Pre-Crime Property Attachable at Equivalent Value Under PMLA
The Appellate Tribunal under SAFEMA, Delhi, has dismissed the appeal of Sadananda Nayak against the Adjudicating Authority's order dated 11.01.2023 confirming the provisional attachment of four properties under the Prevention of Money Laundering Act, 2002 (the Act of 2002). The appeal was filed under Section 26 of that Act. The central point decided is whether property bought before the alleged criminal activity can be attached as "proceeds of crime" under Section 2(1)(u). The Tribunal held that it can, where it is attached as property of equivalent value because the actual proceeds are not available.
Facts
According to the appellant's account, he worked for about 40 years as a sub-contractor to Hindustan Aeronautics Limited (HAL), Sunabeda, Odisha, supplying labourers for ground work. He said that in 2017 HAL's then Finance Manager, Mr. Bhaben Maitra, exceeded his authority and routed large sums to him and other contractors, then threatened him when he objected and forced him to hand the amounts back. The appellant said he did not use a single rupee for himself.
A criminal case was registered by the Special Cell of CBI in 2018, in which the appellant and Mr. Maitra were made parties; the bank accounts of the appellant and his sons were frozen that year and the appellant was granted bail. In July 2022 the Enforcement Directorate attached four scheduled lands of the appellant by Provisional Attachment Order in ECIR/BBZO/06/2020. The Adjudicating Authority confirmed it in O.C. No. 1796/2022.