DIRECTORATE OF ENFORCEMENT Vs. OM PARKASH CHAUTALA

JUDGEMENT

(1.) This appeal has been preferred against the order dated 22.10.2020 passed by the Appellate Tribunal, Prevention of Money Laundering Act, New Delhi on two applications submitted by Abhay Singh Chautala, one as a power of attorney holder/representative of Om Prakash Chautala, who had preferred an appeal and the other in his personal capacity, seeking interim restoration of the attached property i.e. residential house on land bearing Khewat Nos.97/98/99 and 104 in Village Tejakhera, Tehsil Dabwali, District Sirsa, Haryana, on the ground that the grand sons of the respondent herein and sons of the applicant are to get married on 27.11.2020 and 30.11.2020. Prayer was made for interim restoration of the property attached between 15.11.2020 to 30.11.2020 with additional 15 days time to prepare to be used and vacate the property before and after the function. On hearing the parties, Appellate Tribunal has partly allowed the said applications by directing the Enforcement Directorate (appellant herein) to de-seal the attached property by 06.11.2020 and hand over the possession of the same to respondent-Om Prakash Chautala/intervener Abhay Singh Chautala for the purpose of aforesaid marriages subject to the condition that they would hand over the possession back to the appellant on or before 07.12.2020, who may thereafter seal the said property till further orders.

(2.) The basic ground, which was taken by the appellant, opposing the interim prayer for restoration of the property, was that the Appellate Tribunal had no power to restore the property in the light of the provisions of Section 8(8) of the Prevention of Money Laundering Act, 2002 (hereinafter referred to as "the Act") as the said power has been conferred on the Special Court, which is ceased of the trial in the charge sheet, which has been filed before the said Court. It was further pressed into service that the Appellate Tribunal did not have the jurisdiction to pass such an order of interim relief and, therefore, the said order could not be passed, which was negated by the Appellate Tribunal by observing that it had got inherent powers to do so if the possession of the property is taken without following due procedure of law.

(3.) While challenging the said order, the ground, which has been taken by the appellant, is that there is no provision under the Act which allows/permits the temporary de-sealing of the attached property for the use of the accused. It has further been asserted that in the light of Section 3 of the said Act, the use of the property is impermissible during the pendency of the proceedings for an offence of money laundering. Once the use of the said property itself is included in the offence of money laundering, an order permitting use of such property could not have been passed by the Appellate Tribunal. It has further been asserted that as per Section 3(ii) of the Act, the process or activity connected with the proceeds of the crime continues till a person is directly or indirectly enjoying the said proceeds by way of concealment or possession or acquisition etc. It is, therefore, said that the accused is prohibited from enjoying the proceeds of the crime and, thus, the Appellate Tribunal could not have passed such an interim order. A ground has also been taken that only 50% of the residential house has been sealed/attached by the Directorate of Enforcement, Chandigarh and since only the share which would fall in the ownership of the respondent had been sealed, there was no reason for de-sealing the same, as admittedly the remaining house is in possession of Abhay Singh Chautala. Learned counsel for the appellant has referred to various provisions of the statute to impress upon the Court the intent, purpose and scheme of the Act to contend that the property once attached, which is found to be proceeds of crime, the same cannot be, as an interim measure, ordered to be de-sealed and possession handed over. The primary emphasis has been laid by counsel on the definitions as given in Section 2(d) 'attachment', 2 (u) 'proceeds of crime',2(v) 'property', 2(za) 'transfer' and 2(zb) 'value'. Section 3 has been relied upon to impress upon the Court with regard to offence of money laundering, where even the use of said tainted property has been mentioned as an offence, an activity which continues on possession of the said property also falls within the said offence. It is asserted on this basis that by passing of such an interim order, the Appellate Tribunal would perpetuate an offence, which would go against the very basic mandate of statute. Referring to Section 8(4) of the Act, it is asserted that on confirmation of the order of attachment by the Adjudicating Authority, the Enforcement Directorate has been mandated to forthwith take possession of the property, which is attached under Section 5 of the Act. Referring to Section 8(6) of the Act, it is asserted that the Special Court has the power to release the property only after the conclusion of trial, where the commission of offence of money laundering has not been found to have taken place or the property is not involved in the same. Referring to Section 26(4) of the Act, it has been submitted that the Appellate Tribunal although has been given powers to pass such orders as it thinks fit but that does not mean that by way of an interim order, it would perpetuate the commission of an offence, which is not permissible in law. Reference has been made by counsel for the appellant to the following judgments:-