ED’s Prosecution Complaint Filed Within 90 Days of the Attachment Order is Valid as Per Amended Section 8 of PMLA

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Case Details: Yashovardhan Birla v. Deputy Director Directorate of Enforcement - [2024] 162 taxmann.com 428 (SAFEMA-New Delhi)

Judiciary and Counsel Details

• • V. Anandarajan & G.C. Mishra, Member
  • Mrinal Kumar, Adv. for the Respondent.

Facts of the Case

In the instant case, a FIR was registered against accused company ‘B’ and its directors, including the appellant, alleging criminal breach of trust and cheating. Treating offences alleged in FIR as scheduled offences, ED registered an ECIR and found that the accused company collected funds, which were siphoned off by diverting funds to its several group companies. Hence, a web of interconnected transactions is created for the purpose of integrating proceeds of crime generated from cheating and conspiracy.

ED passed an order on 02.09.2014 provisionally attaching certain immovable properties of the accused and filed a complaint under section 5(5) of the Prevention of Money Laundering Act, 2002, before the Adjudicating Authority.

The Authority vide the impugned order confirmed provisional attachment order. Thereafter, an appeal was made to the Appellate Tribunal.

The appellant contended that the Authority confirmed the provisional attachment order on 19.01.2015. However, the prosecution complaint was filed on 16.07.2018, i.e., after a delay of more than 3 years from the date of confirmation of the provisional attachment order.

SAFEMA Held

The Appellate Tribunal noted that since, notification dated 19.04.2018 amended section 8 of the PMLA wherein ED was bound to file its prosecution complaint within the stipulated time of 90 days from the date of confirmation of the provisional attachment order. Hence, the attached properties of the appellant were liable to be released.

The Appellate Tribunal held that since the 90-day period would commence on the date the amendment came into force, i.e., 19.04.2018, ED complied with the requirement of filing the prosecution complaint within 90 days of 19.04.2018. Therefore, there was no illegality in the continued attachment of properties during the pendency of the same, and thus, the instant appeal was to be dismissed.