Delhi High Court
Union Of India vs Mridula Kapur on 11 December, 2019
$~8
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ CRL.A. 801/2018 & CRL.MA. 29080/2018
UNION OF INDIA ..... Appellant
Through Ms. Mallika Hiremath,
Advocate and Mr. Amit
Mahajan, CGSC.
versus
MRIDULA KAPUR ..... Respondent
Through Mr. Vivek Kohli, Mr. Nalin
Talwar, Mr. Sunil Tyagi, Ms.
Prerna Kohli, Ms. Yeshi
Rinchhen, Mr. Mudit Gupta and
Ms. Agashi Verma, Advs.
CORAM:
HON'BLE MR. JUSTICE VIBHU BAKHRU
ORDER
% 11.12.2019
VIBHU BAKHRU, J
1. This is an appeal preferred by the Enforcement Directorate
under Section 42 of the Prevention of Money Laundering Act, 2002
(hereafter 'PMLA') impugning an order dated 13.04.2018 passed by
the Appellate Tribunal (hereafter 'The Tribunal'). By the impugned
order, the Tribunal had allowed the appeal preferred by the respondent
and had quashed the Provisional Attachment order dated 04.11.2016,
as well as the order dated 17.03.2017, confirming the order dated
04.11.2016.
2. By the said order dated 04.11.2016, certain immoveable
properties of the respondent (appellant before the Tribunal) had been
provisionally attached. The said order was confirmed by the
Adjudicating Authority by an order dated 17.03.2017.
3. The order of Provisional Attachment is premised on a case
instituted against the respondent and her husband (Major General
Anand Kumar Kapur) under Section 13(1)(e) of the Prevention of
Corruption Act, 1988. A chargesheet (chargesheet no. 3 dated
26.10.2009) has been filed under Section 173 of the Cr.P.C by ACU-II
Central Bureau of Investigation (CBI), alleging that the petitioner's
husband had amassed assets, disproportionate to his known sources of
income and the petitioner (respondent herein) had abetted the offence.
4. The facts as stated in the chargesheet disclose that Major
General Anand Kumar (husband of the respondent) was commissioned
in the Indian Army on 14.11.1971. On 10.10.2007, various searches
were conducted and the check period for Major General Anand Kumar
was taken from 14.11.1971 to 10.10.2007. As per the chargesheet,
prior to the check period, General Anand Kumar was in possession of
assets, both movable and immovable, to the extent of ₹41,700/- and at
the end of the check period - that is, as on 10.10.2007 - he was in
possession of assets, both movable and immovable, in his own name
or in the name of his wife (the respondent), to the tune of
₹5,51,92,598/-. It was alleged that Major General Anand Kumar had
acquired assets worth ₹3,37,02,592/-, which was disproportionate to
his known sources of income. The respondent had abetted her husband
in the commission of the crime regarding acquisition of
disproportionate assets.
5. The chargesheet was filed before the Court of Ld. Special
Judge-03 (PC Act)(CBI), Patiala House Courts and the Court took
cognizance of the same. A charge under Section 13(2) read with
Section 13(1)(e) of the Prevention of Corruption of Act, 1988 (PC
Act) was framed against the accused Major General Anand Kumar
Kapur. A charge was framed against the respondent under Section 109
of the IPC read with Section 13(2) read with Section 13(1)(e) of the
PC Act.
6. By the judgment dated 27.09.2016, the Learned Special Judge
held that the accused Major General Anand Kumar was unable to
satisfactorily account for the assets to the extent of ₹2,22,04,290/-.
Accordingly, Major General Kapur was convicted under Section
13(1)(e) read with Section 13(2) of the PC Act. Insofar as the
respondent was concerned, the Court held that there was no evidence
that the respondent had abetted her husband Anand Kumar in
amassing the said properties and accordingly, acquitted her of the
charges.
7. On 29.09.2016, the Special Judge, by an order on sentence,
sentenced Anand Kumar to rigorous imprisonment for one year and a
fine of ₹ 50,000/- and in default of payment of fine, to undergo simple
imprisonment for a period of six months. The Court also directed that
the disproportionate assets, to the tune of ₹ 2,22,04,290/-, be
confiscated.
8. On 04.11.2016, the Deputy Director, Directorate of
Enforcement, Ministry of Finance, while exercising his powers under
Section 5(1) of the Prevention of Money Laundering Act, 2002
(PMLA), passed a provisional order of attachment whereby he
attached thirteen properties of Major General Anand Kumar Kapur
and the respondent, on the ground that such properties had been
acquired by utilizing money which were proceeds of crime. It is to be
noted that the list of thirteen properties also contained the following
three properties which were in the sole name of the respondent:
S. No. Particulars Value
1. Office Space bearing No. 9,32,125/-
408A, Vatika Towers,
Gurgaon
2. Plot No. 264, Sector-52, 13,46,294/-
Gurgaon.
3. Cottage No. 10, Devine Golf, 38,81,357/-
Village Sadhora, Mashobra,
Shimla, Himachal Pradesh.
9. On 30.11.2016, the Deputy Directorate of Enforcement, New
Delhi filed a complaint against the respondent and Sh. Anand Kumar
under Section 5(5) of the PMLA. On 17.03.2017, the Adjudicating
Authority, Enforcement Directorate confirmed the provisional order of
04.11.2017 on the ground that the attached properties were "proceeds
of crime".
10. Thereafter, the respondent filed an appeal before the Tribunal,
inter alia, seeking to challenge the provisional attachment order dated
04.11.2016 and the order dated 17.03.2017 passed by the Adjudicating
Authority, whereby the order dated 04.11.2016 was confirmed.
11. On 13.04.2018, the Tribunal passed the impugned order
allowing the appeal preferred by the appellant (respondent herein).
The Tribunal held that since the respondent had been acquitted by the
CBI Court, the properties of the respondent could not be treated as
'proceeds of crime'. In the said circumstances, the Tribunal directed
that the three properties, which did not form part of the confiscated
properties, be released from the said attachment.
12. Thereafter, the Union of India has filed the present petition,
inter alia, challenging the order dated 13.04.2018. The petitioner
contends that that the properties, as released by the order dated
13.04.2018 (hereafter 'the concerned properties), constitute the value
of the proceeds of crime as defined under Section 2(1)(u) of the
PMLA. The appellant further contends that the Tribunal failed to
appreciate that it was not necessary that a person be accused of a
scheduled crime, for attachment of the proceeds of crime, which are in
his/ her possession.
13. There is considerable merit in the appellant's contention that it
is not necessary that proceeds of crime in the hands of a person can be
attached, notwithstanding that the person is not accused of any
scheduled crime or the offence of money laundering. Plainly, if an
asset which is derived by any person from a criminal activity is
entrusted to another person, who is neither complicit in the criminal
activity and is oblivious of the means by which the asset was acquired;
he would neither be charged of committing a scheduled offence nor
the offence of money laundering. Notwithstanding the above, the asset
in his possession would be liable to be attached and confiscated in
terms of the provisions of PMLA.
14. However, the said issue does not arise in the controversy
involved in the present case; because, the three immovable properties
of the respondent sought to be attached are not proceeds of crime. This
is obvious, since on a bare perusal of the allegations against the
respondent's husband and on a plain examination of the findings on
the basis of which respondent's husband was being convicted of the
offence under Section 13(1)(e) of the PC Act. The allegation against
the respondent's husband was that he had amassed assets
disproportionate to his sources of income. It was found that as on
10.10.2007 (end of the check period), the respondent's husband
(Major Gen. Anand Kumar Kapoor) was in possession of assets to the
extent of ₹5,51,92,598/-. These included both movable and immovable
assets, either in his own name or in the name of the respondent. Three
immovable properties of the respondent which are sought to be
attached by the appellant were part of the immovable assets taken into
account while calculating the assets held by the respondent's husband
as on 10.10.2007. The Trial Court had found that a total income of
₹4,10,35,864/- had been earned during the check period and an
expenditure of ₹1,26,52,600/- was incurred during the said period.
After accounting for the same, as well as the assets available at the
beginning of the check period, the Trial Court concluded that the
assets to the extent of ₹2,22,04,290/- were disproportionate to the
known sources of the income of respondent's husband. Thus, clearly
the remaining assets were acquired from legitimate and known sources
of income and therefore, cannot be considered as proceeds of crime.
15. Assets, to the extent of ₹2,22,04,290/-, have been directed to be
confiscated and thus, there is no scope for the present proceedings on
the basis that any of the remaining assets constitute proceeds of crime.
It is relevant to note that no particular assets held by respondent or her
husband were identified as an asset derived from any criminal activity.
The nature of the charge did not warrant any such inquiry and the
extent of disproportionate assets had been determined on the basis of
the value of assets at the end of the check period less the value that
could be accounted from the known sources of income. In view of the
above, the contention that three immovable assets held by the
respondent are proceeds of crime, is fundamentally flawed.
16. In view of the above, this Court finds no merit in the present
appeal and the same is dismissed.
17. The pending application is disposed of.
VIBHU BAKHRU, J
DECEMBER 11, 2019
RK
