Karnataka High Court
The Joint Director vs Smt. Saraswathi on 10 September, 2025
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NC: 2025:KHC:35887-DB
MSA No. 58 of 2018
C/W MSA No. 68 of 2018
MSA No. 69 of 2018
HC-KAR AND 3 OTHERS
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 10TH DAY OF SEPTEMBER, 2025
PRESENT
THE HON'BLE MR. JUSTICE D K SINGH
AND
THE HON'BLE MR. JUSTICE VENKATESH NAIK T
MISCELLANEOUS SECOND APPEAL NO. 58 OF 2018
C/W
MISCELLANEOUS SECOND APPEAL NO. 68 OF 2018
MISCELLANEOUS SECOND APPEAL NO. 69 OF 2018
MISCELLANEOUS SECOND APPEAL NO. 70 OF 2018
MISCELLANEOUS SECOND APPEAL NO. 71 OF 2018
MISCELLANEOUS SECOND APPEAL NO. 72 OF 2018
IN MSA No. 58/2018
BETWEEN:
Digitally signed
by VASANTHA
KUMARY B K S V SRINIVAS
Location: HIGH S/O SKV CHALAPATHY,
COURT OF AGED ABOUT 41 YEARS
KARNATAKA R/AT NO.20, 18TH CROSS, 8TH MAIN,
MALLESHWARAM, BENGALURU-560085
...APPELLANT
(BY SRI. SWAROOP ANAND R., ADVOCATE)
AND:
JOINT DIRECTOR
DIRECTORATE OF ENFORCEMENT,
3RD FLOOR, B BLOCK, BMTC BUILDING,
SHANTHINAGAR TTMC, KH ROAD,
BENGALURU -560020
...RESPONDENT
(BY SRI. MADHUKAR DESPHANDE, SCGSC)
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NC: 2025:KHC:35887-DB
MSA No. 58 of 2018
C/W MSA No. 68 of 2018
MSA No. 69 of 2018
HC-KAR AND 3 OTHERS
THIS MSA IS FILED UNDER SECTION 42 OF THE
PREVENTION OF MONEY LAUNDERING ACT, 2002, AGAINST
THE ORDER DATED 11.05.2018 PASSED IN FPA-PMLA-
446/BNG/2013 ON THE FILE OF THE APPELLATE TRIBUNAL,
PREVENTION OF MONEY LAUNDERING ACT, NEW DELHI,
DISPOSING THE ABOVE APPEAL HEREBY HOLDING THAT THE
APPELLANT SHALL ALSO FILE AN UNDERTAKING BY WAY OF
AFFIDAVIT, THAT IN CASE THE APPELLANT IS FINALLY HELD
GUILTY IN THE PROSECUTION COMPLAINT, HE SHALL DEPOSIT
A SUM OF RS.10.LAKH (TEN LAKH ONLY) WITH THE
RESPONDENT AS THE SAID AMOUNT WAS SPENT BY HIM FOR
RENOVATION OS HIS FATHER'S PROPERTY AS PER ALLEGED
ALLEGATION MADE IN THE PROSECUTION COMPLAINT. ONCE
THE FIXED DEPOSIT RECEIPT AND UNDERTAKING ARE FILED
BY THE APPELLANT WITH THE RESPONDENT WITHIN THE TIME
GRANTED, THE ABOVE NAMED TWO PROPERTIES SHALL
STAND RELEASED. THE SAID DIRECTIONS ARE PASSED
WITHOUT PREJUDICE AND ALSO CLARIFIED THAT IN CASE THE
PROSECUTION COMPLAINT IS DECIDED IN FAVOUR OF
S.V.SRINIVAS AND HIS WIFE RESHMA, THE SAID AMOUNT
SHALL BE RELEASED TO THEM BY THE RESPONDENT
IMMEDIATELY AND ETC.
IN MSA NO. 68/2018
BETWEEN:
THE JOINT DIRECTOR
DIRECTORATE OF ENFORCEMENT,
BENGALURU ZONAL OFFICE,
3RD FLOOR, B BLOCK, BMTC,
SHANTINAGAR-TTMC, KH ROAD, SHANTINAGAR,
BENGALURU -560 027
REP. BY ITS ASSISTANT DIRECTOR
MR.M.N.THYAGARAJ.
...APPELLANT
(BY SRI. MADHUKAR M DESHPANDE., ADVOCATE)
AND:
SRI S K V CHALAPATHI
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NC: 2025:KHC:35887-DB
MSA No. 58 of 2018
C/W MSA No. 68 of 2018
MSA No. 69 of 2018
HC-KAR AND 3 OTHERS
AGED BY MAJOR,
R/AT NO.20, 18TH CROSS, 8TH MAIN,
MALLESHWARAM,
BENGALURU -560 055.
...RESPONDENT
(BY SRI. SWAROOP ANAND R., ADVOCATE)
THIS MSA IS FILED UNDER SEC. 42 OF THE
PREVENTION OF MONEY LAUNDERING ACT, 2002 PRAYING
TO SET ASIDE THE IMPUGNED ORDER DATED 11.05.2018
PASSED BY THE HONORABLE APPELLATE TRIBUNAL (THE
PREVENTION OF MONEY LAUNDERING ACT), NEW DELHI,
IN FPA-PMLA-449/BNG/2013 ALLOWING THE APPEAL AND
SETTING ASIDE THE IMPUGNED ORDER AGAINST THE
APPELLANT, CONSEQUENTLY THE PROVISIONAL
ATTACHMENT ORDER WITH REGARD TO PRESENT
APPELLANT IS ALSO QUASHED. THIS PROPERTY IS
RELEASED FORTHWITH.
IN MSA NO. 69/2018
BETWEEN:
THE JOINT DIRECTOR
DIRECTORATE OF ENFORCEMENT,
BENGALURU ZONAL OFFICE,
3RD FLOOR, B BLOCK, BMTC,
SHANTINAGAR-TTMC, KH ROAD,
SHANTINAGAR,
BENGALURU -560 027
REP BY ITS ASSISTANT DIRECTOR
MR.M.N.THYAGARAJ.
...APPELLANT
(BY SRI. MADHUKAR DESHPANDE., ADVOCATE)
AND:
SMT. SARASWATHI
W/O SRI S.K.V. CHALAPATHY,
AGED BY MAJOR,
R/AT NO.20, 18TH CROSS,
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NC: 2025:KHC:35887-DB
MSA No. 58 of 2018
C/W MSA No. 68 of 2018
MSA No. 69 of 2018
HC-KAR AND 3 OTHERS
8TH MAIN, MALLESHWARAM,
BENGALURU -560 055.
...RESPONDENT
(BY SRI. SWAROOP ANAND R., ADVOCATE)
THIS MSA IS FILED UNDER SECTION 42 OF THE
PREVENTION OF MONEY LAUNDERING ACT, 2002 PRAYING
TO SET ASIDE THE IMPUGNED ORDER DATED 11.05.2018
PASSED BY THE HONBLE APPELLATE TRIBUNAL(THE
PREVENTION OF MONEY LAUNDERING ACT) NEW DELHI IN
FPA-PMLA-448/BNG/2013 (ANNEXURE - A) AND TO GRANT
SUCH OTHER RELIEFS TO THE APPELLANT,IN THE
INTEREST OF JUSTICE AND EQUITY.
IN MSA NO. 70/2018
BETWEEN:
THE JOINT DIRECTOR
DIRECTORATE OF ENFORCEMENT
BENGALURU ZONAL OFFICE,
3RD FLOOR, B BLOCK, BMTC
SHANTINAGAR-TTMC,
KH ROAD, SHANTINAGAR,
BENGALURU - 560027
REPRESENTED BY ITS ASSISTANT DIRECTOR
MR M N THYAGARAJ
...APPELLANT
(BY SRI. MADHUKAR DESHPANDE., ADVOCATE)
AND:
SMT. SARASWATHI
W/O SRI S K V CHALAPATHY
AGED BY MAJOR,
RESIDING AT NO.20, 18TH CROSS
8TH MAIN, MALLESHWARAM
BENGALURU 560055
...RESPONDENT
(BY SRI. SWAROOP ANAND R., ADVOCATE)
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NC: 2025:KHC:35887-DB
MSA No. 58 of 2018
C/W MSA No. 68 of 2018
MSA No. 69 of 2018
HC-KAR AND 3 OTHERS
THIS MSA IS FILED UNDER SEC.42 OF THE
PREVENTION OF MONEY LAUNDERING ACT, 2002 PRAYING
TO SET ASIDE THE IMPUGNED ORDER DATED 11.05.2018
PASSED BY THE HONBLE APPELLATE TRIBUNAL (THE
PREVENTION OF MONEY LAUNDERING ACT), NEW DELHI,
INFPA-PMLA-456/BNG/2013 (ANNEXURE - A) AND TO
GRANT SUCH OTHER RELIEFS TO THE APPELLANT, IN THE
INTEREST OF JUSTICE AND EQUITY.
IN MSA NO. 71/2018
BETWEEN:
THE JOINT DIRECTOR
DIRECTORATE OF ENFORCEMENT,
BENGALURU ZONAL OFFICE,
3RD FLOOR, B BLOCK, BMTC,
SHANTINAGAR-TTMC, K.H. ROAD,
SHANTHINAGAR, BENGALURU -560 027,
REPRESENTED BY ITS ASSISTANT DIRECTOR,
MR. M. N. THYAGARAJ.
...APPELLANT
(BY SRI. MADHUKAR M DESHPANDE., ADVOCATE)
AND:
SRI. S. V. SRINIVAS
S/O. SRI. S. K.V. CHALAPATHY,
AGED BY MAJOR,
RESIDING AT NO. 20, 18TH CROSS,
8TH MAIN, MALLESHWARAM,
BENGALURU -560 055.
...RESPONDENT
(BY SRI. SWAROOP ANAND R., ADVOCATE)
THIS MSA IS FILED UNDER SECTION 42 OF THE
PREVENTION OF MONEY LAUNDERING ACT, 2002 PRAYING
TO SET ASIDE THE IMPUGNED ORDER DATED 11.05.2018
PASSED BY THE HON'BLE APPELLATE
COMP.Y.11,4,2022TRIBUNAL(THE PREVENTION OF MONEY
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MSA No. 58 of 2018
C/W MSA No. 68 of 2018
MSA No. 69 of 2018
HC-KAR AND 3 OTHERS
LAUNDERING ACT,) NEW DELHI IN FPA-PMLA-
446/BNG/2013 (ANNEXURE A) AND TO GRANT SUCH
OTHER RELIEFS TO THE APPELLANT, IN THE INTEREST OF
JUSTICE AND EQUITY.
IN MSA NO. 72/2018
BETWEEN:
THE JOINT DIRECTOR
DIRECTORATE OF ENFORCEMENT
BENGALURU ZONAL OFFICE,
3RD FLOOR, B BLOCK, BMTC,
SHANTINAGAR-TTMC,
KH ROAD, SHANTINAGAR
BENGALURU 560027
REPRESENTED BY ITS ASSISTANT DIRECTOR
MR M N THYAGARAJ
...APPELLANT
(BY SRI. MADHUKAR DESHPANDE., ADVOCATE)
AND:
SMT. RESHMA SRINIVAS
W/O SRI S V SRINIVAS
RESIDING AT NO.20, 18TH CROSS
8TH MAIN, MALLESHWARAM
BENGALURU 560055
...RESPONDENT
(BY SRI. SWAROOP ANAND R., ADVOCATE)
THIS MSA IS FILED UNDER SEC/42 OF THE
PREVENTION OF MONEY LAUNDERING ACT, 2002 AGAINST
THE ORDER DATED 11.05.2018 PASSED IN FPA-PMLA-
447/BNG/2013 ON THE FILE OF THE APPELLATE TRIBUNAL,
PREVENTION OF MONEY LAUNDERING ACT, NEW DELHI
DISPOSING ALL THE APPEALS AND PENDING
MPS/APPLICATIONS AND ETC.
THESE APPEALS, COMING ON FOR ADMISSION, THIS
DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:
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MSA No. 58 of 2018
C/W MSA No. 68 of 2018
MSA No. 69 of 2018
HC-KAR AND 3 OTHERS
CORAM: HON'BLE MR. JUSTICE D K SINGH
and
HON'BLE MR. JUSTICE VENKATESH NAIK T
ORAL JUDGMENT
(PER: HON'BLE MR. JUSTICE D K SINGH)
IN M.S.A No.58 OF 2018:
The present appeal is filed by the appellant under
Section 42 of the Prevention of Money Laundering Act,
2002 (for short 'the PMLA Act').
2. Being aggrieved by the order dated 11.05.2018
passed by the Appellate Tribunal, Prevention of Money
Laundering Act at New Delhi in MP-PMLA-3146/BNG/2017,
MP-PMLA-1595/BNG/2015, FPA-PMLA-446/BNG/2013, the
miscellaneous appeal has been filed.
3. The Adjudicating Authority passed an
attachment order against the four properties belonging to
the family of the appellant. The appellant was arrayed as
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HC-KAR AND 3 OTHERS
accused No.3 in the schedule offence, which was
numbered as SPL CC 135/2011.
4. The charge sheet against him was quashed by
this Court in Crl.P.No.5102/2015. He was also arrayed as
an accused in the Section 45 complaint filed by the Joint
Director numbered as SPL CC 124/2014.
5. It is not in dispute that the appellant has been
discharged in the PMLS case filed under Section 45 of the
PMLA Act. The Tribunal while considering the submissions
and the record, gave the direction that the appellant would
deposit Rs.4,12,112/- with Joint Director by way of fixed
deposit and he would file an undertaking by way of an
affidavit that in the case the appellant was finally held
guilty in the prosecution complaint filed under Section 45
of the PMLA Act, he would deposit a sum of
Rs.10,00,000/- with the Joint Director and the said
amount was spent by him for renovation of his father's
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HC-KAR AND 3 OTHERS
property as per the alleged allegation made in the
complaint.
6. In pursuance to the direction issued by the
Appellate Tribunal, the petitioner had deposited a sum of
Rs.4,12,112/- and also filed an affidavit of undertaking as
directed by the Tribunal.
7. As of the day, there are no complaints pending
against the petitioner and he is not facing prosecution
either for the schedule offence or under the PMLA Act, as
much as the criminal proceedings in respect of the
schedule offence came to be quashed by this Court and he
stands discharged in the proceedings under Section 45 of
the PMLA Act.
8. Learned counsel for the appellant therefore
submits that, in view of the subsequent development, the
direction issued by the Tribunal for making deposit of
Rs.4,12,112/- by filing an undertaking by way of affidavit
of making deposit of Rs.10,00,000/- in case the petitioner
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HC-KAR AND 3 OTHERS
could have been convicted had become inconsequence and
the petitioner may be permitted to withdrawn an amount
of Rs.4,12,112/- deposited by him in pursuance to the
direction issued by the PMLA Act.
9. Mr. Madhukar Deshpande, learned counsel
appearing for the respondent does not dispute the factual
aspect of the petitioner having been discharged in the
PMLA proceedings and the criminal proceedings has been
quashed by this Court for schedule offences. He also
submits that Rs.20,00,000/- amount received by the
appellant was part of the proceeds of crime, which he
spent for renovation of the house of his father and alleged
medical expenses, which he could not prove. He submits
that the proceedings are culminated against Katta
Subramanya Naidu the main accused, the amount for
which the attachment order was passed cannot be
released in favour of the appellant.
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HC-KAR AND 3 OTHERS
10. We considered the submissions of the advocate
on behalf of the learned counsel for the appellant
Sri.Swaroop Anand R., as well as Mr. Madukar Deshpande
learned counsel appearing for the respondent.
11. The Enforcement Directorate has not challenged
the order of discharge in the PMLA proceedings against the
petitioner till date.
12. In view of the aforesaid fact we dispose of the
appeal permitting the petitioner to file an application
before the PMLA Special Court under Section 8(6) of the
PMLA Act, for withdrawing the amount of Rs.4,12,112/-,
which he has deposited in pursuance to the direction
issued by the PMLA Tribunal in its order dated 11.05.2018
and the Special Court till decide the application in
accordance with law. So far as the direction of filing an
undertaking for making deposit of Rs.10,00,000/- in case
of the appellant's conviction that has lost its relevance in
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HC-KAR AND 3 OTHERS
as much as the petitioner stands discharged with PMLA
case.
13. With the aforesaid liberty for filing the
application, we dispose of this appeal.
IN M.S.A.Nos.68/2018, 69/2018,
70/2018, 71/2018 AND 72/2018:
In view of the judgement passed in the
M.S.A.No.58/2018, nothing survives in these appeals and
therefore, we dispose of these appeals in terms of the
judgement passed in M.S.A.No.58/2018.
Sd/-
(D K SINGH)
JUDGE
Sd/-
(VENKATESH NAIK T)
JUDGE
SSB
