Dismissed

FPA-PMLA-2089/CHD/2017 of Bhawna Kirpal v. The Deputy Director, Directorate of Enforcement, Chandigarh

ATFP12 Sept 2024FPA-PMLA-2089/CHD/2017

Case brief

AI extract

What is this about?

The Appellate Tribunal dismissed appeals filed under Section 26 of the Prevention of Money Laundering Act, 2002, against the retention order. The Tribunal held that the order was interim in nature to protect assets until the conclusion of the trial. Having granted relief for copies of reliable materials, the appeals were dismissed without affecting the merits of the prosecution case.

What did the court decide?

Directing the respondent to provide copies of all relied-upon documents; the appellants may apply for release of unrelied documents not required for investigation.

FPA-PMLA-2089/CHD/2017 of Bhawna Kirpal Vs. The Deputy Director… — Money Laundering | ATFP (2024)

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APPELLATE TRIBUNAL UNDER SAFEMA AT NEW DELHI

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1. FPA-PMLA-2085/CHD/2017

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M/s G B Creative Line Through Proprietor Bhawna Kirpal … Appellant 2. FPA-PMLA-2089/CHD/2017 Bhawna Kirpal … Appellant Versus

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The Deputy Director, Directorate of Enforcement, Chandigarh … Respondent

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Advocates/Authorized Representatives who appeared

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For the Appellant	:	Mr. Saurabh Kapoor, Adv.
		Mr. Rishabh Kapoor, Adv.
		Ms. Madhvi Khandelwal, Adv.
For the Respondent	:	Mr. Arjun Sawhney, Adv.
		Mr. Rohan Bhambri, Adv.

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CORAM SHRI G.C. MISHRA : MEMBER SHRI RAJESH MALHOTRA : MEMBER

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FINAL ORDER 12.09.2024

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Dictated by: Rajesh Malhotra

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Present appeals u/s 26 of the Prevention of Money Laundering

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Act, 2002, are filed by the appellants against the impugned order dated 12.09.2017 passed by the Adjudicating Authority in Original Application No. 93/2017, whereby it allowed the respondent ED to retain/seize/freeze the documents, digital records, bank accounts etc., seized from the premises of various persons including the present appellants, during the search conducted on 07.04.2017.

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In the appeal at serial no. 1, Ld. Counsel for appellant stressed for release of bank accounts of appellant M/s G B Creative Line, Proprietor Bhawana Kirpal, detailed as under:

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i. Indian Overseas Bank, Sector 7, Chandigarh having Account No. 28402000012338 stated to be a CC Account having CC limit of

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FPA-PMLA-2085 &2089/CHD/2017

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M/s G.B. Creative Line & Mrs. Bhawna Kirpal v. E.D., Chd.

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225.00 lakhs. The above credit limit was collaterally secured by the following securities:

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Sr.	Nature of Security
No.
1.	Equitable mortgage of vacant plot No. 168, Measuring 400.00 sq. yards at Parvela City, Ludhiana (Punjab) in the name of Mrs. Radhika Kirpal valued at FMV–84.00 lacs
2.	Equitable Mortgage of vacant plot No. 26 measuring 110.00 sq. yards atParvela atFMV – Rs. 29.70lacs

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Ld. Counsel for the appellant firm submitted that the CC Account at Indian Overseas Bank having CC limit of 225.00 lakhs is in the name of M/s G B Creative Line which has been secured by giving the above two properties as collateral for the same, however, the said bank account is seized by respondent ED. He submitted that all the sale and purchase transactions of the appellant proprietorshipconcern are routed through the above two bank accounts which are reflected in their account statements and balance sheet of the firm. Prayer is accordingly made to allow the present appeal and thereby direct the respondent ED to release the above bank accounts.

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He further argued that in the appeal at serial no. 2, the appellant Smt. Bhavana Kirpal is the wife of Mr. Gaurav Kirpal who is alleged to be the main accused in police case with other associates and family members.Search and seizure was conducted on the premises of the appellant on the basis of the FIR No. RCBD No. 1/2016 filed by CBI and thereafter, her bank accounts, locker containing jewellery and vehicle were seized/freezed, which are detailed as under:

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FPA-PMLA-2085 &2089/CHD/2017

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M/s G.B. Creative Line & Mrs. Bhawna Kirpal v. E.D., Chd.

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S. No.	Bank Name	Appellant	A/c No.	Amount
1.	Indian Overseas Bank	Bhavana Kirpal & Gaurav Kirpal	28401000026338	2246.38+Lien Amount 405.00
2.	Induslnd Bank	Bhavana Kirpal & Gaurav Kirpal	100042214415	0.00
3.	Induslnd Bank	Bhavana Kirpal & Gaurav Kirpal	100042243231	0.00

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i. One Scorpio vehicle bearing Registration No. CH03V0010 in the name of Ms. Bhawna Kirpal w/o Mr. Gaurav Kirpal along with RC & Insurancepurchased in the year 2005.

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ii. The appellant has one locker in Indian Overseas Bank Locker No. 118, SCO 26, Sector 7C, Chandigarh vide which different gold ornaments having value of Rs. 13,83,254/- as per Valuation Report dated 21.04.2017 and the same were seized as per Seizure Memo dated 21.04.2017.

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iii. Second locker is in the name of the appellant’s mother-in-law of the appellant at Locker No. 182, Oriental Bank of Commerce, Sarabha Nagar, Ludhiana One gold necklace & pair top & with fused pearls & stones, etc. having value of Rs. 2,49,400/- as per Valuation Report dated 28.04.2017 and the same were seized as per Seizure Memo dated 28.04.2017.

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Ld. Counsel for the appellants further submitted that husband of appellant Shri Gaurav Kirpal, belongs to a business family where business is carried out following due procedure. The financial dealingsof the companies are invariably carried out through banking channels. The books of accounts are prepared and audited as per law. The appellant also has been filing income tax returns regularly. The jewellery found in the possession of the appellant was given to her by her parents, parentsin-law during her wedding of about

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FPA-PMLA-2085 &2089/CHD/2017

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M/s G.B. Creative Line & Mrs. Bhawna Kirpal v. E.D., Chd. 4

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28.00 lacs. Jewellery (Istridhan) worth Rs. 16.32 lakhs were found in the two separate lockers, one locker in Indian Overseas Bank in the name of the appellant and the other in the name of her mother in-law Smt. Leela Kirpal. The contents of both the lockers were seized by the respondent ED.

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The Scorpio Car seized by the respondent EDa 2005 model Mahindra Scorpio purchased in the year 2010 for sum of Rs. 3.75 lacs through cheque issued by brother of the appellant Sh. Rohtash Kumar. Prayer is accordingly made to allow the present appeal and thereby direct the respondent ED to release the above bank accounts, vehicle and jewellery attached, by allowing the present appeals.

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On the other hand, Ld. Counsel for respondent ED submitted that certain bank accounts were identified belonging to the accused and their associate companies as a result of information and also as a result of searches conducted by the respondent ED. The bank officials of Indian Overseas Bank main branch Chandigarh fraudulently intercepted messages and issued letter of conformity/letter of undertaking to the foreign banks for the Buyers Credit (BC) extended by them. This was done in collusion with the accused companies and their directors/proprietors and have caused loss to the bank to the tune of USD 47.86 million equivalent to approximately Indian Rs. 321 crores. In view of the above, various documents, properties, bank account, cash and lockers including foreign currency etc. were seized.

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FPA-PMLA-2085 &2089/CHD/2017

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M/s G.B. Creative Line & Mrs. Bhawna Kirpal v. E.D., Chd.

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Ld. Counsel for the respondent also stated that the accused persons including present appellantspurchased many properties out of the proceeds of crime and the bank accounts might have been used for money laundering. He further submitted that seized cash (both Indian currency & foreign

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currency)/articles/vehicles/documents/properties and also the bank accounts frozen by the ED are relevant for the purposes of further scrutiny and investigation to trace the proceeds of crime and further investigation. Thus, the same are required to be retained. Prayer is accordingly made to dismiss the present appeals being devoid of any merits.

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After hearing the rival submissions, we have given our thoughtful consideration to the same. The impugned retention order passed by the Ld. Adjudicating Authority to continue the seizing/ freezing of the documents and material seized/freezed by respondent ED, till the completion of investigation. After the completion of investigation, prosecution complaint is already filed by respondent ED, wherein present appellant Bhawna Kirpal along with her other family members are arrayed as accused persons. Even otherwise, the aforesaid property is mentioned in the list of properties for the purpose of confiscation in case of conviction, in prosecution complaint case under PMLA. Therefore, the impugned order passed by Ld. Adjudicating Authority was just an interim order/step to protect the same, till the conclusion of trial. Therefore, we are not satisfied with the Ld. Counsel for the appellants and hence, the present appealsare liable to be dismissed being devoid of any merits.

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FPA-PMLA-2085 &2089/CHD/2017

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M/s G.B. Creative Line & Mrs. Bhawna Kirpal v. E.D., Chd.

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However, seeing the fact that prosecution complaint is already filed, the present appellantsare entitled to the copies of all relied upon documents/seized material and have right to apply for release of all un-relied documents (if any), if the same are not required for any further investigation.

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In sequel to our observation in the preceding para, the present appeals are hereby dismissed. Pending applications, if any, stands disposed of accordingly. It is made clear that nothing expressed herein will affect the merits of prosecution case under Prevention of Money Laundering Act, 2002.

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AppealsDismissed.

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Pronounced on this 12^th Day of September, 2024.

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(Rajesh Malhotra) Member

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(G.C. Mishra)

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Member

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‘AB’

FPA-PMLA-2089/CHD/2017 of Bhawna Kirpal v. The Deputy Director, Directorate of Enforcement, Chandigarh

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FPA-PMLA-2089/CHD/2017 of Bhawna Kirpal v. The Deputy Director, Directorate of Enforcement, Chandigarh

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