Disposed

FPA-PMLA-2683/CHD/2018 of Jai Bhagwan v. The Deputy Director, Directorate of Enforcement, Chandigarh

ATFP1 Apr 2024FPA-PMLA-2683/CHD/2018

Case brief

AI extract

What is this about?

The Appellate Tribunal disposed of an appeal against the retention of seized currency under PMLA. Holding it inconclusive for the appeal, the Tribunal directed the amount to be kept in a Fixed Deposit for two years while preserving the appellant's right to lead defense evidence in the pending criminal trial.

What did the court decide?

Appeal disposed of; seized amount directed to be kept in Fixed Deposit for two years with liberty to appellant to lead defense evidence in PMLA Court.

FPA-PMLA-2683/CHD/2018 of Jai Bhagwan Vs. The Deputy Director… — Money Laundering | ATFP (2024)

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BEFORE RAJESH MALHOTRA, MEMBER; SINGLE BENCH: APPELLATE TRIBUNAL UNDER SAFEMA; AT NEW DELHI.

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FPA-PMLA-2683/CHD/2018

Jai Bhagwan

… Appellant

Versus

The Deputy Director, Directorate of Enforcement, Chandigarh … Respondent

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Advocates/Authorized Representatives who Argued For the Appellant : Dr. Rau PS Girwar, Adv. Ms. Archana Arora, Adv.

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For the Respondent : Mr. Arjun Sawhney, Adv. Ms. Mansi Srivastava, Adv.

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FINAL ORDER

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01.04.2024

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Present appeal is filed against the impugned order dated 06.09.2018 passed by the Adjudicating Authority in Original Application No. 195/2018 vide which the retention of seized/frozen documents/records/properties u/s 17(1-a) were permitted to be retained during investigation for a period not exceeding 90 days or the pendency of the proceedings relating to any offence under the PMLA, before the concerned court.

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As per the facts of the case, Civil Writ Petition No. 11094, 14795, 22530 and 20726, of 2011 were filed on behalf of the aggrieved investors of Unipay 2U MarketingPvt. Ltd., before Hon’ble Punjab & Haryana High Court on the ground that the petitioners were duped in ponzy scheme launched by UNIPAY group of companies. Many FIRs were registered against the said group of companies and its Directors/Promoters/ Agents vide FIR No. 652/2011 at P.S. Panipat City, FIR No. 234/2011 at PS Panipat Sadar, FIR No. 202/2012 at PS Sector 36, Chandigarh etc.

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Rajesh Malhotra

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Member

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FPA-PMLA-2683/CHD/2018 Jai Bhagwan v. E.D., Chandigarh

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Respondent ED also registered ECIR No. 01/CDZO/2012 dated 07.03.2012 and conducted investigation under PMLA to unearth the proceeds of crime and the trail of the same.

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Searches were conducted at various places of the accused persons and suspects on 28.07.2017 and thereafter on 22/23.03.2018. The details of the documents and material searched from the various premises on 22.03.2018 is mentioned in table at page 10 to 13 of the impugned order (the same is not reproduced herein). During investigation, it is revealed that proceeds of crime travelled to Puneet Sharma and Surnam Singh and his family members, as heavy unexplained amounts were received by them as revealed in the documents seized from the residence of Gurnam Singh and his family members. The said documents were stated to be required for further scrutiny and individuals to trace out the crime and for further investigation, the same was stated to be required for retention. Accordingly, the Original Complaint No. 195/2018 was moved before the Adjudicating Authority for permission to retain the said documents. After hearing all the affected parties, Ld. Adjudicating Authority passed the impugned order dated 06.09.2018. Aggrieved by the said order, appellant Jai Bhagwan filed the present appeal. 3. During the arguments, Ld. Counsel for the appellant Jai Bhagwan submitted that he has nothing to do with the proceeds of crime and the proceedings being conducted against the suspects under PMLA, 2002. He submitted that on 22.03.2018, he went to the office of M/s Ghai Money Changer,at Shop No. 14, Ground

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Rajesh Malhotra

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Member

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FPA-PMLA-2683/CHD/2018 Jai Bhagwan v. E.D., Chandigarh

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Floor, AC Market, Patiala, to purchase dollars in exchange of Indian currency of Rs. 12,80,000/-. The said US$ were required for travelling by Bhajan Singh, Gurudev Kaur and Jarnail Singh maintaining joint savings NRO account. Bhajan Singh and Jarnail Singh are having agricultural land in India and have income of Rs. 26 lakhs per annum from the agricultural land, along with Avtar Singh and other family members. Bhajan Singh and Gurudev Kaur were in India since 2018 and went back to Canada on 04.04.2018 and therefore, they required dollars for travelling to Canada. Jarnail Singh and Kuldeep Kaur were also travelling. Accordingly, appellant Jai Bhagwan duly explained the seized currency of Rs. 12,80,000/- from his possession. He also explained the source of the said money, but the said plea of appellant Jai Bhagwan was not accepted. Similar reply was filed by him before the Adjudicating Authority, but Ld. Adjudicating Authority did not accept the plea and allowed respondent ED to retain the said currency seized from the premises of M/s Ghai Money Changer. Prayer is accordingly made to release the said amount, as the said amount is not proceeds of crime in any manner and the source of the same is duly explained by the appellant.

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On the other hand, Ld. Counsel for the respondent ED strongly opposed the contention of Ld. Counsel for the appellant Jai Bhagwan on the ground that said amount was found in the premises of Ghai Money Changers. Neither Piyush Ghai, who was present at the time of search, nor any other person claimed the right over the same and the said money is apparently proceeds of

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Rajesh Malhotra

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Member

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FPA-PMLA-2683/CHD/2018 Jai Bhagwan v. E.D., Chandigarh

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crime. He further argued that the defence taken by appellant Jai Bhagwan is false, fabricated and concocted at the instance of Piyush Ghai to claim the possession of said amount, through the present appellant Jai Bhagwan. Prayer is accordingly made to dismiss the present appeal being devoid of any merits.

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After hearing the rival submissions, I have given my thoughtful consideration to the same. After investigation, respondent ED has already filed prosecution complaint before Ld. Special Judge, PMLA Court and admittedly, present appellant is arrayed as one of the accused in the said complaint along with other accused persons. This Appellate Tribunal is not empowered to minutely scrutinise the quality of evidence collected by respondent ED and to decide the nature of the said amount seized from the premises of M/s Ghai Money Changer. This fact needs to be decided by the said criminal court after the conclusion of evidence and analysis of the prosecution evidence led by respondent ED and the defence of the claimants, including the present appellant Jai Bhagwan. Accordingly, present appeal needs to be disposed of with liberty to lead defence in PMLA Court, where prosecution complaint is pending for trial.

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In sequel to my discussion in the preceding para, the present appeal is hereby disposed of, with liberty to appellant Jai Bhagwan to stake the claim over the said seized amount by leading cogent and reliable defence evidence. It is made clear that nothing expressed herein will affect the right of any party during the criminal trial. Till the criminal case attains finality, the said

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Rajesh Malhotra

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Member

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FPA-PMLA-2683/CHD/2018 Jai Bhagwan v. E.D., Chandigarh

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amount is hereby directed to be kept in the form of FDR for the period of two years, with direction to renew the said FDR after every two years, if the said amount is already not deposited with Special Court.

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Appeal disposed of with direction.

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Pronounced on this 1^st Day of April, 2024.

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(Rajesh Malhotra) Member

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‘AB’

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Rajesh Malhotra

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Member

FPA-PMLA-2683/CHD/2018 of Jai Bhagwan v. The Deputy Director, Directorate of Enforcement, Chandigarh

Case brief

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FPA-PMLA-2683/CHD/2018 of Jai Bhagwan v. The Deputy Director, Directorate of Enforcement, Chandigarh

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