PMLA | Assets From Unknown Sources Can't Be Presumed To Be Derived From Scheduled Offence Constituting 'Proceeds Of Crime': Allahabad High Court

The Allahabad High Court has held that assets derived from unknown sources of income cannot presumed to be from scheduled offences under the Prevention of Money Laundering Act, 2002.“A person may have assets derived from unknown source of income, however, that by itself cannot be presumed that the aforesaid assets are derived from schedule offence,” held Justice Vikram D. Chauhan while granting bail to accused in illegal mining in Yamuna Basin case. Multiple FIRs were filed Kangra and Una in Himachal Pradesh regarding illegal mining in the aforesaid districts. It was alleged that the illegal mining was taking place on government land and minerals were being illegally transported through overloaded vehicles. It was alleged that the proprietorship concern of the co-accused, M/s Jai Maa Jwala Stone Crusher, was also engaged in night time extraction. During investigation by ED, it was found that Garhwal Stone Crusher located in Saharanpur (U.P.) was purchased by the proprietor of M/s Jai Maa Jwala Stone Crusher. It was found that the Garhwal Stone Crusher was involved in illegal mining in the Yamuna basin. Applicant is a partner in Garhwal Stone Crusher. FIRs were filed under Sections 379, 413, 415, 417, 418, 424,471, 120-B of IPC, Section 3(2) Prevention of Damage to Public Property Act, 1984, and Sections 4 & 21 of Mines and Minerals (Regulation and Development) Act, 1957 against various persons including the applicant. Prosecution pleaded that though applicant was not a proprietor in M/s Jai Maa Jwala Stone Crusher, he was involved in day to day affairs of both companies. Applicant sought bail on grounds that the co-accused, proprietor of M/s Jai Maa Jwala Stone Crusher, had already been enlarged on bail and that he had not been named in the FIRs in Himachal Pradesh. It was pleaded that no proceeds of crimes in UP have been linked to the applicant. It was also pleaded that he had been in jail for 18months. The Court noted that the applicant was being proceeded under Sections 3 & 4 of Prevention of Money Laundering Act, 2002. “Section 4 of PMLA Act, 2002 provides for punishment of money laundering. Whereas Section 3 of PMLA Act, 2002 provides for offence of money laundering. Section 3 of said Act provides that whosoever directly or indirectly attempts to indulge or knowingly assists or knowingly is a party or is actually involved in any process or activity connected with the proceeds of crime and projecting it as untainted property shall be guilty of offence of money laundering.”The Court observed that “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”. Scheduled offence are specified under Part A of Schedule to PMLA Act, 2002 or offences specified under Part B of Schedule if the total value involved in such offences is thirty lakh rupees or more. The Court observed that there was no disclosure as to any evidence against the applicant in schedule offence registered at Himachal Pradesh. It noted that closure reports had been filed in 4 out of 6 FIRs which were accepted by Courts therein. It held that since closure reports had been filed and the applicant was not a proprietor in M/s Jai Maa Jwala Stone Crusher, income generated at that site may not be from a scheduled offence. The Court noted that once it was established that Garhwal Stone Crusher was not brought from proceeds of crime from a scheduled offence, the income of Garhwal Stone Crusher may not be proceeds of crime. “The expression “property” under Section 2(v) of PMLA Act, 2002 means assets of every description, whether corporeal or incorporeal, movable or immovable, tangible or intangible. The sale and purchase of illegally mined material may be an offence in itself, however, the proceeds of crime are required to be identified by identification of assets obtained or derived by the criminal activity in respect of schedule offence.”The Court held that no property had been identified as proceeds of crime from the sale and purchase of illegal mining material by Garhwal Stone Cursher. It observed that no list had been attached of assets allegedly acquired from scheduled offences or illegal sale purchase of alleged illegally mined minerals. Noting that the co-accused had been enlarged on bail and the trail will take time to conclude, the Court observed,“It is settled principle of law that the object of bail is to secure the attendance of accused at the trial. No material particulars or circumstances suggestive of applicant fleeing from justice or thwarting the course of justice or creating other troubles in the shape of repeating offences or intimidating witnesses and the like have been shown by opposite party.”Accordingly, the bail application was allowed. Case Title: Sanjay Kumar @ Sanjay Dhiman v. Directorate of EnforcementClick Here To Read/Downlodad Order

PMLA | Assets From Unknown Sources Can't Be Presumed To Be Derived From Scheduled Offence Constituting 'Proceeds Of Crime': Allahabad High Court

Upasna Agrawal

This is a premium content
Available exclusively to
Our subscribers

INR 1099+GST

Tags

Upasna Agrawal

PMLA | Assets From Unknown Sources Can't Be Presumed To Be Derived From Scheduled Offence Constituting 'Proceeds Of Crime': Allahabad High Court

Upasna Agrawal

This is a premium content Available exclusively to Our subscribers

INR 1099+GST

Tags

Upasna Agrawal

This is a premium content
Available exclusively to
Our subscribers