Delhi High Court
M/S Vikas Wsp Ltd.And Ors vs Directorate Enforcement And Anr on 18 November, 2020
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Reserved on: 08.09.2020
Date of Decision: 18.11.2020
+ W.P.(C) 3551/2020 & 12626/2020
M/S VIKAS WSP LTD. & ORS. ..... Petitioners
Through: Mr.Dayan Krishnan, Sr. Adv. with
Mr.Arshdeep Singh, Mr.Akshat
Gupta, Mr.Sanjeevi Seshadri,
Ms.Rajshree Sharma, Advs.
versus
DIRECTORATE ENFORCEMENT & ANR. ..... Respondents
Through: Mr.Amit Mahajan, CGSC with
Ms.Mallika Hiremath and Mr.Atul
Tripathi, Advs.
CORAM:
HON'BLE MR. JUSTICE NAVIN CHAWLA
1. This petition raises an interesting question of the effect of the
lockdown declared by the Central Government due to the outbreak of the
COVID-19 Pandemic on the period of the Provisional Attachment Orders
passed under Section 5(1) of the Prevention of Money Laundering Act,
2002 (hereinafter referred to as the 'Act').
BRIEF FACTS:
2. The respondent no. 1, in exercise of its powers under Section 5(1) of
the Act, passed a Provisional Attachment Order dated 13.11.2019,
provisionally attaching certain properties of the petitioners amounting to
WP(C) No.3551/2020 Page 1
Rs. 52,21,16,797/-, for a period of 180 days from the date of the said
order.
3. The respondent no.1 thereafter, in terms of Section 5(5) of the Act,
filed a complaint, being OC No.1228/2019, before the Adjudicating
Authority on 05.12.2019.
4. The Adjudicating Authority, on 18.12.2019, issued a Show Cause
Notice under Section 8(1) of the Act to the petitioners. However, before
the proceedings could be concluded, on 23.03.2020, the Government of
India declared a nationwide lockdown with effect from 24.03.2020 due to
the spread of the COVID-19 Pandemic.
5. The lockdown declared by the Government of India was partially
lifted on 20.04.2020 and the Adjudicating Authority, admittedly, began
functioning in a restricted manner thereafter.
6. On 26.05.2020, the Adjudicating Authority issued the Impugned
Notice/Summons to the petitioners by way of an e-mail, indicating the
next date of hearing in the complaint to be 16.06.2020.
7. The petitioners filed the present petition on 15.06.2020 claiming
therein that as the period of 180 days from the date of the Provisional
Attachment Orders had expired, in terms of Section 5(3) of the Act, the
said order ceased to have effect and therefore, the Adjudicating Authority
had become functus officio and the proceedings in the complaint cannot
proceed. Following prayers have been made in the petition:
"(a) writ of certiorari or any other appropriate writ/ direction/
order in the nature of a writ quashing/ setting aside the Notice/
WP(C) No.3551/2020 Page 2
Summons dated 26.05.2020 issued by the Respondent no. 2
Adjudicating Authority through email in Original Complaint No.
1228/2019 dated 05.12.2019 intimating a fresh date of hearing and
directing the Petitioner to join the proceedings and all
consequential proceedings emanating therefrom; and
(b) writ of declaration or any other appropriate writ/ direction/
order declaring that the Provisional Attachment Order No.
10/2019 dated 13.11.2019 issued by the Respondent No.1 ED and
all proceedings emanating therefrom including Original
Complaint No. 1228/2019 has lapsed and ceased to have any effect
on and from the expiry of 180 day period provided under Section 5
PMLA i.e. from 12.05.2020."
PETITIONERS SUBMISSIONS:
8. The learned senior counsel for the petitioners has submitted that
the provisions of sub-section (1) and sub-section (3) of Section 5 provide
for the maximum period of the validity of a Provisional Attachment
Order and on expiry of the said period, the Provisional Attachment Order
ceases to have effect without any further action/omission on part of any
Authority. He submits that there is no provision in the Act by which such
period can be extended by any Authority or even by a Court of law. He
places reliance on the judgment of the Supreme Court in S.Kasi vs. State
2020 SCC OnLine SC 529.
9. He submits that the effect of an order under Section 5(1) of the Act
is deprivation of the right of a person to enjoy his property. The same
cannot be extended for an indefinite period. The right to enjoyment of a
property is a Constitutional right guaranteed under Article 300A of the
WP(C) No.3551/2020 Page 3
Constitution and cannot be denied to a person except in accordance with
the procedure prescribed by law. In this regard, he places reliance on the
judgment of the Supreme Court in M.C.Mehta vs. Union of India & Ors.
2020 SCC OnLine SC 648.
10. The learned senior counsel for the petitioners further submits that
though the Supreme Court in its orders dated 23.03.2020, 06.05.2020 and
10.07.2020 passed in Suo Moto WP(C) No.3/2020- In Re: Cognizance
for Extension of Limitation, has extended the period of limitation to file
proceedings under the general or special laws, including the Arbitration
and Conciliation Act, 1996 and the Negotiable Instruments Act, 1881,
and also with respect to Section 29A and 23(4) of the Arbitration and
Conciliation Act, 1996 etc., the same cannot extend the period of validity
of a Provisional Attachment Order passed under Section 5(1) of the Act,
as it is not a period of limitation. He further submits that the Government
of India, by a Notification dated 31.03.2020 extended the period for
completion of proceedings prescribed under various Acts, like the Wealth
Tax Act, 1957, The Prohibition of Benami Property Transactions Act,
1988, etc., however, the period prescribed under the provisions of the
Prevention of Money Laundering Act, 2002 has not been extended.
Therefore, there is no occasion for this Court also to extend the period
prescribed.
11. Placing reliance on the judgment of the Supreme Court in New
India Assurance Co. Ltd. vs. Hilli Multipurpose Cold Storage Pvt. Ltd.
(2015) 16 SCC 20 and in Central Bureau of Investigation & Ors. vs.
Keshub Mahindra & Ors. (2011) 6 SCC 216, he submits that where the
WP(C) No.3551/2020 Page 4
statute does not vest any power with the Court to extend the period
prescribed in the Act, the same must prevail and the Court cannot ignore
the same on ground of equity.
12. He submits that even the Supreme Court would not have such
power under Article 142 of the Constitution, leave alone this Court under
Article 226 of the Constitution. In this regard, he places reliance on the
judgment of the Supreme Court in Assistant Commissioner (CT) LTU,
Kakinada & Ors. vs. Glaxo Smith Kline Consumer Health Care Ltd.
2020 SCC OnLine SC 440.
13. In the alternative, he submits that even if the period of the
lockdown declared by the Government of India has to be excluded, that is
between 24.03.2020 to 20.04.2020, 180 days from passing of the
Provisional Attachment Order would have expired by 16.06.2020, which
was the next date of hearing, rendering the Adjudicating Authority
functus officio thereafter.
14. He further submits that this Court on 06.07.2020 was pleased to
stay further proceedings in the Complaint pending before the
Adjudicating Authority. The period of 180 days having already expired
as on 06.07.2020, even the benefit of the proviso to Section 5(1) of the
Act would not be available to extend the period of validity of the
Provisional Attachment Order.
RESPONDENTS SUBMISSIONS:
15. On the other hand, the learned counsel for the respondents submits
that the Supreme Court by the above referred orders passed in Suo Moto
WP(C) No.3551/2020 Page 5
W.P.(C) No.3/2020, has extended the period of limitation for various
proceedings, which would also include proceedings before the
Adjudicating Authority. He submits that the period of the Provisional
Attachment Order, therefore, stands extended in terms of the said orders
of the Supreme Court. Placing reliance on sub-section (1) of Section 8 of
the Act, he submits that a notice of not less than 30 days has to be issued
by the Adjudicating Authority on receipt of the Complaint under sub-
section (5) of Section 5 of the Act. As the said period itself would get
extended in terms of the Supreme Court order, it cannot be said that the
Provisional Attachment Order would lose its validity only because such
notice could not be issued due to the lockdown declared by the
Government of India.
16. He further submits that the proceedings before the Adjudicating
Authority is in the nature of a quasi-judicial proceedings and it is settled
principal of law that a party cannot be prejudiced by the act or omission
of a Court. He submits that the delay in completion of the proceedings
before the Adjudicating Authority, not being attributable to the
respondents, the respondents cannot be prejudiced by the same.
17. I have considered the submissions made by the learned counsels
for the parties.
REASONING AND FINDING:
18. Sub-section (1) of Section 5 of the Act empowers the Director or
any other officer not below the rank of the Deputy Director authorized by
the Director of Enforcement in this regard, to pass an order provisionally
WP(C) No.3551/2020 Page 6
attaching property of a person „for a period not exceeding 180 days from
the date of the order‟. In terms of the third proviso to sub-section (1) of
Section 5, this period is extended by 30 days from the date of the order
vacating any stay order granted by the High Court on such Provisional
Attachment Order or proceedings before the Adjudicating Authority.
Sub-section (3) of Section 5 to the Act provides that every Provisional
Attachment Order passed under sub-section (1) of Section 5 of the Act,
shall cease to have effect after the expiry of the period of one hundred
and eighty days or on the date of the order made under sub-section (3) of
Section 8, "whichever is earlier". Therefore, one hundred and eighty days
from the date of the order passed under sub-section (1) of section 5 of the
Act, is the outer limit of the validity/life of such order and the same
ceases to remain in effect, by efflux of time, beyond that date, in case no
order confirming the Provisional Attachment Order is passed by the
Adjudicating Authority under sub-section (3) of Section 8 of the Act
prior thereto.
19. Sub-sections (1) and (3) of Section 5 of the Act are reproduced
herein below:
"5. Attachment of property involved in money-laundering. --
(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
WP(C) No.3551/2020 Page 7
(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.
xxxxx
WP(C) No.3551/2020 Page 8
(3) Every order of attachment made under sub-section (1) shall
cease to have effect after the expiry of the period specified in that
sub-section or on the date of an order made under sub-section (3)
of section 8, whichever is earlier.
(Emphasis supplied)
20. A reading of the above provisions would clearly show that one
hundred and eighty days from the passing of the Provisional Attachment
Order is not prescribed as a period of limitation to do a particular act, but
as the outer period of validity of the Provisional Attachment Order itself.
On expiry of the said period, in absence of an order passed by the
Adjudicating Authority under sub-section (3) of Section 8 of the Act, the
Provisional Attachment Order ceases to have effect or lapses on its own.
Such lapsing does not require any confirmation from the Authority or any
Court of law; it is automatic; it is preemptory in nature.
21. It is also to be noted that the Act, except in the third Proviso to
Section 5(1) of the Act, does not provide for any extension of validity of
the period of the Provisional Attachment Order. There are no exceptions;
there is no provision for extension.
22. "Attachment" is defined under Section 2(1)(d) of the Act to mean
as under:
"2(1)(d) "attachment" means prohibition of transfer,
conversion, disposition or movement of property by an order
issued under Chapter III."
WP(C) No.3551/2020 Page 9
23. Therefore, a reading of sub-section (1) of Section 5 with Section
2(1)(d) of the Act leaves no manner of doubt that the effect of the
Provisional Attachment Order is deprivation of the right to property.
24. Article 300A of the Constitution creates a Constitutional right in
every person to hold and enjoy his property, unless deprived by authority
of law. In M.C. Mehta (supra), the Supreme Court has emphasized that
when the statue prescribes a mode, the property deprivation cannot be
done in other modes. It was further emphasized that Statutes which
encroach upon rights, whether as regards person or property, are subject
to strict construction in the same way as penal Acts. They should be
interpreted, if possible, so as to respect such rights and if there is any
ambiguity, the construction which is in favour of the freedom of the
individual should be adopted; they must be given a strict construction. It
was further reiterated that when a statutory authority is required to do a
thing in a particular manner, the same must be done in that manner or not
at all. The State and other authorities while acting under the Act are only
creature of statute and must act within the four corners thereof. As
reference to various precedents was made in this judgment, I would like
to quote paragraph 107 of the same:-
"107. Article 300A of the Constitution provides that nobody can
be deprived of the property and right of residence otherwise in the
manner prescribed by law. When the statute prescribes a mode,
the property's deprivation cannot be done in other modes since
this Court did not authorize the Committee to take action in the
matter. An action could have been taken in no other manner except
in accordance with the procedure prescribed by law as laid down
in the decisions referred to at the Bar thus:
WP(C) No.3551/2020 Page 10
(a) State of Rajasthan v. Basant Nahata, (2005) 12 SCC 77,
wherein this Court observed:
"59. .....In absence of any substantive provisions contained
in a parliamentary or legislative act, he cannot be
refrained from dealing with his property in any manner
he likes. Such statutory interdict would be opposed to
one's right of property as envisaged under Article 300-A
of the Constitution."
(b) K.T. Plantation Pvt. Ltd. v. State of Karnataka, (2011) 9
SCC 1 in which it was opined:
"168. Article 300-A proclaims that no person can be
deprived of his property save by authority of law, meaning
thereby that a person cannot be deprived of his
property merely by an executive fiat, without any
specific legal authority or without the support of law made
by a competent legislature. The expression ―property‖ in
Article 300-A confined not to land alone, it includes
intangibles like copyrights and other intellectual property
and embraces every possible interest recognized by
law.
169. This Court in State of W.B. v. Vishnunarayan and
Associates (P) Ltd., while examining the provisions of the
West Bengal Great Eastern Hotel (Acquisition of
Undertaking) Act, 1980, held in the context of Article 300-A
that the State or executive officers cannot interfere with
the right of others unless they can point out the specific
provisions of law which authorizes their rights."
(emphasis supplied)
(c) In T.Vijayalakshmi vs. Town Planning Member, (2006) 8
SCC 502, the Court observed:
"13. Town Planning legislations are regulatory in nature.
The right to property of a person would include a right to
construct a building. Such a right, however, can be
restricted by reason of a legislation. In terms of the
WP(C) No.3551/2020 Page 11
provisions of the Karnataka Town and Country
Planning Act, a comprehensive development plan was
prepared. It indisputably is still in force. Whether the
amendments to the said comprehensive development plan as
proposed by the Authority would ultimately be accepted by
the State or not is uncertain. It is yet to apply its mind.
Amendments to a development plan must conform to
the provisions of the Act. As noticed hereinbefore, the
State has called for objection from the citizens.
Ecological balance no doubt is required to be
maintained and the Courts while interpreting a statute
should bestow serious consideration in this behalf, but
ecological aspects, it is trite, are ordinarily a part of
the town planning legislation. If in the legislation itself
or in the statute governing the field, ecological aspects
have not been taken into consideration keeping in view
the future need, the State and the Authority must take the
blame therefor. We must assume that these aspects of the
matter were taken into consideration by the Authority
and the State. But the rights of the parties cannot be
intermeddled with so long as an appropriate
amendment in the legislation is not brought into force.
***
15. The law in this behalf is explicit. Right of a person to
construct residential houses in the residential area is a
valuable right. The said right can only be regulated in
terms of a regulatory statute but unless there exists a
clear provision the same cannot be taken away. ......"
(emphasis supplied)
(d) In the matter of State of U.P. v. Manohar, (2005) 2 SCC
126, this Court observed:
―7. Ours is a constitutional democracy and the rights
available to the citizens are declared by the Constitution.
Although Article 19(1)(f) was deleted by the Forty-fourth
WP(C) No.3551/2020 Page 12
Amendment to the Constitution, Article 300-A has been
placed in the Constitution, which reads as follows:
"300-A. Persons not to be deprived of property save
by authority of law.-
No person shall be deprived of his property save by
authority of law."
8. This is a case where we find utter lack of legal
authority for deprivation of the respondent's property
by the appellants who are State authorities....."
(e) In Delhi Airtech Services (P) Ltd. v. State of U.P. (2011) 9 SCC
354, this Court held:
―83. The expression ―law‖ which figures both in Article 21
and Article 300-A must be given the same meaning. In
both the cases the law would mean a validly enacted
law. In order to be valid law it must be just, fair and
reasonable having regard to the requirement of
Articles 14 and 21 as explained in Maneka Gandhi.
This is especially so, as ―law‖ in both the Articles 21 and
300-A is meant to prevent deprivation of rights. Insofar
as Article 21 is concerned, it is a fundamental right
whereas in Article 300-A it is a constitutional right which
has been given a status of a basic human right.‖
(f) It was further argued that planning laws are expropriatory
and should be strictly construed, and any ambiguity is to be
construed in favour of the property owner as laid down in Delhi
Airtech Services (P) Ltd. v. State of U.P. (supra) thus:
―129. Statutes which encroach upon rights, whether as
regards person or property, are subject to strict
construction in the same way as penal Acts. It is a
recognised rule that they should be interpreted, if
possible, so as to respect such rights and if there is
any ambiguity, the construction which is in favour of the
freedom of the individual should be adopted. (See
WP(C) No.3551/2020 Page 13
Maxwell on The Interpretation of Statutes, 12 Edn. by P.
St. J. Langan.)
130. This Court in Devinder Singh held that the Land
Acquisition Act is an expropriatory legislation and
followed the case of Hindustan Petroleum Corpn. v. Darius
Shapur Chenai . Therefore, it should be construed strictly.
The Court has also taken the view that even in cases of
directory requirements, substantial compliance with
such provision would be necessary.‖
(emphasis supplied)
(g) In Ramchandra Ravindra Waghmare v. Indore Municipal
Corporation, (2017) 1 SCC 667, it was opined:
―67. It was also submitted that town planning and
municipal institutes are regulating and restricting the use
of private property under the aforesaid Acts. They are
―expropriatory legislation‖. Thus they are liable to be
construed strictly as laid down in Indore Vikas
Pradhikaran v. Pure Industrial Coke & Chemicals Ltd. ‖
(h) In Chairman, Indore Vikas Pradhikaran v. Pure Industrial
Coke & Chemicals Ltd., (2007) 8 SCC 705, it was held:
―57. The Act being regulatory in nature as by reason thereof
the right of an owner of property to use and develop
stands restricted, requires strict construction. An owner of
land ordinarily would be entitled to use or develop the same
for any purpose unless there exists certain regulation in a
statute or statutory rules. Regulations contained in such
statute must be interpreted in such a manner so as to
least interfere with the right to property of the owner of such
land. Restrictions are made in larger public interest. Such
restrictions, indisputably must be reasonable ones. (See
Balram Kumawat v. Union of India ; Krishi Utpadan
Mandi Samiti v. Pilibhit Pantnagar Beej Ltd. and Union
of India v. West Coast Paper Mills Ltd. ) The statutory
scheme contemplates that a person and owner of land
WP(C) No.3551/2020 Page 14
should not ordinarily be deprived from the user thereof
by way of reservation or designation.
58. Expropriatory legislation, as is well-known, must be
given a strict construction.‖
(i) In State of Gujarat v. Shantilal Mangaldas, (1969) 1 SCC 509,
it was held:
―55. ...... Once the draft town-planning scheme is
sanctioned, the land becomes subject to the provisions of
the Town Planning Act, and on the final town-planning
scheme being sanctioned, by statutory operation the title
of the various owners is readjusted and the lands
needed for a public purpose vest in the local authority.
Land required for any of the purposes of a town planning
scheme cannot be acquired otherwise than under the
Act, for it is a settled rule of interpretation of statutes
that when power is given under a statute to do a certain
thing in a certain way the thing must be done in that
way or not at all:‖
(emphasis supplied)
(j) In Bhavnagar University v. Palitana Sugar Mill (P) Ltd., (2003)
2 SCC 111, it was opined:
―40. The statutory interdict of use and enjoyment of the
property must be strictly construed. It is well settled that
when a statutory authority is required to do a thing in a
particular manner, the same must be done in that manner
or not at all. The State and other authorities while
acting under the said Act are only creature of statute. They
must act within the four corners thereof.‖
(emphasis supplied)
(k) In Shrirampur Municipal Council v. Satyabhamabai Bhimaji
Dawkher, (2013) 5 SCC 627 it was held:
―43. ...... This is the reason why time-limit of ten years has
been prescribed in Section 31(5) and also under Sections
WP(C) No.3551/2020 Page 15
126 and 127 of the 1966 Act for the acquisition of
land, with a stipulation that if the land is not acquired
within six months of the service of notice under Section
127 or steps are not commenced for acquisition,
reservation of the land will be deemed to have lapsed. Shri
Naphade's interpretation of the scheme of Sections 126 and
127, if accepted, will lead to absurd results and the
landowners will be deprived of their right to use the
property for an indefinite period without being paid
compensation. That would tantamount to depriving the
citizens of their property without the sanction of law
and would result in violation of Article 300-A of the
Constitution.‖
(emphasis supplied)
25. In the present case, the Act clearly deprives the person against
whom the Provisional Attachment Order is passed of his right to deal in
the property against which the attachment is ordered. Such deprivation
can therefore, be for a maximum of 180 days and no further, except
where such order is confirmed by the Adjudicating Authority prior
thereto under Section 8(3) of the Act. Once the 180 day period has lapsed
without such order being passed under Section 8(3) of the Act, the
Provisional Attachment Order ceases to have effect and therefore, there is
no order before the Adjudicating Authority to confirm under Section 8(3)
of the Act. The Adjudicating Authority therefore, becomes functus
officio.
26. As noted hereinabove, there is no power with any Authority or the
Court to relax or extend the validity of the Provisional Attachment Order.
In New India Assurance (supra), the Constitution Bench of the Supreme
WP(C) No.3551/2020 Page 16
Court while considering Section 13(2) of the Consumer Protection Act,
1986, providing for the time to file response to the complaint by the
respondent/opposite party and the power of the District Forum to extend
such time beyond 15 days, observed as under:-
"21. The legislature in its wisdom has provided for filing of
complaint or appeals beyond the period specified under the
relevant provisions of the Act and Regulations, if there is sufficient
cause given by the party, which has to be the satisfaction of the
concerned authority. No such discretion has been provided for
under Section 13(2)(a) of the Consumer Protection Act for filing a
response to the complaint beyond the extended period of 45 days
(30 days plus 15 days). Had the legislature not wanted to make
such provision mandatory but only directory, the provision for
further extension of the period for filing the response beyond 45
days would have been provided, as has been provided for in the
cases of filing of complaint and appeals. To carve out an
exception in a specific provision of the statute is not within the
jurisdiction of the Courts, and if it is so done, it would amount to
legislating or inserting a provision into the statute, which is not
permissible."
27. It was further held that there may be some hardship or
inconvenience caused to either party with strict compliance with a
statutory provision, however, the Court has no choice but to enforce it in
full rigor, so as to achieve the object of the statute; law prevails over
equity, as equity can only supplement the law, and not supplant it.
Paragraphs 23 to 29 of the judgment can be usefully quoted hereinunder:-
"23. This Court in the case of Lachmi Narain v. Union of India,
(1976) 2 SCC 953 has held that ―if the provision is couched in
prohibitive or negative language, it can rarely be directory, the use
of peremptory language in a negative form is per se indicative of
WP(C) No.3551/2020 Page 17
the interest that the provision is to be mandatory‖. Further,
hardship cannot be a ground for changing the mandatory nature of
the statute, as has been held by this Court in Bhikraj Jaipurai v.
Union of India, AIR 1962 SC 113=(1962) 2 SCR 880 and
Fairgrowth Investments Ltd. v. Custodian, (2004) 11 SCC 472.
Hardship cannot thus be a ground to interpret the provision so as
to enlarge the time, where the statute provides for a specific time,
which, in our opinion, has to be complied in letter and spirit.
24. This Court, in the case of Rohitash Kumar v. Om Prakash
Sharma, (2013) 11 SCC 451 has, in paragraph 23, held as under:
―23. There may be a statutory provision, which causes great
hardship or inconvenience to either the party concerned, or
to an individual, but the Court has no choice but to enforce
it in full rigor. It is a well settled principle of interpretation
that hardship or inconvenience caused, cannot be used as a
basis to alter the meaning of the language employed by the
legislature, if such meaning is clear upon a bare perusal of
the statute. If the language is plain and hence allows only
one meaning, the same has to be given effect to, even if it
causes hardship or possible injustice.‖
25. While concluding, it was observed ―that the hardship caused
to an individual, cannot be a ground for not giving effective and
grammatical meaning to every word of the provision, if the
language used therein, is unequivocal.‖
26. Further, it has been held by this Court in the case of Popat
Bahiru Govardhane v. Special Land Acquisition Officer, (2013) 10
SCC 765 that the law of limitation may harshly affect a particular
party but it has to be applied with all its vigour when the statute so
prescribes and that the Court has no power to extend the period of
limitation on equitable grounds, even if the statutory provision may
cause hardship or inconvenience to a particular party.
27. The contention of the learned Counsel for the respondent is
that by not leaving a discretion with the District Forum for
extending the period of limitation for filing the response before it
by the opposite party, grave injustice would be caused as there
WP(C) No.3551/2020 Page 18
could be circumstances beyond the control of the opposite party
because of which the opposite party may not be able to file the
response within the period of 30 days or the extended period of 15
days. In our view, if the law so provides, the same has to be strictly
complied, so as to achieve the object of the statute. It is well settled
that law prevails over equity, as equity can only supplement the
law, and not supplant it.
28. This Court, in the case of Laxminarayan R. Bhattad v. State
of Maharashtra, (2003) 5 SCC 413, has observed that ―when there
is a conflict between law and equity the former shall prevail.‖ In
P.M. Latha v. State of Kerala, (2003) 3 SCC 541, this Court held
that ―Equity and law are twin brothers and law should be applied
and interpreted equitably, but equity cannot override written or
settled law.‖ In Nasiruddin v. Sita Ram Agarwal, (2003) 2 SCC
577, this Court observed that ―in a case where the statutory
provision is plain and unambiguous, the court shall not interpret
the same in a different manner, only because of harsh
consequences arising therefrom.‖ In E.Palanisamy v. Palanisamy,
(2003) 1 SCC 123, it was held that ―Equitable considerations have
no place where the statute contained express provisions.‖ Further,
in India House v. Kishan N. Lalwani, (2003) 9 SCC 393, this Court
held that ―The period of limitation statutorily prescribed has to be
strictly adhered to and cannot be relaxed or departed from by
equitable considerations.‖
29. It is thus settled law that where the provision of the Act is
clear and unambiguous, it has no scope for any interpretation on
equitable ground."
28. In view of the above dicta, the submission of the learned counsel
for the respondents that as the delay in proceedings before the
Adjudicating Authority cannot be blamed on the respondents, the
respondents must not be penalized and the time period should be
extended, cannot be accepted. It is not a question of penalization of the
WP(C) No.3551/2020 Page 19
respondents for the delay, but of application of the mandate of law from
which there is no escape. Equally, the principle of Actus Curiae Neminem
Gravabit can also have no application.
29. The reliance of the learned counsel for the respondents on the
orders passed by the Supreme Court in Suo Motu Writ Petition (Civil)
No. 3/2020, is also unfounded. The Supreme Court, in its order dated
23.03.2020, directed as under:-
"This Court has taken Suo Motu cognizance of the situation arising
out of the challenge faced by the country on account of Covid-19
Virus and resultant difficulties that may be faced by litigants
across the country in filing their petitions/applications/suits/
appeals/all other proceedings within the period of limitation
prescribed under the general law of limitation or under Special
Laws (both Central and/or State).
To obviate such difficulties and to ensure that lawyers/litigants do
not have to come physically to file such proceedings in respective
Courts/Tribunals across the country including this Court, it is
hereby ordered that a period of limitation in all such proceedings,
irrespective of the limitation prescribed under the general law or
Special Laws whether condonable or not shall stand extended
w.e.f. 15th March 2020 till further order/s to be passed by this
Court in present proceedings.
We are exercising this power under Article 142 read with Article
141 of the Constitution of India and declare that this order is a
binding order within the meaning of Article 141 on all
Courts/Tribunals and authorities."
30. Clearly, the above order extended the period of limitation. In the
present case, Section 5(1) and 5(3) do not provide the period of
WP(C) No.3551/2020 Page 20
limitation, but the period of validity of the Provisional Attachment Order.
The same would not stand extended due to the above order of the
Supreme Court. This becomes more evident from the order dated
06.05.2020 passed by the Supreme Court in I.A. 48411/2020, whereby it
was pleased to extend the period of limitation prescribed under the
Arbitration and Conciliation Act, 1996 and under Section 138 of the
Negotiable Instruments Act, 1881, observing as under:-
"IA No.48411/2020 - FOR DIRECTIONS
By way of filing this application for directions, the applicant
has made the following prayer:
―To issue appropriate directions qua (i) arbitration
proceedings in relation to section 29A of the Arbitration and
Conciliation Act, 1996 and (ii) initiation of proceedings
under section 138 of the Negotiable Instruments Act,
1881;‖
In view of this Court's earlier order dated 23.03.2020
passed in Suo Motu Writ Petition (Civil) No.3/2020 and taking into
consideration the effect of the Corona Virus (COVID 19) and
resultant difficulties being faced by the lawyers and litigants and
with a view to obviate such difficulties and to ensure that
lawyers/litigants do not have to come physically to file such
proceedings in respective Courts/Tribunal across the country
including this Court, it is hereby ordered that all periods of
limitation prescribed under the Arbitration and Conciliation Act,
1996 and under section 138 of the Negotiable Instruments Act
1881 shall be extended with effect from 15.03.2020 till further
orders to be passed by this Court in the present proceedings.
In case the limitation has expired after 15.03.2020 then the
period from 15.03.2020 till the date on which the lockdown is
lifted in the jurisdictional area where the dispute lies or where the
WP(C) No.3551/2020 Page 21
cause of action arises shall be extended for a period of 15 days
after the lifting of lockdown.
In view of the above, the instant interlocutory application is
disposed of."
31. In fact, the most relevant in this series of orders to the present
controversy is the order dated 10.07.2020, which clearly shows that the
above referred two orders of the Supreme Court were only in relation to
the period of limitation and did not extend the period to do something
required under a Statute or the period of validity of an order, as in the
present case. Realizing such difference, the Supreme Court extended the
period to pass an Arbitral Award under Section 29A and for completion
of pleadings under Section 23(4) of the Arbitration and Conciliation Act,
1996 as also for completing the process of compulsory pre-litigation,
mediation and settlement under Section 12A of the Commercial Courts
Act, 2015, however, refused to extend the period of validity of a cheque.
This itself shows that the orders of the Supreme Court are not a universal
extension of time across the board, be it limitation or period prescribed
for doing a particular thing, or as in the present case, the period of
validity of an order. For ready reference, the order dated 10.07.2020 is
quoted hereinbelow:-
"Parties have prayed to this Court for extending the time
where limitation is to expire during the period when
there is a lockdown in view of COVID-19 or the time to
perform a particular act is to expire during the lockdown.
I.A. No. 49221/2020 -Section 29A of the Arbitration and
Conciliation Act, 1996
WP(C) No.3551/2020 Page 22
Taken on Board.
In Suo Moto Writ Petition (C) No. 3/2020, by our order
dated 23.03.2020 and 06.05.2020, we ordered that all
periods of limitation prescribed under the Arbitration and
Conciliation Act, 1996 shall be extended w.e.f. 15.03.2020
till further orders.
Learned Attorney General has sought a minor modification
in the aforesaid orders.
Section 29A of the Arbitration and Conciliation Act, 1996
does not prescribe a period of limitation but fixes a time to
do certain acts, i.e. making an arbitral award within a
prescribed time. We, accordingly, direct that the aforesaid
orders shall also apply for extension of time limit for passing
arbitral award under Section 29A of the said Act.
Similarly, Section 23(4) of the Arbitration and Conciliation
Act, 1996 provides for a time period of 6 months for the
completion of the statement of claim and defence. We,
accordingly, direct that the aforesaid orders shall also apply
for extension of the time limit prescribed under Section
23(4) of the said Act.
The application is disposed of accordingly.
Pre-Institution Mediation and Settlement under Section
12A of the Commercial Courts Act, 2015.
Under Section 12A of the Commercial Courts Act, 2015,
time is prescribed for completing the process of compulsory
pre-litigation, mediation and settlement. The said time is
also liable to be extended. We, accordingly, direct that the
said time shall stand extended from the time when the
lockdown is lifted plus 45 days thereafter. That is to say that
if the above period, i.e. the period of lockdown plus 45 days
has expired, no further period shall be liable to be excluded.
I.A. No. 48461/2020- Service of all notices, summons and
exchange of pleadings
WP(C) No.3551/2020 Page 23
Service of notices, summons and exchange of
pleadings/documents, is a requirement of virtually every
legal proceeding. Service of notices, summons and
pleadings etc. have not been possible during the
period of lockdown because this involves visits to post
offices, courier companies or physical delivery of
notices, summons and pleadings. We, therefore, consider
it appropriate to direct that such services of all the above
may be effected by e-mail, FAX, commonly used instant
messaging services, such as WhatsApp, Telegram, Signal
etc. However, if a party intends to effect service by means
of said instant messaging services, we direct that in
addition thereto, the party must also effect service of the
same document/documents by e-mail, simultaneously on the
same date.
Extension of validity of Negotiable Instruments Act, 1881-
I.A. Nos. 48461 and 48672/2020 (IA. No. 48671/2020,
48673/2020)
I.A. No. 48671/2020 for impleadment is allowed.
With reference to the prayer, that the period of validity of a
cheque be extended, we find that the said period has
not been prescribed by any Statute but it is a period
prescribed by the Reserve Bank of India under Section
35-A of the Banking Regulation Act,1949. We do not
consider it appropriate to interfere with the period
prescribed by the Reserve Bank of India, particularly, since
the entire banking system functions on the basis of the
period so prescribed.
The Reserve Bank of India may in its discretion, alter such
period as it thinks fit. Ordered accordingly.
The instant applications are disposed of accordingly.‖
(Emphasis supplied)
32. The above distinction is also apparent to the Government of India
as it promulgated The Taxation and Other Laws (Relaxation of Certain
WP(C) No.3551/2020 Page 24
Provisions) Ordinance, 2020 on 31.03.2020, extending the time limit for
completion of any proceedings or passing of any order etc. specified in
the Acts specified therein. However, the Prevention of Money
Laundering Act, 2002 is not one of the "specified Acts" under the
Ordinance. Therefore, the respondents cannot take benefit of even this
Ordinance. On the other hand, the Ordinance clearly shows that the
reliance of the respondents on the orders of the Supreme Court is liable to
be rejected.
33. The reliance of the learned counsel for the respondents on Section
8(1) of the Act to contend that the orders of Supreme Court would apply
to extend the validity of the Provisional Attachment Order, is also
unfounded and is liable to be rejected. Section 8(1) does not again,
provide for any period of limitation but for a period of notice. It reads as
under:-
8. Adjudication.-- (1) On receipt of a complaint under
sub- section (5) of section 5, or applications made under
sub- section (4) of section 17 or under sub-section (10) of
section 18, if the Adjudicating Authority has reason to
believe that any person has committed an offence under
section 3 or is in possession of proceeds of crime, it may
serve a notice of not less than thirty days on such person
calling upon him to indicate the sources of his income,
earning or assets, out of which or by means of which he has
acquired the property attached under sub-section (1) of
section 5, or, seized or frozen under section 17 or section
18, the evidence on which he relies and other relevant
information and particulars, and to show cause why all or
any of such properties should not be declared to be the
properties involved in money-laundering and confiscated
by the Central Government:
WP(C) No.3551/2020 Page 25
Provided that where a notice under this sub-section specifies
any property as being held by a person on behalf of any
other person, a copy of such notice shall also be served
upon such other person:
Provided further that where such property is held jointly by
more than one person, such notice shall be served to all
persons holding such property."
(Emphasis supplied)
34. At this stage reference to the judgment of the Supreme Court in S.
Kasi (supra) would also be apposite. The Supreme Court while
considering the effect of the order dated 23.03.2020 passed in Suo Moto
W.P.(C) No. 3/2020 on the right of the accused under Section 167(2) of
the Code of Criminal Procedure to be released on bail on non-submission
of charge sheet within the prescribed period by the prosecution, held as
under:-
"16. The reason for passing the aforesaid order for extending the
period of limitation w.e.f. 15.03.2020 for filing
petitions/applications/suits/ appeals/all other proceedings are
indicated in the order itself. Two reasons, which are decipherable
from the order of this Court dated 23.03.2020 for passing the
order are :-
i) The situation arising out of the challenge faced by the
country on account of Covid-19 virus and resultant difficulties that
are being faced by the litigants across the country in filing their
petitions/applications /suits /appeals/ all other proceedings within
the period of limitation prescribed.
ii) To obviate such difficulties and to ensure that lawyers
/litigants do not have to come physically to file such proceedings
WP(C) No.3551/2020 Page 26
in respective Courts/Tribunals across the country including this
Court.
17. The limitation for filing petitions/ applications/
suits/appeals/all other proceedings was extended to obviate
lawyers /litigants to come physically to file such proceedings in
respective Courts/Tribunals. The order was passed to protect the
litigants/lawyers whose petitions/ applications/ suits/appeals/all
other proceedings would become time barred they being not able
to physically come to file such proceedings. The order was for the
benefit of the litigants who have to take remedy in law as per the
applicable statute for a right. The law of limitation bars the
remedy but not the right. When this Court passed the above order
for extending the limitation for filing petitions/ applications/
suits/appeals/all other proceedings, the order was for the benefit of
those who have to take remedy, whose remedy may be barred by
time because they were unable to come physically to file such
proceedings. The order dated 23.03.2020 cannot be read to mean
that it ever intended to extend the period of filing charge sheet by
police as contemplated under Section 167(2) of the Code of
Criminal Procedure. The Investigating Officer could have
submitted/filed the charge sheet before the (Incharge) Magistrate.
Therefore, even during the lockdown and as has been done in so
many cases the charge-sheet could have been filed /submitted
before the Magistrate (Incharge) and the Investigating officer was
not precluded from filing/submitting the charge-sheet even within
the stipulated period before the Magistrate(Incharge)
18. If the interpretation by the learned Single Judge in the
impugned judgment is taken to its logical end, due to difficulties
and due to present pandemic, Police may also not produce an
accused within 24 hours before the Magistrate's Court as
contemplated by Section 57 of the Code of Criminal Procedure,
1973. As noted above, the provision of Section 57 as well as
Section 167 are supplementary to each other and are the
provisions which recognizes the Right of Personal Liberty of a
person as enshrined in the Constitution of India. The order of this
Court dated 23.03.2020 never meant to curtail any provision of
WP(C) No.3551/2020 Page 27
Code of Criminal Procedure or any other statute which was
enacted to protect the Personal Liberty of a person. The right of
prosecution to file a charge sheet even after a period of 60 days
/90 days is not barred. The prosecution can very well file a charge
sheet after 60 days /90 days but without filing a charge sheet they
cannot detain an accused beyond a said period when the accused
prays to the court to set him at liberty due to non-filing of the
charge sheet within the period prescribed. The right of
prosecution to carry on investigation and submit a charge sheet
is not akin to right of liberty of a person enshrined under Article
21 and reflected in other statutes including Section 167, Cr.P.C.
Following observations of Madras High Court in the impugned
judgment are clearly contrary to the order dated 23.03.2020 of this
Court:-
"....The Supreme Court order eclipses all provisions prescribing
period of limitation until further orders. Undoubtedly, it eclipses
the time prescribed under Section167 (2) of the Code of Criminal
Procedure also....""
35. The above judgment clearly highlights the reason and the limit of
the order dated 23.03.2020 passed by the Supreme Court. It also
highlights that the said order was never meant to curtail any provision of
other statute which is enacted to protect the personal liberty of a person.
In my opinion, in a similar manner, the order dated 23.03.2020 was not
meant to deny any person his/her property rights.
36. I may also usefully refer to the order of the Calcutta High Court in
Knight Riders Sports Pvt. Ltd. vs. Adjudicating Authority (PMLA) and
Ors., 2020 SCC OnLine Cal 1311, wherein allowing the petitioner
therein to withdraw his petition, the High Court observed as under:-
WP(C) No.3551/2020 Page 28
"5. On hearing learned counsel, this Court is of the view that
under Section 5(1)(b) of the PMLA, an order of provisional
attachment remains in force only for a period of 180 days from the
date of the order passed by the Director with regard to the
proceeds of crime which the concerned Director has reasons to
believe are likely to be concealed, transferred or dealt with in a
manner which may frustrate any proceedings relating to
confiscation of such proceeds of crime under Chapter III of the
PMLA. Section 5(3) further provides that every order of
attachment made under Section 5(1) shall cease to have effect after
the expiry of 180 days or on the date of an order made under
Section 8(3) or whichever is earlier. Section 8(3) deals with a
situation where the Adjudicating Authority makes an order in
writing confirming the attachment of the property made under
Section 5(1) or for retention of the property etc. Admittedly, no
such order has been passed by the Adjudicating Authority against
the petitioner under Section 8(3). It should be mentioned that the
Adjudicating Authority has been served with copies of the petition.
6. If the concerned Act provides certain windows to a party in
relation to a provisional order of attachment expressed in the clear
language of Section 5(1)(b), this Court cannot come in the way of
the petitioner taking advantage of the said exit route. Needless to
say, allowing withdrawal of this petition will not prejudice any of
the rights or contentions of the parties in the event of future
proceedings before this Court or any other forum."
37. In view of the above, the 180 days from the date of the Provisional
Attachment Order dated 13.11.2019 having expired without any order
under Section 8(3) of the Act being passed by the Adjudicating
Authority, it is held that the Adjudicating Authority has been rendered
functus officio and cannot proceed with the Original Complaint, being
O.C. No. 1228/2019 pending before it. The Notice/Summons dated
26.05.2020 is accordingly set aside.
WP(C) No.3551/2020 Page 29
38. In the present case I have intentionally refrained myself from
making any comment on whether the period of total lockdown declared
by the Central Government, that is from 24.03.2020 to 20.04.2020, can
be excluded for computation of the 180 days, as it is not disputed that
even on exclusion of this period, the 180 days would have expired on
16.06.2020, the returnable date of the notice issued by the Adjudicating
Authority.
39. Accordingly, the petition is allowed. There shall be no order as to
costs.
NAVIN CHAWLA, J
NOVEMBER 18, 2020
RN
WP(C) No.3551/2020 Page 30
