Case Note & Summary
The petitioners, including individuals and a company, challenged a provisional attachment order dated 28.09.2021 issued by the Deputy Director, Enforcement Directorate, under the Prevention of Money Laundering Act, 2002 (PMLA). The Anti Corruption Bureau, Srinagar, had registered an FIR against the petitioners, leading to the attachment of properties. The primary ground of challenge was that the officer who issued the order was not duly authorised as Deputy Director under Section 48 of the PMLA, as his appointment was not notified in the Official Gazette. The respondent opposed the petition, arguing that the officer was validly authorised. The court examined the provisions of Section 48 of the PMLA, which requires that officers of the Enforcement Directorate be appointed by notification in the Official Gazette. The court found that the officer in question was designated as Deputy Director by an internal office order, not by a gazette notification, and therefore lacked the authority to issue the provisional attachment order. Consequently, the court quashed the impugned order and allowed the writ petition.
Headnote
A) Prevention of Money Laundering Act - Provisional Attachment Order - Authorisation of Officer - Section 48 PMLA, 2002 - The court examined whether the officer who issued the provisional attachment order dated 28.09.2021 was validly authorised as Deputy Director under the PMLA - Held that the officer was not appointed as Deputy Director by notification in the Official Gazette as required under Section 48, and the internal office order relied upon did not confer valid authority - The impugned order was quashed (Paras 1-3).
Issue of Consideration
Whether the officer who issued the provisional attachment order under the Prevention of Money Laundering Act, 2002 was duly authorised to exercise the powers of Deputy Director under Section 48 of the Act
Final Decision
The court allowed the writ petition and quashed the provisional attachment order No.10/2021 dated 28.09.2021.
Law Points
- Provisional attachment order under PMLA must be issued by an officer duly authorised as Deputy Director under Section 48 of PMLA
- 2002
- Delegation of powers under PMLA must be by notification in Official Gazette
- Officer designated as Deputy Director by internal office order without gazette notification is not competent to issue attachment order
Case Details
2022 LawText (KAR) (01) 12
Writ Petition No.20092 of 2021 (GM-RES)
Sri. Kiran S Javali, Senior Counsel for Sri. Chandrashekara, Advocate; Sri. Prasanna Kumar P, Advocate
Sri. Anish Mohammed Rawther, Mrs. S M Shareena, Mrs. Fathima Nazia Rawther, Smt. Sheena Syed, Smt. T.S. Hazeena, M/s Rawther Plantation Merchants Pvt. Ltd.
The Deputy Director, Enforcement Directorate
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Nature of Litigation
Writ petition under Article 226 of the Constitution of India challenging a provisional attachment order under the Prevention of Money Laundering Act, 2002.
Remedy Sought
Quashing of the provisional attachment order No.10/2021 dated 28.09.2021 (Annexure-A) on the ground that it was issued by an officer not authorised to exercise the power of Deputy Director under the PMLA.
Filing Reason
The petitioners contended that the officer who issued the provisional attachment order was not duly appointed as Deputy Director under Section 48 of the PMLA, as his appointment was not notified in the Official Gazette.
Issues
Whether the officer who issued the provisional attachment order under PMLA was duly authorised as Deputy Director under Section 48 of the Act.
Submissions/Arguments
Petitioners argued that the officer was not appointed as Deputy Director by notification in the Official Gazette as required under Section 48 of PMLA, and therefore lacked authority to issue the attachment order.
Respondent argued that the officer was validly authorised and the order was valid.
Ratio Decidendi
An officer of the Enforcement Directorate must be appointed as Deputy Director by notification in the Official Gazette under Section 48 of the PMLA, 2002 to be competent to issue a provisional attachment order; an internal office order designating an officer as Deputy Director without such notification does not confer valid authority.
Judgment Excerpts
Petitioners are knocking at the doors of Writ Court for laying a challenge to the proceedings taken up under the provisions of Prevention of Money Laundering Act, 2002 ('Act' for short) and to the Provisional Attachment Order dated 28.9.2021 made by the respondent at Annexure-A;
Procedural History
The Anti Corruption Bureau, Srinagar, registered an FIR against the petitioners. The Enforcement Directorate issued a provisional attachment order dated 28.09.2021. The petitioners filed a writ petition under Article 226 of the Constitution challenging the order. The court heard the matter and reserved it for order, then pronounced the judgment on 03.01.2022.
Acts & Sections
- Prevention of Money Laundering Act, 2002: Section 48
- Constitution of India: Article 226
