'Need To Support Widows, Families Of Fallen Soldiers': Bombay High Court Directs ED To Donate 50% Of Interest On ₹46.5 Crore Deposit

In an unusual order, the Bombay High Court recently while noting the 'pressing' need to provide for the widows and children of the Army men, who lost their lives for the country, ordered the Enforcement Directorate (ED) to pay the 50 per cent of the interests accrued on the Rs 46.5 crores, to be paid to the Armed Forces Battle Casualties Welfare Fund (AFBCWF).

A division bench of Justice Ajay Gadkari and Justice Ranjitsinha Bhonsale passed the order while dismissing appeals filed by the ED, which had challenged a January 17, 2019 order of an Appellate Tribunal under the Prevention of Money Laundering Act (PMLA) which ordered the ED to release the movable and immovable properties to the tune of Rs 141.50 crores belonging to the real-estate giant Shapoorji Pallonji Company Limited (SPCL). This amount was paid by the SPCL to one Nitesh Thakur from 2005 onwards under an agreement for acquiring at least 900 acres of land at the rate of Rs 30 lakhs per acre for a development project in Alibaug and Pen regions near Navi Mumbai.

Thakur, a public servant along with his brother and family members, was booked initially in a disproportionate assets case under the Prevention of Corruption (PC) Act in 2009 as he had acquired several movable and immovable properties from the amount received from SPCL including flats, high-end cars etc. He was also booked for duping mill workers of providing homes at cheaper rates.

After the amendment of of June 2009, ED took over the probe premising its case on the 'predicate offence' (disproportionate assets case) and contended that all the properties were acquired out of the 'proceeds of crime' and therefore, initiated provisional attachment of all the assets owned by Thakurs. However, Thakur informed SPCL that some of the properties, which the company was entitled to get under its agreement with Thakur, was also being attached.

Therefore, SPCL challenged the provisional attachment of the properties citing its agreement and also an Income Tax Assessment (ITA) order which clearly indicated that it had advanced Rs 141.50 crores to Thakur for acquiring lands in Alibaug and Pen. This, was done, when Thakur was on an 'unsanctioned' leave for 4 years and thus was not performing any 'official or public duty', the SPCL argued. The Appellate Tribunal, accepting the SPCL's contentions that the properties acquired from its money, cannot be labelled as property procured from 'proceeds of crime' and thus ordered release of their properties.

The ED moved the High Court challenging the same and as an interim order, sought stay of the Appellate Tribunal's order. But while allowing this request, the High Court in 2019, ordered ED to deposit an amount of Rs 46.5 crores (Rs 45 crores + Rs 1.5 crores) before its Registry.

And now, by an order passed on December 23, 2025 which was made available on January 8, the bench led by Justice Gadkari held that the ED could not place anything on record to show that the SPCL 'bribed' Thakur or that the said money or the properties purchased from the same, were 'proceeds of crime' and thus upheld the Appellate Tribunal's order.

While doing so, the bench ordered the Registry to return the Rs 46.5 crores to SPCL but with regard to the interest accrued on this amount, the bench said that 50 per cent of interest amount be paid to SPCL and the remaining to AFBCWF.

The judgment authored by Justice Bhonsale, pointed out that SPCL is one of the oldest companies in India and noted from its track record that it had all times whilst pursuing its own objectives has strived to develop economic activities in the interest of the nation and charitable works for benefit of the society.

"We are inclined to issue directions to pay 50 per cent of the accrued interest on the principal amount to the AFBCWF. We have done this in view of dedication of the soldiers of the Armed Forces of our Country. It is a known fact that, the casualties are being suffered by the Indian Armed Forces while serving the Nation. There is an urgent and pressing need to provide for the families and widows of the soldiers who have lost their lives on the battlefield and in protecting the borders of the nation. In modifying the condition of refund of accrued interest we have considered the sacrifices of the soldiers for protecting the country and borders and also difficulties faced by the widows and the families of the soldiers who have sacrificed their lives for the country," the judges said in the order.

The judges, therefore, deemed it fit to transfer 50 per cent of the interest accrued on the said FD's to the AFBCWF.

"We do this in a manner and with an object of balancing the equities," the bench clarified.

With these observations, the judges dismissed the appeals filed by the ED.

Appearance:

Advocates Manisha Jagtap and Mansi Joshi appeared for ED.

Advocates Gaurang Mehta, Shahzad AK Najam-ES-Sani and Rhea Mehta instructed by Maneksha & Sethna represented respondents..

Case Title: Union of India vs Nilesh Thakur (Criminal Appeal 1309 of 2024)

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