Varsha Raut Vs Deputy Director (Appellate Tribunal Under SAFEMA Delhi)
No Money Trail, No Attachment: SAFEMA Tribunal Quashes PMLA Attachment of Properties
The Appellate Tribunal under SAFEMA, New Delhi in Varsha Raut vs. Deputy Director, Directorate of Enforcement, Mumbai (FPA-PMLA-5216/MUM/2022, order dated 10-12-2025) set aside the Provisional Attachment Order (PAO), holding that in absence of any money trail linking the appellant to “proceeds of crime”, attachment of her properties was unsustainable.
The case arose from the Patra Chawl (MHADA) project investigation, where the appellant was not named as an accused, yet two properties—Alibaug property and Dadar (Mumbai) flat—were attached on the allegation that they were acquired from proceeds of crime routed through third parties.
For the Alibaug property, Tribunal found that the entire consideration was paid through banking channels, largely out of interest-free loans from relatives, with no allegation in the FIR of undervaluation or cash component, and no evidence showing that lenders received proceeds of crime. Mere suspicion or relationship with alleged accused was held insufficient.
Regarding the Dadar property, though ₹55 lakh was borrowed from a friend whose husband was alleged to be a recipient of tainted funds, Tribunal noted that the loan was fully repaid in December 2020, much prior to registration of ECIR on 08-09-2021. The finding of ED that repayment was “post-investigation” was held factually incorrect, and once the loan stood repaid, nothing remained with the appellant that could be termed proceeds of crime.
Tribunal emphatically held that PMLA attachment requires prima facie proof of money trail, not assumptions based on association or relationship. Since ED failed to establish any nexus between the appellant’s funds and the alleged crime, the impugned attachment order was quashed, while clarifying that the decision would not affect the pending criminal proceedings.
FULL TEXT OF THE JUDGMENT APPELLATE TRIBUNAL UNDER SAFEMA AT NEW DELHI
By this appeal filed by Smt. Varsha Raut, a challenge has been made to the order dated 29.09.2022 passed by the Adjudicating Authority confirming the Provisional Attachment Order (‘PAO’) dated 05.04.2022.
