NDPS Act: Property Freezing Upheld as Spouse Fails to Prove Lawful Assets

Rani @ Sunita Ashtikar Vs Competent Authority (Appellate Tribunal Under Safema At New Delhi)

Spouse of NDPS Convict Fails to Prove Lawful Income – Tribunal Upholds Asset Freezing- No Proof of Legitimate Income – NDPS Tribunal Upholds Attachment of Raipur Properties- Cash Gifts & Unverified Loans Rejected – Tribunal Confirms Seizure of Assets under NDPS Act

FPA-ND-60/MUM/2016, decided on 29.10.2025

The Appellant challenged confirmation of property freezing under NDPS Act after her husband’s conviction for possession of 49 kg ganja. She claimed the Raipur properties, vehicles, & household items were bought from her savings, gifts, & sale of her late mother’s assets.

The Tribunal, after examining her bank statements & ITRs, noted heavy unexplained cash deposits & absence of corroborative evidence such as sale deeds, bank statements of donors, or loan documents. It held that mere filing of ITRs cannot prove legitimate sources of income, nor can undocumented cash transactions be accepted, particularly in light of Section 269SS of the Income-tax Act which bars cash loans beyond ₹20,000.

The Tribunal found the explanations for purchase of both residential properties, vehicles, & household items to be inconsistent & unsupported. The alleged sale of the car before freezing was also rejected as there was no transfer of registration nor evidence of receipt of sale consideration.

Accordingly, the Tribunal upheld the Competent Authority’s order confirming attachment of all assets, holding that the Appellant failed to rebut the statutory presumption u/s 68J of the NDPS Act that the properties were acquired from illicit sources.

FULL TEXT OF THE ORDER OF APPELLATE TRIBUNAL UNDER SAFEMA AT NEW DELHI

Present Appeal u/s 68-O of the Prevention of Money Laundering Act, 1985 is filed against the Confirmation Order No. CA/MUM/NDPS/03/ 2016 dated 26.04.2016 passed by the Competent Authority, SAFEMA, NDPS, Mumbai whereby the properties seized/frozen by the Freezing Authority vide order no. 431/2016 dated 28.03.2016 were confirmed. The details of the said properties are as under:

(i) property bearing Khasra No. 542, Village – Siltara Patwari, Halka No. 90 Naya Number 20 RNM, Char Sova -1, Raipur, Tah/Zila Raipur, (Chhattisgarh).

(ii) second residential property i.e. Flat No. 102, MIG Duplex Phase 1, Kabir Nagar, Raipur, Chhattisgarh – 492001.

(iii) one Scooty No. CG-04-HZ/0863.

(iv) Maruti Swift Dezire Regn No. CG04-HD-9992.

(v) L. G. Ultra TV 40”

(vi) one Refrigerator, Double Door, Fridge LG Joy Plus.

(vii) Joint bank account No. 935010110000340 with Bank of India, Ravi Bhavan, Sharda Chowk Branch.

2. As per the facts of the case, Accused Avinash Ashitkar (AP-3) was arrested being found in possession of 49 Kg of Ganja and accordingly FIR No. 471/2015 for commission of offence u/s 20 was registered against him at P.S. Kareli, District – Narsinghpur, Madhya Pradesh.

Thereafter, financial investigation was conducted by the SHO on the basis of same, the aforementioned properties were seized/frozen vide order dated 431/2016 dated 28.03.2018 dated 28.03.2016. The matter was referred to the Competent Authority with notice to the affected persons to appear on 20.04.2016. AP- 6 refused to take notice for hearing and the same was served by way of affixation. Notice to AP-7 Shalini Ashtikar was served through her son Ajay Ashtikar and notice to AP-8 Sanjay Joshi was served by way of affixation. Shri Sultan A. Khan, Counsel appeared on behalf of AP-1 to AP-8 on 20.04.2016 and demanded the copy of the Freezing Order dated 28.03.2016 which was duly served on him. On the next date of hearing i.e. 28.03.2016, Ld. Counsel appeared and argued the case and filed written submissions. On the basis of material on record, the Competent Authority confirmed all the seized/frozen properties.

Aggrieved by the said order, Appellant filed the present Appeal.

3. During the arguments, Ld. Counsel for the Appellant pointed out that the impugned property bearing Khasra No. 542, Village – Siltara Patwari, Halka No. 90 Naya Number 20 RNM, Char Sova -1, Raipur, Tah/Zila Raipur, (Chattisgarh) was purchased on 12.12.2013 from the past savings, cash gifts, sale of jewelry, sale of land of Mrs. Hemlata (mother) of Rani Ashtikar for Rs. 19,32,000/-. He pointed out the mode of payment for the said house as under:

Ld. Counsel for the Appellant argued that the second residential property i.e. Flat No. 102, MIG Duplex Phase 1, Kabir Nagar, Raipur, Chhattisgarh – 492001 was purchased on 15.05.2014 from the past savings, cash gifts, house loan from Adhar Housing Finance Limited – Raipur for Rs. 30,00,000/-. The said details were explained which is tabulated as under:

He further argued that one Scooty No. CG-04-HZ/0863 was purchased on 19.10.2015 from past savings for sum of Rs. 51,810/- which was withdrawn from her account on the date of purchase.

He further argued that Maruti Swift Dezire Regn No. CG04-HD-9992, was already sold to Mr. Pradeep Raut on 27.08.2015 for Rs. 4.5 Lakh even before the passing of the Freezing Order and its confirmation. He pointed out the copy of the sale agreement annexed as Annexure 4. He further submitted that this car was purchased by Appellant in the year 2011.

He pointed out that L.D. Ultra TV 40” was purchased on 29.07.2015 for sum of Rs. 66,630/- by invoice annexed as No. 5, from the past savings.

He pointed out that one Fridge LG Joy Plus was purchased on 01.09.2015 by Sanjay Joshi, brother of the Appellant but the same was lying with Appellant being his sister. Copy of the purchase invoice is annexure no. 6.

He pointed out that the savings bank account was joint account but operated by Appellant Smt. Rani @ Sunita Ashtikar and all the deposits and withdrawal entries were done by her. This account reflects her savings and investments.

He further argued that husband of the Appellant is a person of bad character and she is not having any marital/sexual relationship with him since 2012. The Appellant is residing along with her two sons in Flat No. 102, MIG Duplex Phase 1, Kabir Nagar, Raipur, Chhattisgarh and maintaining herself and her family by running a Kirana store in the name and style of Sameer & Yash Kirana store with effect from 2009. The shop is situated at Krishna Nagar, Gudhiyari, Raipur. The said shop is owned by her mother Hemlata Joshi, and in fact she is running the shop. He pointed out that the mother of the Appellant died on 22.05.2011 on account of prolonged cancer and left one residential property, cash and some jewelry. After the death of her mother, Appellant Rani @ Sunita Ashtikar sold the residential property, of her gold ornaments and valuable things and received the cash which was utilized for purchasing the aforementioned assets, which was wrongly attached by the Freezing Authority. He further pointed out that the Appellant is filing her ITRs since 2005-06 which are annexed as Annexure – N. Ld. Counsel pointed out that she has not received any financial assistance from her husband Avinash Ashtikar. Prayer is accordingly made to set aside the impugned order passed by the Competent Authority by allowing the present Appeal.

4. On the other hand, Ld. Counsel for the Respondent Competent Authority submitted that the accused Avinash Ashtikar is the husband of the present Appellant. He was arrested in case FIR No. 471/2015, Police Station – Kareli, Narsinghpur and charge-sheet was filed against him on 26.11.2015. He was convicted by Ld. Special Judge, NDPS Court, Narsinghpur vide judgment of conviction dated 18.02.2020. He further pointed out that the said accused was also involved in a number of other cases (details not mentioned). He argued that the Competent Authority passed the well-reasoned and detailed order on each and every property of the appellant as mentioned in the findings.

Prayer is accordingly made to dismiss the present Appeal being devoid of any merits.

5. After hearing the rival submissions, we have given our thoughtful consideration to the same. FIR was registered against the accused persons on 29.08.2015 and chargesheet was filed on 29.11.2015 and Shri Avinash Ashtikar was convicted on by Ld. Special Judge, NDPS Court, Narsinghpur vide judgment dated 18.02.2020.

Coming to the statement of account no. 935010110000340 of Bank of India, filed by the appellant which is at page 95 to 117 of the appeal paper book. Perusal of this bank statement reveals that there are heavy cash deposits on various dates viz. Rs.1.06 Lakh on 08.4.2011,

Rs.87,000/- on 25.08.2011, Rs.4,00,000/- on 23.05.2012, Rs.47,000/- on 08.10.2012, Rs.1,10,000 on 25.10.2012, Rs.50,000/- on 19.10.2012, Rs.1,00,000/- on 11.02.2013, Rs.2,20,000/- on 18.02.2013, Rs.1,00,000/- on 18.02.2013, Rs.1,50,000/- on 04.06.2013, Rs. 1,00,000/- on 18.06.2013, Rs.1,14,000 on 08.07.2013, Rs.1,00,000 on 17.07.2013, Rs.1,60,000/- on 12.08.2013, Rs.1,00,000/- on 23.08.2013, Rs.1,30,000/- on 08.10.2013, Rs.1,50,000/- on 30.10.2013, Rs.1,30,000/- on 12.11.2013, Rs.75,000/- on 25.11.2013, Rs.1,10,000/-on 19.12.2013, Rs.90,000/- on 24.12.2013, Rs.1,00,000/- on 06.02.2014, Rs.70,000/- on 20.02.2014, Rs.1,25,000/- on 24.02.2014, Rs.60,000/- on 31.03.2014, Rs.50,000/- on 22.07.2015, Rs. 50,000/- on 29.12.2015 (excluding many other cash deposit entries less than Rs. 45,000/-). There is no explanation regarding the sources from where she procured huge cash for deposit in her bank account on various dates. The same cannot be sale proceeds from her grocery shop, as we fail to notice any payment to any supplier from her bank account. Accordingly, the property at serial no. 7, the bank account is rightly frozen by the SHO and confirmed by the Competent Authority.

Now coming to the Income Tax Returns filed on behalf of Appellant, it reveals her net income during the respective AYs viz. Rs. 1,32,110/- for AY 2006-07, Rs. 1,33,619/- for AY 2007-08, Rs. 1,44,216/- for AY 200809, Rs.1,79,130/- for AY 2009-10, Rs. 1,89,740/- for AY 2010-11, Rs. 1,74,960/- for AY 2012-13, Rs. 1,99,900/- for AY 2013-14, Rs. 2,85,960/-for the AY 2014-15, Rs. 3,22,140/- for the AY 2015-16, Rs.3,53,350/- for AY 2016-17. Though, there is no challenge to the ITRs filed by the appellant, but we cannot deduce that she was having any sufficient savings from year to year on account of her earnings from the grocery shop, seeing the fact that the deposits made from time to time were spent regularly for one purpose or the other and mostly by way of cash withdrawals (CWDR).

Property at serial no. 1 was stated to be purchased by Appellant vide sale deed dated 12.12.2013 for sum of Rs. 19,32,000/-, which is at page no. 15 to 41 of the appeal paper-book. As per the contention of the appellant, out of the said sale consideration, she tendered cheque of Rs. 1.5 Lakhs dated 07.11.2013 and the remaining amounts of Rs. 17,82,000/- by way of cash as explained in the table in para no. 3 above. It is pertinent to mention that entry by way of Cheque amounting to Rs. 1.5 Lakh is out of the cash deposit of Rs. 1.5 Lakh on 30.10.2013, and she failed to explain from where she arranged sum of Rs. 1.5 Lakh. The statement of account of appellant reveals withdrawal of Rs. 6,00,000/-vide cheque no. 74824. We also fail to appreciate that why Appellant has withdrawn the huge amount of Rs. 6 Lakh (when the remaining sale consideration was already stated to be paid on 06.12.2013), for tendering payment of Rs. 1,32,000/- to the vendor, instead of issuing cheque in the name of vendor. Appellant has taken the plea that she obtained sum of Rs. 4 Lakh from her sister Sangeeta Pansare; Rs. 5 Lakh from her brother-in-law, Sandeep Pimplapure and Rs. 7 Lakh from the share she received from the sale of property of her mother Smt. Hemlata Joshi, for tendering the payment of Rs. 16 Lakh (Rs. 4 Lakh + Rs. 5 Lakh + Rs. 7 Lakh) to the vendor on 06.12.2013. However, Appellant failed to file any documentary evidence in this regard, as she has not filed any documentary evidence i.e. the statement of accounts of Sangeeta Pansare and Sandeep Pimplapore and the copy of sale deed of property of her mother to corroborate this fact. Hence, the Competent Authority has rightly gave the findings against the Appellant, qua the property at serial no. 1.

Now coming to property at serial no. 2, Appellant failed to explain the source of tendering Rs. 1,11,000/- to the vendor on 01.04.2014, as her saving bank account statement of Bank of India does not reflect any such withdrawal on 01.04.2014 or few days prior to the said date. On the other hand, it reflects deposit entry of Rs. 60,000/- on 31.03.2014. Further, Appellant has not filed any loan account statement of Aadhar Housing Finance Ltd. from where she received the two demand drafts of Rs.4,90,000/- each. She has also not filed the bank statement of SBI Raipur, Central Bank, Raipur, Bank of Baroda from where she tendered payment of Rs.2,79,000/-, Rs.4,70,000/- and Rs. 1,70,000/- on 18.04.2014. She has also not filed from where she procured sum of Rs. 5,00,000/- for preparing DD from Chhattisgarh Gramin Bankra, Raipur on 13.05.2014. Accordingly, we are of the considered view that she failed to prove the legitimate sources of income for purchasing this property.

Now coming to property at serial no. 3, one Scooty No. CG-04HZ-0863 stated to have been purchased on 19.10.2015 from past savings for sum of Rs. 51,810/-. However, on perusal the bank statement annexed by the Appellant, it is evident that the sum of Rs. 51,810/- as claimed by the Appellant was not withdrawn on the date of purchase i.e. on 19.10.2015. Merely filing of Income Tax Return does not absolve the appellant from explaining the sources of income. Moreover, filing of Income Tax Return is not a guarantee that the income was acquired for illicit sources. Therefore, the source of income used for purchasing the aforesaid vehicle is not known and in view of that, the confirmation order for freezing the scooty is valid.

Regarding property at serial no. 4, vehicle Maruti Swift Dezire Regn No. CG04-HD-9992, which is stated to have been sold to Mr. Pradeep Raut on 27.08.2015 for Rs. 4.5 Lakh even prior to the passing of the Freezing Order and its confirmation. Since the appellant has claimed that she has already sold the same to a third-party i.e. Mr. Pradeep Raut, however, on perusal of annexure no. 4, the same is just a sale agreement and mere agreement does not pass on the ownership, in absence of transfer of Registration Certificate of the vehicle in the name of vendee. Further, on perusal of the bank account statement of the appellant, there is no deposit entry of Rs. 4.5 Lakh (or any other amount) on 27.08.2015 or thereafter. But, in-fact there is cash withdrawal entry of Rs. 10,000/- on 31.08.2015, and thus we fail to understand that if appellant received cash payment of Rs. 4.5 Lakh on 27.08.2015, then why she was required to withdraw the petty amount of Rs. 10,000/- on 31.08.2015. Even otherwise, Mr. Pradeep Raut is not the registered owner of the vehicle, till date. Mr. Pradeep Raut tendered the sale consideration of Rs. 4.5 Lakh in cash as per agreement to sell, but there is nothing on record how he arranged the said amount, in absence of any bank statement and creditworthiness of Mr. Pradeep Raut. Moreover, the date of sale is 27.08.2015 which is just two days prior to the arrest of the husband of the appellant, which casts a doubt on the genuineness of the sale agreement being ante-dated, in absence of the endorsement of stamp vendor on the stamp paper on the reverse side of page 1 of the agreement. Accordingly, appellant failed to rebut the presumption u/s 68-J of NDPS Act, 1985 that the said property was not acquired from any illicit source of income.

Regarding serial no. 5, L.G. Ultra TV 40”, the appellant has annexed the copy of invoice as annexure no. 5 and claimed that she purchased the same from her past savings for a value of Rs. 66,630/-, the amount was paid in cash on 29.07.2015, however, she has not specified the bank account from where this cash was withdrawn, further, on perusal of the bank account statement annexed by the appellant, we could not find any corresponding entry of withdrawal of Rs. 66,630/-. Hence, in absence of any proof regarding the source of income used for purchasing the T.V., we are inclined to presume that the same must have been derived using the illicit source of income of her husband and the same is liable to be attached/ frozen.

Regarding the property at serial no. 6, the appellant on the one hand has claimed that the said Refrigerator was purchased by her brother Sanjay Joshi and she has also annexed the purchase invoice as annexure 6. However, on the other hand, she has claimed in her appeal and before the Competent Authority that she has purchased the same with assistance from Bajaj Finance, however, she has not annexed any document to support the same. Moreover, the bank account statement of Sanjay Joshi has also not been annexed. Further, on perusal of her bank account statement of appellant there is no such entry found regarding any loan taken from Bajaj Finance on 01.09.2015. Hence, the appellant herself has made contradictory claims, where on one hand she claims to have purchased the same herself and while on the other hand, she stated the same to have been purchased by Mr. Sanjay Joshi. In view of the same, the source of expenditure for the purchase itself is not clear, hence, we are of the view that the same has been purchased using illicit source of income and is rightly seized and confirmed.

Before concluding our discussion, we will like to point out the relevant provisions of Income Tax Act, 1961, pertaining to cash transactions as under:

“Section 269SS prohibits a taxpayer from taking/accepting loans or deposits or a sum of more than Rs.20,000 in cash. All loans and deposits of more than Rs.20,000 must always be taken through a banking channel. Section 269SS of the Income Tax Act is however not applicable when accepting/taking loan or deposit from a person or entity mentioned below:

• • Government;
  • Any banking company, post office saving bank or co-operative bank;
  • Any corporation established by a Central, State or Provincial Act
  • Any Government company as defined in clause (45) of section 2 of the Companies Act, 2013
  • An institution, association or body or class of institutions, associations or bodies notified by Central Government in the official gazette.

Finally, if the person from whom the loan or deposit is taken and the person by whom the loan or deposit is accepted, are both having agricultural income and neither have any income taxable under Income Tax Act, then the provisions of Section 269SS will not apply.

Penalty under Section 269SS

Failure to comply with provisions of section 269SS could lead to a penalty equal to the amount of loan or deposit or specified sum accepted.”

6. In sequel to our discussion in the preceding para no. 5, the present appeal is hereby dismissed being devoid of any merits.

Appeal Dismissed.

Pronounced on this 29t^h Day of October, 2025.