Suraj Satish Chavan Vs Deputy Director (Appellate Tribunal Under SAFEMA Delhi)
SAFEMA Tribunal Upholds PMLA Attachment in BMC ‘Khichdi’ Scam; Rejects Salary and Loan Defence for ₹1.25 Crore Receipt
The Appellate Tribunal under SAFEMA dismissed the appeal filed by Suraj Satish Chavan, upholding the provisional attachment of his properties under the Prevention of Money Laundering Act, 2002 in connection with the alleged BMC “Khichdi” scam. The Enforcement Directorate alleged that contractors engaged to supply 300-gram Khichdi packets to the Brihanmumbai Municipal Corporation instead supplied 100-gram packets, causing a wrongful loss of over ₹6.37 crore to the civic body. During the investigation, it was found that ₹1.25 crore had been transferred from M/s Force One Multi Services to the appellant, who was alleged to have used his political influence to facilitate the award of the contract.
The appellant contended that he had been denied adequate opportunity before the Adjudicating Authority, that he had no role in securing the contract, and that the amount received represented either salary or a loan, and therefore could not constitute proceeds of crime. The Tribunal rejected these submissions, observing that the appellant failed to produce any appointment order or employment records to support the claim that ₹1.25 crore was salary. It also found the loan explanation untenable, as no loan agreement or repayment evidence was produced despite being specifically called upon to do so.
The Tribunal held that the appellant had failed to satisfactorily explain the receipt of ₹1.25 crore, which was traced through banking channels from an entity allegedly involved in the scheduled offence. Accepting the Enforcement Directorate’s case that the appellant had received the amount for facilitating the award of the contract, the Tribunal concluded that the attached properties represented proceeds of crime liable to attachment pending the conclusion of the criminal proceedings. Finding no merit in the appeal, it dismissed the challenge and upheld the provisional attachment.
FULL TEXT OF THE JUDGMENT APPELLATE TRIBUNAL UNDER SAFEMA AT NEW DELHI
By this appeal under Section 26 of the Prevention of Money Laundering Act, 2002 (in short “the Act of 2002”), a challenge has been made to the order dated 28.08.2024 passed by the Adjudicating Authority confirming the Provisional Attachment Order dated 12.03.2024.
