AI Structured Summary
Not yet generated for this judgment
Judgment
FPA-PMLA-4812/PTN/2022
The appeal has been filed under section 26 of the Prevention of Money Laundering Act, 2002, ( herein after referred as PMLA Act, 2002.)against the order dated 25.07.2022 passed by the learned Adjudicating Authority vide which provisional attachment order dated 17.09.2021 has been confirmed.
The provisional attachment order dated 17.09.2021 was inter-alia to attach the following movable properties of the appellant:-
VEHICLES IN NAME OF APPELLANT
S.No
Type of Vehicle
Date of Registration
Vehicle No
Value of property attached
Source
1
Mahindra &
Mahindra
Scorpio W
TC4 CRDe
2WD BS3
7STR
28.09.2007
BR01 AG
1111
Rs. 6,00,000 + Rs.2,00,000 +
Rs. 40,000
Agricultural income,
income/profit
from horse/cow
sale, salary and
pension of the
Appellant
2
Maruti Swift VDI
BSIV
20.10.2015
BR01AZ 6128
Rs. 4, 70,000 +· Rs. 2500 + Rs.
90,000
Agricultural income,
income/profit
from horse/cow
sale, salary and
pension of the
Appellant
3
Mahindra &
Mahindra
Scorpio
HAWK
BS3 TC5
HI W AB
2WD STR
Date of
delivery
06.07.2010
BR01 PB 1855
Rs. l 0,02,207
Agricultural income,
income/profit
from horse/cow
sale, salary and
pension of the
Appellant
4.
Mahindra Marshal
Jeep
Purchased in 2003
BRIC 0221
Rs.3,83,482/-
Agricultural income,
income/profit
from horse/cow
sale, salary and
pension of the
Appellant.
(acquired before
commencement
of PMLA)
Total
27,88,189
ACCOUNTS HELDIN NAMEOFAPPELLANT
S.No.
Account Number
Account Holder
BankName
Balance(as on 06.07.2021
1.
10839462844
Dadan Singh
SBI,BiharVid hanMandai,P atna
Rs.4629.00
2.
20040413444
Dadan Singh
SBI,PBBBr
anch,Patna
Rs.947.50
3
355152512
14 (Pension A/c)
Dadan Singh
SBI,BiharVid hanMandai,P atna
Rs.2821.00
4.
911010024626
099
Dadan Singh
AxisBank,Dak Bunglo
Rs.696.00
5.
3101292500
DadanSin gh &Usha Singh
Centralbankof India,BoringR oad
Rs.9425.44
Total
18,518.94
The learned counsel for the appellant submitted that order of provisional attachment as also the order of the Adjudicating Authority are not legally sustainable without there being proceeds of crime. The movable properties have been attached without having any connection with the crime.
The movable properties were otherwise acquired much prior to the alleged crime thus were existingwithout relation to any predicate offence, thus could not have been subjected to attachment. It does not fall in the definition of “proceeds of crime”. Thus, on the aforesaid ground also, the impugned orders deserves to be set aside.
An allegation of malafide against the respondent has been made.
It is submitted that the appellant remain Member of Legislative Assembly and a Minister in the Government. The proceedings against him were initiated to settle the score.
In view of the above also, the impugned order deserves to be set aside. The appellant has been falsely implicated in the predicate offence and otherwise the entire proceedings suffers from malafide. It is also that in many cases, closure report has been given or an order has been passed by Patna High Court in favour of the appellant, thus hardly any predicate offence exist.
To support the argument, the learned counsel for the appellant has given reference to the object behind the PMLA Act, 2002.It is with further reference to the definition of “Proceeds of Crime” given under section 2 (1) (u) and offence of Money Laundering under section 3 of Prevention of Money Laundering Act, 2002.
It is to demonstrate that the movable property attached by the respondent does not fall in the definition of “proceeds of crime”. It was acquired much prior to alleged commission of offence.
The learned counsel for the appellant has given reference of the facts of this case to show that no proceeds were generated out of the alleged crime so as to be taken as proceeds of crime. The provisional attachment and its confirmation by the Adjudicating Authority are in ignorance of the facts and law. The compliance of section 5(1) of the Act of 2002 has not been made for that reason.
In view of the above, the appeal deserves to be allowed with quashing of the impugned orders.
The appeal has been contested by the learned counsel for the respondent. The learned counsel submitted that the attached properties need not necessarily to be proceed of crime. It can be for the value equivalent there to. It is not that proceed of crime alone can be attached rather if it is not available, the property of equivalent value can be attached. In the instant case, the property so attached is to the equivalent value of the proceeds of crime.
In view of the above, it was not necessary to show that the movable property attached by the respondent was directly or indirectly the proceeds of crime.
The learned counsel for the respondent further submitted that proceeds of crime was generated out of the scheduled offence thus, it is not correct to state that no proceeds of crime exist. The facts on record would show that appellant is involved in many offences. The appellant had mortgage tainted property to the bank and obtained loan of Rs. 2,50,00,000. It was even by over valuation of the land for the aforesaid loan. It is also that the land and other properties were purchased in the name of the wife and son by paying in cash without its withdrawal from Bank or showing the source.
The facts on record are sufficient to demonstrate generation of proceeds of crime and therefore movable properties of equivalent value rather for lessor value were attached. It is thus not correct to state that there was no proceeds of crime out of the alleged predicate offence.
The reference of the facts were given to support the argument and would be referred elaborately while dealing with the rival arguments.
The allegations of malafide has been refuted by the counsel for the respondent. It is submitted that allegation of malafide are for the sake of it because it is not been attributed to anyone in person and for that even no one was made party in person to establish the allegation of malafide. It is easy to make allegation of malafide than to prove it and in the present case no material is placed on record to prove the allegation of the malafides.
The allegation of malafide cannot be levied only for the reason that appellant was MLA or remain a Minister. If anyone commits a scheduled offence can be subjected to proceedings under the Act of 2002, irrespective of the position and the political party.
Thus, impugned orders may not be set aside on the ground of the malafide rather prayer was made to dismiss the appeal.
We have considered the rival submission of the parties and pursued the record. Before addressing the legal issues raised by the appellant, it would be relevant to refer brief facts of the case.
The brief facts
The facts available on record would show that number of FIRs have been registered against the appellant for commission of different offences under Indian Penal Code (IPC) and The Arms Act. The details of all the facts has been given by the complainant in the OC and even by the Adjudicating Authority. For ready reference, paragraph 6 of the impugned order of the Adjudicating Authority is reproduced hereunder to refer brief facts of the case.
Investigation under PMLA as stated by the Complainant in the OC:-
6.1 “That, on the basis of the FIR No. 45/04 dated 28.10.2004 & FIR No. 43/06 dated 12.11.2006 and Supplementary Charge sheet No. 62/07 dated 21.10.2007 filed by Koransarai Police Station, Buxar, forwarded by Superintendent of Police, Buxar, Bihar, Patna, vide his letter No. 6192 dated 16.11.2013, an investigation was conducted by the Enforcement Directorate, Patna Zonal Office, Patna, under the provisions of PMLA, 2002.
That perusal of Charge-Sheet No. 62/07 dated 21/10/2007 in FIR No. 43/06 dated 12/11/2006 filed by Koransarai Police Station, Buxar, revealed that this FIR was filed by Shri Sunil Kumar, Anumandal Aarakshi Padadhikari, and Dumraon. The case is registered with Koran Sarai Police Station invoking Section 144 of IPC and Section 25 (1b), 26, 35 of Arms Act. In this FIR, Shri Dadan Singh and Smt. Usha Singh were not reported as accused. At the time of filing Supplementary Charge Sheet No. 62/07 dated 21/10/2007 Shri Dadan Singh and Smt. Usha Singh were made accused under section – 188, 384, 420, 120B of IPC & under section – 25 (1b), 26, 35, 29, 30 of Arms Act.
In the FIR, it was mentioned that one Scorpio having registration No. DL 9CG - 9596 was seized on 12/11/2006, during Panchayat Election. In the vehicle two Aarakshi who were bodyguard of Dadan Singh, MLA and two other people namely Shri Bhim Ram and Shri Sanjay Kumar Yadav were present along with Rifles and its cartridge. They were not carrying the license of those Rifles. Approx 500 posters and hand bill of “Prajatantrik Lok Ekta Dal” was also found in the Vehicle, which is chaired by Shri Dadan Singh. In the Supplementary Charge Sheet No. 62/07 dated 21/10/2007, it is mentioned that the suspect Bhim Ram is a criminal and active member of M.C.C. Both the Rifles seized from the Scropio were in the name of Smt. Usha Devi W/o Shri Dadan Singh. One Arms License bearing No. 56/2000 was issued from Nawada District and another Arms License bearing No. 276/2003 was issued from Buxar District. It is also reported that many irregularities were found in the process of acquiring these Arms Licenses. During the investigation of LEA, it was also found that the Vehicle used in this case was also acquired from its owner by threatening and deceit. The license holder has intentionally handed over the Arms to deserter of Murder case and active member of M.C.C. for the purpose of crime. The detained suspects were closely related to the family of License holders. Therefore, Shri Dadan Singh and Smt. Usha Devi were framed as accused of Section 188, 384, 420, 120B of IPC and Section 25 (1b), 26, 35, 29, 30 of Arms Act in the Charge sheet filed by Koransarai Police station. Whereas, the Section 120B, 384 & 420 of IPC, 1860 and Section 25, 26, 29 & 30 of the Arms Act, 1959 is “Scheduled Offence” under Prevention of Money Laundering Act 2002 (PMLA), as specified in paragraph 1 & 5 of Part A of the PMLA, ECIR No. PTZO/10/2014 dated 13.05.2014 was recorded for investigation of the offence of money laundering, under the provisions of PMLA.
6.2 Whereas, during the course of investigation conducted under the PMLA, following FIRs/Charge -sheet against Shri Dadan Singh@ Yadav @ Pehalwan & Smt. Usha Yadav were unearthed:
i) FIR with Koransarai Police Station, Buxar:
Name of Police
Station
FIR No. &
Date
Charge sheet No. &
Date
Name of Suspect
ACT &
Section
Scheduled offence
Koransarai, Buxar
43/06 dated 12.11.2006
62/07 dated 21.10.2007
In the FIR, name of Dadan Singh & Smt Usha Singh was not mentioned whereas in the Supplementary Charge sheet, they have been made accused.
IPC – 188. 384, 420, 120B Arms Act – 25 (1b), 26, 35, 29, 30.
IPC - 384, IPC - 384, 420, 120B
Arms Act – 25, 26, 30
This FIR was filed by Shri Sunil Kumar, Anumandal Aarakshi Padadhikari, Dumraon. The case is registered with Koran Sarai Police Station invoking Section 144 of IPC and Section 25 (1b), 26, 35 of Arms Act. In this FIR, Shri Dadan Singh and Smt. Usha Singh was not reported as accused. At the time of filing Supplementary Charge Sheet No. 62/07 dated 21/10/2007, Shri Dadan Singh and Smt. Usha Singh were made accused under Section188, 384, 420, 120B of IPC &Section -25 (1b), 26, 35, 29, 30 of Arms Act.
In the FIR, it was mentioned that one Scorpio bearing No. DL 9CG - 9596 was seized on 12/11/2006 during Panchayat Election. In the vehicle two Aarakshi who were bodyguard of Dadan Singh MLA and two other people namely Shri Bhim Ram and Shri Sanjay Kumar Yadav were present along with Rifle and its cartridge were also found. They were not carrying the license of Rifles. Approx 500 posters and hand bill of “Prajatantrik Lok Ekta Dal” was also found in the Vehicle which is chaired by Shri Dadan Singh.
In the Supplementary Charge Sheet No. 62/07 dated 21/10/2007, it is mentioned that the suspect Shri Bhim Ram is a criminal and active member of M.C.C. (a Naxal outfit) Both the Rifles seized from the Scropio was in the name of Smt. Usha Devi W/o Shri Dadan Singh. One Arms License bearing No. 56/2000 was issued from Nawada District and another Arms License bearing No. 276/2003 was issued from Buxar District. It is also reported that many irregularities were found in the process of acquiring these Arms Licenses. During the investigation of LEA, it was also found that the Vehicle used in this case was also acquired from its owner by threatening and deceit. The license holder has intentionally handed over the Arms to deserter of Murder case and active member of M.C.C. for the purpose of crime. The detained suspects were closely related to the family of License holders. Therefore, Shri Dadan Singh and Smt. Usha Devi were framed as accused of Section 188, 384, 420, 120B of IPC and Section 25 (1b), 26, 35, 29, 30 of Arms Act in the Charge sheet filed by Koransarai Police station.
ii) FIR with Dumraon Police Station, Buxar:
Name of Police Station
FIR No. & Date
Charge sheet No. & Date
Name of Suspect
ACT & Section
Scheduled offence
Dumraon, Buxar
192/05 dated 25/10/2005
177/05 dated 19/12/2005
Dadan Singh & Others were made suspect in the FIR and the same were made accused in the Charge sheet.
IPC – 147, 148, 149, 341, 342, 323, 307, 379, 504, 506
IPC – 307
That this FIR was lodged by one, Shri Ramjee Singh Yadav, the then Deputy President of RJD, of Buxar District. He has reported that due to political enmity Shri Dadan Singh along with others attacked him and beat till the unconsciousness. They had also snatched cash and jwellery available with him. In the Charge sheet filed by the police authorities, the same charges were framed by invoking section 147, 148, 149, 341, 342, 323, 307, 379, 504, 506 of IPC wherein Section 307 of IPC is schedule offence under PMLA.
iii) FIR with Danapur Police Station, Patna:
Name of Police Station
FIR No. & Date
Charge sheet No. & Date
Name of Suspect
ACT & Section
Scheduled offence
Danapur, Patna
55/14 dated 02/02/2014
501/2018 dated 31.10.2018.
Dadan Singh, Kartar Singh, Usha Singh & Other
IPC – 147, 148, 149, 341, 342, 323, 307, 379, 504, 506
IPC – 120B, 420, 467, 471
That this FIR was lodged by Shri Arun Kumar Singh who has bought immovable properties at Naya Tola, Saguna More, Danapur, Patna from Shri Dadan Singh. The suspects have deceived him by stating that this property is free from any encumbrance but at the time of registry, it came to his notice that this property has already been mortgaged with Bank of India, against a sanctioned loan. Amount of Rs. 15 lacs were still to be paid to bank. To ensure the peace of mind Shri Arun Kumar Singh has again paid Rs. 15 lacs for clearance of loan from Bank of India. This payment was in addition to earlier sale price of that property. In the sale deed it was mentioned that seller has taken loan from Bank of India for construction of house and he will clear the loan amount including interest thereon and receive the Original document of property from the Bank. The original document will be handed over to the purchaser i.e., Arun Kumar Singh. As per FIR, as a conspiracy, Shri Dadan Singh with the help of officials of Registrar office, has change the word “Seller to Purchaser” so that the liability of Loan shifts on purchaser. After purchasing of property, Arun Kumar Singh has built a four storey full furnished house. Further, he came to know that Dadan Singh has also mortgaged this property with Bank of India and HUDCO as a collateral security against the loan taken in the name of Rice mill and HUDCO. This fact was suppressed by Dadan Singh at the time of sale of properties and thereby he cheated the buyer. Therefore, an FIR with Danapur Police station was filed by Arun Kumar Singh. Subsequently, Charge sheet corroborating the allegation made by Arun Kumar Singh is also filed by the Police Authorities. Due to fraud and cheating of Dadan Singh, Arun Kumar Singh has to incur loss of Rs. 91 lacs as a payment to bank which was onus of Dadan Singh being the owner of property.
iv) FIR with Buddha Colony Police Station, Patna:
Name of Police Station
FIR No. & Date
Charge sheet No. & Date
Name of Suspect
ACT & Section
Scheduled offence
Buddha Colony, Patna
110/11 dated 16/07/2011
Charge sheet not filed till date
Dadan Singh & Others
IPC – 448, 420, 341
IPC – 420
That this FIR was lodged by Smt. Kiran Prakash Singh. She accused that Shri Dadan Singh along with others intruded in her house at Sumitra Devi Path, Patna-1, and threatened that he had purchased that house and she had to vacate the house. They all were with arms and threatened to vacate the house within three days. They also threatened her life. As a forgery her house was sold to Shri Dadan Singh and now they are threatening her for her life along with other family members.
v) FIR with Ranipur Police Station, Mau, Uttar Pradesh:
Name of Police Station
FIR No. & Date
Charge sheet No. & Date
Name of Suspect
ACT & Section
Scheduled offence
Ranipur Police Station, Mau, U.P.
1286/10
A-44 dated 25/04/2011 and A-44A dated 14/06/2012
Dadan Singh & Others
IPC – 419, 420, 467, 468, 471
IPC – 419, 420, 467, 471
That this FIR was filed by one Sanjay Kumar, Resident of Chausa Khurhat, Ranipur, Mau, Uttar Pradesh against Dadan Yadav @ Pehalwan & others for cheating under the guise of providing Job. Dadan Singh along with others have taken Rs. 3.5 lakh in the name of employment whereas, no job was provided. Further, cheque given by Dadan Singh to compensate this loss got bounced. Despite repeated request no payment was made by Dadan Singh & others. They have cheated Sanjay Kumar and an FIR under section 419, 420, 467, 468, 471 of IPC was filed accordingly and charge sheet was also filed corroborating the same charges.
In the instant case the complainant has attached properties, valued at Rs. 28,06,707/- . The FIRs referred to above were registered from time to time and by different complainants. In reference to the scheduled offence, ECIR was recorded under the Act of 2002. The investigation was conducted in pursuance to it. According to the respondent, the proceeds of crime was generated out of those offences. The details of the movable property attached in pursuance to the impugned order have been given in the opening paras of this order.
The provisional attachment order was issued after taking into consideration not only the scheduled offence alleged to have been committed by the appellant but in reference to the statement recorded under section 50 of the Act of 2002. The various immovable properties were found in the name of appellant’s wife without having source to purchase it. She is shown to be a housewife having no means of earning yet immovable properties in the shape of land and other immovable properties were purchased from time to time. It was mainly by making payments in cash and it was not with its withdrawal from Bank or showing the source.
The appellant’s wife fairly conceded that she has no knowledge of those properties rather knowledge of it is to the appellant.
Since, properties were purchased in cash without disclosing its sourcethus fall under definition of Money Laundering and therefore it became tainted propertyin the hands of appellant’s wife. As per the statement of the wife, it was at the instance of the appellant.
The counsel for the appellant did not argue the connected appeal filed by the appellant’s wife and his son while pressing the present appeal for final arguments. It is despite of the fact that the facts in the present appeal so as the appeal preferred by the wife and son are co-related rather they are inter-mixed with each other.
Thus, it would be relevant to refer the facts pertaining to immovable and movable properties acquired in the name of the appellant’s wife and son. The detailed reference of it has been given in the paragraph 8 of the impugned order and is quoted hereunder :-
8.1 That during investigation under PMLA, following immovable and movable properties are found to have been acquired in the name of Shri Dadan Singh @ Yadav @ Pehalwan: -
(A) Immovable property:
Sale Deed No./ Date
Area
Particulars and Location of property
Total Value
(In Rs.)
Remarks
10863/200 5 dated 19.10.2005
80 Decimal
Land at Dumraon, Buxer, Khata No. 380 Plot No. 1501/1731
Sale deed price – 47000 Governme nt value – 173000
Payment made in Cash and Dadan Singh shown himself an Agriculturist. Land mortgaged with HUDCO
a) From the sale deed of above property, it is evident that Dadan Singh has purchased this property in Cash but no evidence regarding the source of cash was produced. In the sale deed, he declared himself an agriculturist however, Nil agricultural income was shown in his Income Tax Returns for the last three years from the date of purchase i.e. F.Y. 2003-04, 2004-05 & 2005-06. This makes, it is evident that proceeds of crime available with him in cash was utilized for purchase of property and the same was tried to be disguised in the form of acquisition from agricultural income so that tainted properties can be projected as untainted.
b) Scrutiny of transactions for the 29.552 Decimal land at Mauja – Babakpur, Phulwari, Sub Registry – Danapur, Tauji No. 5059, Thana No. 35, Khata No. 4, Survey Plot No. 19 & Khata No. 7, Survey Plot No. 20:
i) Sale deed No. 979/2009 dated 04.03.2009 submitted by Dadan Singh vide his submissions dated 12.07.2018, was executed by Indralal Mankani & others in favour of Dadan Singh S/o Late Lal Chand Singh for a sale consideration of Rs. 18,06,000/-. In this sale deed, it is clearly mentioned that the sellers are in need of money for business and personal need. No one other than Dadan Singh has offered the highest price for land which was at par with the market value of land. It is also evident from the sale deed that the sale consideration of Rs. 18,06,000/- was fully paid by Dadan Singh to the sellers prior to execution of sale deed. In sale deed, no payment through banking channel was mentioned which corroborate that sale consideration was paid in Cash.
ii) Sale deed No. 3459/2010 dated 31.03.2010 submitted by Dadan Singh vide his submissions dated 06.08.2018 was executed by Dadan Singh in favour of M/s Navrang Buildicon Pvt.Ltd. for sale consideration of Rs. 57,09,000/-. Whole Payment of Rs 57,90,000/- was paid to the Dadan Singh vide cheques.
(B) Movable property:
Sr. No.
Type of Vehicle
Date of Registration
Vehicle No.
Source of purchase amount
01
Mahindra & Mahindra Scorpio W TC4 CRDe 2WD BS3 7STR
28/09/2007
BR-01AG / 1111
Rs. 6,00,000/- From SBI vide Cheque No. 191386 on 06/08/2007 Cash – Rs. 2,00,000/- on 06/08/2007
Rs. – 40,000/- from SBBJ Bank on 06/08/2007
02
Maruti Swift VDI BS IV
20/12/2015
BR-01AZ / 6128
Rs. 4,70,000/- vide Banker‟s cheque (SBI Car Loan) on 06/01/2011
Cash – Rs. 2500 on 14/12/2010
Cash – Rs. 90,000/-
03
Mahindra & Mahindra Scorpio HAWK BS3 TC5 HI W AB 2WD 7STR
Date of Delivery – 06/07/2010
BR-01PB / 1855
Price – 10,02,207/- & Registration+ Insurance – Rs. 75,699
Rs. 8,20,651/- From SBI as car loan on 30/07/2010.
Rs. 75,699/- vide cheque on 06/07/2010
Cash Payment of Rs. 2,02,207/- made on 06/07/2010.
04
Mahindra Marshal Jeep
Purchased in the year 2003
BR-1C / 0221
Loan of Rs. 3,83,482/- repaid to PNB.
Total
Rs. 27,88,189/-
As regards, the purchase of above vehicles, certified copy of registration from the concerned District Transport officers and statement of loan accounts from the concerned banks have been obtained. Scrutiny of documents as well as the statement of Dadan Singh tendered under section 50 of the PMLA revealed the following:
i) For the part payment of purchase of vehicle, in addition to the loan amount, was made in Cash;
ii) Loans utilized for purchased of vehicles are either not repaid or cash has been utilized for Repayment of loans which were firstly placed into bank and transferred to loan account. Cash has also been utilized to deposit into loan account directly;
iii) The source of cash was not explained;
No evidence regarding the legitimate source of generation of cash was produced before the investigation.
(C) Saving Bank Accounts:
That during the course of investigation under PMLA, the following Bank Accounts held in the name of Shri Dadan Singh @ Yadav @ Pehalwan and in the name of business entities controlled by Dadan Singh were identified:
Sl . No
Name of the Bank
Bank A/c No.
Name of Account Holder
1.
SBI, Bihar Vidhan Mandal, Patna
10839462844
Dadan Singh
2
SBI, PBB Branch Patna (Loan A/c)
31256316401
Dadan Singh
3
SBI, PBB Branch Patna
20040413444
Dadan Singh
4
SBI, PBB Branch Patna (RA- Auto Loan A/c)
31544364527
Dadan Singh
5
BOI, Frazer Road (Housing Loan A/c)
440075110000019
Dadan Singh
6
BOI, Frazer Road (Cash Credit A/C)
440030110000024
M/s Satyaveer Agrotech (Dadan Singh is Director)
7
BOI, Frazer Road (Term Loan A/C)
440070410000008
M/s Satyaveer Agrotech(Dadan Singh is Director)
8
Axis Bank, Boring Road
911020026186808
Dadan Singh
9
Axis Bank, Dak Bunglow
911010024626099
Dadan Singh
10
Kotak Mahindra, Exhibition Road
03512000000771
M/s Nirbhay Cold Storage Pvt. Ltd. (Dadan Singh is Director)
11
Kotak Mahindra
03510010002869
Dadan Singh
12
Central Bank of India, Boring Road
3101292500
Jt. A/C of Dadan Singh & Usha Devi
13
PNB, Dumraon
0152000101955221
Dadan Singh
14
PNB, Frazer Road
PNB, Frazer Road,
2913000100138082
Mr. Dadan Singh
15
Patna (Auto Loan A/C)
291300NG00202884
Dadan Singh
16
BOI, Patna
440020110000089
Satyaveer Agrotech Pvt. Ltd. (Dadan Singh is Director)
17
Axis Bank, Boring Road, Patna, Housing Loan
PHR014200327328
Dadan Singh
Scrutiny of above bank accounts have been made under PMLA and it is revealed that several cash deposits were made into the bank accounts controlled by Dadan Singh. The details of which is as follows:
Details of Cash Deposits in Bank Accounts pertaining to Dadan Yadav
Axis
Axis
PNB Loan A/c
PNB
SBI
SBI
SBI
(Loan
A/c)
SBI
(Loa n
A/c)
Account N.o
/F.Y
911010024626099
911020026186808
291300NG00202884
0152000101955221
10839462844
20040413444
31544364527
31256316401
TOTAL
2008-09
0
0
383482 *
0
0
0
0
0
383482
2009-10
0
0
0
0
1309147
0
0
0
1309147
2010-11
0
0
0
0
1925500
3601410
2350
0
5529260
2011-12
959822
159100
0
0
3122500
250500
75000
125000
6124322
2012-13
0
0
0
0
188000
0
0
0
188000
2013-14
0
0
0
0
1664700
0
10000
10000
00
2014-15
0
0
0
0
0
0
0
0
0
2015-16
0
0
0
1536000
0
0
0
0
1536000
0
Total
959822
1591500
383482
1536000
8209847
3851910
87350
135000
16756911
*Note : Cash deposit of Rs. 6,50,000/- was also made with PNB Assets Management‟s Imprest Account. Firstly this cash was placed in the Bank Imprest Account and subsequently an amount of Rs. 383482/- was transferred to PNB Vehicles loan account No. 291300NG00202884 for repayment of loan and rest of Rs. 2,65,518/- was transferred to another PNB Vehicles Loan account No. 291300NG00204271 held in the name of his wife Usha Yadav.
8.2 That following immovable and movable properties are found to have been acquired by Dadan Singh in the name of his wifeSmt. Usha Singh: -
(A) Immovable properties:
Sl No.
Sale Deed No./
Date
Area
Particulars and Location of property
Total Value (In Rs.)
Remarks
1.
486/2003
dated 21.01.200
3
187.5
Decimal
Land at Mauja –
Dumraon, Thana No. 168
Khata No. 179, Plot No. 1997 & 1998
2,82,000/
-
Payment made in
cash. Declared herself
Housewife.
This property is
mortgaged with
HUDCO.
2.
9429
Dated
31.10.2011
26.50
Decimal
Land at Mauja –
Dumraon, Khalwa
Innar, Samhar,
Dumraon. Thana No.
168
Khata No. 179, Plot
No. 1998
265000/-
Payment made in
cash. Declared
herselfHousewife.
This property is
mortgaged with
Oriental Bank
of Commerce
(Now PNB) &
also mortgaged
with HUDCO.
3.
10221/20
09 dated
25.11.2009
7
Decimal
Land at Dumraon, Buxar, Mauja – Samhar, Khata No. 20,6 Plot No.
290, 633, Thana No. 153.
24000/-
Payment made in cash.
Declared herself Housewife.
4.
2999/200
8 dated
09.04.2008
3.125
Decimal
Land at Mauja - Dumraon, Ward No.
1, Thana No. 168,
Khata No. Nil
Plot No. 3253
375000/-
Payment made in cash.
Declared herself
Housewife.
5.
2938/200
8 dated 08.04.2008
17.18
Decimal
Land at Mauja - Dumraon, Ward No. 1, Thana No. 168, Khata No. Nil Plot No. 3253
150000/-
Payment made in cash.
Declared herself Housewife.
6.
722/2008
dated
30.01.2008
59
Decimal
Land at Mauja - Dumraon, Thana No.
168 Khata No. 84
Plot No. 1972, 1989
180000/-
Payment made in cash.
Declared herself
Housewife.
7.
670/2008 dated
29.01.2008
45
Decimal
Land at Najirganj, Dumraon, Buxar Khata No. 335 Plot No. 1985
135000/-
Payment made in cash.
Declared herself Housewife.
Total
Rs. 14,11,000/-
That detailed investigation regarding the acquisition of above mentioned 07 plots has been carried out under PMLA, the outcome of which is as follows:
i) All the 07 plots have been purchased in the name of Smt. Usha Singh@Yadav;
ii) the payments against all these purchases of land were made in cash;
iii) no corresponding withdrawal from the bank accounts held in the name of Smt. Usha Yadav has been made for payment against the purchase of plots;
iv) She has declared herself „house wife‟ in most of the bank account opening forms.
v) In all the sale deeds of immovable properties, she has declared herself either house wife or an agriculturist.
However, she doesn‟t own and neither has inherited agricultural land prior to the purchase of land out of proceeds of crime.
vi) At the time of statement dated 18.06.2019 tendered under section 50 of PMLA, she showed her ignorance about the purchase of most of the land, however, she stated that all the financial transaction in her name were executed by her husband i.e., Dadan Singh.
vii) Despite ample opportunities, no evidence regarding the source of her income was produced by her. She has concocted the story of dairy and agricultural income; however, she even doesn‟t know the name of her customers and having registration of these businesses.
Property earlier purchased in her name has been utilized for acquiring loans from financial institution whose repayment was not made. At the time of loan, the valuation of land was overvalued by forging documents which is apparent from the Government Valuation from sale deed and Valuation made by Ram Balak Prasad, Approved Valuer who has valued the properties at excessive higher rate which is almost 140 times higher than purchase price and government valuation. Further, forged stamp in the name of B Sahay
& Associates, Patna, Chartered Accountant Firm was utilized for certification of overvalued of properties so that huge loan can be taken from bank. Moreover, forged stamp of A.K. Verma & Associates, Bhagalpur, Chartered Accountant was also utilised for certification of Income Tax Returns on the basis of which huge loans were taken. The institute of Chartered Accountants of India vide their email dated 27.07.2020 [Annexure A-55, marked and enclosed, refers] has confirmed that no such Chartered Accountants Firms as below are registered with ICAI in the manner and style of B. Sahay & Associates, Patna and A. K. Verma & Associates, Bhagalpur.
(B) Movable property:
Sr. No.
Type of Vehicle
Date of Registration
Vehicle No.
Source of purchase amount
01
Mahindra Jeep
In the year 2003
BR – 17H / 0221
Loan of Rs. 2,66,518/- repaid to PNB.
Total
Rs. 2,66,518/-
As regards, the purchase of above vehicle, certified copy of registration from the concerned District Transport officers and statement of loan accounts from the concerned bank have been obtained and scrutinized. Scrutiny of documents as well as the statements of Smt. Usha Singh@Yadav and Dadan Singh tendered under section 50 of the PMLA revealed the following:
i) Loans utilized for purchased of vehicles are either not repaid or cash has been utilized for Repayment of loans which were firstly placed into bank and transferred to loan account. Cash has also been utilized to deposit into loan account directly;
ii) Smt. Usha Yadav has no independent source of income. She is a house wife whose name has been utilized for acquisition of properties;
iii) False and fabricated ITRs have been filed in the name of Smt. Usha Yadav to cover-up the proceeds of crime in the form of business and agriculture income so that tainted properties can be projected as untainted;
iv) The source of cash was not explained;
v) No evidence regarding the legitimate source of generation of cash was produced before the investigation.
During the course of investigation under PMLA, it is revealed that Smt. Usha Yadav is a house wife and has no independent source of her income.
8.3 That following movable properties are found to have been acquired in the name ofShri Kartar Singh Yadav S/o Dadan Singh @ Pehalwan: -
(A) Immovable property:
Sl No.
Sale Deed No./ Date
Area
Particulars and Location of
property
Total Value
(In Rs.)
Remarks
1.
9632/2007 dated 23.10.2007
9
Decimal
Mauza – Dumraon, Thana No. 168, Najirganj, Dumraon, Buxar, Khata No. 436/426, New Khata No. - 311 Plot No. 1999
27000/-
Cash payment
2.
9619/2007 Dated 22.10.2007
57
Decimal
Mauza – Dumraon, Thana No. 168, Najirganj, Dumraon, Buxar, Khata No. 426 Plot No. 1969/1999
171000/-
Cash payment.
3.
10873/200 8 dated 22.12.2008
16
Decimal
Mauza – Dumraon, Thana No. 168, Najirganj, Dumraon, Buxar, Khata No. 471 Plot No. 1968 & 1990 etc
Sale value 60000/- Market Value - 96000/-
Cash
Payment
4.
103/2015 dated 05.01.2015
8 dhoor
Mauza – Dumraon, Thana No. 168, , Dumraon, Buxar,New Ward No. 11, Khata No. 46, Plot No. 337
Sale consideration Rs. 500000/-
Cash Payment
This land was sold vide sale deed No. 01 dated 20.11.2018 for a sale consideration of Rs. 12 lacs. Sale consideration of Rs. 12 lacs has been received in cash. As this property was purchased out of proceeds of crime, therefore the sale consideration received Rs. 12 lacs is also the fruits of proceeds of crime and is liable for attachment.
5.
5764/2016 Dated 15.09.2016
0.004 Hectare
Arazi No. 157/3, Mauza – Firozpur, Pargana – Kopachitsharki, Tehsil & District – Baliya
Sale value 50000/- Market Value – 2,21,000/-
Cash payment
Total
Rs.16,79,000/-
That detailed investigation regarding the acquisition of above mentioned 05 plots has been carried out, the outcome of which is as follows:
i) All the 05 plots have been purchased in the name of Kartar Singh Yadav;
ii) the payments against all these purchases of land were made in cash;
iii) no corresponding withdrawal from the bank accounts held in the name of Kartar Singh Yadav has been made for payment against the purchase of plots;
iv) In all the sale deeds of immovable properties, he has declared himself an agriculturist. However, he doesn‟t own nor has he inherited agricultural land prior to the purchase of land out of proceeds of crime.
v) At the time of statements dated 04.07.2018, 11.07.2018, 25.07.2018 & 30.01.2019 tendered under section 50 of PMLA, he stated that properties mentioned at Sr. No. 01., 02, & 03 have been purchased out of funds provided by his father, however, Dadan Singh has not produce such evidences to corroborate the funds through legitimate source of income. Further, properties mentioned at Sr. No. 04 & 05 was claimed to have acquired out of income from operation of vehicle, however, no evidence of business operation of vehicle was produced. Moreover, the vehicles from which income was claimed to be generated is not even registered with Transport Authorities. Cash in the form of proceeds of crime was also utilised for procurement of both vehicles. Therefore, income, if any, generated through these vehicles is also the fruits of proceeds of crime.
vi) Despite ample opportunities, no evidence regarding the source of his income was produced. He has concocted the story of vehicle operation and agricultural income; however, he doesn‟t know the name of his customers and having registration of business.
vii) Immovable Property earlier purchased in his name has been utilized for acquiring loans from financial institution whose repayment was not made. At the time of loan, the valuation of land was overvalued by forging documents, as no such valuer was found or his details have been provided by her or her husband. Forged stamp in the name of B. K. Sahay & Associates, a Chartered Accountant firm was utilized for certification of overvalued of properties so that huge loan can be taken from bank.
Property mentioned at Sl. No. 4 was sold by Dadan Singh and Kartar Singh Yadav on 20.11.2018 for a sale consideration of Rs. 12 lacs. This property was sold in Cash and after the knowledge of ongoing proceedings under PMLA. They have willfully sold the properties and got the sale consideration in Cash in an attempt to frustrate the proceedings under PMLA. As the source of acquisition of this property is nothing but the proceeds of crime generated by Dadan Singh, therefore, the fruits of proceeds of crime in cash by way of sale consideration of Rs. 12 lacs is itself proceeds of crime and liable for attachment.
(B) Movable property:
Sr. No.
Type of Vehicle
Date of Registration
Vehicle No.
Source of purchase amount
01
Mahindra & Mahindra Scorpio
Purchased in 2009, however Registration made on 18.05.2010
BR 44P / 1080
Loan from Dena Bank (now Bank of Baroda) – Rs. 7,00,000/- Cash - Rs. 1,10,000/-
02
Mahindra & Mahindra Scorpio SLE 2.2 HWK 2WD
29.07.2013
Not yet Registered
Rs. 9,87,034/-
Total
Rs. 17,97,034/-
As regards, the purchase of above vehicles, Certified copy of registration from the concerned District Transport officers and statement of loan accounts from the concerned banks have been obtained and scrutinized. Scrutiny of documents as well as the statement of Kartar Singh tendered under section 50(3) of the PMLA revealed the following:
i) For the part payment of purchase of vehicle, in addition to the loan amount, was made in Cash;
ii) Loans utilized for purchased of vehicles are either not repaid or cash has been utilized for Repayment of loans which were firstly placed into bank and transferred to loan account. Cash has also been utilized to deposit into loan account directly;
iii) Kartar Singh Yadav claimed that income generated from the operation of vehicle has also been utilised for purchase of vehicle, however no evidence regarding the operation of vehicle was produced. Furthermore, no government permit for operation of vehicle was also produced before the investigation. He even doesn‟t know the single name of his customer;
iv) The source of cash was not explained;
viii) No evidence regarding the legitimate source of generation of cash was produced before the investigation.
The para quoted above shows not only the details of the properties in the name of the appellant’s wife and son but how it was acquired by the appellant. It is whether movable or immovable. They were not having independent source of income rather properties were purchased by tendering consideration in cash without showing its source. It was not that the amount was paid in cash after its withdrawal from the bank or showing the sources having legal means to earn it. Thus, the properties were taken to be out of the crime, thus the proceeds of crime. However, so far as the appellant is concerned, his movable properties have been attached. The appellant has failed to give any explanation to the acquisition of the properties before the Adjudicating Authority or before this Tribunal by disclosing the sources for purchase of immovable properties. The Income Tax Returns of the relevant years were taken into consideration to find out alleged agriculture income. It was not disclosed to be the source for purchase of properties in the name of his wife and the son.
In the light of the facts given above, we are unable to accept the arguments of the learned counsel for the appellant that no proceeds of crime was generated out of the alleged scheduled offence.
It is in the light of the fact that learned counsel for the appellant could not clarify as to how the properties, whether movable and immovable properties were purchased or generated. Though, the appellant has claimed agricultural income but was not shown in the Income Tax Return of the last three years. It is however true that the proceedings in reference to certain offences were quashed by the High Court but others are still pending. In few cases closure report has been given.
During the course of arguments also, the learned counsel for the appellant failed to show the source of income to prove that all the properties were acquired by appellant’s wife or his son by rightful means. The properties in the name of wife and son were taken into account in reference to their own statement under section 50 of the PMLA Act, 2002. The serious allegation exist against the appellant for mortgage of tainted properties to obtain the loan which remain nothing but the proceeds of crime.
It may be that the vehicles so attached were purchased by taking loan from the bank but payments were made even in cash. However, discussion on the aforesaid is not required because movable properties attached by the respondent are not the proceeds of crime but is for the value thereof and thus we are unable to accept the argument of the counsel for the appellant that the movable property attached by the respondent does not fall under the definition of “proceeds of crime”. The proper interpretation of the definition of proceeds of crime has been given by the Apex Court in the case of Vijay Madanlal Choudhary and Ors. Vs. Union of India reported in 2022 SC Online 929. It is held that the property of equivalent value to the proceeds of crime would fall under the definition of “proceeds of crime”.
In the light of the aforesaid, the attachment of movable property is for the equivalent value to the proceeds of crime and it makes no difference that it was purchased prior to alleged predicate offence.
Thus, the impugned orders cannot be set aside on the strength of the arguments of the counsel for the appellant.
The allegation of the malafide have been made but there is no material to support it. It cannot be accepted only for the reason that the appellant belongs to a political party and thereby any action against him should be treated out of malafide.
In the light of the discussion made above, we are unable to accept any of the argument raised by the learned counsel for the appellant and accordingly the appeal fails and is dismissed.