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2020 (3) TMI 86

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..... in whose custody the property of the offender is being held - In the case on hand, the fixed deposit is alleged to have been created by the fourth respondent with the petitioner bank. In fact, a copy of the provisional order of attachment dated 15.03.2012 was also communicated by the Director of Enforcement to the petitioner bank as seen from the names found in the last page of the said provisional order of attachment. Even though the provisional order of attachment was communicated to the petitioner, even without hearing the petitioner and without giving any opportunity to the petitioner, the final adjudication order of attachment has been passed by the third respondent under the impugned order. It is clear that the third respondent has no .....

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..... for M/s.Shivakumar and Suresh For the Respondents 1 & 2 : Mr.V.Parivallal For the Respondents 3 & 4 : No appearance ORDER This writ petition has been filed challenging the order dated 13.06.2012 passed by the third respondent under Section 8(1) of the Prevention of Money Laundering Act, 2002. 2. It is the case of the petitioner that they granted loan to the fourth respondent, based on the security of fixed deposit created by him and that the fourth respondent committed default in the repayment of the loan and therefore, they exercised lien over the fixed deposit created by the fourth respondent in their favour towards repayment of the loan. According to them, the third respondent without any notice to the petitioner has passed the .....

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..... the petitioner bank. They have also narrated the money laundering offence committed by the fourth respondent in their detailed counter affidavit. 4. Heard Mr.V.Suresh, leared counsel for the petitioner and Mr.V.Parivallal, learned standing cunsel for the respondents. 5. Section 8(1) of the Prevention of Money Laundering Act, 2002 reads as follows: 8. Adjudication.- (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 subsection (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 ca .....

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..... ven though the provisional order of attachment was communicated to the petitioner, even without hearing the petitioner and without giving any opportunity to the petitioner, the final adjudication order of attachment has been passed by the third respondent under the impugned order. 7. It is the case of the petitioner that the fixed deposit was created by the fourth respondent only to secure the loan availed by him from the petitioner bank. According to them, under the loan documents executed by the fourth respondent, the petitioner is having a right to exercise lien over the fixed deposit for non-payment of the dues by the fourth respondent. It is their case that the fourth respondent is a defaulter to them and he owes substantial sums of mo .....

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..... y the learned counsel for the petitioner in the case of Indian Bank vs. Government of India reported in 2012 (4) CTC 225, this Court has observed that there is an obligation on the part of the adjudicating authority to hear the bank, when it is pointed out to the adjudicating authority that the bank had already laid a claim. The relevant paragraphs of the said judgment are extracted hereunder: 29. The Proviso to sub-section (2) of Section 8 enables any person who claims the property to be his own, also to be given an opportunity of being heard to prove that the property is not involved in money laundering. This proviso makes it clear that the leverage given to the Adjudicating Authority to release the property is limited to instances where .....

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..... ng into account all relevant materials placed on record before him, by an order, record a finding whether all or any of the properties referred to in the notice issued under sub-section (1) are involved in money-laundering: Provided that if the property is claimed by a person, other than a person to whom the notice had been issued, such person shall also be given an opportunity of being heard to prove that the property is not involved in money-laundering. 42. Therefore, there is an obligation on the part of the Adjudicating Authority to hear the Bank, when it is pointed out to the Adjudicating Authority that the Bank had already laid a claim and that they also have obtained an interim stay of all further proceedings. 10. In the case on hand .....

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