Search And Seizure Of Cash And Jewellery By ED Without Recording The ‘Reasons To Believe’: Telangana High Court Quashes Seizure

The Telangana High Court has set aside the search and seizure of cash and jewellery by ED as it was done without recording the "reasons to believe."

The single bench of Justice K. Sarath has observed that the Additional Director of the Enforcement Directorate without recording the "reasons to believe" issued a search warrant/authorisation to his subordinates.The Deputy Director of the Enforcement recorded the reasons to believe without any date and time, which clearly shows that without following the requirements under Section 17 (1) of the PML Act, authorities conducted search and seizure and seized jewellery, cash, and other articles belonging to the petitioners.

The petitioners submitted that the search warrant was only shown, signatures were forcefully taken, and the petitioners could not read the contents of the search warrant. The respondents/department failed to provide the details of the date and time for the recording of the "reasons to believe" as per Section 17(1) of the PMLA, 2002.

As the Writ Petition is not maintainable, the department contended that the PML Act itself provides the petitioners with a remedy before the adjudicating authority rather than going to court.

The court ruled that the respondents conducted the search and seizure without following the procedure outlined in Section 17 of the PML Act, and even after the search was completed, they did not follow the procedure outlined in Section 17 of the PML Act.

The court directed the respondents to release all the jewellery, cash, and other articles seized.

Case Title: M/s. Musaddilal Gems and Jewels (India) Private Limited Versus UOI

Citation: Writ Petition No. 39378 of 2022

Date: 11.01.2023

Counsel For Petitioner: Advocate B.Chadnrasen Reddy

Counsel For Respondent: T.Suryakaran Reddy

Citation: 2023 LiveLaw (Tel) 4 

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