Shishir P. Dharkar v. The Deputy Director

MP-PMLA-1371/MUM/2015

Appellant/Applicant has sought condonation of delay in filing the appeal under proviso to section 26(3) of Prevention of Money Laundering Act, 2002. The Appellant contended that on account of his ongoing illness and as he was under treatment for severe backache (sciatica), severe depression (the psychological illness) and Angino Pectoris (Chest pain) which are continuing and as he was advised complete bed rest, he could not instruct his counsel to file the appeal within time. Along with the application he has produced the copy of the medical certificate dated 3.12.2014.

The notice of the application was issued on 8th January, 2015 and was accepted by the counsel for respondent No. 1. Time was granted to file the reply to the respondent No. 1.

The reply was not filed by the respondent No. 1. The notice to other respondents was dispensed with as they are not at issue with the appellant rather they have been allegedly in collusion with the appellant. Therefore the application was heard without other respondents.

In view of the allegations made in the application by the Appellant seeking condonation of delay which remained unrebutted, it is inevitable to hold that the Applicant/Appellant has been able to make out sufficient cause for condonation of delay in filing the appeal.

Therefore, the above noted application seeking condonation of delay in filing the appeal is allowed and delay in filing the appeal is condoned.

FPA-PMLA-758/MUM/2014

1. The learned counsel for the Appellant and respondent No. 1 contended that the appeal be heard and decided at the stage of admission as no properties of the Appellant has been attached by the provisional attachment order nor any confirmation of attachment order is passed by the Adjudicating Authority against appellant. The counsel for the Appellant also contended that he has filed an application being MP-PMLA-1372/MUM/2015 on the ground that the provisional attachment order of the properties could not be passed by the Deputy Director and therefore, PAO dated 26.05.2014 is not valid and consequently the order of the Adjudicating Authority is ultra vires. The counsel also contended that though none of the properties of the Appellant has been attached, however, the appeal is filed to bring all the facts and circumstances in their correct perspective to the knowledge of the Tribunal, as false averments and facts have been presented by the Respondent No. 1. In the circumstances, the counsel for the Appellant contended that the notice to other respondents be dispensed with and the Appeal be heard finally considering the pleas and contentions of the Appellant and respondent No. 1. Consequently the appeal was heard and the order was reserved. The appeal is filed by the Appellant against impugned judgment dated 9th October, 2014 in Original Complaint/petition No. 333 of 2014 titled Deputy Director Vs. Shishir P. Dharkar & Ors. filed under section 5(5) of the Prevention of Money Laundering Act, 2002 for confirmation of the Provisional Attachment Order (PAO) No. 10/2014 dated 26.05.2014 passed on ECIR/13/MZO/2013 in respect of the 26 immovable properties, being land admeasuring 1133.9 gunthas (28.35 acres) standing in the name of Shri Shailesh Chandrakant Deshpande, valued at Rs. 24,44,77,711/-.

2. Brief facts to comprehend the pleas and contentions of the Appellant are given in short hereinafter:-

2.1. That a complaint was lodged by Shri Tushar Madhukar Kakde, Member Administrative Board, Pen Co-op. Urban Bank Ltd. on which a FIR No. 34 of 2013 dated 22.3.2011 was registered at Pen Police Station, Dist. Raigad. The complaint, inter alia alleged cheating and fraud committed on Pen Co-op. Urban Bank Ltd. at its Pen (H.O.), Pen, Wadkhal, Khopoli, Karjat, Uran, Matheran, Mohpada, Neral, Vaveshi, Pali, Roha, Kolad, Karjat, Shilphata, Ramwadi, Girgaum, Dadar, Vileparle during the period 2008 till 24.9.2010. The complaint was investigated and the Charge sheet bearing No. 41/2011 was filed on 23.6.2011 in the Case No. 1/2011 before the Court of the Additional Sessions Judge, District & Sessions Court at Alibaug under sections 409, 418, 420, 465, 467, 468, 471, 477, 163 and 34 of IPC, 1860 for offence of fraud and cheating. Subsequently supplementary charge sheets have also been filed in the said case, which are as under:-

(i) Supplementary Charge sheet No. 78/2011 dated 30.11.2011

(ii) Supplementary Charge sheet No. 79/2012 dated 25.10.2012

(iii) Supplementary Charge sheet No. 57/2012 dated 05.2.2013.

2.2. The allegations are that the Appellant, Shri Shishir Dharker, Chairman, Pen Urban Co-op. Bank Ltd. and Shri Prem Kumar Sharma, Expert Director, Pen Co-op. Urban Bank Ltd. and its Board Members/Representatives of the Pen Urban Co-op. Bank Ltd. entered into conspiracy with the concurrent auditors of the Pen bank namely Shri S.D. Jethwar, partner of M/s. S.D. Jethwar & Co, Shri Sunil Dutt Sharma, partner of M/s. SDS Associates, Mumbai and Shri S.P. Sule, Partner of M/s. S.P. Sule Associates, Mumbai and willfully and intentionally manipulated the books of accounts of Pen Bank and fraudulently reported profit of Rs. 6.82 crores and Rs. 8.47 crores for the year 2008-09 and 2009-10 respectively, even though Pen Bank had net accumulated losses of Rs. 403.18 crores as on 31st March 2009 and of Rs. 651.35 crores as on 31st March, 2010.

2.3. Charges leveled are that the Appellant, Shri. Shishir Dharker, Chairman, Pen Bank, Shri Prem Kumar Sharma, Ex-Expert Director, Pen Bank entered into criminal conspiracy with Shri Purshottam V. Joshi, Chief Executive Officer, Pen Bank and Shri Ajay Shivaji Mokal, Computer in charge of Pen Bank and willfully and intentionally accessed the Pen Banks computer data base. On basis of documents of genuine customers, fraudulent bogus cash credit/loan accounts in name of various individuals and entities at various branches of Pen Bank were opened in violation of RBIs KYC norms and diverted the funds of investors of Pen Bank to said forged/fake bank accounts. The proceeds generated out of the crime of forgery and cheating was further diverted and routed through several bogus loan accounts and utilized for acquiring immovable properties admeasuring 131.6 acres (5265.5 gunthas) at villages Nere, Akurli, Vichumbe at Panvel and Roha, Roha - Killa, Sudhagad - Asare, Siddheshwar - Budruk, Ghera in name of Shri. Shailesh Chandrakant Deshpande, Shri Pradnya Deshpande and Shri Ashok H. Shah.

2.4. It is further alleged that the Appellant, Shri. Shishir Dharker, Shri Prem Kumar Sharma; Shri Purshottam V. Joshi, and concurrent Auditors namely Shri Sunil Dutt Sharma; Shri S.D. Jethwar and Shri S.P. Sule falsely represented to RBI that Pen Banks liquidity status was sound and that the bank was holding the necessary deposits with The Maharashtra State Co-op. Bank Ltd. and The Mumbai District Central Co-op. Bank Ltd., both Apex Co-op. Banks. These representations were found to be incorrect by the Reserve Bank of India and therefore, a penalty of Rs. 18.18 crores was imposed on Pen Bank for making false representation.

2.5. It has also been revealed that Shri. Purshottam V. Joshi, CEO of Pen Bank, as per instruction of the Appellant, Shri Shishir Dharker/Shri Prem Kumar Sharma, allegedly diverted the legitimate funds of investors of Pen Bank into the bogus loan account of Shri Toona Satish Chandra Sharma, and later withdrew the said amounts by issuing DDs/pay orders and utilized the proceeds for their own benefits during the period 2008-09 and 2009-10.

2.6. The charge sheets filed against the Appellant and other alleges that Rs. 16 crores were further siphoned off from the benami loan accounts and diverted by Hawala to Kolkata, Delhi and other places and RTGS/cheques were credited to account of Shri Prem Kumar Sharma and bogus bills were generated for showing that the funds received in his account were by trading on Commodity Exchange/shares etc.

2.7. Further allegations are that the Appellant, Shri Shishir Dharker, Chairman of Pen Bank and Shri Prem Kumar Sharma, Expert Director of Pen Bank entered and hatched a criminal conspiracy to divert the funds held in Pen Bank into bogus cash credit (loan) accounts in Pen Bank. In this conspiracy they were aided and abetted by Pen bank officials namely, Shri Purshottam V. Joshi, Chief Executive Officer, Pen Bank and Shri Girish Prabhakar Gupte, DGM (Loans). They signed the blank loan application forms required for the purpose of applying for cash credit (loan) accounts to be opened in Pen Bank. Shri Purshottam Joshi obtained KYC documents required for loan sanction purpose from the known customers showing good faith to them and thereafter, bogus cash credit (loan) accounts were opened for routing the Pen bank funds for purposes like closing of existing NPA accounts as well as utilizing part of Pen Bank funds for purchasing land in various places in Raigad District. Investigation has revealed that the officials of Pen Bank have misused the KYC documents obtained in good faith from Pen Banks customers and opened loan accounts in name of the said bank customers using the said KYC documents. Thereafter, the legitimate funds of Pen Bank was fraudulently diverted/transferred into these bogus loan (cash credit) accounts and siphoned off and also partly utilized for closing various existing NPA accounts of Pen Bank.

2.8 Based upon scrutiny of these facts, the respondent No. 1 registered an ECIR bearing No. 13/MZO/2013 dated 30.9.2013 for investigation into the offence of money laundering, if any, in terms of the PMLA. The offence under Section 120(B)) r/w Section 418, 420, 467, 471 of IPC, 1860 fall under scheduled offences covered by Paragraph 1 of Part - A of schedule to the PML Act, 2002.

2.9 Statements of Shri Purshottam V. Joshi, Ex-CEO, Pen Urban Co-op. Bank Ltd.; Shri Shailesh C. Deshpande dated 5.2.2014; Shri Girish P. Gupte, Ex-DGM, Pen Urban Co-op. Bank Ltd.; Shri Mohan Shetty, Estate Agent, dated 7.2.2014; the Appellant, Shri Shishir P. Dharker, Ex-Chairman, Pen Urban Co-op. Bank Ltd. and of many other persons were recorded. Appellant stated that he was Chairman of Pen Urban Co-op. Bank Ltd. for the period 1996-2004 and thereafter, in 2009 till 2010 (Sept.); that Pen Urban Co-op. Bank Ltd. was started by Kolathkar and Dandekar some 76 years ago; that his father came on board of Directors somewhere in 1970 and later was the Chairman till he became Cabinet Minister in Maharashtra during 1993 for three years; that thereafter the appellant, also came on the board of Directors of Pen Urban Co-op. Bank Ltd. and later became Chairman of the said bank. Appellant further disclosed that he was arrested by the CBI:ACB, Mumbai in the month of November, 2010 in the matter connected with export of gold jewelry by M/s. Space Mercantile Co. Pvt. Ltd. in which he was Ex-Director and his wife, Smt. Gul Raihana Sayed Omar, on charges of criminal conspiracy and cheating; that he was released on bail in month of January 2011. Appellant disclosed that he was also arrested by Pen Police in April 2011 in connection with fraud in Pen Urban Co-op. Bank Ltd. for his role as Ex-Chairman of Pen Urban Co-op. Bank Ltd. on charges of fraud, cheating and criminal conspiracy; that he was released in October 2011; that he has been charge sheeted in both the cases and criminal trials are yet to start; that he and his wife Gul Raihana Omer owned various properties as detailed below;-

1. 450 Sq.ft. flat in Avanti Apartment, Shivaji Path, Pen, Dist-Raigad in name of Shri Shirish P. Dharker is developed on ancestral property.

2. A shop admeasuring 200 to 250 sq.ft. in Avanti Apartment, Shivaji Path, Pen, Dist-Raigad in name of Shri Shishir P. Dharker is developed on ancestral property.

3. Flat No. 905(56.91 sq. mtrs.), 906(47.79 sq. mtrs.) in Amarnath Towers, Off Seven Bunglows, Behind Padmaja, Yari Road, Versova, Andheri (W), Mumbai-61 purchased in 1999.

4. Office situated at 607,608 totally admeasuring 750 sq. ft. in Janki Centre of Veera Desai Road, Andheri (W) Mumbai-53 in name of myself and my wife Gul Raihana Omar Sayed purchased from M/s. Space Mercantile Co. Pvt. Ltd. in 2008.

5. Flat No. 805 (56.91 sq. mtrs.) & 806 (47.79 sq. mtrs.) in Amarnath Towers, Off Seven Bunglows, Behind Padmaja, Yari Road, Versova, Andheri (W), Mumbai-61 in the name of Gul Raihana Omer purchased from M/s. Space Mercantile Co. Pvt. Ltd. in 2008

2.10. Appellant admitted that he was aware that funds from Pen Urban Co-op. bank was diverted and used for purchase of lands/properties in Raigad District. He had stated that he did not have any details of land properties purchased out of funds of Pen Urban Co-op. Bank Ltd., however Shri Purshottam Joshi, CEO was handling the work and the same was being carried out by him as per instructions given by him. That he knew properties were purchased in name of one Shailesh Deshpande and Pradnya Deshpande and Ashok Shah. He did not have idea how much amount was actually used for purchase of land properties in Raigad District. According to him it was after discussion with Shri. Prem Kumar Sharma, Advisor of Pen Urban Co-op. Bank Ltd. that it was conceived as good idea to invest in properties around Panvel where new airport was coming up.

2.11. Statement of Shri Prem Kumar Sharma, Ex-Expert Director, Pen Urban Co-op. Bank Ltd. was also recorded who revealed the details of properties held by him and or his family members which are as follows;

1. Flat No. 191, 2B, Windermer, Off New Link Road, Oshiwara, Andheri (W), Mumbai-53 purchased in year 2003.

2. Shop No. 3, at Mhada, Shastrinagar, Lokhandwala, Andheri purchased on 11.10.2006.

3. Approx 100 ft. office in at 156, Somdutt Chambers II, Bhikaji Cama Place, New Delhi purchased in 1991.

4. Half acre farm land at village Mandavane, Near Karjat, Dist-Raigad in his name purchased in 20.8.2010.

5. Half acre farm land at village Mandavane, Near Karjat, Dist-Raigad in name of wife, Smt. Vasudha Sharma purchased in 29.5.2008.

6. Mercedes C Class registration No. is MH-02-BC-0567 purchased in year 2007.

7. Honda City registration No. is MH-02-BD-0789 purchased in year 2005.

2.12. The scrutiny of bank transactions indicated that the cash credit/loan accounts were opened and Pen banks funds were sourced into them and some of these funds were then routed for day to day operations and also ever greening the books of account of Pen Bank, existing NPA accounts and part of said funds were utilized for making payment towards purchase of agricultural land at Panvel Taluka, Dist-Raigad. In some cases even the bogus cash credit/loan accounts were squared off by transferring deposits from other bogus cash credit/loan accounts opened in Pen Bank and thereafter, the said accounts were closed. The details of the bogus cash credit/loan accounts are as under:-

2.13. The scrutiny of the bank transactions statements of bogus cash credit/loan accounts forwarded by Pen Bank vide their letter dated 24.1.2014 and other relevant documents, day book extract etc. and sale/purchase agreements of immovable properties acquired in name of Shailesh Deshpande for Pen Bank, revealed that several demand drafts were issued from the bogus cash credit loan accounts and payments were made towards purchase of immovable properties from the aforementioned bogus loan accounts opened at Dadar and Vileparle branch of Pen Bank as per instruction of the Appellant, Shri Shishir Dharker, Shri Prem Kumar Sharma and Shri Purshottam Joshi.

2.14. The investigation under PMLA revealed that Shri Shishir Dharker, Appellant and Shri Prem Kumar Sharma conspired with Shri Purshottam Joshi and purchased immovable properties out of the diverted funds of Pen Bank. In pursuance of said conspiracy, Shri Purshotam Joshi utilized the services of local estate broker namely, Shri Mohan Shetty and Shri Ganesh Kanade for identifying agricultural land at Panvel and Pali/Roha/Suddhagad, respectively. Further they were informed that Pen Bank wanted to invest money in purchasing land around Panvel and Pali/Roha/Sudhhagad. Shri Purshottam Joshi with the assistance of Shri Girish Gupte, DGM of Pen Bank identified Shri Shailesh Deshpande/Smt. Pradnya S. Deshpande (wife of Shailesh Deshpande) and Shri Ashok Shah, all existing clients of Pen Bank and known acquaintance of Shri Shishir Dharker/Shri Purshottam Joshi. Shri Purshottam Joshi then convinced Shailesh Deshpande that the Pen Bank cannot invest directly in agricultural land and therefore, Pen Bank wanted to purchase land out of its own funds in his name (in name of Shri Shailesh Deshpande). Shri Shailesh Deshpande agreed to lend his name as purchaser and agreed to hold the land in his name on behalf of Pen Bank.

2.15. The investigation revealed that the original sale/purchase deeds of land in name of Shailesh Deshpande were purchased out of Pen Banks funds and those were in custody of Shri Purshottam Joshi. However, as instructed by Shri Prem Kumar Sharma, Ex-Expert Director, Pen Bank, a close acquaintance of Shri Shishir Dharker, Appellant, Chairman of Pen Bank, the same were handed over to Pen Banks Solicitor, M/s. Divya Shah & Associates, Mumbai and offered as collateral security to MSTC (a public Sector enterprises) on behalf of M/s. Ushma Jewellery & Packaging Exports Pvt. Ltd. In view of above, it has been viewed that, Shri Shishir Dharker, Shri Prem Kumar Sharma and Shri Purshottam Joshi in connivance with each other have willfully and intentionally placed the proceeds of crime derived from offence of cheating and forgery into the bogus cash credit/loan accounts in Pen Bank and further by layering and integrating the proceeds of crime acquired immovable properties in name of Shri Shailesh Dehapande and further placed the said properties as collateral Security in favor of MSTC for and on behalf of M/s. Ushma Jewellery & Exports Packaging Pvt. Ltd. through Shri Vivek Vaidya, Director, M/s. Ushma Jewellery & Packaging Exports Pvt. Ltd. and thereby laundered the proceeds of crime and projected as untainted property acquired in name of Shailesh Deshpande.

2.16 Appellant, Shri Shishir Dharker, Ex-Chairman of Pen Bank and Shri Prem Kumar Sharma, Ex-Director of Pen Co-op. Urban Bank Ltd., Shri Purshottma Joshi CEO and Shri Girish P. Gupte, DGM of Pen Bank, therefore, have been charged of having committed offences under Section 120B r/w Section 420, Section 409, 418, 465, 467, 468, 471, 477, 163 and Section 34 of IPC, 1860 in charge sheet filed in Case No. 41/2011 dated 23.6.2011. The offence committed under Section 120B r/w Section 418, 420, 467, 471 of IPC 1860 are scheduled offences under Paragraph 1 Part A of the Schedule and as defined under Section 2(y) of the Prevention of Money Laundering Act, 2002 (2 of 2013). The proceeds of crime generated out of the said scheduled offences of cheating were layered and integrated by way of purchase of land in name of Shri Shailesh Deshpande and as per directions/instructions from Shri Shishir Dharker, Shri Prem Kumar Sharma and Shri Purshottam Joshi, Shri Shailesh Deshpande gave his No Objection Certificate in respect of the immovable properties mentioned in the schedule above and placed it as collateral Security with MSTC on behalf of M/s. Ushma Jewellery & Packaging Exports Pvt. Ltd. of Shri Vivek C. Vaidya, with sole intention to conceal its tainted origin and projecting it as untainted property.

2.17. The respondent No. 1, therefore, after passing the provisional attachment order in respect of properties acquired from the proceeds of crime, filed a complaint before the Adjudicating Authority. Before passing the provisional attachment order the respondent No. 1 had the reasonable belief that the depositors funds held with Pen Bank were systematically diverted/transferred into fake loan accounts held in Vileparle and Dadar branch of Pen Bank. The fake accounts were opened in Vileparle and Dadar branch of Pen Bank on basis of forged/fabricated documents and without following KYC norms mandated by RBI. Pen Bank officials, CEO, Purshottam Joshi and DGM, Shri Girish Gupte confirmed these facts. The demand drafts issued from fake loan accounts were utilized for purchase of immovable properties i.e. land in name of Shri Shailesh Deshpande, a front man of Shri Shishir Dharker, Shri Prem Kumar Sharma and Shri Purshottam Joshi. Thus the immovable properties admeasuring 1133.9 gunthas (28.35 acres) at villages Nere, Akurli and Vichumbe at Panvel purchased in name of Shailesh Deshpande are derived out of the depositors fund of Pen Bank.

2.18. Thus the Appellant, Shri Shishir Dharker, Shri Prem Kumar Sharma and Shri Purshottam Joshi in connivance with each other have willfully and intentionally systematically diverted the proceeds of cheating and forgery into bogus loan accounts opened in Pen Bank in name of bona fide customers of Pen Urban Co-op. Bank Ltd. without their knowledge and consent. The proceeds of crime were than layered and integrated by issuing demand drafts for purchasing land in name of Shailesh C Deshpande. Thus the proceeds of crime were layered and integrated for acquiring immovable properties in name of Shri Shailesh C. Dehapande which was further pledged as collateral Security in favor of MSTC on behalf of M/s. Ushma Jewellery & Exports Packaging Pvt. Ltd. through its Director, Shri Vivek Vaidya and thereby have laundered the proceeds of crime and projected as untainted property acquired in name of Shailesh C. Deshpande. Thus, it can be prima-facie concluded that, the above said defendants viz. Shri. Shishir Dharker, Ex-Chairman, Pen Urban Co-op. Bank Ltd., Shri Prem Kumar Sharma, Ex-Expert Director, Pen Co-op. Urban Bank Ltd, Shri Purshottam V. Joshi, CEO, Pen Urban Co-op. Bank Ltd., Shri Vivek Vaidya, Director, M/s. Ushma Jewellery & Packaging Exports Pvt. Ltd. and Shailesh C. Deshpande have prima facie indulged in committing offence under Section 3 of Prevention of Money Laundering Act (PMLA), 2002 and that the immovable properties(mentioned in the schedule of properties) totally valued at Rs. 24,44,77,711/- presently under order of provisional attachment involved in money laundering and hence liable for confirmation of attachment under Section 8(3) of the said Act. The investigation under PMLA, 2002 are still in progress. The Adjudicating Authority considered the allegations made in the complaint and the provisional attachment order and the documents filed before it and on being satisfied issued notice to the appellant under section 8(1) of PMLA.

2.19. The appellant contended before the Adjudicating Authority that the facts have been presented in utter distorted manner whereby while concealing the factual position, a false view has been presented which is entirely prejudicial to the Appellant and the allegations have been made against the appellant with ulterior motives. The appellant also relied on the discrepancies in the charge sheets and the facts as presented by the respondent No. 1. The Appellant alleged that there are misrepresentations/suppression of facts in the complaint filed by the respondent No. 1.

2.20. The appellant categorically contended that he has no direct or indirect interest in the immovable properties as detailed at Sr. Nos. 1 to 26 in the PAO No. 10/2014 dated 26.05.2014. However, for the purpose of apprising the Adjudicating Authority of the facts in their proper perspective, the Appellant made submissions before the Adjudicating Authority. It was contended that all the 26 properties which had been purportedly stated to have been purchased by the Bank in the name of Shri Shailesh C. Deshpande fall out of the purview of PMLA, 2002. Appellant alleged that he did not interfere with day to day working of the Bank and visited Pen H.O. only at the time of meetings. He also alleged that during the check period of investigation he was the Chairman of the Bank only in 2009 till September, 2010 and as Chairman he was not controlling day to day work of the Bank. Various committees of bank used to monitor the loans and advances. He was not the member of high powered committee which sanctioned all the loans above Rs. 20 lakhs. He was forced to write a number of things in his statements which are not correct. The appellant contended that deeds of land purchased by Pen Bank were in possession of the Bank until the same were given as collateral Security to MSTC and this clearly proves beyond doubt that the Appellant had no role to play in the purchase of these properties by the bank in the name of Shri Shailesh C. Deshpande.

2.21 The allegations and pleas raised by the Appellant were not admitted and it was contended that the true facts have been stated by the respondent No. 1 before the Adjudicating Authority on the basis of charge-sheet filed by the Maharashtra State Police and on the basis of result of investigation conducted under the provisions of the Prevention of Money Laundering Act, 2002. It was stated that the allegations made by the Appellant were based on ignoring certain part of the statements and relying on the part statements.

2.22 The respondent No. 1 contended that in O.C. No. 333/2014, the total properties provisionally attached are 26 (twenty six) and the value of proceeds of said properties was shown as Rs. 24,44,77,711/- which is an inadvertent calculation mistake. The respondent No. 1 contended that the value of proceeds of the Crime has been arrived on the basis of an authenticated money trail provided by Pen Urban Co-Operative Bank Ltd. and as per the said money trail, the value of the 26 impugned properties attached provisionally works out to Rs. 21,16,00,171/-. The respondent No. 1 also explained the other typographical mistakes also. The respondent No. 1 summarized the value of the properties and stated that the actual value of impugned properties comes to Rs. 21,16,00,171/-

2.23. After considering the O.C., PAO/charge sheet/statements recorded under PMLA and others agencies, investigations, considering the submissions of the accused and the Complainant/respondent No. 1 it has been held by the Adjudicating Authority that the Appellant is apparently in control of affairs of the Bank. He has issued certain instructions to the CEO in connection with certain matters and it is not reasonable to believe that the Appellant was not in control of things in PEN Bank. The Appellant was either Director or Chairman during the relevant period and was in control the affairs of the Bank. It has been further held that it is not possible to believe that Shri Purshottam V. Joshi as the CEO did various acts and all his actions were without the knowledge and connivance with Appellant. Therefore, prima facie, it has been held that the Appellant and others are involved in Money Laundering and the properties under attachment are also acquired from the proceeds of crime and are liable for attachment. Therefore, the provisional attachment of properties was confirmed by the Adjudicating Authority. It has been held that the attachment of the properties shall continue during the pendency of the proceedings relating to any offence under this Act before a Court or under corresponding law of any other country, before the competent Court of criminal jurisdiction outside India, as the case may be; and become final after an order of confiscation is passed under sub-section (5) to sub-section (7) of Section 8 or section 58B or sub-section (2A) of section 60.

3. Aggrieved by the order of confirmation of attachment of properties, though the appellant claims that he has no interest in the attached properties, the Appellant has challenged the order of confirmation of the provisional attachment order by the Adjudicating Authority contending inter alia that there is gross violation of principles of natural justice and entire proceedings are vitiated; English translation of the documents were not provided to the appellant; copy of the rejoinder filed by the respondent had not been supplied to the appellant; the statement of Shri Deshpande have been referred to which do not exist. Reliance was also placed on : AIR 1960 SC 941 , Satyadhyan Ghoshal vs. Deorjin Debi, to contend that an order of remand was an interlocutory order which did not terminate the proceedings and the correctness thereof could be challenged in an appeal from the final order. The Appellant in his appeal emphasized that it is equally well settled that because a matter has been decided at an earlier stage by an interlocutory order and no appeal has been taken therefrom or no appeal did lie, a higher court is not precluded from considering the matter again at a later stage of the same litigation.

4. Relying on the Statutory Audit report of the "Kirtane and Pandit", it has been contended that the work profile of the INVESTMENT COMMITTEE was with regard to the investment of the bank in "Government Securities" and immovable properties do not come under the purview of the same. Thus the submission of the Appellant that he was not aware with regard to the purchase of the said land, and which is also corroborated by the statements of other accused in the complaint holds true. The Appellant also relied on various reports of various branches of the bank and quoted them in extensor to contend that the offenses which he has been accused of, has not been committed by him. The Appellant also relied on various reports of various branches to augment his plea that his name should be deleted from the Original Complaint filed by the respondent No. 1. The Appellant also claimed that the entire report of the Statutory auditors be placed before the Tribunal so that it and may also issue notice to Respondent No. 1 in this regard to see for itself, the evidence available and not placed on record by the Respondent No. 1.

5. The appellant very emphatically contended that he has no direct or indirect interest in the 26 immovable properties covered in the PAO No. 10/2014 dated 26.05.2014 (O.C. 333 of 2014). He submitted that the Adjudicating Authority failed to dismiss the averments of the Respondent No. 1 as made out against the Appellant in the aforesaid PAO/O.C. in the light of the facts which clearly demonstrated that the Appellant had no claim, right, interest or any benefit accrued or which may accrue in future in respect of the said 26 properties. The Appellant contended relying on Pareena Swarup v. Union of India; : (2008) 14 SCC 107 that the Adjudicating Authority is a body of experts from different fields to adjudicate on the issue of confirmation of provisional attachment of property involved in money laundering. The functions of Adjudicating Authority are civil in nature to the extent that it does not decide on the criminality of the offence nor does it have power to levy penalties or impose punishment yet Adjudicating Authority traversed beyond its statutory scope and jurisdiction and made the uncalled for observations and directions.

6. According to appellant the Adjudicating Authority failed to take note that what has been mentioned in charge sheet has not been properly presented before the Adjudicating Authority in the Original complaint as the Appellant has no direct or indirect interest in the immoveable properties as detailed in the provisional attachment order. According to the Appellant the Adjudicating Authority failed to comprehend the bias against the Appellant as in the charge sheet the accused have been placed together on the basis of their designations, however, in the original complaint, the Appellant had been made defendant No. 1. The Appellant has also alleged various errors of facts.

7. The Appellant also filed an application being MP-PMLA-1372/MUM/2015 contending that all Deputy Directors of the Directorate of Enforcement were authorized for the purpose of section 5 to provisionally attach the properties by authorization dated 7th February, 2007. According to him, however, by circular order No. 3/2011 on account of cadre restructuring and re-designation of posts, only the Joint Director became authorized for provisional attachment of properties by said circular dated 27th September, 2011. According to appellant the provisional attachment order date 26th May, 2014 was passed by a Deputy Director who was not authorized to pass the provisional attachment order in the facts and circumstances. The appellant also filed another circular of the respondent No. 1 dated 12th of October, 2011 whereby the following words were added to the circular dated 7th February, 2011 which is as under:

"Or joint Director" after the words "all deputy Directors" in the tenth line of said Authorization.

According to the appellant in view of circular dated 27 September, 2011, the addendum order dated 12th October, 2011 could not have been passed. The plea of the appellant is that the officer below the rank of Joint Director was not empowered to issue provisional attachment order. Therefore, it is contended that the provisional attachment order itself is ultra-vires.

8. This Tribunal has heard the learned counsel for the parties. By the application being MP-PMLA-1372/MUM/2015 it is contended that the provisional attachment order has been passed by the Deputy Director of the respondent No. 1 who was not authorized to provisionally attach the properties, therefore, provisional attachment order and confirmation order, impugned by the Appellant, are illegal and are liable to be set aside.

9. The plea of the appellant that the provisional attachment order is not sustainable as it was passed by an officer of the rank of Deputy Director is not sustainable in view of the circular dated 12 October, 2011 which authorizes the Deputy Director or the Joint Director to issue the provisional attachment orders. The appellant has quoted the circular dated 7th February, 2007 which after amendment reads as under:-

"In exercise of powers conferred on the Director by sub-section 5(1) of section 5 of the Prevention of Money Laundering Act, 2002 (15 of 2013) read with notification published in Gazette of India on 1st July, 2005 vide G.S.R. 441(E), all Deputy directors or joint directors of the enforcement are hereby authorized for the purposes of section 5 of the said Act to provisionally attach property in respect of cases registered for investigation in their respective Zones in accordance with the statutory requirements of the said Act and the rules made thereunder."

From the amended circular it is clear that not only the Joint director but also the Deputy Director was authorized to provisionally attach the property in respect of cases registered for investigation. The plea of the appellant that the Deputy Director of the respondent was not authorized to provisionally attach the property for the cases registered, therefore, cannot be accepted and is rejected. The provisional attachment order and its confirmation by the Adjudicating Authority, therefore, cannot be set aside on the ground raised by the appellant. The said plea of the appellant is therefore, rejected and the concerned application of the appellant is also dismissed.

10. Perusal of the provisions of the Prevention of Money Laundering Act reveals that the legislation has predicated two parallel proceedings. One, with regard to the attachment of the properties derived and obtained from the proceeds of crime and its confiscation after the guilt of the person in schedule offence is established before the concerned Court. The second action contemplated by the Act is, prosecution and punishment for commission of offence covered by Section 3 of the Act and upon being found guilty, impose punishment under Section 4 of the Act. From the scheme of the provisions of the enactment under consideration, no property can be confiscated unless it is attached in the first instance.

11. The provisional attachment is an emergent measure to be taken by the Authorized Officer upon being satisfied and having reason to believe that the proceeds of crime are likely to be concealed, transferred or dealt with in any manner, which may result in frustrating any proceedings relating to confiscation of such proceeds of crime. On the basis of material in his possession, the Authorized Officer upon identifying the property derived from the proceeds of crime is competent to order provisional attachment of such property. That power flows from Section 5 of the Act. At the same time, until, the proceeds of crime are finally confiscated under Section 8(3), the same have to be protected and preserved until the guilt or innocence of the person, as the case may be, is established.

12. It has been prima-facie inferred that Shri Shishir Dharker, Ex-Director of M/s. Space Mercantile Co. Pvt. Ltd. (Appellant) & ex-chairman, Pen Bank allegedly indulged in committing offence under Section 3 of Prevention of Money Laundering Act (PMLA), 2002 and that the above stated immovable properties provisionally attached as involved in money laundering and thus were liable for confirmation of attachment under Section 8(3) of the said Act. The respondent No. 1, therefore, filed the complaint being O.C. No. 333 of 2014 without prejudice to the provisional attachment of other properties. From the pleas taken before the Adjudicating Authority as has been detailed hereinbefore and in the appeal, it is apparent that the Appellant has admitted that none of the properties of the said appellant has been attached nor he has any interest in any of the properties which have been provisionally attached and in respect of which the attachment order has been confirmed. In the circumstances the learned counsel was asked as to how his appeal is maintainable as he has no interest or rights in the properties which have been attached by impugned order dated 9th October, 2014. The Appellant has alleged that the respondent No. 1 has distorted and misrepresented various facts and circumstances and has made certain false averments and had even withheld and suppressed various material facts from the knowledge of the Adjudicating Authority.

13. The appellant has categorically pleaded that the Appellant has no stake in the properties attached by the impugned order dated 09.10.2014 of the Adjudicating Authority and the appellant is filing this appeal as averments/findings and opinions have been expressed by the Adjudicating Authority in its Order, which are contrary to law and out of his jurisdiction of its Adjudication powers. The Appellant, however, has prayed to set aside the impugned order dated 09.10.2014 passed by the Adjudicating Authority in O.C. No. 333 of 2014 qua the Appellant.

14. It is apparent that the Appellant has admitted that none of the properties of the said appellant has been attached nor he has any interest in any of the properties which have been provisionally attached and in respect of which the attachment order has been confirmed. In the circumstances the learned counsel was unable to explain as to how his appeal is maintainable as he has no interest or rights in the properties which have been attached by impugned order dated 9th October, 2014. Prima facie it has become apparent that the properties attached are the proceeds of crime as contemplated under law. The provisional attachment is an emergent measure to be taken by the Authorized Officer upon being satisfied and having reason to believe that the proceeds of crime are likely to be concealed, transferred or dealt with in any manner, which may result in frustrating any proceedings relating to confiscation of such proceeds of crime. On the basis of material in his possession, the Authorized Officer upon identifying the property derived from the proceeds of crime is competent to order provisional attachment of such properties which has been done in the present case. The properties are to be attached until, the proceeds of crime are finally confiscated under Section 8(3), as the same have to be protected and preserved until the guilt or innocence of the person, as the case may be, is established. The learned counsel for the Appellant is unable to show that the properties attached are prima facie not the proceeds of crime.

15. The learned counsel for the Appellant has contended that the appellant is aggrieved by the observation made by the Adjudicating Authority against the appellant. The prima facie observations made by the Adjudicating Authority cannot be challenged successfully by the appellant under section 26 of the PMLA, 2002. The prima facie observations made by the Adjudicating Authority are not decisive in deciding the criminal cases against the Appellant. Any observation made while confirming the order of attachment by the Adjudicating Authority will not be decisive even in any complaint filed against the appellant under Section 3 & 4 of PMLA, 2002 in any manner. In the criminal cases which are pending and which may be filed against the appellant, the Courts will have to come to an independent finding on the basis of documents and evidence produced before them, whether the offenses alleged against the appellant have been made out or not. On the basis of the observation made in the impugned order passed under section 8(3) of PMLA, the appellant cannot be convicted and sentenced in the criminal cases. The apprehension of the learned counsel is, therefore, without any legal basis in the facts and circumstances.

16. The thrust of section 5 is to attach every property involved in money laundering irrespective of whether it is in possession of the person charged of having committed a scheduled offense or any other person - provided however, it must be shown to have proceeds of crime and further, the proceeds of crime are likely to be concealed, transferred or dealt with in any manner, which may result in frustrating any proceedings relating to confiscation of such proceeds of crime under the Act. The action of attachment is not in relation to a person as such but essentially to freeze the proceeds of the crime. The fact that the respondent No. 1 could have acted only if there was reason to believe that a person is in possession of proceeds of crime, does not mean that the authorities at this stage are obliged to prove the fact beyond reasonable doubt that the property in possession, in fact was proceeds of crime. All that the authority is required to show is that there was "substantially probable cause" to form an opinion that the property under attachment is proceeds of crime. The authorities under section 5 & 8 do not have to establish whether the offense of money laundering has been committed by the party or not or whether the scheduled offense has been committed by the accused or not.

17. Perusal of Chapter III of PMLA also reveals that the orders passed under it are interlocutory in nature and such orders do not decide finally whether an offence has been committed by an accused under section 3 of the Act for Money Laundering nor such orders passed under said chapter decide what punishment is to be imposed on such accused for money laundering. Any observation made while passing orders under said chapter are not the findings for the purpose of alleged offense committed under section 3 nor observations are the findings in the Criminal matters pending against such accused. Findings recorded by the Adjudicating Authority and/or Tribunal while deciding interim matters cannot be taken into account while deciding criminal cases on merits. The order on an interlocutory application is really not an adjudication, but a mere expression of opinion not necessary for the disposal of criminal complaint under section 3 of the Act. Such an observation will not be res judicata at a subsequent stage in the criminal complaint of Money Laundering or in the Criminal case pending against the accused.

18. An opinion expressed in an interlocutory proceeding on merits of the main lis does not operate as res judicata and it is open to the Court/Tribunal to take a different view when all the evidence has been let in. Reliance can be placed on : AIR 1960 SC 941 , Satyadhyan Ghosal vs. Deorjin Debi, where it was held that an order of remand was an interlocutory order which did not terminate the proceedings and the correctness thereof could be challenged in an appeal from the final order. In : AIR 1979 SC 1436 , Sukhrani Vs. HariShanker it was held by the Honble Supreme Court in para 6 as under:

"6. It is true that at an earlier stage of the suit in the proceeding to set aside the award, the High Court recorded a finding that the plaintiff was not entitled to seek reopening of the partition on the ground of unfairness when there was neither fraud nor misrepresentation. It is true that the plaintiff did not further pursue the matter at the stage by taking it in appeal to the Supreme Court but preferred to proceed to the trial of his suit. It is also true that a decision given at an earlier stage of a suit will bind the parties at later stages of the same suit. But it is equally well settled that because a matter has been decided at an earlier stage by an interlocutory order and no appeal has been taken therefrom or no appeal did lie, a higher Court is not precluded from considering the matter again at a later stage of the same litigation........."

Similarly in United Provinces Electric Supply Co. Ltd. v. Workmen, : (1972) 2 SCC 54 , at page 65 it was held that the interlocutory orders which do not have a force of decree must be distinguished than those which have a force of decree. The Honble Supreme Court had held as under:

"Interlocutory judgments which have the force of a decree must be distinguished from other interlocutory judgments which are a step towards the decision of the dispute between parties by way of a decree or a final order. We are unable, therefore, to accede to the contention that the rule of res judicata could be invoked by the respondent in the present case."

19. It is also well settled that the Principle of res judicata does not apply to interlocutory orders like order of attachment, stay, injunction or appointment of receiver which are designed to preserve the status quo pending litigation to ensure that the parties may not be prejudiced but the normal delay which the proceedings before the Court usually take. The orders which are passed under Chapter III of PMLA are passed to ensure that the parties may not be prejudiced on account of the normal delay which the proceedings before the Tribunal may usually take before deciding whether an accused has committed the offence of Money Laundering or not and whether the accused has committed the scheduled offence.

20. In case the appellant is of the opinion that the statements implicating him and evidence relied on against him are not sufficient for continuation of proceeding in the FIRs, the remedy available to the appellant shall be to seek quashing of the same before the appropriate Court. Prima facie, from the material as detailed even hereinbefore, it cannot be said that there is no evidence against the appellant. In any case any findings given or observation made by the Adjudicating Authority or by this Tribunal against the appellant regarding his alleged guilt are only prima facie observation and they will not be binding in the proceedings if initiated against the appellant for money laundering under PMLA and in the criminal proceedings pending against the appellant for the scheduled offence. The Adjudicating Authority has not inferred that the appellant is not guilty of the scheduled offence nor this Tribunal can give a final finding whether the appellant has committed the offense of Money Laundering. In the present facts and circumstances the appellant is also not entitled for findings from this Tribunal on the pleas whether the appellant is guilty of the offence alleged against him or not. It will be more so because any findings by this tribunal regarding the offence being committed by the appellant or not shall not be res judicata in the criminal proceedings which shall be initiated against the appellant for money laundering under PMLA and in the criminal proceedings for the scheduled offence.

21. The learned counsel for the appellant has also contended that the appellant is aggrieved by not deleting the Appellant in the O.C. filed by the respondent No. 1 and confirming the attachment of properties during the pendency of the proceedings relating to any offense before a Court or under corresponding law of any other country, before the competent court of Criminal jurisdiction outside India as the case may be and thus confirming the provisional attachment order.

22. Any observation by the Adjudicating Authority will not be decisive and final for the criminal case pending against the appellant nor will impact any complaint filed against the said appellant under Section 3 & 4 of PML Act, 2002 in any manner. In the criminal cases which are pending and which may be filed against the appellant, the Courts will have to decide on the basis of documents and evidence produced before them, whether the offenses alleged against the appellant have been made out or not. On the basis of the observation made in the impugned order, the appellant cannot be convicted and sentenced in the criminal cases. The apprehension of the learned counsel is, therefore, without any legal basis in the facts and circumstances. However, the plea of the Appellant that the respondent No. 1 ought not to have impleaded him as a party in the O.C. also cannot be accepted. The allegations against the appellant are that he continued to be the Chairman of the Bank and influenced its functioning and siphoning of the funds of the Bank from which various properties were purchased which have been attached. There is no provision for notice before passing the provisional attachment order as it is an emergent measure. After provisional order of attachment is passed, notice had to be given by the Adjudicating Authority to hear the plea of the appellant whether the appellant has any rights in the properties which have been provisionally attached and to ascertain whether such properties could be attached or not. The Appellant has not claimed any rights over the properties which had been provisionally attached. The provisional attachment order was passed in respect of proceeds of crime. The case pertaining to scheduled offense has appellant as an accused. In the circumstances, the appellant is a necessary party in the O.C. Without impleading the appellant as party in the Original Complaint the pleas of the appellant could not be ascertained. All the parties to a lis are to be impleaded in every litigation so that the rendering of justice is not hampered. Complainant, Enforcement Directorate is to sue every possible adverse claimant in the same proceedings to avoid multiplicity of proceedings and needless expenses. All persons against whom the right to relief is alleged to exist or those persons who may claim any rights in the properties which are sought to be attached, may be joined as defendants. A party can be joined as defendant even by the Adjudicating Authority or the Tribunal even though the respondent No. 1 does not think that he has any cause of action against him, as it is open to the Tribunal and Adjudicating Authority to add at any stage of the proceedings, a necessary party or a person whose presence before the Tribunal may be necessary in order to enable the Tribunal to effectually and completely adjudicate upon and settle all the questions involved in the proceeding. The Adjudicating Authority/Tribunal has wide discretion to meet every case of defect of parties and is not affected by the inaction of the respondent No. 1 to bring the necessary parties on record. The question of impleadment of a party has to be decided on the touchstone that only a necessary or a proper party may be added. A necessary party is one without whom no order can be made effectively. A proper party is one in whose absence an effective order can be made but whose presence is necessary for a complete and final decision on the question involved in the proceeding. The addition of parties is generally not a question of initial jurisdiction of the Tribunal but of a judicial discretion which has to be exercised in view of all the facts and circumstances of a particular case. In order to ascertain whether a person is a necessary party or not what is to be seen is whether in absence of such person, conflicting orders or judgments may be passed by the Tribunal. The only reason which makes it necessary to make a person a party to an action is so that he should be bound by the result of the action and the question to be settled. The question to be settled must be a question in the action which cannot be effectually and completely settled unless he is a party. A line has been drawn on a wider construction between the direct interest or the legal interest and commercial interest. It is, therefore, necessary that the person must be directly or legally interested in the action in the answer, i.e., he can say that the litigation may lead to a result which will affect him legally that is by curtailing his legal rights. Reliance can be placed on Sarvinder Singh v. Dalip Singh, : (1996) 5 SCC 539 and on Ramesh Hirachand Kundanmal v. Municipal Corpn. of Greater Bombay, : (1992) 2 SCC 524 in this regard. In these circumstances, it cannot be said that the appellant was not a necessary party in the facts and circumstances. Consequently the plea of the appellant to delete him as a party before the Adjudicating Authority is without any legal basis and cannot be accepted. If the respondent No. 1 was entitled to implead the appellant as a party in the OC, the Adjudicating Authority could issue a notice under section 8(1) of the PMLA on being satisfied and the appellant is not entitled to claim that he should have been deleted as he is claiming no rights in the properties which have been attached. Such a plea of the Appellant that he should have been deleted as a party before the Adjudicating Authority in the facts and circumstances is without any legal and factual basis and is liable to be rejected.

23. If the appellant could be impleaded as a party in the O.C. filed before the Adjudicating Authority, he could also be issued show cause notice under section 8(1) of the PMLA on Adjudicating Authority being satisfied and having reasons to believe that the appellant has prima facie committed offense and issuing of notice cannot be faulted by the appellant in the facts and circumstances. Therefore, the appellant is not entitled to claim that the show cause notice issued to him is liable to be withdrawn and the appellant is entitled to be deleted as a party.

24. The appellant is unable to show that a false view has been presented by the Adjudicating Authority. The view presented by the Adjudicating Authority is not such which is completely untenable. The allegation of the appellant that the view presented by the Adjudicating Authority is utterly distorted cannot be inferred in the facts and circumstances. Computer in charge of Pen Bank willfully and intentionally accessed the Pen Banks computer data base and on basis of documents of genuine customers fraudulently opened bogus cash credit/loan accounts in name of various individuals and entities at various branches of Pen Bank in violation of RBIs KYC norms and diverted the funds of investors of Pen Bank to said forged/fake bank accounts. The proceeds generated out of crime of forgery and cheating was further diverted and routed through several bogus loan accounts and utilized for acquiring immovable properties admeasuring 131.6 acres (5265.5 gunthas) at villages Nere, Akurli, Vichumbe at Panvel and Roha, Roha - Killa, Sudhagad - Asare, Siddheshwar - Budruk, Ghera in name of Shri. Shailesh Chandrakant Deshpande, Shri Pradnya Deshpande and Shri Ashok H. Shah. In the circumstances, it cannot be inferred even prima-facie that there has been misrepresentation/suppression of facts in the complaint filed by the respondent, No. 1.

25. The appellant has categorically contended that he has no direct or indirect interest in the immovable properties as detailed at Sr. Nos. 1 to 26 in the PAO No. 10/2014 dated 26.05.2014. He has filed the appeal for the purpose of apprising the facts in their proper perspective, though the appellant had attempted to show the same before the Adjudicating Authority and hemade submissions before the Adjudicating Authority. According to him all the 26 properties which had been stated to have been purchased by the Bank in the name of Shri Shailesh C. Deshpande fall out of the purview of PMLA, 2002. No cogent reason has been given by the appellant as to how these properties which have been provisionally attached fall out of purview of PMLA, 2002 even though prima facie they are the proceeds of crime. The plea of the appellant that he did not interfere with day to day working of the Bank and visited pen H.O. only at the time of meetings cannot be accepted at this stage when the evidence contrary to his plea is available on record. His other plea that during the check period of investigation he was the Chairman of the Bank only in 2009 till September, 2010 and as Chairman he was not controlling day to day work of the Bank, cannot be accepted in view of the allegations by the respondent No. 1 that although the Appellant became the chairman of Pen Urban Cooperative Bank Ltd. w.e.f. February, 2009, however, prior to the said date, his mother Mrs. Elen Prabhakar Dharkar was Chairman of the said bank and though prior to February, 2009, the Appellant was not the Director of the said Bank but all the powers of the Chairman were exercised by him. The then Chief Executive Officer and the Deputy General Manager of the bank explained the role of the Appellant that even the oral instructions of Appellant and his close confident, Shri Prem Kumar Sharma were required to be followed by the executives of the bank and the Modus Operandi of opening bogus loan account by closing existing NPA accounts were within the knowledge of Appellant, Shishir Dharkar and Prem Kumar Sharma. The role of Appellant has been mentioned in charge sheet of the commission of Schedule Offence. It is also revealed that the accused Shri Purshottam Vasant Joshi, Shri Shishir Prabhakar Dharkar, Shri Prem Kumar Sharma and Shri Sunil Dutt Sharma in collusion with each other withdrew huge amount by using demand Drafts/Cheques from various bogus loan accounts created by themselves in the Bank for their personal monetary gains and also making investment in the impugned properties. In circumstances it cannot be inferred that the facts as stated by the applicant are the only correct facts which he is entitled to agitate before this Tribunal in his appeal and the allegations of the appellant are entitled to be accepted. The adjudication of the alleged facts and the allegations canvassed before this Tribunal will be relevant and final in the action for prosecution and commission of offence taken under section 3 of the Act.

26. The plea of the appellant that he was forced to write a number of things in his statements which were not true cannot be accepted. The appellant has not pointed out as to what he was allegedly forced to write which is not true. The appellant has not disclosed as to what type of force was used against him to write things which were not correct. The appellant has not disclosed as to when, at the earliest, he had retracted the statement made by him which allegedly has a number of untrue things. This plea of the appellant, therefore, cannot be accepted at this stage. In any case, the appellant has not sought release of the properties from the attachment on the ground that his statements contain untrue facts. Rather, the plea of the appellant is that he has nothing to do with the properties which has been attached by respondent No. 1.

27. Even if it is assumed as has been alleged that the Appellant had no role to play in the purchase of properties of the bank in the name of Shri Shailesh C. Deshpande, it cannot be inferred that the properties are not the proceeds of crime and are not liable for attachment. The statements on the record show that the Appellant had been giving oral instructions and even the oral instructions of his close confidante were required to be followed by the executives of the bank. It is also on the record that the modus operandi of opening the bogus loan account by closing existing NPA accounts were within the knowledge of the appellant. This can also be reasonably inferred that the appellant has role in withdrawal of huge amounts by using demand drafts/cheques from various bogus loan accounts created in the bank for the monetary gains.

28. The appellant has also made a grievance of not providing him the English translation of some of the documents and thus, according to the Appellant there is violation of principles of natural justice. This is not disputed that the documents which was relied on by the respondent No. 1 for passing the provisional attachment order was supplied to the parties. No grievance was made out that the copies of the documents were not supplied to the parties. No provision has been shown which mandates that the translation of the documents are also to be supplied along with the documents. In any case, there is no allegation by the appellant that he cannot read Marathi as some of the documents are alleged to be in Marathi. The Appellant cannot be allowed to take the plea of violation of principles of natural justice so such illogical extend that though he understood the documents yet he should have been given the alleged translations of some of the alleged documents which were in Marathi. The appellant did not allege at any stage that he had been prejudiced on account of not supplying him the translations of documents. If the plea of the appellant is that none of the properties which have been attached are owned by him or he has any interest in them, he cannot contend that the order of attachment and its conformation is liable to be set aside on these grounds or that he has been prejudiced. The appellant has also referred to the reports of various branches of the bank to canvass his non-involvement in the crime of money laundering. However, whether the appellant is liable for punishment for money laundering or not is to be considered and decided in the appropriate proceedings under section 3 of PMLA, and these pleas cannot be adjudicated finally in the proceedings for attachment of the properties which are prima facie the proceeds of crime.

29. The plea of the appellant is also that the authorities were biased against him and the Adjudicating Authority failed to consider the effect of the alleged bias against the appellant. The allegation of bias in generic without any particulars and in the circumstances, the appellant cannot succeed to claim that there was any bias of the authorities, against the appellant. In any case, if the plea of the appellant is that he has no rights in the properties which have been attached and he has no concern with them, the attachment of such properties cannot be vitiated on account of alleged bias against the appellant. This plea of the appellant in the facts and circumstances, therefore, has to be repelled.

30. In the proceedings for the provisional attachment which is an emergent measure, the factors which are to be considered by the Authorized Officer are whether there are reason to believe that the proceeds of crime are likely to be concealed, transferred or dealt with in any manner, which may result in frustrating any proceedings relating to confiscation of such proceeds of crime. On the basis of material in his possession, the Authorized Officer upon identifying the property derived from the proceeds of crime has to order provisional attachment of such property and it is not for him to decide all the pleas and contentions raised by a party. Until, the proceeds of crime are finally confiscated under Section 8(3), the same have to be protected and preserved until the guilt or innocence of the person, as the case may be, is established which is to be done in the proceedings under section 3 of the Act and not under section 5 of the Act.

31. No other plea or proposition has been raised or canvassed by the counsel for the parties in the appeal except those which have been considered and dealt with herein before in the appeal.

32. The Appellant in the facts and circumstances is not entitled for the reliefs prayed in the appeal and the appeal is liable to be dismissed.

33. The Appeal is therefore, dismissed. The parties are however, left to bear their own costs.