TMI Blog2018 (5) TMI 993X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Complaint. No copy of reason to believe was served before passing the provisional attachment order. The provisional order passed by the respondent is violative of principles of natural justice and violates the rights of this Appellant enshrined in Art. 14 and 21 of the Constitution of India. The notice issued by the Adjudicating Authority under Section 8 of the Act, is issued in gross violation of Article 14 of the Constitution of India and is against principles of natural justice. No case was brought out against the appellant either in the charge-sheet filed by the Lokayuktha Police Wing or the complaint filed by the Complainant and as such Section 2(u) of PMLA does not come into operation and as a consequence of the same Section 5 of PMLA. Thus the present appeal is allowed with regard to the property owned by the appellant. The impugned order is set-aside. Consequently, the provisional attachment order pertaining to the appellant in relation to the property in question is quashed. Property is released forthwith. - FPA-PMLA-448/BNG/2013 - - - Dated:- 11-5-2018 - Justice Manmohan Singh Chairman For the Appellant : Shri R. Swaroop Anand, Advocate Fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 20(B) IPC 5 Mr Venkaiah (absconding at the time of filing chargesheet) 420, 465,468 r/w 120(B) of IPC 6 Mr Basavapoornaiah 12 PC Act, 1988 120(B) of IPC 7 Mr T.P.Muninarayanappa 13(1)(d) r/w 13(2) P.C. Act, 1988 120(B) of IPC 8 Mr B.K.Manju. 420 ,506 r/w 120(B) of IPC 9 Mr M.Gopi 420, 506 r/w 120(B) of IPC 4. The Joint Director of Enforcement Directorate based on the charge- sheet dated 25.09.2012 filed by the Karnataka Lokayuktha Police Wing in Spl CC 135/20111 passed a provisional order of attachment bearing No. ECIR/07/BZO/2011 AD MNT /1477. The respondent had attached Flat bearing No. 1713, 1st Floor, 17th Wing, Measuring 1639 sft, situated on Corporation No. 59, at Palace Road, Ward No. 76, Vasanthanagar, Bangalore at Embassy Habitat only by the appellant. 5. The Joint Director, Directorate of Enforcement, Government of India, Bangalore, being t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 014, subsequently the respondent herein filed a complaint under Section 45(1) of the Act before the Principal City Civil and Sessions Judge and Special Court for Prevention of Money Laundering Act, Bangalore on 24/03/2014 against various parties however, the appellant herein is not arrayed as an accused. In the said complaint, the Respondent has made the prayer confiscations of all the attached properties vide provisional attachment order No. 7/2012 dt: 25.09.2012 in terms of Section 8(5) of the Act among other things including the attached property of the appellant. The principal City Civil and Session Judge and Special Court for Prevention of Money Laundering Act, Bangalore by its order dt. 24.03.2014 registered the complaint filed by the Respondent as Spl CC 124/2014. 12. It is the admitted position that before the Adjudicating Authority, the Appellant herein furnished detailed information pertaining to the source of funds from which the above said attached property had been purchased to rebut the stand of the Complainant vide her reply and submitted that during the year 2010 this Appellant wanted to purchase a flat to provide residence to her daughter. She spoke regarding th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ues towards consideration for purchase of undivided interest in the land as well as for payment to be made to Embassy Properties Development Ltd for construction of the flat. Her husband thereafter agreed to pay payments due to Embassy Properties Development Ltd., as well as M/s Magarath Property Development from his bank account. 18. Accordingly by he in his letter dated 21/9/2011 (which is filed in the appeal at page 196), he issued cheques drawn from his account in Axis bank Ltd, Sampige Road, Bangalore. 19. The statement issued by the said bank pertaining to this Appellant s husband account is filed at page 202 has already been made available to the Complainant by this Appellant s son S.V. Srinivas pursuant to the summons issued to him. Copy of the letter dated 21/09/2011 and account statement of this Appellant s husband is filed as ANNEXURE A-7 A-8 . 20. The details of the cheques issued by this Appellant s husband are as follows: i) Cheque No.291072 dated 21/09/2011 drawn on Axis Bank, drawn in favour of Embassy Properties Development Ltd., for ₹ 32 lakhs. ii) Cheque No.291073 dated 21/09/2011 drawn on Axis Bank, drawn in favour of M/s Magarath proper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in order to show her bona-fide had also filed an application under section 11 of PMLA r/w Order 16 Rule (1)(2) of the Code of Civil Procedure before the Adjudicating Authority to issue summons to M/s Embassy Properties Development Ltd to give evidence and produce the post dated cheques issued by her son SV Srinivas and the bank endorsement for the dis- honored cheque issued to M/s Margarath Property Development. The copy of the said application is produced filed as ANNEXURE A-11 at page 205 in the present appeal. No order in the said application was passed even it was not dealt in the impugned order. 28. As already stated that the Adjudicating Authority accepts the fact that all payments for purchase of the flat in question was made by this Appellant s husband only except ₹ 20 lakh which was paid later on but on the basis of mere apprehension, Adjudicating Authority passed the order to continue the attachment, on the reason that as post-dated cheques were issued by S.V. Srinivas ( One of them was dishonored and the others were not encashed at paragraph 140 at page 67 of impugned order ). 29. It is apparent from the recital in the sale deed that a sum of ₹ 20,4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommon order dt: 03/11/2016 allowed Criminal RP 432/2013 and CrlP 2313/2016 and quashed FIR 57/2010 resulting in charge sheet numbered as SPL CC 135/2011, as against Mr. Katta Subramnaya Naidu and M. Gopi. The prosecution has challenged the order of the Hon ble High Court of Karnataka in Criminal RP 432/2013 and CrlP 2313/2016 before the Hon ble Supreme Court in SLP (Crl) 1192-1193/2017. Notice is ordered in the said matters. 35. The appellant in appeal No. 447/2013 is Smt Reshma Srinivas. She is the wife of SV Srinivas. She is not accused in the schedule offence. She is an accused in the section 45 compliant filed by the Respondent herein numbered as SPL CC 124/2014 and is arrayed as accused No.22. The said SPL CC124/2014 was instituted on 24/03/2014 after the impugned order dt: 21/02/2013 passed by the Adjudicating authority in OC 158/2012. 36. The Adjudicating Authority upon receipt of a complaint under section 5(5) of Act; under section 8 (1) of the Act is bound to peruse the same and upon perusal of such a complaint if it has reason to believe that any person has committed an offence under section 3 of the Act or is in possession of proceeds of crime may serve a notice on ..... 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