Top Stories Property Seized by ED Must be Returned if PMLA Investigation Exceeds 365 Days: Delhi HC [Read Order] The Delhi HC observed that the property seized by the ED must be returned if the investigation conducted under the PMLA exceeds 365 days By Kalyani B. Nair – On February 8, 2024 3:22 pm – 2 mins read In a recent decision, the Delhi High Court observed that the property seized by the Enforcement Directorate ( ED ) must be returned if the investigation conducted under the Prevention of Money Laundering Act, 2002 ( PMLA ) exceeds 365 days. It was alleged that the Central Bureau of Investigation, against BPSL, its Directors, and the other Key Managerial Persons, on allegations of offences committed under Sections 120-B read with Sections 420, 468, 471 & 477A of the IPC, and Section 13(2) r/w 13(1) (d) of the Prevention of Corruption Act, 1988. The petitioner was neither named as an accused in the FIR nor was investigated by the CBI. He was neither summoned nor asked to join the investigation by the CBI in the said FIR.
The petitioner claimed that as no complaint against the petitioner was thereafter filed for a period of more than 365 days, the petitioner, sought the return of the seized documents and properties. As the respondent did not return the said properties nor gave any reply to the request of the petitioner, the petitioner has filed the present petition claiming the aforementioned reliefs. The counsel for the petitioner submitted that the reliance of the respondents on the Explanation to Section 8(3) of the PMLA also cannot be accepted inasmuch as there was no order passed by a Court staying the investigation. In fact, the respondent attached the properties of the petitioner post the order passed by the Court whereby the respondent was restrained from taking any coercive action against the petitioner.
The respondents did not even apply for seeking the vacation of the said order before carrying out the search and seizure. The counsel for the ED submitted that, in any case, Section 8(3)(a) does not provide for any consequence on the lapse of the period of 365 days inasmuch as it does not state that the order of seizure would thereafter lapse or that the documents and property seized must be returned to the person from whom it is seized. A Single Bench of Justice Navin Chawla observed that “Therefore, the natural consequence of the investigation for a period beyond three hundred and sixty five days not resulting in any proceedings relating to any offence under the Act, in terms of Section 8(3) of the PMLA, is that such seizure lapses and the property so seized must be returned to the person from whom it was so seized.”
“In view of the above, the respondents are directed to return the documents, digital devices, property, and other material seized from the petitioner pursuant to the search and seizure operation conducted on 19th and 20th August, 2020, forthwith to the petitioner, subject to any order to the contrary passed by any competent Court” the Court directed. To Read the full text of the Order CLICK HERE