A. Vishwanathan Raju Vs Deputy Director (Appellate Tribunal Under SAFEMA Delhi)
Satyam Case: PMLA Attachment Valid Even for Uncharged Persons – Tribunal Upholds ED Action- ED Attachment under PMLA Needs No Predicate Charge Post-2009 Amendment –
Appellants challenged the Adjudicating Authority’s order dated 14.01.2010 confirming provisional attachment of properties in the Satyam Computers fraud case, contending that (i) they were not charged with the predicate offence, hence attachment u/s 5(1) PMLA was invalid, & (ii) the show-cause notice u/s 8(1) was issued without proper application of mind on the very day the voluminous record was received.
The Bench noted that both the issues were squarely covered by the earlier M. Suryanarayana Raju decision. Key legal principles reaffirmed were:
1. Attachment of un-charged persons valid post-2009 amendment:
The second proviso to Section 5(1) (inserted w.e.f. 01.06.2009) authorizes attachment of property even of persons not charged with the scheduled offence, if the officer has recorded reasons to believe that immediate attachment is necessary to prevent concealment or transfer. Thus, the argument that only “charged persons” could be subjected to attachment was untenable.
2. No violation of Section 8(1):
The Tribunal held that an Adjudicating Authority can validly form reasons to believe & issue notice on the same day after perusing the record. The issuance of notice did not per se indicate non-application of mind.
The Bench reiterated that the properties in question were demonstrably linked to the money-laundering chain and that non-attachment would have frustrated proceedings under PMLA.
Finding the issues covered by the earlier ruling, the Tribunal dismissed both appeals, upholding the ED’s attachment as validly made under the amended provisions of PMLA.
