UNION OF INDIA Vs. BHUVAN MADAN

JUDGEMENT

(1.) Heard learned Additional Solicitor General Mr.Devang Vyas for the appellant-Union of India and Directorate of Enforcement, learned advocate Mr.Satendra K. Rai for learned advocate Mr.Shrijit G. Pillai for respondent No.1- M/s.Diamond Power Infrastructure Limited and learned advocate Mr.Seshagiri with learned advocate Mr.Gaurav Lakhwani for respondent No.2 in respect of admission of the appeal as well as grant or otherwise of interim stay, at length.

(2.) The appeal is directed against judgment dated 18th June, 2019 passed by the Appellate Tribunal, Prevention of Money Laundering Act , 2002 in the Appeal No.5595/AHD/2019 and No.5596/AHD/2019 which are filed by respondent No.2 Bank herein as well as in Appeal No.2742/AHD/ 2019 preferred by the respondent-Resolution Professional for M/s.Diamond Power Infrastructure Limited. Thereby the Appellate Tribunal has released the attachment over the properties of M/s.Diamond Power Infrastructure Limited (DPIL) as per order dated 24th April, 2018 which was provisional attachment order and came to be confirmed by the adjudicating authority on 01st October, 2018.

(3.) The facts and events in the background leading to the aforesaid order of the Appellate Tribunal under the Prevention of Money Laundering Act are inter alia that Central Bureau of Investigation, Gandhinagar, registered F.I.R. No.0292018A0006 dated 26th March, 2018 against M/s.DPIL, Vadodara and others for the commission of alleged offences under Sections 420 , 467 , 468 , 471 read with Section 120B of the Indian Penal Code, 1860 and Sections 13(2) read with Section 13(1)(d) of the Prevention of Corruption Act, 1988. It is alleged in the F.I.R. that M/s.DPIL has caused loss of Rs.2654.40 crores to a consortium of as many as eleven banks which includes public sector as well as private sector banks/financial institutions. It is alleged that M/s.DPIL resorted to high and exorbitant turnover projections and submitted false stock statements to the lead bank in order to acquire more drawing power in their Cash Credit accounts; they manipulated the details and the contents of the invoices so as to help them in showing more networth capital than the actual. Large number of Letters of Credit were obtained by M/s.DPIL from these banks and M/s.DPIL subsequently failed to honour many of the Letter of Credits and 16 of such Letters of Credit amounted to Rs.110.79 crores, it was stated in the F.I.R.