Property Attachment Upheld for Illicit Assets | SAFEMA

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  • Last Updated on 24 June, 2025

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Property Attachment Under SAFEMA

Case Details: Smt. Kusum Lata v. Joint Director, Directorate of Enforcement, Lucknow - [2025] 175 taxmann.com 676 (SAFEMA-New Delhi)

Judiciary and Counsel Details

  • Rajesh Malhotra & G.C. Mishra, Member
  • Ms Soumya Chino & Ms Payal Singh, Advs. for the Appellant.
  • Ms Nattasha Garg, Ms Anshita Arora & Ms Shrishty Singh, Advs. for the Respondent.

Facts of the Case

In the instant case, the CBI registered FIR against accused persons, including appellants for commission of offence under section 109 of IPC, 13(2) read with section 13(1)(e) of the Prevention of Corruption Act, 1988.

In the FIR, it was alleged that the appellant, YS, was involved in allotting plots of high-value land to himself, members of his family, and his associates. The appellants were also alleged to possess disproportionate assets, approximately Rs. 11.90 crores, the acquisition of which they could not satisfactorily account for.

Accordingly, the Enforcement Directorate (ED) recorded ECIR to conduct an investigation against the accused persons for possession of proceeds of crime and commission of the offence of money laundering.

Further, ED provisionally attached the appellants’ properties and filed a complaint before the Adjudicating Authority for confirmation of the said properties. The Adjudicating Authority confirmed the provisional attachment order (PAO).

It was noted that ED is not required to conduct an independent investigation for a predicate offence. Further, when proceeds from a crime were not available to the appellants but rather vanished and were siphoned off, ED could also attach property of equivalent value.

Further, ample evidence was available from the investigation against the appellants regarding the commission of the offence of money laundering. They were found in possession of disproportionate assets and thereby utilised illicit money to purchase impugned properties.

Appellate Tribunal Held

The Appellate Tribunal held that the appellants failed to prove their legal sources of income to acquire the impugned properties, which were found to be disproportionate to their known sources of income. Further, there was apparent apprehension of alienation of these properties, and conditions stated under the second proviso of section 5(1) were fulfilled. Therefore, the appeal was to be dismissed.

List of Cases Referred to

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied