PMLA | Nexus to transaction must be proved to array a person as defendant in proceedings for confiscation of property involved in money laundering

Appellate Tribunal for PMLA: The Tribunal chaired by Manmohan Singh, J. set aside an order restraining a woman from sale or transfer of a property, in which she was not claiming any right, title or interest.

The present appeal was filed under Section 26 of Prevention of Money Laundering Act, 2002 against the order passed by the Adjudicating Authority in an Original Application (OA) whereby appellant and her associates had been restrained from sale/ transfer of certain properties. The appellant’s case was that prima facie there was no link or nexus with the accused. Her name had only been mentioned in relation to a property which she had agreed to be purchased from one Nirmala Jain. However, due to certain personal reasons on the seller’s part, the sale could not be consummated. The said OA made no mention of any paper/documents/article or the like which had been seized and which had any connection with the appellant.

Appellant’s sole submission was that no cogent evidence had been provided by the ED to show that it had any link/ nexus with any alleged accused parties. However, despite the same, she had been arrayed as a defendant in the O.A.

The Tribunal noted that in the impugned order, no plea of the appellant had been referred. The appellant was not even claiming any right in the subject property. No prosecution complaint had been filed under Section 8(3)(a) of PMLA and the period of ninety days had already expired. Thus, her name ought to be deleted as the defendant from the O.A. At this juncture, counsel for respondent Atul Tripathi submitted that since the appellant was claiming no right and title in the property, her name may be deleted.

In view of the above, the appeal was allowed.[Alka Pahwa v. Assistant Director Directorate of Enforcement, Chandigarh, 2019 SCC OnLine ATPMLA 10, decided on 28-03-2019]

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