was dismissed. He relied on the judgment of the Hon ble High Court of Jharkhand in the case of Hari Narayan Rai v. Union of India judgment dated 6th August, 2010 where the Hon ble High Court held that the relevant date is not the date of acquisition of illicit money but the date on which such money is being processed for projecting it untainted. 16. The counsel for the respondent submitted that non-recording of statement of Shri Tapan Bhandari, who filed complaint before the police authorities in FIR No. 61 of 2011, by the police authorities is of no consequences as even in the absence of non-recording of statement of Shri Tapan Bhandari, the FIR and charge sheet fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rther, except making oral submission that police has not recorded statement of Shri Tapan Bhandari, the appellants have not brought any material on record to show conclusively that his statement was never recorded by police and non-recording of his statement will render the FIR nugatory even if the charge sheet has been filed. The present proceedings under PMLA are qua property and this tribunal is not to decide the sustainability of allegations in the FIR and charge sheet. Therefore, non-recording of statement of Shri Tapan Bhandari by police, even if it is correct, will not render the proceedings under PMLA void. 19. As regards the plea of the appellants that offences u/s 420 and 471 of IPC were added in the Schedule of PMLA w.e.f. 1st June, 2009 and the scheduled offences alleged to have been committed, were committed prior to that date, therefore provisions of PMLA are not attracted, is not sustainable. The appellants will still be covered for attachment proceedings under the provision of PMLA for the reasons as argued by the respondent and detailed hereinafter. A similar question came for consideration before Andhra Pradesh High Court in W.P. No. 27898 of 2010 in the case o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er Section 5 of 2002 Act against 1st petitioner could not be faulted. To hold so, the Hon ble Andhra Pradesh High Court also referred to and relied upon the principles enunciated in judgment of Division Bench of that court in the case of B. Rama Raju and Ors. v. Union of India, Ministry of Finance, Department of Revenue, represent by its Secretary (Revenue), New Delhi and Others 2011 (3) ALT 443 (D.B.). Relevant extracts of the Andhra Pradesh High Court s judgment in V. Suryanarayana Prabhakara Gupta (supra) are adverted to as follows : 7. Before I proceed any further, it would be apt to remind oneself that at this stage of the matter, it would be wholly inappropriate to examine the tenability or otherwise of the proceedings initiated under Section 5 of the PML Act. The only question that can be examined is whether the 1st Petitioner can be proceeded under Section 5 of the PML Act, for an offence alleged to have been committed by him prior to 1-6-2009, the date on which the Schedule appended to the PML Act has been amended. 8. The objects and reasons for enacting the PML Act, have been clearly spelt out. It is pointed out that the Political Declaration and Global Programme o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wingly assists or knowingly is a party or is actually involved in any process or activity connected with the proceeds of crime and projecting it as untainted property, shall be guilty of offence of money laundering. Section 4 declares that whoever commits the offence of money laundering shall be punishable with rigorous imprisonment for a term, which shall not be less than three years, but which may extend to seven years and shall also be liable to fine, which may extend to five lakh rupees. From the definition of offence of money laundering contained in Section 3 of the PML Act, it becomes clear that, whosoever directly or indirectly attempts to indulge or becomes a party or gets involved in any process or activity or activity connected with the proceeds of crime and projecting it as untainted property, shall be guilty of the offence of money-laundering. The two crucial expressions used in the said Section 3, which are relevant for our inquiry are proceeds of crime and property . These two expressions have been defined under Section 2(u) and 2(v) of the PML Act, as under: (u) proceeds of crime means any property derived or obtained, directly or indirectly, by any person ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction. Chapter-II dealt with the conduct, which constitutes the offence and provided for the appropriate punishment therefore, while Chapter III dealt with the regulatory aspects of the proceeds of the crime , enabling them to be subjected to attachment and adjudication and leading to their ultimate confiscation to the State. Therefore, if Chapter II can be characterized as dealing with the criminal facets of the conduct, the provisions in Chapter III are essentially intended to deal with the aspects to deny certain persons from deriving benefits either knowingly or unknowingly, arising from the proceeds of crime . But, for the provisions contained in Chapter III, the proceeds of crime could not have been dealt with at the initial stages itself. These two aspects are completely distinct and separate. Chapter III, therefore, had to deal first with the immediate action that is required to be taken in the matter by ordering for provisional attachment, and then, seeking the process of adjudication, which might lead to ultimate confiscation of such proceeds. Otherwise, the proceeds of the crime continue to impact the financial streams of the society. 16. Before analysing the provis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st the 1st petitioner by the C.B.C.I.D., in C.C. No. 187 of 2009 on the file of the XIV Additional Chief Metropolitan Magistrate, Hyderabad, alleging him to have committed offences punishable under Section 120B r/w Section 420 of Indian Penal Code, on 22-11-2009. Therefore, after 22-11-2009, the proceeds of crime punishable under Sections 120B and 420 of Indian Penal Code, in the hands of the 1st petitioner herein, are capable of being subjected to action under Section 5 of the PML Act. As was already noticed, the provisional attachment order has been passed only on 21-10-2010, which is long subsequent to 22-11-2009. 20. Hon ble Gujarat High Court in the case of Alive Hospitality and Food Pvt. Ltd. v. Union of India Others vide its judgment dated 31-7-2013 in writ petitions SCA No. 4171 of 2012 and 1059 of 2012 held that contentions of learned Senior Advocates in both the petitions that scheduled offences incorporated in the second amendment Act which came into force with effect from 1st June, 2009 are not applicable with retrospective effect, have no substance and without merit. 21. In the present case also, the charge Sheet No. 1/2013 was filed on 25-2-2013 before the Ad ..... X X X X Extracts X X X X X X X X Extracts X X X X
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