120B, 1860, 1956, 1973, 2(1)(u), 2(u), 2(v), 3, 420, 45, 482, 5, 8, 8(5), 81, Companies Act, Cr.P.C., Indian Penal Code, MCA, Prevention of Money Laundering Act
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Mere pendency of that investigation would not sustain a Provisional Attachment Order(POA) based on allegations which do not form part of those proceedings. Delhi High Court passed the order on 24.01.2023. Kindly click the link to get full order.
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All that needs to be observed in this respect is that while it may be open for the CBI and the ED to continue to investigate in terms of the liberty granted by the competent courts, the mere pendency of that investigation would not sustain a Provisional Attachment Order(POA) based on allegations which do not form part of those proceedings. This since the PAO and its validity would have to be evaluated based on the material on which the competent authority had proceeded to form its opinion that the properties constituted proceeds of crime.
- This Court in the facts of the present case has found that the PAO essentially rests on allegations which neither form part of the chargesheet submitted by the CBI nor the ECIR. The validity of the PAO is thus liable to be examined on the basis of the material which comprises and constitutes the predicate offence. Similarly, the argument of Mr. Hossain that it would always be open to the investigating agency to submit additional and supplementary chargesheets cannot possibly sustain the Provisional Attachment Orders. Quite apart from the above submission being wholly conjectural, it may only be additionally noted that the PAO or its validity cannot be adjudged based on what the investigating agency may do in the unforeseeable
- Hossain had then submitted that the PAO impugned in these petitions is based on more than one allegation and thus even if the Court were to come to the conclusion that one of those would not constitute proceeds of crime, that would not be sufficient to setaside or quash the same. Reliance in this respect was placed on the following observations made by the Supreme Court in Srikrishna (P) Ltd. vs. ITO21:-
―14. In ITO v. Mewalal Dwarka Prasad [(1989) 2 SCC 279 : 1989 SCC (Tax) 266 : (1989) 176 ITR 529] this Court held that if the notice issued under Section 148 is good in respect of one item, it cannot be quashed under Article 226 on the ground that it may not be valid in respect of some other items. We need not, however, dilate on this aspect for the reason that no argument has been urged before us to the effect that since the notice under Section 148 is found to be justifiable in respect of some loans disclosed and not with respect to other loans, it is invalid.‖
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