Prior Mortgage and DRT Proceedings Defeat PMLA Attachment on Case Facts: Tribunal

State Bank of India Vs Deputy Director (Appellate Tribunal under SAFEMA, New Delhi)

PMLA Attachment of SBI’s Mortgaged Properties Set Aside for Failure to Meet Section 5(1) Conditions

The Appellate Tribunal under SAFEMA at New Delhi set aside an order confirming attachment under the Prevention of Money Laundering Act, 2002 (PMLA), concerning properties mortgaged to a consortium led by State Bank of India. The Tribunal held that the twin conditions required under Section 5(1) could not coexist on the facts, given the mortgage and existing Debt Recovery Tribunal proceedings.

The ruling was delivered by Member Shri V. Anandarajan on October 13, 2026, in State Bank of India v. Deputy Director, Directorate of Enforcement, Bangalore, Appeal No. FPA-PMLA-2738/BNG/2018.

Background of the dispute

The proceedings arose from allegations concerning merchandise trade transactions involving M/s. Future Metal Private Limited, M/s. Future Exim India Private Limited and overseas entities.

A complaint alleged conspiracy and siphoning of approximately USD 250 million overseas through transactions facilitated by State Trading Corporation Limited (STCL). Following registration of the police case and subsequent investigation by the CBI, the Enforcement Directorate (ED) registered two Enforcement Case Information Reports in October 2009.

According to the investigation described in the order, STCL entered into arrangements for trading copper and nickel through overseas sellers and buyers. A consortium of eight banks, led by SBI, facilitated the transactions through letters of credit.

The overseas buyers failed to make the expected payments, while the letters of credit devolved and payments were made to overseas sellers. ED alleged that properties had been acquired using proceeds of crime and projected as untainted assets.

A provisional attachment order dated March 31, 2018, covered various properties. The Adjudicating Authority confirmed the attachment on September 12, 2018. SBI challenged that confirmation insofar as it concerned the mortgaged properties forming the subject matter of its appeal.

SBI relies on mortgage and recovery proceedings

SBI submitted that title deeds relating to approximately 154.67 acres in Patiala, Punjab, had been deposited with the consortium as collateral security.

The bank claimed a mortgage by deposit of title deeds within Section 58(f) of the Transfer of Property Act, 1882. It maintained that the original documents remained in its possession.

SBI also relied on recovery proceedings initiated before the Debt Recovery Tribunal (DRT) in 2011 and an injunction restraining alienation of the properties. Proceedings under the SARFAESI Act had likewise commenced, with symbolic possession taken in 2011.

The bank argued that these measures preceded ED’s attachment by several years. It further submitted that the properties had been acquired before the relevant criminal transactions and disputed their characterisation as direct proceeds of crime.

ED defends attachment

ED argued that the PMLA empowered it to attach proceeds of crime and that its provisions had overriding effect under Section 71.

It contended that the SARFAESI Act, the recovery legislation and the Insolvency and Bankruptcy Code did not prevail over the PMLA. ED also submitted that SBI should seek release of the properties before the Special Court under Sections 8(7) and 8(8).

The Tribunal, however, examined whether the attachment satisfied the requirements of the PMLA itself.

Twin conditions under Section 5(1)

The Tribunal explained that Section 5(1) required recorded reasons to believe, based on material in the authority’s possession, that a person possessed proceeds of crime.

Additionally, there had to be reasons to believe that those proceeds were likely to be concealed, transferred or otherwise dealt with in a manner that could frustrate confiscation proceedings.

Both conditions had to coexist for a valid provisional attachment. The Tribunal found that the mortgage, possession of title deeds and prior recovery measures were not contested by ED.

Considering the borrower as the person possessing the property, the Tribunal held that the second condition was not satisfied. The borrower could not conceal, transfer or deal with property already mortgaged to the bank and covered by a DRT order. This remained so even if physical possession continued with the borrower.

Alternatively, treating the bank as the relevant person, the Tribunal held that the first condition was not met. In the bank’s hands, the properties constituted collateral for financial facilities validly advanced in the ordinary course of business.

Overriding effect did not cure the defect

The Tribunal held that ED’s reliance on the overriding effect of the PMLA did not establish the validity of this attachment.

Even accepting that the other enactments did not prevail over the PMLA, the attachment still had to satisfy Section 5(1). Those statutory conditions could not coexist in the circumstances.

The Tribunal therefore allowed the appeal on this ground without deciding the other principal issues. It also observed that SBI’s objection to being relegated to the Special Court was supported by the Supreme Court decision in Nav Nirman Builders relied upon by the bank.

Outcome

The impugned order was set aside only insofar as it concerned the properties mortgaged to the bank and forming the subject matter of the appeal. No costs were awarded.

The ruling rests on failure to satisfy Section 5(1), rather than a determination that secured-creditor legislation overrides the PMLA.

Cases Discussed

• State Bank of India Vs Assistant Commissioner — 2016 SCC OnLine Mad 33329. Cited by SBI concerning the application of the 2016 amendments to the SARFAESI Act to pending proceedings.
• State Bank of India Vs Joint Director, Directorate of Enforcement, Kolkata — Appellate Tribunal; FPA-PMLA-1026/KOL/2015; 14/07/2017. Relied upon by SBI regarding the rights of secured creditors in PMLA attachment proceedings.
• HDFC Vs Joint Director, Directorate of Enforcement, Goa — Appellate Tribunal; FPA-PMLA-1368/GOA/2016; 28/08/2017. Relied upon by SBI in support of its secured-creditor arguments.
• Nav Nirman Builders & Developers (P) Ltd. Vs Union of India — Supreme Court; 2026 SCC OnLine SC 161. Relied upon by SBI regarding the availability of appellate remedies and proceedings before the Special Court. The Tribunal found support in this decision for SBI’s objection to being relegated to the Special Court.
• Joint Director Vs HDFC Bank — Bombay High Court, Nagpur Bench; First Appeal No. 1413/2017; 23/03/2026. Relied upon by ED concerning the relationship between the PMLA and secured-creditor legislation. The Tribunal distinguished the issue decided in that case.
• Deputy Director Vs Axis Bank — (2020) 220 Comp Cas 147. Relied upon by ED regarding the overriding effect of the PMLA in relation to other recovery and insolvency laws.

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

The present appeal arises from order dated 12.09.2018 of the Ld. Adjudicating Authority (AA) established under the Prevention of Money Laundering Act, 2002 (PMLA) in Original Complaint (OC) No. 965/2018 confirming the Provisional Attachment Order (PAO) No. 02/2018 dated 31.03.2018 passed in Enforcement Case Information Reports (ECIRs) No. ECIR/BGZO/25/2009, and ECIR/BGZO/26/2009, both dated 29.10.2009, whereby, the provisional attachment of the following properties was confirmed:

Facts in Brief:

2. The relevant facts briefly are that an FIR (FIR No. 176/2009) was registered by the High Ground Police Station, Bangalore on 18.07.2009 for offences under Sections 406, 468, 420, 120-B and 34 of the Indian Penal Code, 1860 (hereinafter “IPC”) upon a complaint being made by the M/s State Trading Corporation Limited (STCL) against M/s Future Metal Private Limited (FMPL), M/s Future Exim India Private Limited (FEIPL) and their directors, alleging conspiracy and siphoning of foreign exchange to the extent of USD 250 Million from India to overseas companies under the guise of merchandise trade based on the strength of tripartite agreements and back-to-back contracts entered into with STCL. Subsequently, the CBI took over the investigation and registered FIR No. RC-ACI-2009-A004 on 09.10.2009. Further, the CBI filed a Police Report before the Special Court of CBI, CCH-4, Bangalore Courts at Bangalore against the accused persons for offences under Sections 420, 465, 471 read with 120-B IPC and under Sections 13(2) read with 13(1)(d) of the Prevention of Corruption Act, 1988 on 05.12.2016.

3. On the basis of the said FIRs, the Directorate of Enforcement (ED), the respondent no. 1 herein, recorded Enforcement Case Information Reports (ECIRs) No. ECIR/BGZO/25/2009 and ECIR/BGZO/26/2009, both dated 29.10.2009, to investigate the matter under the PMLA as Sections 120-B and 420 of IPC are scheduled offences under Part-A of the Schedule to the PMLA.

4. The enquiries inter-alia revealed that:

a. FMPL and FEIPL approached STCL for entering into merchandise trade in copper and nickel and requested STCL to facilitate the trade and enter into a series of back-to-back agreements with overseas sellers and buyers as identified by FMPL and FEIPL.

b. Subsequently, STCL entered into agreements with 3 overseas sellers for supply of metal scrap and 3 overseas buyers for purchase of metal scrap. FMPL and FEIPL also signed sale contracts guaranteeing the payment to be made by the overseas buyers to the STCL’s bank.

c. Mr. Naveen Sriram and Mr. Sudheer Sriram executed deed of personal and corporate guarantee in favour of STCL against the latter agreeing to provide finance for the merchandise trade transactions and for the corporate guarantee to be invoked by STCL in the event of any default in repayment of amount due to STCL.

d. STCL, being a trade facilitator opened Usance Letter of Credit (hereinafter “LC”) (90/120 days) with its banks, including the State Bank of India, (appellant herein), leading a consortium of eight banks, for remitting foreign exchange in favour of the foreign sellers’ bank effective from 31.05.2008 to 03.10.2008.

e. The overseas buyers failed to take delivery of goods and remit payments to the accounts of STCL. However, the 134 LCs devolved and the amount was credited to the accounts of the overseas sellers. The STCL remitted a total foreign exchange of USD 250.572 Million to the three overseas suppliers through its banks including appellant bank herein at the instance of FMPL and FEIPL. However, an amount of USD 999,970 was received by the bank of STCL, thus, resulting in wrongful loss of USD 249.572 Million to STCL. The details of amounts remitted and received by STCL’s banks are detailed hereinafter:

f. The investigation further revealed that FMPL and FEIPL connived with their overseas associates to cheat STCL and acquired properties in the name of FMPL, M/s Indo Asia Infrastructure Pvt. Ltd and in the name of directors/MD of FMPL as well as their family members, and further projected them as untainted. Thus, the amount of USD 250.572 Million as remitted by STCL to the foreign sellers is the proceeds of crime. Additionally, properties worth Rs. 39,00,08,266/- were acquired by FMPL and M/s Indo Asia Infrastructure Pvt. Ltd. in Punjab and by FMPL in Tamil Nadu from the proceeds of crime, which were provisionally attached by the ED.

5. A Provisional Attachment Order (PAO) No. 02/2018 dated 31.03.2018 was passed by ED whereby various properties worth of Rs. 39,00,08,266/- as mentioned on page numbers 36 to 49 of PAO were provisionally attached.

6. Consequent to the passing of the PAO, as per the requirement of Section 5(5) of PMLA, an Original Complaint (OC) No. 965/2018 was filed before the Ld. AA for confirmation of the PAO. Subsequently, the said PAO was confirmed by the Ld. AA vide impugned order dated 12.09.2018.

7. Aggrieved by the said order of the Ld. AA, the appellant bank has filed the present appeal before this Appellate Tribunal under Section 26 of PMLA.

Submissions for the Appellant (SBI)

8. The appellant bank has, firstly, referred to the following facts relevant for proper adjudication of the case:

a. The consortium of 8 banks, led by the appellant bank i.e., State Bank of India, extended credit facilities to FMPL and FEIPL by opening a Usance Letter of Credit (90/120 days) in favour of the foreign sellers’ banks.

b. The overseas buyer failed to take delivery of goods and remit payments to STCL, however, the LCS (134 in number) devolved and the amount was credited to the accounts of the sellers abroad.

c. Title deeds of properties admeasuring 154.67 acres at Patiala, Punjab were handed over to the consortium as security/collateral against the debt advanced by the appellant bank as banker of STCL.

d. ED requested the appellant bank vide letter dated 08.07.2011 for disclosure of mortgaged properties qua STCL. The appellant bank provided details of mortgaged properties to the ED vide letter dated 13.07.2011.

e. The appellant bank/consortium instituted recovery proceedings on behalf of all the banks before the Debts Recovery Tribunal, Bangalore (hereinafter “DRT”) for recovery of Rs. 1529 Crores vide OA No. 751/2011 on 18.07.2011. The DRT passed an order dated 17.11.2011 in IA No. 1799/2011 granting injunction in favour of the appellant bank against alienation of properties by the garnishees.

f. Appellant bank informed the ED vide letter dated 11.06.2018 regarding the pending DRT proceedings, injunction order, proceedings under SARFAESI Act and outstanding dues of Rs. 3740.35 Crore as well as of the fact that the bank is in possession of original title deeds as the properties are deemed mortgaged.

9. It is submitted on behalf of the appellant bank that the properties were acquired and registered from 2007 to 2008 and the payments/remittances made by STCL through the appellant bank dates to February, 2009, as evident from page number 59 of the impugned order and page numbers 97-98 of the PAO. Moreover, the same were acquired by and mortgaged to the appellant bank before the commission of the alleged offences and in fact, were acquired from legitimate sources of income. Thus, the finding of the Ld. AA as well as of the ED that the properties are direct proceeds of crime is incorrect.

10. It is also submitted that the impugned order records that the properties were purchased from 2007 to 2008 and the PAO also records that the LCs were issued from 31.05.2008 to 03.10.2008 in favour of the overseas sellers. Additionally, the impugned order further records that the payments were made pursuant to devolution of LCs in favour of the foreign sellers from February 2009 to April 2009, therefore, the finding of the Ld. AA that the attached properties are proceeds of crime is contradictory and unsustainable. Moreover, the question of attachment of properties as value thereof does not arise as it is the case of the ED as reflected in the PAO and finding of the Ld. AA in the impugned order that the attached properties are direct proceeds of crime as they were acquired from the proceeds of crime and projected as untainted properties.

11. It is further submitted that the properties should not have been attached as the same were mortgaged to the appellant bank for securing debts and amounts to ‘deemed mortgage’ by depositing of title deeds within the meaning of Section 58(f) of the Transfer of Property Act, 1882 and the same are still in possession of the appellant bank. Nevertheless, the ED has failed to undertake necessary investigation to establish that the attached properties are proceeds of crime and further attached the properties despite being informed prior to the issuing of PAO that the properties were mortgaged properties.

12. It is pointed out that the provisional attachment of the properties by ED is incorrect as the appellant bank had previously informed the ED on 13.07.2011 that the properties are deemed mortgaged to the bank as original title deeds are in possession of the appellant bank as collateral security for debt granted to STCL. Likewise, the appellant bank further informed the ED on 11.06.2018 that the proceedings under the Recovery of Debts and Bankruptcy Act, 1993 (hereinafter “RDB Act”) stands initiated and the DRT has passed injunction order on 17.11.2011 restraining the garnishees from alienating the properties. Thus, the ED ought not to have passed the PAO and the Ld. AA also should not have confirmed the PAO during the pendency of the proceedings before the DRT as further attachment would hamper the execution of the decree passed by the DRT.

13. It is also submitted that the exposure of the consortium member banks in the present case is to the extent of Rs. 3740.35 Crores as on 31.03.2017, therefore, the consortium of the banks are entitled to retain the properties as security for realization of their aforesaid financial exposure. Further, the appellant bank is the victim of the alleged offences as it suffered loss due to commission of offences and the interest of the consortium members needs to be protected given public money is required to be secured by executing the decree of the DRT. Moreover, the legislative amendment in the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and the RDB Act w.e.f. 01.09.2016 have provided to facilitate the right of secured creditors which gives overriding effect over any other law for the time being in force. Reliance herein is placed on State Bank of India v. Assistant Commissioner, 2016 SCC OnLine Mad 33329 to contend that the amendment of 2016 to the SARFAESI Act would apply to the pending proceedings. Further reliance is placed on the decisions of this Appellate Tribunal in State Bank of India v. The Joint Director, Directorate of Enforcement, Kolkata, FPA-PMLA-1026/KOL/2015 dated 14.07.2017 and HDFC v. The Joint Director, Directorate of Enforcement, Goa, FPA-PMLA-1368/GOA/2016 dated 28.08.2017.

14. It is further argued on behalf of the appellant bank that it cannot be relegated to the remedy of filing application before the Special Court under Section 8 of PMLA as there is a deemed embargo on the proceedings before the Special Court under Section 8 of PMLA given pendency of appeal before this Appellate Tribunal under Section 26 of PMLA. Reliance in this regard was placed on Nav Nirman Builders & Developers (P) Ltd. v. Union of India, 2026 SCC OnLine SC 161.

15. Ld. Counsel for the appellant bank also submitted that reliance on the judgment of the Hon’ble High Court of Judicature at Bombay, Nagpur Bench in Joint Director v. HDFC Bank, First Appeal No. 1413/2017 dated 23.03.2026 by the respondent Directorate is incorrect as the issue before the Hon’ble High Court was different from the issue in the present appeal. He further submitted that the Hon’ble Supreme Court has held that the right to appeal is a statutory right vested by the statute in a person and the jurisdiction of this Tribunal is wider than of the Special Court, therefore, the appellant bank cannot be compelled to withdraw the appeal and approach the Special Court.

16. It is lastly contended that the impugned order is unreasonable and erroneous as the Ld. AA failed to consider and note the submissions of the appellant bank, despite detailed written submissions and reply being filed. The impugned order is completely bereft of reasoning and demonstrates non-application of mind on the part of Ld. AA as the Ld. AA has incorrectly recorded that the PAO was not opposed by the appellant bank herein on any specific point.

17. In light of the detailed submissions, as above, it is prayed by the appellant bank that the present appeal be allowed and the impugned order passed by the Ld. AA dated 12.09.2018 in OC No. 965/2018 be set aside.

Submissions for the Respondent (ED)

18. The respondent has opposed the contentions raised on behalf of the appellant bank and defended the impugned order dated 12.09.2018 confirming the provisional attachment of properties.

19. Firstly, the respondent has emphasized the serious nature of the offence of money-laundering and its ramifications on the economy. It is submitted that the purpose of investigation under the PMLA is to identify the proceeds of crime and to subsequently confiscate, besides penal action against the offenders.

20. It is submitted that the attached properties were not part of the collateral at the time of making outward remittances by the banks and the same is evident from the statement of the Directors of FMPL and FEIPL recorded by the Investigating officer.

21. It is further submitted that the provisions of PMLA has overriding effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force in terms of Section 71 of PMLA, therefore, the ED has power to attach properties. In fact, amendment was made to Section 8(8) of PMLA vide Finance Act, 2018 w.e.f. 29.03.2018 which provided that the provisions of PMLA would have overriding effect on SARFAESI Act. Further, reliance was placed on Deputy Director v. Axis Bank, (2020) 220 Comp Cas 147 to contended that the objective of PMLA being distinct from the purpose of RDB Act, SARFAESI Act and Insolvency Code, the latter three legislations do not prevail over the former.

22. The respondent has also submitted that the appellant bank should approach the Special Court under Section 8(7) and (8) of PMLA for release of attached properties as prosecution complaint stands filed before the Special Court and reliance herein was placed on the decision of the Hon’ble High Court of Judicature at Bombay, Nagpur Bench in Joint Director v. HDFC Bank, First Appeal No. 1413/2017 dated 23.03.2026.

23. In sum and substance, the respondent submits that the impugned order of the Ld. AA in OC No. 965/2018 dated 12.09.2018 is well reasoned, passed after due diligence, and does not require any interference, and the attachment of the properties needs to be continued.

Analysis & Findings, Order

24. I have given careful consideration to the facts on record and the rival contentions of the parties. At the outset, I find that the factual contentions of the Appellant Bank have not been seriously contested by the Respondent Directorate.

25. The main arguments advanced on behalf of the appellant are as follows:

(i) That at the time of their provisional attachment the properties already stood mortgaged to the consortium of banks led by the appellant bank, the title deeds of the properties were in the possession of the Bank, and recovery action had also been initiated by the bank under the relevant laws;

(ii) That properties were acquired prior to the period of scheduled offence and therefore, the same could not be held to be the direct proceeds of crime;

(iii) That appellant cannot be relegated to the remedy of filing an application before the Special Court under Section 8(7) and 8(8) of the PMLA for release of the attached properties.

26. Coming to the first argument of the appellant, it is contention of the appellant that the properties in question, which are the subject matter of attachment in the present case, were under deemed mortgage by deposit of title deeds within the meaning of Section 58(f) of the Transfer of Property Act, 1882 and the same were still in the possession of the appellant bank as collateral security for debt granted to the State Trading Cooperation Ltd. It is also submitted that the appellant bank had informed ED on 11.06.2018 that the proceedings under the Recovery of Debts and Bankruptcy Act, 1993 (RDB) Act stand initiated and the Debts Recovery Tribunal has passed an injunction order on 18.07.2011, restraining the alienation of the properties. Notice under Section 13(2) of the SARFAESI Act was issued on 23.08.2011, and symbolic possession of properties was taken on 28.10.2011 and 16.11.2011, respectively. The aforesaid contentions of the appellant have not been contested by ED. It is also not in doubt that the provisional attachment order, which has been confirmed by the Ld. AA through the impugned order, was passed on 31.03.2018, which was many years after the aforesaid recovery action and orders thereon by the Debts Recovery Tribunal. Section of 5(1) of the PMLA reads as below:

“[(1) Where the Director or any other officer not below the rank of Deputy Director authorised by the Director for the purposes of this section, has reason to believe (the reason for such belief to be recorded in writing), on the basis of material in his possession, that-

(a) any person is in possession of any proceeds of crime; and

(b) such 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 this Chapter,

he may, by order in writing, provisionally attach such property for a period not exceeding one hundred and eighty days from the date of the order, in such manner as may be prescribed:

Provided that no such order of attachment shall be made unless, in relation to the scheduled offence, a report has been forwarded to a Magistrate under section 173 of the Code of Criminal Procedure, 1973 (2 of 1974), or a complaint has been filed by a person authorised to investigate the offence mentioned in that Schedule, before a Magistrate or court for taking cognizance of the scheduled offence, as the case may be, or a similar report or complaint has been made or filed under the corresponding law of any other country :

Provided further that, notwithstanding anything contained in [first proviso], any property of any person may be attached under this section if the Director or any other officer not below the rank of Deputy Director authorised by him for the purposes of this section has reason to believe (the reasons for such belief to be recorded in writing), on the basis of material in his possession, that if such property involved in money laundering is not attached immediately under this Chapter, the non-attachment of the property is likely to frustrate any proceeding under this Act.].

[Provided also that for the purposes of computing the period of one hundred and eighty days, the period during which the proceedings under this section is stayed by the High Court, shall be excluded and a further period not exceeding thirty days from the date of order of vacation of such stay order shall be counted.]”

27. Upon a plain reading of the aforesaid provision, the essential pre-conditions for making a valid provisional attachment are, the existence of reason to believe, which is to be recorded in writing that, firstly, any person is in possession of proceeds of crime, and, secondly, that “such” proceeds of crime (i.e., proceeds of crime which is in possession of “any person”) are likely to be concealed, transferred or dealt with in a manner which may result in frustrating the proceedings relating to confiscation of “such” proceeds of crime. The co-existence of both the conditions is necessary in order for the authority acting under Section 5(1) to make a valid attachment.

28. In the present case, if the borrower who is accused of the offence of money laundering is considered to be the “any person” referred to in Section 5(1)(a), then the second condition would not be met as the said borrower was in no position to conceal, transfer or deal with the property which was under mortgage to the appellant Bank and in respect of which an order of the DRT was already in place This would be so even if he continued to be in physical possession of the property. Conversely, if the phrase “any person” under Section 5(1)(a) were to be considered to be a reference to the appellant Bank, the first pre-condition, i.e., that it (the Bank) was in possession of “any proceeds of crime” would not be met as, in the hands of the Bank, the property did not constitute “proceeds of crime” but rather collateral security for financial facility validly advanced in the usual course of business.

29. The respondent has contended that the provisions of the SARFAESI Act, the RDB Act, and Insolvency and Bankruptcy Code (IBC), do not prevail over the PMLA. They seek to rely upon the judgment of Hon’ble Delhi High Court in the case of the Axis Bank in this regard. Having considered the argument, I find that the same argument does not travel very far in supporting the action of the ED in attaching the properties which already stood mortgaged to the banks, and in respect of which the orders had already been passed by the Ld. DRT. Even if, the position that the provisions of other Acts, i.e., RDB SARFAESI Acts do not prevail over the PMLA were to be accepted, it is the requirement of PMLA itself that the authority attaching property under Section 5(1) must have the twin reasons to believe as discussed above, on the basis of material in its possession which could not have co-existed in the facts of the present case.

30. In the light of the above discussion, the appeal filed by the Bank succeeds on this ground alone, and the other issues mentioned in para-25 (supra) need not be gone into. As regards the judgment of the Nagpur Bench of the Hon’ble Bombay High Court, in Joint Director of Enforcement v. HDFC Bank, the same is on the issue as to whether the provision of the RDB Act and SARFAESI Act would override the provisions of PMLA so as to render the attachment illegal. In the present case, the order of provisional attachment under Section 5 of the PMLA has been found to be illegal not because of any conflict with the RDB Act or SARFAESI Act, but because it was not in accordance with the provisions of Section 5(1) of the PMLA itself, for the reasons discussed in para 27 and 28 (supra). However, before parting with this order, it may also be mentioned that the contention of the appellant that the appellant cannot be relegated to filing an application before the Special Court under Section 8(7) and 8(8) of PMLA is also well supported by the judgment of the Hon’ble Supreme Court in Nav Nirman Builders on which reliance has been placed by the appellant.

31. Accordingly, in light of the above discussion, the present appeal is hereby allowed and the impugned order is set aside qua the properties which were under mortgage to the Bank and constitute the subject matter of this appeal.

32. Pending applications, if any shall disposed of.

33. No order as to costs.