Bajaj Finance Ltd vs Joint Director Directorate Of Enforcement, Lucknow

FPA-PMLA-2058/LKW/2017

The present appeal has been filed under section 26 of the PMLA Act against the order dated 13.09.2017 passed by the Adjudicating Authority.

The case of the Appellant is closely similar to the case decided by this Tribunal on dated 14.07.2017 in State Bank of India and Ors. Vs. The Joint

Director, Directorate of Enforcement, Kolkata. In Paragraphs 46 and 47 of the Judgment, this Tribunal found that the attached property was

purchased much prior to the period when the facility of offending loans were sanctioned to the borrowers. Further, the Bank was not involved in the

schedule offence. It was further observed that the mortgaged properties are security to the loans and cannot be subject matter of attachment

particularly when the same were purchased and mortgaged prior to the events of funds diversion and frauds committed by the borrowers. A

completely same scenario exists in the present case also where the Appellant is a bona fide lender and the properties in question have been originally

purchased, much before the offending transactions took place. The contents of said properties 46 and 47 are reproduced:-

“46. In the present case, it is undisputed facts that the attached property were purchased much prior to the period when the facility of

loan sanctioned to the borrowers. The banks while rendering the facilities were boanfide parties. It is not the case of the respondent that the

attached properties were purchased after the loan was obtained. The mortgaged of the properties were done as bonafide purposes. None of

the bank is involved in the schedule offence. No PMLA proceedings are pending except the complainant bank was arrayed as Column;-11

at the time of framing charges. Union Bank of India has not granted sanction against its employee to proceed against him in criminal

complaint. There is no criminal complaint under the schedule offence and PMLA is pending against the two banks. In case of failure on the

part of borrowers to comply with the terms of settlement, the contempt proceedings are maintainable in the Court where the settlement was

recorded.

In view of the entire gamut of the dispute, we are of the considered opinion that the conduct of the banks are always bonafide. Both

banks are innocent parties. They were legally entitled to inform the Adjudicating Authority about their innocence and they rightly did so but

their contention was rejected as appeared from the impugned order.â€​

The said Judgment passed by us has not been considered and followed by the Adjudicating Authority. It is a very serious matter. The Authority is

supposed to give due respect to the judgment of the higher Authority and Courts. The said judgment was passed by referring the decisions of Supreme

Court, Full Bench of the High Court of Madras and other High Court. But the same has not been discussed at all.

However, it appears to us, in many matters, the judgments of the Tribunal and higher courts are not being followed. The member who has passed

the impugned order is not a judicial member, he should here consulted at least the member (legal) before ignoring the judgment of higher authority and

courts.

Issue notice of the appeal. Mr. Vikas Garg, Counsel for the respondent accepts the notice and seeks time to file the reply. Let the reply be filed

within four weeks with an advance copy to the counsel or the appellant.

List this appeal for final disposal on 15th January, 2018.

In the meanwhile, operation of impugned order shall remain stayed as far as the case of the appellant is concerned.

Copy of the order be sent to the Ministry.

Order be given “Dastiâ€​ to both the parties.