Dyani Antony Paul and others vs Union of India and another. Writ Petition 38642/2016 and connected matters decided on 11 December 2020.
Judgment link: http://judgmenthck.kar.nic.in/judgmentsdsp/bitstream/123456789/352800/1/WP38642-16-11-12-2020.pdf
8(4) Where the provisional order of attachment made under sub-section (1) of Section 5 has been confirmed under sub-section (3), the Director or any other officer authorised by him in this behalf shall forthwith take the possession of the property attached under Section 5 or frozen under sub-section (1-A) of Section 17, in such manner as may be prescribed:
Provided that if it is not practicable to take possession of a property frozen under sub-section (1-A) of Section 17, the order of confiscation shall have the same effect as if the property had been taken possession of.
Relevant paragraphs: 30. Having heard the learned Advocates appearing for parties, I am of the considered view that following points would arise for my consideration:
(i) Whether sub-section (4) of Section 8 of PML Act is violative of Article 14 and Article 300A of the Constitution of India and as such proceedings initiated against petitioners under PML Act are liable to be quashed?
(ii) Whether the proceedings initiated under the PML Act by the authorities would be bad in law or without jurisdiction for want of existence of predicate offence or offence prescribed under the Schedule to the PML Act not being in existence on the date of initiation of proceedings under PML Act? OR Whether the offence of money laundering under Section 3 of PML Act is a stand alone offence?
(iii) Whether the proceedings initiated by the authorities under PML Act and passing orders of provisional attachment and its confirmation thereof is liable to be set aside or quashed on account of any procedural lapse prescribed under Sections 5 and 8 of PML Act?
(iv) Whether the notice/s issued by the authorities to take possession of the property on provisional order of attachment being confirmed is liable to be set aside?
(v) Whether writ petitions are liable to be dismissed on the ground of petitioners having not availed the alternate remedy of appeal available under Section 25 and under Section 42 of PML Act?
42. A construction which reduces the statute to a futility has to be avoided. The principle expressed in the maxim ut res magis valeat quam pereat i.e., liberal construction should be put upon written instruments so as to uphold them, if possible and carry into effect the intention of parties has to be adopted. (See Broom’s Legal Maxims 10th Edition, page 361, Craies on Statutes (7th edition), page 95 and Maxwell on Statutes (11th edition) page 221. ) A statute or a provision in any enactment must be so construed to make it effective and operative. The Hon’ble Apex Court in the case of CIT vs S.TEJA SINGH reported in AIR 1959 SC 352, have held that a statute is designed to be workable and interpretation thereof by a court should be to secure that object unless crucial omission or clear direction makes that end unattainable. It has been further held that courts will have to reject that construction which will defeat the plain intention of the legislature, even though there may be some inexactitude in the language used in the enactment.
44. Time and again, Hon’ble Apex Court in catena of judgments has held that whenever it is possible to do so, it must be done to construe the provisions which appear to conflict so that they harmonise. The court must ascertain the intention of the legislature by directing its attention not merely to the clauses to be construed but to the entire statute.
54. Section 8 as amended by the Amendment Act 2 of 2013 cannot be said to be arbitrary or violative of fundamental right of a person, even if the proceedings are continued for trial of scheduled offence resulting in acquittal and the alleged proceeds of crime pertained to that scheduled crime. It is to be further noticed that mandate of sub-section (4) of Section 8 to the authorities is to take possession of the property forthwith which is attached under Section 5 or frozen under sub-section (1-A) of Section 17 on the provisional order of attachment made under sub-section (1) of Section 5 has been confirmed under sub-section (3). The authorities have no discretion at all and they are bound to take possession and the expression “possession” referred to in sub-section (4) refers to physical possession. The judgment of the KAMARUNNISA’s case relied upon by petitioners was rendered on 11.07.2012 i.e., pre 2013 amendment i.e., prior to Act 2 of 2013 coming into force. The amendment which was brought to sub-section (4) of Section 8 namely, the expression “possession of the property attached under Section 5 or frozen under sub-section (1-A) of Section 17 in such manner as may be prescribed” was not found in sub-section (4) as it stood in the year 2009. Hence, the judgment of KAMARUNNISA would not come to rescue of the petitioners.
82. In the light of aforestated analysis, this Court is of the considered view that existence of a predicate offence for initiation of proceedings under the PML Act is not a condition precedent or in other words, the offence under Section 3 of the PML Act is a stand alone offence. Hence, the presence of a schedule offence as prescribed under the PML Act would not be condition precedent for proceeding against such person under the PML Act.
99. The expression “proceeds of crime” covers any property derived or obtained directly or indirectly by any person, as a result of criminal activity, related to a scheduled offence or the value of such property. The expression ‘property’ is elucidated in Clause (v) of Section 2, as any property or assets of every description, whether corporeal or incorporeal, movable or immovable, tangible or intangible and includes deeds and instruments evidencing title to, or interest in, such property or assets, wherever located. Section 2(u), therefore, does not envisage either mens rea or knowledge that the property acquired is a result of criminal activity.
107. Hence, this Court is of the considered view that contentions raised by the petitioners to quash the proceedings on the ground of the proceedings initiated against them is without jurisdiction for want of either there being no predicate offence or on the date of launch of proceedings under the PML Act, the predicate offence referred to in the schedule was not incorporated in the schedule and as such, there would be retrospective application of law cannot be accepted, inasmuch as, the offence of money laundering as indicated under Section 3 of PML Act is a stand-alone offence. It is to be further noticed that the proceedings initiated by the authorities by passing an order of provisional attachment and its confirmation thereof would not fail or lapse on account of any procedural irregularity for the reasons indicated herein above.
Compiled by S. Basavaraj Daksha Legal.
Daksha Legal 