SATISH MOTILAL BIDRI Vs. UNION OF INDIA.

JUDGEMENT

(1.) During the course of an investigation under the provisions of the Prevention of Money Laundering Act, 2002 (for short 'PMLA') against a proprietary concern called M/s. Masters Finserv, and others, the bank accounts of the petitioner were frozen by an order dtd. 5/9/2023. While the challenge against the freezing of bank accounts was pending consideration in this writ petition, an order of provisional attachment was issued on 22/5/2024, attaching the very same bank accounts and an immovable property of the petitioner. The subsequent order of attachment was incorporated as an additional challenge after amending the writ petition. Thus petitioner, inter alia, challenges the freezing of his bank accounts and the provisional order of attachment issued under sec. 5 of PMLA, in this petition under Article 226 of the Constitution of India.

(2.) Petitioner is a businessman having an electronic shop at Sholapur, Maharashtra and claims that he has no connection with the business of Masters Finserv or its proprietor. During September 2023, petitioner was informed by his bankers that his bank accounts maintained with the IDFC Bank, ICCI Bank and Federal Bank were frozen under orders of the Enforcement Directorate. Since the order freezing the bank accounts was in violation of Sec. 17(1) of the PMLA, petitioner approached this Court in this writ petition. In the meanwhile, on 25/4/2024, an interim direction was issued by this Court, directing the second respondent to consider petitioner's request for permitting him to withdraw money from his bank account due to his wife's medical condition. Though the said direction was challenged by the petitioner before the Supreme Court in SLP (Crl) No.6628/2024, it was disposed of with a direction for an expeditious adjudication of the writ petition. While so, on 22/5/2024, the second respondent issued an order under Sec. 5(1) of the PMLA, provisionally attaching an immovable property of the petitioner together with the three bank accounts which were earlier frozen by the order dtd. 5/9/2023. Petitioner thus challenges not only the order freezing his bank accounts but also the order of provisional attachment of his properties - both immovable and his bank accounts.

(3.) A counter affidavit has been filed by respondents 2 and 3 stating that the writ petition is not maintainable as the petitioner has an alternative remedy before the adjudicating authority under Sec. 8 of the PMLA Act. The predicate offence alleged includes multiple FIR's including F.I.R No. 1156/2022, wherein, offences are alleged to have been committed by the proprietary concern called M/s.Masters Finserv and its proprietor Sri. Ebin Varghese and others during the period 27/1/2021 and 14/11/2022 under Ss. 406, 420 and 34 of the Indian Penal Code, 1860. Respondents stated that during the investigation it was revealed that the accused had induced complainants to make deposits promising to generate huge profits on their investments after giving false assurances of high interest rates and thereafter embezzled more than 73 crores from various complainants. It was further stated that the investigation also revealed that petitioner who is not an accused in any of the FIR's had arranged two mule accounts under the name of M/s. Prashant Traders and M/s. Model Traders and received a credit of Rs.85.50 lakhs and Rs.3.98 crores from the bank accounts of the accused and its related entities for use in Online Casinos, and in return, petitioner received Rs.33.00 lakhs for the said arrangement of which Rs.15,00,000.00 was through his bank account and Rs.18,00,000.00 in cash from local hawala operators. It is also stated that during the course of the investigation, the second respondent felt it necessary to issue a provisional attachment order and therefore on 22/5/2024, the impugned order Ext.P11 was issued and since the bank account has also been attached provisionally, the lien marked over the said bank accounts have lost its significance. The respondents further alleged that petitioner do have an appropriate remedy before the adjudicating authority under the provisions of the PMLA and that the writ petition is not a proper remedy.