M/S. Fibermarx Papers Pvt. Ltd. vs Deputy Director Directorate Of Enforcement, Dehradun

G. C. Mishra, Acting Chairman

MP-PMLA-8539/DDN/2021 (U.H.)

The present application has been filed by the applicant/appellant with a multiple prayers by the appellant including grant of urgent hearing. The prayers

for urgent hearing is considered, allowed and disposed of.

MP-PMLA-8538/DDN/2021 (Exem.)

The present exemption application has been filed by the applicant/appellant seeking to exempt the applicant from filing the certified copy of the

Adjudication order dated 12.03.2021. The same is considered, allowed and disposed of.

FPA-PMLA-4000/DDN/2021 & MP-PMLA-8540/DDN/2021 (Stay) in FPA-PMLA-4000/DDN/2021

Fresh appeal has been filed under 26 of the Prevention of Money Laundering Act, 2002 against the impugned order dated 12.03.2021 passed by the

Adjudicating Authority in O.C. No. 1353/2020.

Alongwith appeal the appellant has filed application for stay of the effect of the impugned order and to prevent physical possession of the following

property by the Respondent/ED. The details of the property is as follows:-

“Property having a total land area 8.8660 hectare at Khasra No. 600, 603 min at village Jagatpur Patti, 52, 53 min, 74 min (all in village Haldua

Sahu), 591 Min & Building, to the tune of Rs. 15,15,86,100/-â€​

Issue notice in the appeal and as well as in the stay application. Shri N.K. Matta, the learned counsel for the Respondent accepted the notice. It is

submitted by him that the copies of the appeal paper book has not been supplied to him. On the other hand the learned counsel for the appellant

submitted that the appellant has already supplied two sets of the copies of the appeal paper book to the Respondent in the Headquarters. However,

the appellant is directed to supply one set copy of appeal paper book to the learned counsel for the Respondent/ED through digital mode within one

week. The learned counsel for the Respondent/ED has sought six weeks time to file the replies to the appeal as well as in the stay application, which

is not objected. Let the replies to the appeal and stay application be filed within six weeks with advance copies to be served on the other side. The

learned counsel for the Respondent sought four weeks time to file rejoinder to the reply to the appeal from the date of receipt of the copy of the same,

which is not objected. Let the rejoinder to the reply to the appeal be filed within four weeks as prayed.

During the course of hearing, the learned counsel for the appellant has submitted that the Respondent has issued 10 days notice of eviction from the

aforesaid property which is a running concern and is paper mill and that 40 labourers are employed in the said mill and besides them there are also

management people managing the paper mill and that total alleged proceeds of crime involved in the present case is Rs. 4,49,10,000/- where as the

value of the aforesaid property is Rs. 15,15,86,056.48 p and that property has been attached as a value equivalent to the proceeds of crime and that

the aforesaid property has been acquired 10 years prior to the commission of scheduled offence and that without prejudice to the right of the appellant

the Respondent/ED should have attached the share of the persons concerned and that on the basis of above, the learned counsel for the appellant

submitted for grant of order of status quo with respect to the aforesaid property.

On the other hand, the learned counsel for the Respondent/ED submitted that the appellant should submit the gross income of the appellant company

with the Respondent/ED and separate proportionate amount be deposited. However, he submitted that he will file reply to the stay application.

Heard both sides and considered the material placed on record. It is an admitted fact that the appellant is a running concern and is a paper mill and

that the property has been attached as a value equivalent to the proceeds of crime and that the value of the property attached herein is more than

three times than the alleged proceeds of crime and that when it is a paper mill there must have been labourer working in the said mill and employees

must have been there to run/manage the business of mill. It is also seen from the paper that 10 days eviction notice has been issued for eviction which

is not in accordance with the relevant rules as prescribed under Prevention of Money Laundering (Taking Possession of Attached or Frozen

Properties Confirmed by the Adjudicating Authority), Rules 2013. Admittedly the appellant is a productive assets which is producing paper and the

manufacturing process is being carried out and in such case the appropriate notice would have been under Rule 5 (6) of the said Rules.

Considering the above, I am of the considered view that the appellant has a prima facie case for grant of interim order of “status quo†till the next

date of hearing. If the order of “status quo†is not granted, it will not only hit the economy but also create unemployment which cannot be

compensated in terms of money, hence there would be irreparable injury. The balance of convenience lies in favour of the grant of order of “status

quoâ€​ till the next date of hearing. The order of “status quoâ€​ is subject to the following conditions:-

(i) Attachment shall continue.

(ii) The legal and constructive possession of the property in question shall remain with the Enforcement Directorate;

(iii) The appellant is prohibited to create any third party right or dispose of the property in question in any manner;

(iv) No encumbrance shall be created by the appellant in respect of the said property.

(v) The appellant is directed not to change the nature and character of the property.

With the consent of both the parties, list the matter on 29th July, 2021.