Thursday, December 10, 2015

Attachment of property isn't restricted only in hands of accused involved in money laundering


There is no restriction in respect attachment of property of person in possession of proceeds of crime. Section 5 of Money Laundering Act, 2002 does not have restriction that property in hands of persons involved in Money Laundering alone can be attached pending confiscation. Thus, provisional attachment of property is not restricted in hands of accused persons alone.

Facts


a)    ‘G’ was accused of having played fraud and obtained a loan of Rs.15 Crores by producing bogus and fabricated documents. Out of the said amount, the property in question was purchased by him in the names of his Benamies. ‘A’ was appointed as their Power Agent. One ‘GS’ purchased the property through the Power Agent ‘A’, later on, ‘GS’ sold property to appellants.

b)    The respondent- Deputy Director, PMLA, Directorate of Enforcement filed a complaint under Section 5(5)of the PMLA, 2002 against the appellants and ‘G’ having reason to believe that property in the hands of appellants was part of proceeds of crime u/s 2(1)(u) of the PMLA,2002 and appellants and ‘G: were involved in the offence of money laundering and held them liable for adjudication and confiscation in terms of Section 8 of PMLA, 2002


c)   The appellants said that they were bonafide purchasers of the land and the consideration was paid through legal source of income through agricultural operations and transactions were carried out through bank also and they were not aware of that property bought by them was a proceed of crime.

d)    The adjudicating authority held that property represented the proceeds of crime and 
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