Professional Update

(Criminal Case laws)

Crl. Appeal no.  6925/2022 (Madras High Court)

Director Mr. P. Kaunakaran and Others

vs

Directorate of Enforcement.

Ratio.

Hon’ble Madras High court held ED can only attach the property acquired proceeds of crime. However, if the Proceeds of Crime is taken outside the country, then any property of equivalent amount could be attached by ED.

Facts.

The applicant filed writ petition for the attachment of the property of the accused. The accused company has taken foreign loan from a bank through web of companies. The accused company again takes loan from Indian bank and again via web of companies, repaid the foreign loan. The ED registered an ECIR against the said company, as it tantamount to Schedule Offence. The ED attached the properties held by the companies even before 2010, when the schedule offence took place.  

Issue.

Whether the ED can attach the properties which are acquired even before the schedule offence took place.

Findings.

The Hon’ble Madras High Court has held some property as a result of the criminal activity, is held outside the country, then the property equivalent in value held within the country can be attached by the ED. The very object of the provision would be to protect the economic interest of the country. Therefore, the petitioner cannot take the stand that property purchased prior to the schedule offence cannot be attached by the ED.

The petition is therefore, dismissed.

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CA Manoj Garg

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