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Judgment
FPA-PMLA-2744/DLI/2018
The Deputy Director, Enforcement Directorate has preferred this present appeal against the order dated 26th September, 2018 passed by the
Learned Adjudicating Authority in the matter of OA No. 204/2018 in which it is held that condition laid down for retention are not satisfied and OA is
rejected.
In Para no. 4 of the impugned order it is held by the Learned Adjudicating Authority as follows:
“Based on the submissions made by the Applicant and the Respondent it is on record that as a result of search conducted by the Assistant
Director only few gold coins have been recovered and it is not difficult to ascertain whether they, can be useful in any investigation in the
matter. Applicant has termed them as proceeds of crime. However there is no justification for that. I don’t find any justification for
retention of seized gold coins as it does not carry any special marking or mention on it. I am also shocked to see that the application has
been filed before the Authority but in the 3 hearings conducted by the Authority in none of the them Applicant or its Counsel remain present
for replying to query or making arguments in favour of the Application. This indifference towards the proceedings before the Authority
after filing of the Application is totally unjustified and ridiculous. In view of this it is not tenable to support the Application of the Applicant
and accordingly the Application is rejected. The seized item should be restored to the Respondent.â€
Heard the respective counsels and gone through the materials available on record. It is seen from the record that the ED registered an ECIR on the
basis of an FIR registered by CBI vide RCBD1/2017/E/0007 on 25.10.2017 under Section 13(2) r/w 13(1)(d) of PC Act, 1988 and Sections 120(B)
r/w 420, 467, 468 & 471 of IPC, 1860. It is alleged in the said FIR that M/s. Sterling Biotech Limited, its 05Â Directors, namely S/Sh. Nitin Jayantilal
Sandesara, Chetan Jayantilal Sandesara, Rajbhushan Dixit, Vilas Dattatray Joshi and Smt. Dipti Chetan Sandesara and others
hatched criminal conspiracy with each other with dishonest intention to cheat Andhra Bank and other Public Sector Banks. The Sterling Biotech
Limited availed loan of more than INR 5000 Crores which have turned into Non-Performing Assets (NPA).
The Respondent is not an FIR named accused nor named in the ECIR. It is the case of the appellant that during the course of search dated
16.04.2018, they found some Gold Coins of different weights weighing about 368 grams in total valued at Rs. 11,77,600/- alongwith jewellery from one
of the locker no. 104 with SBI, New Ashok Nagar, New Delhi - 110096, jointly held in the name of the respondent and his wife. According to the
appellant only the Gold Coins were seized. The relevant documents concerning the search, seizure/panchnama dated 16.04.2018 are perused.
In appeals bearing no. FPA-PMLA-2383/DLI/2018 and FPA-PMLA- 2384/DLI/2018 against the orders passed by AdjudicatingÂ
Authority dated 04th May, 2018 in OA No. 155/2018 and 160/2018 respectively arising out of the same ECIR and betweenÂ
the same parties, this Appellate Tribunal had passed the following orders:
“FPA-PMLA-2383/DLI/2018
By this order, we propose to decide the above mentioned appeal which has been filed under Section 26 of the Prevention of Money
Laundering Act, 2002 against the order dated 04th May, 2018 passed by the Adjudicating Authority in OA No. 155/2018.
The impugned order was passed on 04th May, 2018. The prosecution complaint has been filed within 90 days under Section 8(3)(a) of the
Act. Section 8(3)(a) is a mandatory provision which stipulates that if no prosecution complaint is filed, the retention order of seizure lapses.
In the present case, more than a year has been passed. No prosecution complaint has been filed. Therefore, the appeal is allowed by setting
aside the order dated 04th May, 2018. However, the retained material shall be returned to the appellant within four weeks.
In the interest of justice, the respondent is at liberty to keep the copy/print of the same before handing over the same to the appellant.
It is clarified that we have not decided anything on merit of the case. The appeal is accordingly disposed of.
FPA-PMLA-2384/DLI/2018
By this order, we propose to decide the above mentioned appeal which has been filed under Section 26 of the Prevention of Money
Laundering Act, 2002 against the order dated 04th May, 2018 passed by the Adjudicating Authority in OA No. 160/2018.
The impugned order was passed on 04th May, 2018. The prosecution complaint has been filed within 90 days under Section 8(3)(a) of the
Act. Section 8(3)(a) is a mandatory provision which stipulates that if no prosecution complaint is filed, the retention order of seizure lapses.
In the present case, more than a year has been passed. No prosecution complaint has been filed. Therefore, the appeal is allowed by setting
aside the order dated 04th May, 2018. However, the retained material shall be returned to the appellant within four weeks.
In the interest of justice, the respondent is at liberty to keep the copy/print of the same before handing over the same to the appellant.
It is clarified that we have not decided anything on merit of the case. The appeal is accordingly disposed of.â€
The aforesaid two appeals were also relating to search and seizures of certain documents etc., from the possession of the present respondent arising
out of same ECIR. The said two impugned orders were set aside by this Bench of the Tribunal on the grounds stated therein.
During the course of arguments the learned counsel for the respondent amongst others submits that the respondent is not named in the FIR or
ECIR and no complaint has been filed against him under PMLA. The retention of seized items, therefore, beyond the prescribed period provided under
Section 8(3)(a) of the PML Act, 2002. The prescribed period of the retention having already expired, there is no justification of retaining this seizure.
It is an undisputed fact that the respondent is not an FIR named accused nor named in the ECIR and no prosecution complaint has also been filed
against him even though prosecution complaint under PMLA has been filed against several persons including Shri Gagan Dhawan, Shri Nitin Jayantilal
Sandesara, etc., arising out of same ECIR and the Special PMLA Court has taken the cognizance of the same and further trial proceedings are
underway. There is no whisper anywhere in the appeal that either the respondent is prosecuted under PMLA or the materials seized herein are part of
any prosecution complaint.
The arguments of this appeal were completed on 30.07.2019 and then it is fixed for orders.
In the circumstances, as per the provisions of Section 8(3)(a) of PMLA, 2002 as existed till 31.07.2019 prosecution complaint was to be filed within
90 days. The impugned order was passed on 26th November, 2018. As per the said mandatory provision then existed, the prosecution complaint was
to be filed involving the property in question within the prescribed period of 90 days and that if no prosecution complaint is filed in respect of the
property concerned, the retention order of seizure lapses. In the present case more than 90 days have been passed since the day of passing of the
impugned order and no prosecution complaint was filed that the materials seized herein are part of any prosecution complaint. Therefore, in the light of
the above the impugned order to the extent that “The seized item should be restored to the Respondent.†is confirmed with a direction to the
appellant that the retained material shall be returned to the respondent within four weeks.
It is clarified that we have not decided the present appeal on merit.