PARENA SWARUP Vs. UNION OF INDIA

JUDGEMENT

(1.) MS. Pareena Swarup, member of the Bar, has filed this writ petition under Art. 32 of the Constitution of India by way of Public Interest Litigation seeking to declare various sections of the Prevention of Money Laundering Act, 2002 such as section 6 which deals with adjudicating authorities, composition, powers etc. , Section 25 which deals with the establishment of Appellate Tribunal, Section 27 which deals with composition etc. of the Appellate Tribunal, Section 28 which deals with qualifications for appointment of chairperson and Members of the Appellate Tribunal, Section 32 which deals with resignation and removal, Section 40 which deals with members etc. as ultra vires of Arts. 14, 19 (1) (g), 21, 50, 323b of the Constitution of India. It is also pleaded that these provisions are in breach of scheme of the constitutional provisions and power of judiciary.

(2.) BRIEF facts in a nutshell are: the Prevention of Money Laundering Act, 2002 (hereinafter referred to as "the Act") was introduced for providing punishment for offence of Money Laundering. The Act also provides measures of prevention of money laundering. The object sought to be achieved is by provisional attachment of the proceeds of crime, which are likely to be concealed, transferred or dealt with in any manner which may result in frustrating any proceedings relating to confiscation of such proceeds under the Act. The Act also casts obligations on banking companies, financial institutions and intermediaries to maintain record of the transactions and to furnish information of such transactions within the prescribed time. In exercise of powers conferred by clause (s) of sub-section (2)of Section 73 read with Section 30 of the Prevention of Money-Laundering Act, 2002 (15 of 2003), the Central Government framed rules regulating the appointment and conditions of service of persons appointed as Chairperson and Members of the Appellate Tribunal. These rules are the Prevention of money-Laundering (Appointment and Conditions of Service of chairperson and Members of Appellate Tribunal) Rules, 2007. The Central Government has also framed rules called the prevention of Money Laundering (Appointment and Conditions of Service of Chairperson and Members of Adjudicating authorities) Rules, 2007.

(3.) WE have carefully verified the provisions of the Act and the Rules, particularly, relating to constitution and selection of adjudicating Authorities, Members and Chairperson of the appellate Tribunal. Considering the stand taken by the petitioner with reference to those provisions, we requested Mr. K. K. Venugopal, learned senior counsel, to assist the Court. Pursuant to the suggestion made by the Court, Mr. K. K. Venugopal and Mr. Gopal Subramaniam, learned Additional solicitor General, discussed the above issues and by consensus submitted certain proposals.