Prevention of Money Laundering Act, 2002 is an Act of the Parliament of India
enacted by the NDA government to prevent money-laundering and to provide for
confiscation of property derived from money-laundering. PMLA and the Rules that
are notified came into force with effect from July 1, 2005. The Act and Rules
that are notified impose obligation on banking companies, financial institutions
and intermediaries to verify identity of clients, maintain records and furnish
information in prescribed form to Financial Intelligence Unit - India.
At the time of drafting any law, it is important to insert enough checks and
balances within the statute to avoid arbitrary and excessive abuse of power by
using that law. This intention is well reflected in the Prevention of Money
Laundering Act, 2002 (PMLA).
It secures the proceeds of crime by virtue of which the Enforcement Directorate
(ED) has the power to attach any property during the pendency of a trial,
irrespective of whether the owner of such property himself was involved in any
crime or not.
Much caution was taken with regard to the PMLA imposing conditions on the
authorities. The officer should form an opinion; apply his mind based on facts
regarding the property being prima facie reflective of the proceeds of crime
before attaching such a property. He should also gauge whether there is any
imminent danger that the owner may distance himself from the property
frustrating the entire investigative or trial proceedings.
But are the officials implementing the statute while remaining within its
limitations? The ED, rightly, throws a net to catch sharks. But more often than
not ED also catches innocent fish that get entangled in this. Despite no fault
of their own, the latter is subjected to an expensive and time-consuming
litigation process. However the act has come under a lot of heat lately for
being arbitrary and downright unconstitutional.
Certain sections of PMLA have been questioned wherein the enforcement
directorate basically acts as a whiplash on offenders, where in the offenders
may not be given bails. SC of India clamped down on arbitrary rule of not
providing bail to the offenders.
However, the recent judgement of the appellate tribunal of the Money Laundering
Act headed by Justice Manmohan Singh in the State Bank of India vs. The Joint
Director, ED case comes as a big respite for the banking sector that, more
often than not, gets caught in the crossfire between the accused and the ED.
In recent cases, the ED started attaching a lot of properties that had been
mortgaged to the banks to procure loans. This was done on the pretext of these
properties being representative of proceeds of crime. On the one hand, in most
such cases, banks had advanced loans, and continue to do so, after conducting
proper due diligence and in compliance with RBI guidelines and regulations.
Fugitive Economic Offender
The government has said action has been initiated against seven fugitives
involved in economic offences involving Rs 27,969 Crore in competent court.
All possible channels, including legal, are being explored to get the economic
offenders repatriated, said Minister of State for Finance Shiv Pratap Shukla in
a written reply to the Sabha. The Fugitive Economic Offenders Act, 2018 got
President's assent in August in 2018. A fugitive economic offender is any
individual against whom warrant for arrest is issued for his involvement in
select economic offences involving amount of at least Rs 100 Crore or more and
has left India so as to avoid criminal prosecution.
In reply to another question related to chit fund and ponzy schemes scam in West
Bengal, the minister said the government has taken cognizance of various such
Shukla said the CBI has registered 42 cases relating to chit fund and ponzy
schemes scams which took place in West Bengal during the last four years, of
these, 24 cases were registered in 2017 and 18 in 2018 (till November 30).
He further said the Enforcement Directorate has informed that attachments for
the value of Rs 274.62 Crore have been issued and prosecution complaints filed
against 10 persons in the case of Saradha Group of Companies.
The Fugitive Economic Offenders Act, 2018 is an Act of the Parliament of India
that seeks to confiscate properties and assets of economic offenders that evade
prosecution by remaining outside the jurisdiction of Indian courts. Economic
offences with a value of more than Rs 100 Crores, which are listed in the
schedule of the Fugitive Economic Offenders Act, come under the purview of this
As per the Act, a court (Special Court under the Prevention of Money
Laundering Act, 2002) has to declare a person as a Fugitive Economic Offender.
The bill for the act was introduced in the Lok Sabha, the lower house of the
Parliament of India, on 12 March 2018. On 25 July 2018, the Parliament passed
Recently, on 5 January 2019, Special Prevention of Money Laundering Act (PMLA)
court has declared Vijay Malya a fugitive economic offender. His properties can
now be confiscated by the government.
The Bill allows for a person to be declared as a fugitive economic offender (FEO)
if: (i) an arrest warrant has been issued against him for any specified offences
where the value involved is over Rs 100 Crore, and (ii) he has left the country
and refuses to return to face prosecution.
To declare a person an FEO, an application will be filed in a Special Court
(designated under the Prevention of Money-Laundering Act, 2002) containing
details of the properties to be confiscated, and any information about the
persons whereabouts. The Special Court will require the person to appear at a
specified place at least six weeks from issue of notice. Proceedings will be
terminated if the person appears.
The Bill allows authorities to provisionally attach properties of an accused,
while the application is pending before the Special Court.
Upon declaration as an FEO, properties of a person may be confiscated and vested
in the central government, free of encumbrances (rights and claims in the
property). Further, the FEO or any company associated with him may be barred
from filing or defending civil claims.
Key Issues and Analysis of FEO.
Under the Bill, any court or tribunal may bar an FEO or an associated company
from filing or defending civil claims before it. Barring these persons from
filing or defending civil claims may violate Article 21 of the Constitution i.e.
the right to life. Article 21 has been interpreted to include the right to
Under the Bill, an FEOs property may be confiscated and vested in the central
government. The Bill allows the Special Court to exempt properties where certain
persons may have an interest in such property (e.g., secured creditors).
However, it does not specify whether the central government will share sale
proceeds with any other claimants who do not have such an interest (e.g.,
The Bill does not require the authorities to obtain a search warrant or ensure
the presence of witnesses before a search. This differs from other laws, such as
the Code of Criminal Procedure (CrPC), 1973, which contain such safeguards.
These safeguards protect against harassment and planting of evidence.
The Bill provides for confiscation of property upon a person being declared an
FEO. This differs from other laws, such as CrPC, 1973, where confiscation is
final two years after proclamation as absconder.
The Delhi high court has set aside five orders that prevented the Enforcement
Directorate from attaching the assets of those suspected of violating the
Prevention of Money Laundering Act (PMLA) in response to a plea by the central
The orders were passed by the appellate PMLA tribunal after four banks – State
Bank of India, Axis BankNSE -1.32 %, IDBINSE -3.21 % and Punjab National Bank –
complained that the ED had attached properties over which the banks had liens,
compromising their ability to sell the assets and recover loans that had been
granted to the suspected criminals.
In the case before the High Court of Delhi, titled Himachal Emta Power Limited
Vs. Union of India and Ors. (W.P. (C) 5537/2018, CM Nos. 21583/2018 and
33487/2018) (, the primary issue before the court was "What is Proceeds of
Crime?” Another issue also related to the rule of forum non conveniens- common
law legal doctrine whereby courts may refuse to take jurisdiction over matters
where there is a more appropriate forum available to the parties.
In this case the impugned order founded on the basis of an FIR registered by
Central Bureau of Investigation (CBI) on 07.08.2014 alleging offences under
Section 120-B read with Section 420 IPC against HEPL, its promoters/directors,
members of the 35th Screening Committee and other unknown persons. It was
alleged that the said persons have cheated the Government of India by securing
allocation of Gaurangdih ABC Coal Block in favour of HEPL.
It was alleged that
HEPL had misrepresented the status of land in question and the investment made
by it in the project and had secured the allocation of the coal block based on
In this case the impugned order of provisional attachment was founded on the
allegation that the property sought to be attached has been used in commission
of a scheduled offence and, therefore, is liable to be attached as proceeds of
crime. However, the Court observed that merely because a property used in
commission of crime, the same cannot be construed as proceeds of that crime.
At this stage, it would be relevant to refer to Section 5(1) of the PML Act, the
relevant extract of which is set out below:
Section 5 (1)-Where the Director or any other officer not below the rank of
Deputy Director authorized by the Director for the purposes of this section, has
reason to believe (the reason for such belief to be recorded in writing), on the
basis of material in his possession, that-
any person is in possession of any proceeds of crime; and such proceeds of crime
are likely to be concealed, transferred or dealt with in any manner which may
result in frustrating any proceedings relating to confiscation of such proceeds
of crime under this Chapter, he may, by order in writing, provisionally attach
such property for a period not exceeding one hundred and eighty days from the
date of the order, in such manner as may be prescribed.
A plain reading of Section 5(1) of the PML Act indicates that an order of
provisional attachment can be passed only where the concerned officer has
reasons to believe on the basis of material in his possession that:
person is in possession of proceeds of crime; and
(b) such proceeds are likely
to be concealed, transferred, or dealt with any manner which would result in
frustrating any proceedings relating to confiscation of such proceeds of crime.
The expression "proceeds of crime" is defined under clause (u) of Section 2 (1)
of the PML Act as under:
Section 2 (u)-proceeds of crime
means any property derived or obtained,
directly or indirectly, by any person as a result of criminal activity relating
to a scheduled offence or the value of any such property (or where such property
is taken or held outside the country, then the property equivalent in value held
within the country).
The Court held that it is clear from the language of Section 2(u) of the PML Act
that the expression "proceeds of crime" refers to a property, which is "derived
or obtained" by any person as a result of criminal activity. Therefore, in order
to pass an order of provisional attachment, it was necessary for the ED to have
reasons to believe that the property sought to be attached was "derived or
obtained" from any scheduled crime.
The Court further held that the assumption that any amount used in commission of
a scheduled offence would fall within the expression "proceeds of crime" as
defined under Section 2(1) (u) of the PML Act is fundamentally flawed.
Section 65 of the Prevention of Money Laundering Act, 2002 (hereinafter, PMLA)
has been under scrutiny for long, it being one of the means of exploitation by
the authorities. It gives them the opportunity to pick and choose the provisions
they want to apply in case a certain aspect is covered by both the Criminal
Procedure Code, 1973 (CrPC) and PMLA , S 65 of PMLA states that:
The provisions of the Code of Criminal Procedure, 1973 (2 of 1974) shall apply,
insofar as they are not inconsistent with the provisions of this Act, to arrest,
search and seizure, attachment, confiscation, investigation, prosecution and all
other proceedings under this Act.
Although the legislators have included the word 'inconsistent' to create a
demarcation as to when will the provisions of CrPC be used to supplement PMLA
the authorities under the Enforcement Directorate (hereinafter, ED) have become
blatantly ignorant towards it.
In Virbhadra Singh & Anr vs Enforcement Directorate & Anr
on 3 July,
In this matter common questions of law was raised, of general interest involving
provisions of Prevention of Money Laundering Act, 2002 (for short, PMLA) in
the context of a case under investigation with Enforcement Directorate of
Ministry of Finance in the Government of India.
It is claimed in the petition
that summons were issued under Section 50(2) and (3) PMLA requiring presence of
the petitioners for questioning. Detailed averments were made with regard to the
response of the petitioners pursuant to said summons, facts pertaining which may
be elaborated a little later.
The trigger for filing the petition is indicated to be the denial of extension
of time for compliance with the summons on the ground that the legislative
assembly of the State of Himachal Pradesh was in session till 06.04.2016 in
spite of which, through the summons issued by the respondents. It is clear, that
the Enforcement officers under PMLA do not require the powers of police for
investigation as granted by the general law contained in Chapter XII of the Code
of Criminal Procedure.
On the contrary, to hold that the said part of Code of
Criminal Procedure applies to PMLA investigations or proceedings would bring in
inconsistency - in breach of the mandate of Section 65 PMLA. There is nothing in
PMLA to indicate that the power to arrest conferred on the Director or the other
specified officers are contingent upon formal authorisation by the court.
Further, the law does not contain any clause from which it could be deduced that
the authorization to the Director or other specified officers to take up the
investigation or exercise any of the powers thereby conferred requires prior
approval from the court in each case.
In view of the above, it must be concluded
that notwithstanding the deletion of clause (a) of the then existing sub-
section (1) of Section 45 PMLA, by the amendment of 2005, the offences under
PMLA continue to be cognizable in the sense that a person respecting whom
there is a reason to believe to be guilty for such offence may be arrested by
the officer empowered by the law in terms of Section 19 without the need of
obtaining warrant of arrest from the court.
Thus, the use of the expression cognizable
in relation to PMLA offences would
be different from the one applied for general law offences (say, IPC offences)
and consequently, the definition of the expressions "cognizable offence" and
"cognizable case" as appearing in Section 2(c) Cr. P.C. would have to be read
and applied mutatis mutandis with suitable modification - that is to say, by
substituting the words "a police officer" and instead referring to the officers
mentioned in Section 19 PMLA.
The Deputy Director Directorate vs. Axis Bank & Ors on 2 April, 2019
In this matter the Delhi High Court said, that on the issue of, the measure of
attachment of property involved in money laundering
, it essentially
representing proceeds of crime
(as defined in law), is provided to ensure
that the ultimate objective of confiscation
of such ill-gotten property
be not frustrated, the power and jurisdiction to order confiscation being vested
in the Special Court. As would be seen at length in later part of this judgment,
the provisions for attachment (followed by adjudication) leading to confiscation
are sanctions in addition to the criminal sanction rendering the act of money
a penal offence (by virtue of section 4).
The order of confiscation
of property attached under PMLA takes away the right and title of
its owner and vests it absolutely in the Central Government free from all
The appeals at hand relate to claims of entities other than the
persons in whose name the attached properties are held - to be referred
hereinafter as third party
- such claims of the third party emanating
from charge, lien or encumbrances legitimately created.
To put it simply, the conflict meriting resolve here concerns the sovereign
authority of the State to take away and confiscate the property which has been
acquired by a person through criminal activity as against the lawful claim of a
third party to reach out to such property to recover, in accordance with law,
what is due by attachment and sale of same very property.
legislation against money-laundering (PMLA) seeks to enforce the sanction of
confiscation (initiated by attachment) against ill-gotten assets expecting to
ensnare them in a net wider than under most of the existing laws germane to the
issue of economic well-being, security and integrity of India as a sovereign
State. It is vivid that the legislature has made provision for provisional
bearing in mind the possibility of circumstances of urgency that
might necessitate such power to be resorted to.
A person engaged in criminal
activity intending to convert the proceeds of crime into assets that can be
projected as legitimate (or untainted) would generally be in a hurry to render
the same unavailable. The entire contours of the crime may not be known when it
comes to light and the enforcement authority embarks upon a probe. In view of
the above conclusions, the impugned decisions of the appellate tribunal will
have to be set aside.
There is a need for further scrutiny particularly on facts, of the claims of the
respondents, in their appeals which were presented before the said forum to
challenge the orders of attachment, as confirmed by the adjudicating authority
in the five cases. It does appear that the assets which have been the subject
matter of attachment in the appeals at hand are not tainted property
, the same
having been seemingly acquired prior to the criminal activity giving rise to
accusations of money-laundering.
But, they are sought to be attached and subjected to eventual confiscation on
account of they being the alternative attachable properties or deemed tainted
properties, which is permissible in law. The Audi car (subject matter of first
appeal) was acquired by a transaction which has no direct connection with the
case of money-laundering. However, there is no clarity as to the value of
proceeds of crime which are to be confiscated as against value of the attached
property as indeed the extent of the debt yet to be recovered by the secured
The monetary gains made by the transactions which are subject matter of the
accusations of money-laundering on account of illicit foreign exchange
transactions (third appeal) or the case of cheating by use of fabricated defence
supply orders (fourth appeal), both involving public servants, require closer
scrutiny as to the claim of the respondent banks of bonafide action.
there is no such element of complicity on part of any of the officials of the
respondent banks in the case relating to fictitious hospital equipment (second
appeal) or the one involving consortium of banks (fifth appeal), scrutiny
respecting legitimacy and bonafide of the claim on the touchstone, inter alia,
of the subsisting value of the secured interest and chronology of events leading
to attachment would be necessary. It will be appropriate that such further
scrutiny as is necessary on the touchstone of above principles is undertaken by
the appellate tribunal after calling for further responses (and inputs) from
The crime of such nature is generally executed in stealth and secrecy, multiple
transactions (seemingly legitimate) creating a web lifting the veil whereof is
not an easy task. The truth of the matter is expected to be uncovered by a
detailed probe which may take long time to undertake and conclude. The total
wrongful gain from the criminal activity cannot be computed till the
investigation is completed. The authority for provisional
suspect assets is to ensure that the same remain within the reach of the law.
Having regard to the above scheme of the law in PMLA, it is clear that if a
bonafide third party claimant had acquired interest in the property which is
being subjected to attachment at a time anterior to the commission of the
criminal activity, the product whereof is suspected as proceeds of crime, the
acquisition of such interest in such property (otherwise assumably untainted) by
such third party cannot conceivably be on account of intent to defeat or
frustrate this law. In this view, it can be concluded that the date or period of
the commission of criminal activity which is the basis of such action under PMLA
can be safely treated as the cut-off.
From this, it naturally follows that an
interest in the property of an accused, vesting in a third party acting bona
fide, for lawful and adequate consideration, acquired prior to the commission of
the proscribed offence evincing illicit pecuniary benefit to the former, cannot
be defeated or frustrated by attachment of such property to such extent by the
enforcement authority in exercise of its power under Section 8 PMLA.
Though the sequitur to the above conclusion is that the bonafide third party
claimant has a legitimate right to proceed ahead with enforcement of its claim
in accordance with law, notwithstanding the order of attachment under PMLA, the
latter action is not rendered irrelevant or unenforceable.
To put it clearly, in
such situations as above (third party interest being prior to criminal activity)
the order of attachment under PMLA would remain valid and operative, even though
the charge or encumbrance of such third party subsists but the State action
would be restricted to such part of the value of the property as exceeds the
claim of the third party.
Situation may also arise, as seems to be the factual matrix of some of the cases
at hand, wherein a secured creditor, it being a bonafide third party claimant
vis-a-vis the alternative attachable property (or deemed tainted property) has
initiated action in accordance with law for enforcement of such interest prior
to the order of attachment under PMLA, the initiation of the latter action
unwittingly having the effect of frustrating the former. Since both actions are
in accord with law, in order to co-exist and be in harmony with each other,
following the preceding prescription, it would be appropriate that the PMLA
attachment, though remaining valid and operative, takes a back-seat allowing the
secured creditor bonafide third party claimant to enforce its claim by disposal
of the subject property, the remainder of its value, if any, thereafter to be
made available for purposes of PMLA.
As already noted, the newly inserted provision contained in Sections 26-B to
26-E falling in Chapter (no. IV-A) on "registration by secured creditors and
other creditors" of SARFEAESI Act is yet to be notified and brought into force.
In the event of said statutory clauses coming into force, a creditor will not be
entitled to exercise the right of enforcement, inter alia, of security interest
over the property of borrower unless such "security interest" has been duly
registered under the said law. Upon such amended law being enforced, a bona fide
third party claimant seeking relief against an order of attachment under PMLA
will also be obliged to show due compliance with such statutory requirements.
As has been highlighted earlier, the provisional order of attachment is subject
to confirmation by the adjudicating authority. The order of the adjudicating
authority, in turn, is amenable to appeal to the appellate tribunal. The said
forum (i.e. the appellate tribunal) may pass such orders as it thinks fit confirming, modifying or setting aside the order appealed against .
Undoubtedly, an aggrieved party is entitled in law to invoke the said
jurisdiction of the appellate tribunal to bring a challenge to the orders of
attachment (as confirmed) but, the law in PMLA, at the same time, also confers
jurisdiction on the special court to entertain such claim for purposes of
restoration of the property during the trial of the case .The jurisdiction to
entertain objections to attachment conferred on the appellate tribunal on one
hand and, on the special court, on the other, thus, may be co-ordinate, to an
Innoventive Industries Ltd. v. ICICI BankThe Supreme Court in the case of Innoventive Industries Ltd. v. ICICI Bank laid
down the test for determining if there is repugnancy between two statutes by
finding out whether one of the statutes has adopted a plan or a scheme, which
will be hindered or obstructed by giving effect to the other statute. In the
case of Abdullah Ali Balsharaf v. Directorate of Enforcement a case arose
in relation to an inconsistency between S. 109 of CrPC and S. 17(1A) of PMLA
where the ED seized the assets of the petitioner u/s 102 of CrPC.
The court while explaining how the provisions of CrPC were inapplicable for
seizing the property for the offence of money laundering cited inconsistencies
on two grounds:
The power u/s 17(1) of PMLA to provisionally attach, seize or freeze a property
can be exercised only
(a) if the specified officer has material in his possession, which provides him
'reason to believe' that the property sought to be attached or seized is
proceeds of crime or related to a crime; and
(b) after recording the reasons in writing. Whereas the power under S. 102 of
CrPC can be exercised without meeting any of the above mentioned requirements
u/s 20 of PMLA the orders of provisional attachment and/or seizure and/or
freezing cannot extend beyond the period of 180 days. Whereas the property can
be seized u/s 102 of CrPC for an indeterminate period.
The nature of the power of seizure contemplated under the provisions of CrPC is
drastic and exercise of such power is likely to have adverse effects on the
person concerned. The parliament in its wisdom did not confer upon the ED any
powers to attach or freeze assets on a mere suspicion. The Authorities cannot
bypass the legislative intent using the tool of arbitrary discretion and need to
abide by the legislative wisdom behind a particular provision.
The Delhi High
Court in the case of Abdullah Ali Balsharaf v. Directorate of Enforcement
dealt with the inconsistency between S. 109 of CrPC and S. 17(1A) of PMLA where
the ED seized the assets of the petitioner u/s 102 of CrPC. S. 65 of PMLA states
that. The provisions of the Code of Criminal Procedure, 1973 (2 of 1974) shall
apply, insofar as they are not inconsistent with the provisions of this Act, to
arrest, search and seizure, attachment, confiscation, investigation, prosecution
and all other proceedings under this Act.
The nature of the power of seizure contemplated under the provisions of CrPC is
drastic and exercise of such powers is likely to have severe adverse effects on
the person concerned thus, the parliament in its wisdom did not confer upon the
Enforcement Directorate, any powers to attach or freeze assets on a mere
suspicion. The Authorities cannot bypass the legislative intent using the tool
of arbitrary discretion, and need to abide by the legislative wisdom behind a
Further in this particular case the Delhi High court dealt with two important
questions as well.
Whether the instructions issued by the Officers of the Enforcement Directorate
via an email, inter alia, restraining the transfer of shares in respect of a
third party by the BSE. It was held that the ED cannot make such orders u/s 102
of CrPC and it was without authority of law. At best the court can restrain the
transfer of money to the petitioners and not the transfer of shares to a third
Whether the shares purchased in the year 2003, which was prior to the PMLA
coming into force and, therefore, the provisions of the PMLA are inapplicable to
the said shares. This is so because shares were subscribed by remittances paid
through banking channels much prior to commission of any alleged crime. It was
held by the court that if any property is derived or obtained from any criminal
activity relating to a scheduled offence is held outside India, then a property
of an equivalent value held in India, would also fall within the scope of
expression of 'proceeds of crime' u/s 2(u) of PMLA.
· In Joint Director, Enforcement Directorate and Others vs. M/s Obulapuram
Mining Company Pvt Ltd, High Court of Karnataka. It was held that the
Enforcement Case Information Report and the order of attachment are without
jurisdiction and are liable to be quashed since the offences alleged, are not
scheduled offences under the PML Act rather being under Mines and Geology
(Development and Regulation) Act, 1957, the Forest (Conservation) Act, 1980, the
Indian Penal Code and the Prevention of Corruption Act, 1988 and were included
in the PML Act w.e.f. June 1, 2009. Hence, the ED cannot invoke the provisions
of the PML Act with retrospective effect.
· Mahanivesh Oils & Foods Private Limited Vs Directorate Of Enforcement
2016 SC, The central issue in the present case is not on whether the scheduled
offence was committed, but whether the attachment under Section 5 of the Act can
be sustained where the principal offence as well as the offence of using its
proceeds is alleged to have been committed prior to the Act coming into force.
After Amendment to Section 3 in 2013, the words “concealment, possession,
acquisition or use” appearing in Section 3 of the Act must be read in the
context of the process or activity of money laundering and this is over once the
money is laundered and integrated into the economy.
Thus, a person concealing or
coming into possession or bringing proceeds of crime to use would have committed
the offence of money laundering when he came into possession or concealed or
used the proceeds of crime. For any offence of money laundering to be alleged,
such acts must have been done after the Act was brought in force.
of crime which had come into possession and projected and claimed as untainted
prior to the Act coming into force, would be outside the sweep of the Act. In
the circumstances, it cannot be readily accepted that any offence of money
laundering had been committed after the Act coming into force. This Act cannot
be read as to empower the authorities to initiate proceedings in respect of
money laundering offences done prior to 1-7-2005 or prior to the related crime
being included as a scheduled offence under the Act.
· B.Rama Raju vs. UOI & others 2011 Supreme Court.
On analysis of the provisions of Section 5, 8, 17 and 18, it is clear that
provisions of the Second Amendment Act have carefully ironed out the creases and
the latent ruckus in the texture of the provisions of the Act relating to
attachment, adjudication and confiscation in Chapter-Ill. Attachment or
confiscation of proceeds of crime in the possession of a person who is not
accused or charged of an offence under Section 3 is thus not an incorporation
for the first time by the provisions of the Second Amendment Act, 2009.
contention on behalf of the petitioners that the second proviso to Section 5(1)
of the Act, applies only to property acquired/possessed prior to enforcement of
this provision or if interpreted as being retrospective, the provision itself
must be invalidated for arbitrary retrospective operation is therefore without
substance or force. If the provisions of the second proviso to Section 5 are
applicable to property acquired even prior to the coming into force of this and
even so is not invalid for retrospective penalisation.
In view of the above discussed issues circling PMLA, it is for the reader to
decide whether PMLA is a bane or boon.