TMI Blog2018 (10) TMI 330X X X X Extracts X X X X X X X X Extracts X X X X ..... tions with reference to the PMLA Act and with reference to the stage in which the present writ petitions are filed. Thus, all those judgments referred by the learned counsel for the writ petitioners have no relevance with reference to the grounds considered in the present writ petitions. This Court has no hesitation in coming to the conclusion that the present writ petitions are not only premature and the complex facts and circumstances now raised by the writ petitioners, cannot be adjudicated in view of the fact that the writ petitioners have not exhausted the appeal remedies provided under the Statutes and not participated in the administrative procedures contemplated under the provisions of the Prevention of Money Laundering Act, 2002, establishing their innocence or otherwise before the Competent Authorities. Such administrative procedures contemplated cannot be construed as akin to that of the criminal proceedings initiated under the Indian Penal Code. Writ petitioners, being failed to establish any legally acceptable ground, so as to interfere with the impugned orders passed by the respondents under the provisions of the Prevention of Money Laundering Act, 2002. Thus, b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... based on the another complaint lodged by the very same E.Premkumar against Rt.Rev.Dr.Manickam Dorai by the CBCID, Coimbatore. In FIR No.1 of 2009, charge sheet was filed on 3.5.2011 and the same was taken cognizance by the Chief Judicial Magistrate, Coimbatore in C.C.No.158 of 2011. As against the above charge sheet in FIR No.1 of 2009 and C.C.No.158 of 2011, a quash petition under Section 482 Cr.P.C., was preferred in Crl.O.P.No.15098 of 2011 on the file of this Court and the said Criminal Original Petition was subsequently dismissed. 6. During the pendency of the criminal proceedings and charge sheet, the second respondent registered an Enforcement Case Information Report in ECIR No.3 of 2012 dated 12.4.2012 based on the above FIR No.1 of 2009 and the charge sheet stayed by this Court as against the one of the writ petitioners Rt.Rev.Dr.Manickam Dorai for the alleged commission of scheduled offences under Sections 120-B, 420 and 471 of IPC under the PMLA, 2002. Consequent upon the registration of above ECIR, the second respondent vide proceedings dated 14.2.2013 provisionally attached the properties which stand in the name of Mrs.Soodamani Dorai, one of the writ petitioners i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave not been accepted by the Income Tax Appellate Authority ratifying the explanation/reasons given by the one of the writ petitioners Mrs.Soodamani Dorai and the same also attained the finality by implementation of the same. Hence, the respondents herein are duty bound to allow the order of the ITAT which was implemented by the Id. A.O. The said finding of the ITAT, 'D' Bench, Chennai cannot be found fault with or reversed by this Court, since it is not a Forum to reopen the issue which already attained finality. 10. While countering the facts submitted on behalf of the writ petitioners, the respondents have stated that the writ petitioners have questioned the validity of the provisional attachments in PAO No.01 of 2013 dated 14.2.2013 under Section 5(1) proviso and the complaint in O.C.No.178 of 2013 made on 27.2.2013 under Section 5(5) of the Prevention of Money Laundering Act, 2002 in the present writ petitions. This Court vide its order dated 2.4.2013, granted interim stay of ten weeks on the entire proceedings pursuant to the ECIR No.03 of 2012 including the PAO No.1 of 2013. The writ petitioners have not challenged other PAO Nos.2 of 2013 and 3 of 2013 issued by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... G.Srinivasan vs. The Chairperson, Adjudicating Authority under Prevcention of Money Laundering Act, 2002 and others [ decided on 1.4.2011 in WP No.530 of 2011 ] , this Court held as follows:- 15. In the present case, by attachment of property made by the second respondent, the petitioner is not bound to lose anything and he cannot be said to be prejudiced. On the other hand, by virtue of Section 5(3), every order of attachment made under Section 5(1) of the POMLA will lose its efficacy either after 150 days or after an order passed under Section 8(2) of the POMLA. Therefore, it is only the petitioner instead of approaching the first respondent Adjudicating Authority who had initiated proceedings under Section 8(1), had rushed to this court. Even if the attachment is made final, under Section 26, an appeal lies to the Appellate Tribunal. Therefore, the petitioner must submit his explanation to the Adjudicating Authority and convince it that the amount sought to be attached was not obtained due to any money laundering and that it was the legally earned income. Even if he fails before the first respondent, there is time enough for challenging the same before the judicial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ect immovable property is not deprived of its enjoyment. Taking over possession of the attached property would arise upon confirmation of the provisional attachment. On an analysis of several provisions of the Act in particular Section 5, Section 8 and Section 26, it becomes clear that the legislative intent underlying the sequential provisions for provisional attachment, confirmation of such attachment and eventual confiscation or for retention of a seized property and also providing remedy of appeal to the appellate authority, is to balance public interest with the individual interest of the person against whom allegations are made and action is initiated. A mechanism is provided under the Act for redressal of the grievance at different stages that is to say before the Adjudicating Authority at 25the first instance and latter before the Appellate Tribunal. It is only when a person is aggrieved by the order of the Appellate Tribunal that he may file an appeal to the High Court as per Section 42 of PML Act. When such is the mechanism provided for the effective redressal of the grievance within the four corners of the provisions of the PML Act, petitioner is not justified in rushing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act is a standalone enactment, differentiating the scheduled offence and money laundering offence and also the powers of Adjudicating Authority (PMLA) and the Special Court (PMLA), which are reproduced below:- S.No. Before PMLA (Amendment) 2012, - before 15.2.2013 After PMLA (Amendment) 2012, w.e.f. 15.2.2013 1. Section 8(3) Where the Adjudicating Authority decides under sub-section (2) that any property is involved in moneylaundering, he shall, by an order in writing, confirm the attachment of the property made under sub-section (1) of section 5 or retention of property or record seized under section 17 or section 18 and record a finding to that effect, such attachment or retention of the seized property or record shall- (a) continue during the pendency of the proceedings relating to any scheduled offence before a Court; and (b) become final after the guilt of the person is proved in the Trial Court and order of such Trial Court becomes final. Section 8(3) Where the Adjudicating Authority decides under sub-section (2) that any property is involved in money laundering, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Schedule under the Prevention of Money Laundering Act, 2002 till 1.7.2009 and therefore, there is a violation of Article 20(1) of the Constitution and therefore, the proceedings under the Act, are not maintainable. In this context, it is submitted that the offence of money laundering is a continuing offence and it has retrospective effect. 18. In the case of Devas Multimedia Pvt Ltd vs. The Joint Director, ED, Bangalore [decided on 4.10.2017 in WP No.11544 of 2017], the Hon'ble High Court of Karnataka has strengthened that the provisions of Prevention of Money Laundering Act, have a retrospective effect, as follows:- 25. It is not in dispute that Section 420 IPC has been included as a scheduled offence only in 2009, so also Section 120B IPC and Section 13 of the Prevention of Corruption Act. The question whether petitioner was involved in money laundering as provided under Section 3 of the PML Act has to be decided by the competent authority. What is the date of laundering in the facts of the present case and what process or activity by which illicit money was being projected as untainted in the facts and circumstances of the case has to be examined ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e larger questions that can be examined based on relevant facts as and when they emerge during the course of adjudication. 19. In the case of R.Subramanian vs. The Assistant Director, Directorate of Enforcement, Chennai [decided on 18.8.2015 in WA No.764 of 2015], the Division Bench of this Court held as follows:- 15. The matter involves a core question as to whether the relevant date is the date of acquisition of illicit money or the date on which such money is being processed for projecting it untainted. The question cannot be decided merely on the basis of the affidavit filed by the appellant. The respondent should be permitted to conduct investigation to arrive at a definite finding. The jurisdiction in a case of this nature is a mixed question of law and fact and the same cannot be decided on the basis of half baked materials produced by the appellant. We are, therefore, of the view that the learned Single Judge was correct in dismissing the writ petition. 20. In the case of B.Rama Raju vs. Union of India [decided on 4.3.2011 in WP Nos.10765, 10769, 23166 of 2010] , the Hon'ble Division Bench of High Court of Andhra Pradesh at Hyderabad held as follows:- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... undering is independent of scheduled offences and it has been further held that the time of commission of the scheduled offence is not relevant to the context of the prosecution under the Act. 23. The offence of money laundering is not covered under any other provisions of law. Section 3 enacted by 2002 Act is a new offence and stands by itself. Section 44(1)(c) of the Prevention of Money Laundering Act, 2002, it is provided that if the Court which takes cognizance of the scheduled offences is other than the Special Court under the PMLA, the Authority should move an application for tr4ansfer of the scheduled offence to the Special Court and the Special Court, on receipt of such case, proceed to deal with it from the stage at which it is committed. Therefore, it is clear from the provisions of the Act that the offence of money laundering stands by itself. As evident from Section 8(6) of the Act, the Court will release the property only if it is found on the conclusion of trial under PMLA that the offence of money laundering has not taken place or if the property is not involved in money laundering. Therefore, adjudication, prosecution, trial under PMLA is independent of scheduled ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , is in a better position to decide on the facts being introduced by the writ petitioner. However, the writ petitioners approached this Court without opting for the mechanism provided under the Act. Therefore, the writ petitions are liable to be dismissed. 26. The learned counsel for the writ petitioners also submitted the legal contentions as follows:- (i) The alleged scheduled offences as against one of the writ petitioners Rt.Rev.Dr.Manickam Dorai are unde Section 120-B, 420 and 471 of IPC under the Prevention of Money Laundering Act, 2002. (ii) The alleged offences were committed by one of the writ petitioners Rt.Rev.Dr.Manickam Dorai flowing out of a criminal complaint dated 14.11.2008 lodged by one E.Premkumar. Consequently, FIR No.1 of 2009 was registered on the file of the CBCID, Coimbatore and the pursuant charge sheet and C.C.No.158 of 2011 on the file of the Chief Judicial Magistrate, Coimbatore. (iii) Therefore, it is very clear that alleged scheduled offences were committed by Rt.Rev.Dr.Manickam Dorai much prior to the date of criminal complaint dated 14.11.2008. (iv) The IPC offences, particularly, offences under Sections 120-B, 427 and 471 of IPC we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of State of Maharashtra vs. Kaliar Koil Subramaniam Ramaswamy [(1977) 3 SCC 525] wherein in paragraph 6, the Hon'ble Supreme Court held as follows:- 6. It appears that the Legislature thereafter thought it proper to do away with the rule of evidence provided by sub-section (3) of Section 5 and inserted the new clause (e) in sub-section (1) of Section 5 as one more category of the offence of criminal misconduct. But it cannot be gainsaid that the new offence, under the newly inserted clause (e), became an offence on and from December 18, 1964 by virtue of Section 6 of the Amending Act 40 of 1964. In this view of the matter, the High Court rightly held that in the absence of any evidence on record to show that the appellant acquired or was found to be in possession of pecuniary resources or property disproportionate to his known sources of income after the coming into force of the Amending Act , he was entitled to the protection of clause (1) of Article 20 of the Constitution which provides as follows: 20. (1) No person shall be convicted of any offence except for violation of a law in force at the time of the commission of the act charged as an offence, nor b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gned to prevent a person being punished for an act or omission which was considered innocent when done. It only prohibits the conviction of a person or his being subjected to a penalty under ex post facto laws. In Rao Shiv Bahadur Singh v. State of Vindhya Pradesh [AIR 1953 SC 394 : 1953 SCR 1188 : 1953 SCJ 563 : 1953 Cri LJ 1480] the Court pointed out that what is prohibited under Article 20(1) is only conviction or sentence under an ex post facto law and not the trial thereof. Such trial under a procedure different from what obtained at the time of the commission of the offence or by a court different from that which had competence at the time cannot ipso facto be held to be unconstitutional. A person accused of the commission of an offence has no fundamental right to trial by a particular court or by a particular procedure, except insofar as any constitutional objection by way of discrimination or the violation of any other fundamental right may be involved. Thus the appellant cannot object to a procedure different from what obtained at the time of the commission of the offence. The offence that was committed was when Section 5(3) was in force and by Act 16 of 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the Indian Evidence Act relate to the trial and proof of the offence. Section 498-A inserted in the Indian Penal Code by the Criminal Law (Second Amendment) Act, 1983 (Act 46 of 1983) is an offence triable by a Magistrate of the First Class and is punishable with imprisonment for a term which may extend to three years in addition to fine. It is for the offence punishable under Section 498-A which was in the statute book on the date of death of Chhaya that the respondents are being tried in the Court of Magistrate of the First Class. The offence punishable under Section 304-B, known as dowry death, was a new offence created with effect from November 19, 1986 by insertion of the provision in the Indian Penal Code providing for a more stringent offence than Section 498-A. Section 304-B is a substantive provision creating a new offence and not merely a provision effecting a change in procedure for trial of a pre-existing substantive offence. Acceptance of the appellant's contention would amount to holding that the respondents can be tried and punished for the offence of dowry death provided in Section 304-B of the Indian Penal Code with the minimum sentence of seven years ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7, held as under:- 5. This Court finds that after coming into force of the Code of Criminal Procedure (Amendment) Act, 2005 from 23-6-2006 the offence under Section 324 IPC is made non http:// compoundable. However, in this case the offence under Section 324 IPC was committed on 23-7-1986 on which date it was compoundable with the permission of the court. As the Code of Criminal Procedure (Amendment) Act, 2005 is not applicable to the facts of the case, the offence under Section 324 IPC would be compoundable with the permission of the court. 6. In view of the statement made by Respondents 2 to 4 in their affidavit and having regard to the facts and circumstances of the case, permission to compound the offence deserves to be granted to the original complainant and the injured. 7. Hence, the appeal is allowed. The two judgments impugned in the appeal are set aside. The injured complainant and two other injured are permitted to compound the offence punishable under Section 324 IPC. In view of sub-section (8) of Section 320 of the Code of Criminal Procedure, the composition of offence under Section 324 IPC shall have the effect of an acquittal of the appellant with who ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e on 25-10-1995. Would it apply in a case where the cause of action arose prior thereto? Ex facie, a penal statute will not have any retrospective effect or retroactive operation. If commission of fraud was complete prior to the said date, the question of invoking the penal provisions contained in the said Regulations including Regulations 3 to 6 would not arise. It is not that Parliament did not provide for any penal provision in this behalf. If the appellants have violated the provisions of the Companies Act, they can be prosecuted thereunder. If they have violated the provisions of the SEBI Act, all actions taken thereunder may be taken to their logical conclusion. A citizen of India has a right to carry on a profession or business as envisaged by Article 19(1)(g) of the Constitution of India. Any restriction imposed thereupon must be made by reason of a law contemplated under clause (6) thereof. In the absence of any valid law operating in the field, there would not be any source for imposing penalty. A right to carry on trade is a constitutional right. By reason of the penalty imposed, the Board inter alia has taken away the said constitutional right for a period of ten y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble to be quashed. As we have, already, held that the writ petitioner cannot be prosecuted for the offences alleged, as they are not the scheduled offences under the PML Act. Those offences under the Mines and Geology (Development and Regulation) Act, 1957, the Forest (Conservation) Act, 1980, the Indian Penal Code and the Prevention of Corruption Act, 1988, were included in the PML Act declaring them as scheduled offences only with effect from June 1, 2009. Hence, the Enforcement Directorate could not have invoked the provisions of the PML Act with retrospective effect. 12. The petitioner cannot be tried and punished for the offences under the PML Act when the offences were not inserted in the schedule of offences under the PML Act. This would deny the writ petitioner the protection provided under Clause (1) of Article 20 of the Constitution of India. Article 20(1) of the Constitution of India prohibits the conviction of a person or his being subjected to penalty for ex-post facto laws. Consequently, the order of attachment is, also, liable to be set aside. 17. In addition to the aforesaid submissions, Mr Nandrajog, Learned Senior Advocate appearing for the writ petition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 5 of the Act, it would be necessary for the concerned authorities to identify the scheduled crime. The First Proviso to Section 5 also indicates that no order of attachment shall be made unless in relation to a schedule offence a report has been forwarded to a Magistrate under Section 173 of the Code of Criminal Procedure, 1973 or a complaint has been filed by a person authorised to investigate the scheduled offence before a Magistrate or Court for taking cognizance of the scheduled offence. Thus, in cases where the scheduled offence is itself negated, the fundamental premise of continuing any proceedings under the Act also vanishes. Such cases where it is conclusively held that a commission of a scheduled offence is not established and such decision has attained finality pose no difficulty; in such cases, the proceedings under the Act would fail. 29. The Act is a penal statute and, therefore, can have no retrospective or retroactive operation. Article 20(1) of the Constitution of India expressly forbids that no person can be convicted of any offence except for the violation of a law in force at the time of the commission of the act charged as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Prevention of Money Laundering Act , 2002, by the second respondent are in accordance with law or liable to be quashed? 7. It is not disputed that the 1st petitioner was charge sheeted by the CBI, Anti Corruption Branch for the alleged possession of assets and pecuniary resources and the 2nd petitioner was prosecuted for abetment in the above offence. It is also not in dispute that the alleged offences against the petitioners 1 and 2, related to the period from 01.05.1997 to 30.06.2005 and 3rd and 4th petitioners have not been made as accused in the charge sheet filed by the 3rd respondent before the XIV Additional Special Judge for CBI Cases. Further, it is also not in dispute that in C.C.No.18 of 2009 trial also commenced and 74 witnesses were examined. The provisional Attachment Order was passed by the 2nd Respondent on 07.04.2017 to attach the properties of the petitioners including 3rd and 4th petitioners, in whose name the properties were shown to the value of ₹ 5,61,039.36 in the form of some Fixed Deposits, Kisan Vikas Patras, Savings Bank Account and PPF, etc., It is also not in dispute that based on the charge sheet filed by the CBI Anti Corruption ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y proceeding under this Act.] (2) The Director, or any other officer not below the rank of Deputy Director, shall, immediately after attachment under sub-section (1), forward a copy of the order, along with the material in his possession, referred to in that sub-section, to the Adjudicating Authority, in a sealed envelope, in the manner as may be prescribed and such Adjudicating Authority shall keep such order and material for such period as may be prescribed. (3) very order of attachment made under sub-section (1) shall cease to have effect after the expiry of the period specified in that sub-section or on the date of an order made under sub-section (2) of section 8 , whichever is earlier. (4) Nothing in this section shall prevent the person interested in the enjoyment of the immovable property attached under subsection (1) from such enjoyment. Explanation. For the purposes of this sub-section person interested, in relation to any immovable property, includes all persons claiming or entitled to claim any interest in the property. (5) he Director or any other officer who provisionally attaches any property under subsection (1) shall, within a period of thirty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o application. 11. Therefore, the Enforcement Case Information Report and the order of attachment are without jurisdiction and are liable to be quashed. As we have, already, held that the writ petitioner cannot be prosecuted for the offences alleged, as they are not the scheduled offences under the PML Act. Those offences under the Mines and Geology (Development and Regulation) Act , 1957, the Forest (Conservation) Act , 1980, the Indian Penal Code and the Prevention of Corruption Act , 1988, were included in the PML Act declaring them as scheduled offences only with effect from June 1, 2009. Hence, the Enforcement Directorate Could not have invoked the provisions of the PML Act with retrospective effect. 12. The petitioner cannot be tried and punished for the offences under the PML Act when the offences were not inserted in the schedule of offences under the PML Act. This would deny the writ petitioner the protection provided under Clause (1) of Article 20 of the Constitution of India. Article 20(1) of the Constitution of India prohibits the conviction of a person or his being subjected to penalty for ex-post facto laws. Consequently, the order of at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by a person authorised to investigate the scheduled offence before a Magistrate or Court for taking cognizance of the scheduled offence. Thus, in cases where the scheduled offence is itself negated, the fundamental premise of continuing any proceedings under the Act also vanishes. Such cases where it is conclusively held that a commission of a scheduled offence is not established and such decision has attained finality pose no difficulty; in such cases, the proceedings under the Act would fail. 29. The Act is a penal statute and, therefore, can have no retrospective or retroactive operation. Article 20(1) of the Constitution of India expressly forbids that no person can be convicted of any offence except for the violation of a law in force at the time of the commission of the act charged as an offence. Further, no person can be inflicted a penalty greater than what could have been inflicted under the law at the time when the offence was committed. Clearly, no proceedings under the Act can be initiated or sustained in respect of an offence, which has been committed prior to the Act coming into force. However, the subject matter of the Act is not a scheduled offe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... documents of the alleged proceeds of crime, which are in the custody of the CBI Court. When the entire documents are in the custody of the Court, there cannot be any reason to believe that the properties will be dealt with in any other manner. The impugned order was as if 1st petitioner not able to offer any satisfactory explanation during examination. Therefore, the attachment officer has passed an order without a reason to believe that the proceeds of crime are likely to be transferred or disposal. In the absence of any sufficient reason, arriving to such conclusion by mere reproducing the words reason to believe it cannot be stated that the order has been passed after considering the entire gamut of materials. Admittedly, in this case, entire documents are available and the properties are in the custody of the court. Therefore, the order of attachment is not maintainable. 13. Similarly, the charge sheet was filed on 13.1.2009 under Section 13 of Prevention of Corruption Act, but this section was included in the list of Scheduled Offences under Prevention of Money Laundering Act is only on 1.6.2009. Therefore subsequent amendment cannot be given any retrospectiv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v. Taylor [(1875) 1 Ch D 426 (CA)] that where a statute provides for something to be done in a particular manner it can be done in that manner alone and all other modes of performance are necessarily forbidden. This principle has been followed by the Judicial Committee of the Privy Council in Nazir Ahmad v. Emperor [(1935-36) 63 IA 372 : AIR 1936 PC 253 (2)] and also by this Court in Deep Chand v. State of Rajasthan [AIR 1961 SC 1527 : (1961) 2 Cri LJ 705] , AIR at para 9 and also in State of U.P. v. Singhara Singh [AIR 1964 SC 358 : (1964) 1 Cri LJ 263 (2)] reported in AIR at para 8. 40. In the case of Kalabharati Advertising vs. Hemant Vimalnath Narichania [(2010) 9 SCC 437] , wherein the Hon'ble Supreme Court, in paragraphs 25 and 26, held as under:- 25. The State is under obligation to act fairly without ill will or malice- in fact or in law. Legal malice or malice in law means something done without lawful excuse. It is an act done wrongfully and wilfully without reasonable or probable cause, and not necessarily an act done from ill feeling and spite. It is a deliberate act in disregard to the rights of others. Where malice is attributed to the State, it ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mind at the stage of show-cause notice itself. Such a closed mind is inconsistent with the scheme of Rule 43 which is set out below. The aforesaid Rule has been framed in exercise of the power conferred under Section 33 of the Marine Products Export Development Authority Act, 1972 and as such that Rule is statutory in nature. 30. Rule 43 of the MPEDA Rules provides as follows: 43. Cancellation of registration.-Where the Secretary or other officer is satisfied that any person has obtained a certificate of registration by furnishing incorrect information or that he has contravened any of the provisions of this rule or of the conditions mentioned in the certificate of registration, or any person who has been registered as an exporter fails during the period of twelve consecutive months to export any of the marine products in respect of which he is registered, or if the Secretary or other officer is satisfied that such person has become disqualified to continue as an exporter, the Secretary or such officer may, after giving the person who holds a certificate a reasonable opportunity of making his objections, by order, cancel the registration and communicate to him a co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5. The test, therefore, is as to whether a mere apprehension of bias or there being a real danger of bias and it is on this score that the surrounding circumstances must and ought to be collated and necessary conclusion drawn therefrom-in the event however the conclusion is otherwise inescapable that there is existing a real danger of bias, the administrative action cannot be sustained: (emphasis supplied) 35. Going by the aforesaid test any man of ordinary prudence would come to a conclusion that in the instant case the alleged guilt of the appellant has been prejudged at the stage of show-cause notice itself. 40. In Kranti Associates [(2010) 9 SCC 496 : (2010) 3 SCC (Civ) 852] this Court after considering various judgments formulated certain principles in SCC para 47 of the judgment which are set out below: (SCC pp. 510-12) (a) In India the judicial trend has always been to record reasons, even in administrative decisions, if such decisions affect anyone prejudicially. (b) A quasi-judicial authority must record reasons in support of its conclusions. (c) Insistence on recording of reasons is meant to serve the wider principle of justice that justice must not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ruiz Torija v. Spain [(1994) 19 EHRR 553] , EHRR at p. 562, para 29 and Anya v. University of Oxford [2001 EWCA Civ 405 : 2001 ICR 847 (CA)] , wherein the Court referred to Article 6 of the European Convention of Human Rights which requires, adequate and intelligent reasons must be given for judicial decisions . (o) In all common law jurisdictions judgments play a vital role in setting up precedents for the future. Therefore, for development of law, requirement of giving reasons for the decision is of the essence and is virtually a part of due process . 42. In the case of Siemens Ltd. vs. State of Maharashtra [(2006) 12 SCC 33] , wherein the Hon'ble Supreme Court, in paragraphs 9 and 10, held as under:- 9. Although ordinarily a writ court may not exercise its discretionary jurisdiction in entertaining a writ petition questioning a notice to show cause unless the same inter alia appears to have been without jurisdiction as has been held by this Court in some decisions including State of U.P. v. Brahm Datt Sharma [(1987) 2 SCC 179 : (1987) 3 ATC 319 : AIR 1987 SC 943] , Special Director v. Mohd. Ghulam Ghouse [(2004) 3 SCC 440 : 2004 SCC (Cri) 826] and Union of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owed as a binding precedent is well established. If authority is needed for this proposition, we may refer to the decision of the Court of Appeal in Young v. Bristol Aeroplane Company, Ltd. [(1944) 2 All E R. 293], where Lord Greene, M.R. observed as follows: Where the Court has construed a statute or a rule having the force of a statute, its decision stands on the same footing as any other decision on a question of law. But where the Court is satisfied that an earlier decision was given in ignorance of the terms of a statute or a rule having the force of a statute, the position is very different. It cannot, in our opinion, be right to say that in such a case the Court is entitled to disregard the statutory provision and is bound to follow a decision of its own given when that provision was not present to its mind. Cases of this description are examples of decisions given per incuriam. 44. In the case of Philip Jeyasingh vs. The Joint Registrar of Co-operative Societies, Chidambaranar Region, Tuticorin [ (1992) 1 LW 216 (FB) (Mad.)] , the Hon'ble Full Bench of this Court, in paragraph 23, held as under:- 41. A Full Bench of this Court has in Syed Mohideen v. G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder the Prevention of Money Laundering Act, 2002. 47. In this regard, the judgments cited above by the learned counsel for the writ petitioners are also on the same legal issues. Thus, applying the principles laid down in the judgments cited by the learned counsel for the writ petitioners, the writ petitions are to be allowed. 48. The learned Additional Solicitor General of India, Mr.G.Rajagopalan, disputes the contentions raised on behalf of the writ petitioners in entirety. The learned Senior Counsel referred Section 3 of the Prevention of Money Laundering Act, 2002, which denotes the offence of money laundering and the said provision reads as under:- 3. Offence of money-Laundering .- Whosoever directly or indirectly attempts to indulge or knowingly assists or knowingly is a party or is actually involved in any process or activity connected proceeds of crime including its concealment, possession, acquisition or use and projecting or claiming it as untainted property shall be guilty of offence of moneylaundering. 49. Chapter III deals with attachment, adjudication and confiscation. Section 5 of the Act, deals with attachment of property involved in money lau ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... djudication.- (1) On receipt of a complaint under sub-section (5) of section 5, or applications made under sub-section (4) of section 17 or under sub- section (10) of section 18, if the Adjudicating Authority has reason to believe that any person has committed an offence under section 3 or is in possession of proceeds of crime, he may serve a notice of not less than thirty days on such person calling upon him to indicate the sources of his income, earning or assets, out of which or by means of which he has acquired the property attached under sub-section (1) of section 5, or, seized or frozen under section 17 or section 18, the evidence on which he relies and other relevant information and particulars, and to show cause why all or any of such properties should not be declared to be the properties involved in money-laundering and confiscated by the Central Government: Provided that where a notice under this sub-section specifies any property as being held by a person on behalf of any other person, a copy of such notice shall also be served upon such other person: Provided further that where such property is held jointly by more than one person, such notice shall be served ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3 of the Act, also states that the proceeds of crime, including its concealment, possession, acquisition or use and projecting or claiming it as untainted property shall be guilty of offence of money-laundering. Thus, even in case where the alleged offences were committed prior to the amendment, then also if the proceeds of crime is in possession of the alleged offenders are in use, then also the Authorities Competent are empowered to register the case under the Prevention of Money Laundering Act, 2002. 54. Section 24 of the Act, denotes burden of proof. Subclause (a) states in the case of a person charged with the offence of money-laundering under Section 3, the Authorities or the Courts shall, unless the contrary is proved, presume that such proceeds of crime are involved in money- laundering . Thereafter, Section 26 deals with the Appellate Tribunal. Section 42 of the Prevention of Money Laundering Act, 2002, provides an appeal to High Court (CMA). Any person aggrieved by any decision or order of the Appellate Tribunal may file an appeal to the High Court within sixty days from the date of communication of the decision or order of the Appellate Tribunal to him on any ques ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r to escape from the clutches of law. Such an attitude of the litigants can never be encouraged by the Courts. Prima facie, the maintainability of the writ petitions are to be considered at the first instance. 58. In the present cases, the writ petitions are pending for about six years. The authorities competent are unable to proceed with the matter. The writ petitioners are also unable to submit their defence statements in the manner prescribed under the provisions of the Prevention of Money Laundering Act, 2002. Such situations are certainly to be averted and the persons against whom such proceedings are initiated must be allowed to submit the facts and defence before the Competent Authorities, enabling the authorities to arrive a conclusion whether there is any offence is made out or proceeds of crime are in existence. 59. No writ proceedings can be entertained against a show cause notice and the attachment order, which was issued only for the purpose of commencing the investigation and the process under the provisions of the Prevention of Money Laundering Act, 2002. A writ proceeding can be entertained if the show cause notice and the attachment order had been issued with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... then also the provisions of the Act, attracts and there is no infirmity in respect of the actions initiated by the respondents under the provisions of the Prevention of Money Laundering Act, 2002. 62. It is made clear that the very initiation under the Prevention of Money Laundering Act, 2002 is not akin to that of the initiation of criminal proceedings under the Indian Penal Code. The Prevention of Money Laundering Act, 2002 is a Special Act contemplating an administrative proceedure at the initiat stage and thereafter prosecution. The Act has got certain special purposes and therefore, the initiation of proceedings under the Prevention of Money Laundering Act, 2002 can never be compared with the initiation of criminal proceedings under the Indian Penal Code. The enactment is a distinct one wherein separate procedures are contemplated in order to protect the interest of the alleged offenders also. The authorities under the Prevention of Money Laundering Act, 2002 cannot jump into the conclusion that the offenders are arrested at the first instance. An administrative procedure of verifying the records, recording statements of the offenders and other persons are provided under th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... offence of money laundering is made out, then only they are empowered to proceed further against the alleged offenders. However, while undertaking the process of investigating the truth behind the allegation of money laundering, the High Court cannot entertain the writ petition, so as to quash the entire institution of the proceedings, and accordingly, the authorities must be allowed to investigate freely and failry and by following the procedures contemplated under the Prevention of Money Laundering Act, 2002. 66. This apart, the appeal provisions are available under the Statutes, as discussed above, Section 26 provides an appeal to the Appellate Tribunal. Section 42 provides an appeal to the High Court (CMA). There is a comprehensive procedure for preferring an appeal to the PMLA Appellate Tribunal and thereafter to the High Court, the present writ petitions cannot be entertained at all. The writ petitioners are bound to exhaust the alternate remedies provided under the Statutes. The question raised before this Court by the respondents that the writ petitions are premature and further, the writ petitioners have not exhausted their remedies available under the provisions of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... utional structure. (These cannot be catalogued but can only be illustrated): (1) The supremacy of the Constitution. (2) Republican and Democratic form of government and sovereignty of the country. (3) Secular and federal character of the Constitution. (4) Demarcation of power between the Legislature, the executive and the judiciary. (5) The dignity of the individual secured by the various freedoms and basic rights in Part III and the mandate to build a welfare State contained in Part IV. (6) The unity and the integrity of the Nation. 2. Holiness Kesavananda Bharati Sripadagalvaru v. State of Kerala and Anr . [MANU/SC/0445/1973 : (1973) 4 SCC 225]. That separation of powers between the legislature, the executive and the judiciary is the basic structure of the Constitution is expressly stated by Sikri, C.J. 3. P. Kannadasan and Ors. v. State of T.N. and Ors . [MANU/SC/0650/1996 : (1996) 5 SCC 670] the Supreme Court noted that the Constitution of India recognised the doctrine of separation of powers between the three organs of the State, namely, the legislature, the executive and the judiciary. The Court said: It must be remember ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion. (iv) The superior judiciary (High Courts and Supreme Court) is empowered by the Constitution to declare a law made by the legislature (Parliament and State legislatures) void if it is found to have transgressed the constitutional limitations or if it infringed the rights enshrined in Part III of the Constitution. (v) The doctrine of separation of powers applies to the final judgments of the courts. Legislature cannot declare any decision of a court of law to be void or of no effect. It can, however, pass an amending Act to remedy the defects pointed out by a court of law or on coming to know of it aligned. In other words, a court's decision must always bind unless the conditions on which it is based are so fundamentally altered that the decision could not have been given in the altered circumstances. (vi) If the legislature has the power over the subject-matter and competence to make a validating law, it can at any time make such a validating law and make it retrospective. The validity of a validating law, therefore, depends upon whether the legislature possesses the competence which it claims over the subject-matter and whether in making the validation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ief is against public policy or barred by any valid law; and host of other factors. 2. KanaiyalalLalchand Sachdev and Ors. vs. State of Maharashtra and Ors . (07.02.2011 - SC) : MANU/SC/0103/2011 It is well settled that ordinarily relief Under Articles 226/227 of the Constitution of India is not available if an efficacious alternative remedy is available to any aggrieved person. ( See Sadhana Lodh v. National Insurance Co. Ltd .; Surya Dev Rai v. Ram Chander Rai and SBI v. Allied Chemical Laboratories.) 3. Commissioner of Income Tax and Ors. v. ChhabilDass Agarwal , MANU/SC/0802/2013 : 2014 (1) SCC 603, as follows: Para 15. while it can be said that this Court has recognised some exceptions to the Rule of alternative remedy i.e. where the statutory authority has not acted in accordance with the provisions of the enactment in question, or in defiance of the fundamental principles of judicial procedure, or has resorted to invoke the provisions which are repealed, or when an order has been passed in total violation of the principles of natural justice, the proposition laid down in ThansinghNathmal case, Titaghur Paper Mills case and other similar judgments that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en considered to be a rule of self imposed limitation. It is essentially a rule of policy, convenience and discretion and never a rule of law. Despite the existence of an alternative remedy it is within the jurisdiction of discretion of the High Court to grant relief under Article 226 of the Constitution. At the same time, it cannot be lost sight of that though the matter relating to an alternative remedy has nothing to do with the jurisdiction of the case, normally the High Court should not interfere if there is an adequate efficacious alternative remedy. If somebody approaches the High Court without availing the alternative remedy provided the High Court should ensure that he has made out a strong case or that there exist good grounds to invoke the extraordinary jurisdiction. 6. K.S. Rashid and Sons v. Income Tax Investigation Commission and Ors., AIR (1954) SC 207; Sangram Singh v. Election Tribunal, Kotah and Ors ., AIR (1955) SC 425; Union of India v. T.R. Varma , AIR (1957) SC 882; State of U.P. and Ors. v. Mohammad Nooh , AIR (1958) SC 86 and M/s K.S. Venkataraman and Co. (P) Ltd. v. State of Madras , AIR (1966) SC 1089, Constitution Benches of the S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... und of maintainability of the writ petitions with reference to the PMLA Act and with reference to the stage in which the present writ petitions are filed. Thus, all those judgments referred by the learned counsel for the writ petitioners have no relevance with reference to the grounds considered in the present writ petitions. 69. Accordingly, this Court has no hesitation in coming to the conclusion that the present writ petitions are not only premature and the compex facts and circumstances now raised by the writ petitioners, cannot be adjudicated in view of the fact that the writ petitioners have not exhausted the appeal remedies provided under the Statutes and not participated in the administrative procedures contemplated under the provisions of the Prevention of Money Laundering Act, 2002, establishing their innocence or otherwise before the Competent Authorities. Such administrative procedures contemplated cannot be construed as akin to that of the criminal proceedings initiated under the Indian Penal Code. 70. This being the view of the Court, the writ petitioners, being failed to establish any legally acceptable ground, so as to interfere with the impugned orders passed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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