Abhay Nigam and others Vs Union of India and others
Date 18th June 2021
Court Madhya Pradesh High Court

Sub- Whether a writ lies against an order of provisional attachment of property under the Prevention of Money laundering Act, 2002

The appeal court was considering appeal against the provisional attachment of plot of land at Empire Wild Flower colony on various grounds interalia that the attachment violated Right to enjoy property under Article 300A of the Constitution of India as the plot was purchased out of life time savings and not proceedings of crime and thus the single bench dismissal order dismissing on the grounds that the order of attachment of property was simply provisional and the adjudicating authority can be approached before the order is made final was not correct. It was also argued that the PMLA Act mandated “reason to believe” and not “ reason to suspect” and thus the order needed to be quashed.

However, the Writ Appeal court held that a microscopic and conjoint reading of Sections 5 and 8 of the PML Act leaves no room for any doubt that orders of attachment issued by invoking Section 5 is ‘provisional’ in nature. Thus, the attachment order passed by the competent authority and “reason to believe” therefor is also tentative / provisional in nature subject to confirmation by the adjudicating authority and one can not simply see the skin and miss the soul and thus held that the petitioner can put all these points before the adjudicating authority and the adjudicating authority shall take into account these grounds and shall pass appropriate order in accordance with law expeditiously preferably within 30 days.

While approaching the writ court, the question of alternative remedy is one of the important hurdle to cross which is of course a self imposed limitation on the Courts.

Ramesh Patodia
20-06-2021