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Judgment
G.S. Sistani, J
Challenge in this appeal is to the order dated 10.12.2018 passed by the learned Single Judge of this Court. Some necessary facts which are required
to be noticed for disposal of this appeal are that the respondents herein had challenged an order passed by the Appellate Tribunal constituted under the
provisions of the Prevention of Money Laundering Act, 2002 (hereinafter referred to as “PMLA†in short). Another important factor to be
noticed is that one of the parties to the proceedings being the husband/father of the respondent (petitioner in writ petition) filed a review petition before
the Appellate Tribunal, which is still pending.
The petitioners in the writ petition had filed an application seeking a direction to the appellants herein to release the jewellery, which was seized
during the search operation of 22.09.2014 conducted on the respondents herein. The petitioners/respondents herein sought the release of the jewellery
in lieu of security by way of a Fixed Deposit of Rs. 1,23,22,317/-in the case of respondent No. 1 and Rs. 29,64,387/- in the case of respondent No.2.
This amount was as per the valuation of the jewellery given by the appellants herein. Mrs. Acharya, learned Additional Solicitor General submits that
the filing of a writ petition by two parties and filing of a review petition and getting the matter adjourned sine die is part of a larger device of the parties
to delay the matter and even otherwise a single order cannot be split and the parties cannot be permitted to take advantage in the manner which is
being sought. Additionally, it is contended before us that there is no provision under the PMLA for return of seized articles, even on furnishing of a
security.
Mr. Kapur, learned Senior Counsel appearing for the respondents submits that no prejudice would be caused to the rights of the appellant and all
legal issues sought to be raised in the writ petition as also in the review petition as well as rights and contentions of the parties may be kept open. Mr.
Kapur also submits that the petitioners (respondents herein) have not sought release of the jewellery unconditionally, but have agreed to protect the
rights of the Department by furnishing a Fixed Deposit receipt as per the valuation of the Department. He also relies on Section 9 and 10 of the
PMLA in support of his contention that should the appellant succeed, they would be well within their rights to liquidate the amount. It is also contended
by Mr. Kapur that since no notice was issued to the respondents herein under Section 17(4) or Section 20 of the Act and also that they were not
parties to the adjudicating proceedings, the jewellery could in any case not be retained by the appellants for a period of more than 180 days, as per
Section 20(3), which is reproduced below:
“20. Retention of property.â€
(1) xxx xxx xxx
(2) xxx xxx xxx
(3) On the expiry of the period specified in sub-section (1), the property shall be returned to the person from whom such property was seized unless
the Adjudicating Authority permits retention of such property beyond the said period.â€
We have heard the learned counsel for the parties, and have examined the order passed by the learned Single Judge, the operative part of which
reads as under:
“10. Prima facie, the contention advanced by the petitioners appears to be merited as admittedly no order of seizure of jewellery has been passed
against the petitioners.
As noted above, there appears to be no dispute that certain jewellery seized on 22.09.2014 belongs to the petitioners. This is also noted by the
Appellate Tribunal in the impugned order.
Admittedly, after the seizure was affected under Section 17(1) of the Act, the respondents were required to seek an extension under Section 20 of
the PMLA if the respondents required to retain the seized property beyond the period of 180 days. It was also incumbent upon the respondents to
make an application under Section 17(4) of the Act, which would be required to be adjudicated by the Adjudicating Authority in terms of Section 8 of
the PMLA. Section 8(1) of the PMLA also requires that notice of not less than 30 days be issued to be person from whose the possession of the
property is recovered, calling upon them to show cause why the property could not be treated as properties involved in money laundering. The
Adjudicating Authority, thereafter, is required to pass an order after considering the reply, if any, submitted by such a person.
In the present case, it is not disputed that no notice in respect of the subject jewellery (seized jewellery belonging to the petitioners) has been
issued to them.
However, at this stage, it is not necessary for this Court to dwell further into the said issue as the prayers made by the petitioner are of a limited
import. The petitioners merely seek conditional return of the jewelleries seized by the respondents on them furnishing security for full value of the
same. Considering above, this Court finds no reason to reject this present application, while ensuring that the interest of the respondents are duly
protected.
Accordingly, the respondents are directed to return the jewellery of the value belonging to petitioner nos. 1 and 2 (jewellery valued at Rs.
1,23,22,317/- in case of petitioner no. 1 and Rs. 29,64,387/- in case of petitioner no. 2). This shall be released to petitioners on them furnishing (a) fixed
deposit of the aforesaid amount to the respondents; and (b) an undertaking to this Court that they shall not transfer, part with, encumber or in any
manner alienate the jewellery so returned. It is clarified that the attachment with regard to the jewellery shall continue and although, the petitioners
may be placed in possession of the said jewellery the same would be considered as custodia legis.â€
We do not find any force in the submissions made by the learned ASG in view of the fact that admittedly the respondents herein are not party to the
proceedings initiated against the husband/father of the respondents herein respectively. We are also of the view that the appellants have not sought
any extension under Section 20(3) of the PMLA for further retention of the jewellery. Learned ASG submits that a notice was issued subsequently
and the effect of which would be decided by the Single Judge.
We are prima facie satisfied that no prejudice in any manner will be caused to the appellant if the jewellery is released, for the reason that before
the Single Judge, the respondents have volunteered to furnish a fixed deposit receipts in the amount Rs. 1,23,22,317/- and Rs. 29,64,387/- respectively
and also furnish an undertaking that they would not transfer, part with or encumber in any manner or alienate jewellery returned to them and this
undertaking has been accepted by the Court. We are informed that the undertaking has been furnished. Additionally, we direct the Department to take
pictures of the jewellery in the presence of the respondents herein and the pictures would be duly signed by both the parties for the purposes of proper
identification. The jewellery would be returned to the respondents against a proper receipt to be issued by the appellants.
We find no grounds to entertain this appeal.
The appeal is accordingly dismissed.
The order be complied within 10 days.