,,,
FPA-PMLA-435/DLI/2013, FPA-PMLA-436/DLI/2013FPA-PMLA-474/DLI/2013, FPA-PMLA-462/DLI/2013 & FPA-PMLA-",,,
463/DLI/2013,,,
1. The above mentioned 5 (five) appeals have been filed against common order dated 15.02.2013 passed by the Adjudicating Authority in Original,,,
Complaint No. 166 of 2012 confirming the attachments made vide Provisional Attachment Order dated 04.10.2012 (PAO) in ECIR/09/HZO/2011.,,,
PAO passed corresponding to CC No. 8 of 2012 before the Special Judge for CBI Cases, Hyderabad (CBI Case). By this common order, we",,,
propose to decide all the above said five appeals.,,,
2. Two appeals have been filed by M/s Jagati and M/s Janani:,,,
1. FPA-PMLA-435/HYD/2013 - Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â M/s.Jagati Publications Pvt. Ltd.,,,
2. FPA-PMLA-436/HYD/2013 -Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â M/s.Janani Publications Pvt. Ltd.,,,
3. The rest of three appeals have been filed by private parties i.e. companies Aurobindo and Hetero & Group companies/investors.,,,
4. Following private parties,,,
3. FPA-PMLA-474/DLI/2013- Â Â Â Â Â Â Â Â Â Â Â Hetero Drugs (for short Hetero),,,
4. FPA-PMLA-462/DLI/2013- Â Â Â Â Â Â Â Â Â Â Â APL Research Centre.,,,
5. FPA-PMLA-463/DLI/2013- Â Â Â Â Â Â Â Â Â Â Â Aurobindo Pharma (for short Aurobindo),,,
(Herein after they would be referred as private parties),,,
5. The allegations against the private parties in Appeal nos. FPA-PMLA-474/DLI/2013, FPA-PMLA-462/DLI/2013 & FPA-PMLA-463/DLI/2013",,,
against Auroindo Pharma by CBI/ E.D contend that 75 acres of land in Industrial Development Area (IDA) Jedcharla was allotted by Andhra,,,
Pradesh Industrial Infrastructure Corporation (APIIC), IDA at the instance of the then Y.S Rajshekhar Reddy (Y.S.R) at a concessional price of Rs",,,
7 lakhs per acre instead of Rs 15 lakh per Acre. It is contended by respondent no. 1 that a benefit of Rs 8.6 Cr was derived by Aurobindo appellants,,,
in appeal no. FPA-PMLA-463/DLI/2013 with resultant loss of Rs. 12.26 crores to APIIC.,,,
6. Para 5.C of the Provisional Attachment Order No. 1/2012 dated 04.10.2012 reads as under:,,,
“The investigation carried out so far has thus established that the said criminal activities were carried out for the allotment/acquisition of,,,
the lands and to receive money in the form of equity contribution (in the said 2 companies) in lieu of the favour in the allotment/acquisition,,,
of lands at a lower rate, by the accused persons as per facts and circumstances of the case stated hereinabove. The said criminal activities",,,
have resulted into generation of the proceeds of crime. The amount of losses incurred by APIIC in the illegal allotment of lands to the,,,
companies at a lower rate and the amount of money received in lieu of illegal favour by way of investments in M/s Jagati Publications Pvt.,,,
Ltd. and M/s Janani Infrastructure Pvt. Ltd. are the proceeds of crime and in fact acquired as a result of the aforesaid criminal activities.â€,,,
[Emphasis supplied],,,
7. Attachments effected in the entire O.C. 166 of 2012 totaling to Rs. 51 Crs, the details are given as under:-",,,
i) M/s. Jagati Publications Pvt. Ltd. - Â Â Fixed Deposits worth for Rs 14.5 Crs.,,,
ii) M/s. Janani Publications Pvt. Ltd. - Land and properties for Rs 15 Crs.,,,
iii) Hetero Group - Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Immovable properties for Rs 8.61 Crs.,,,
iv) Aurobindo Pharma - Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Fixed deposits of Rs 3 Crs.,,,
v) APL Research Centre â€"                  Immovable properties of Rs 9.88 Crs.,,,
8. It is alleged by all the appellants that as the Provisional Attachment Order No. 1 of 2012 had been passed on 04.10.2012, i.e. prior to the coming",,,
into force of the Prevention of Money-Laundering (Amendment) Act, 2012, the present case is to be adjudicated under the unamended provisions of",,,
the Act.,,,
9. The following properties owned by the Aurobindo have been provisionally attached by the respondent no. 1 vide Provisional Attachment Order No.,,,
1/2012 dt. 04.10.2012:,,,
a. 95.095 Acres of land situated at Village Kota Bhogapuram, Bhogapuram Mandal, District Vizianagaram, Andhra Pradesh (Serial Nos. 7, 8, 10 to 41",,,
of the list of properties attached) valued at Rs. 9,71,50,640/-.",,,
b. 0.35 Acres of land situated at Village Lakshmipuram, Bhogapuram Mandal, District Vizianagaram, Andhra Prades (Serial No. 9 of the list of",,,
properties attached) valued at Rs. 2,30,060/-, which is incorrectly mentioned as being situated in Krishna District.",,,
c. 5 Acres of land at Village Borapatla, Hathnoora Mandal, Medak District, Andhra Pradesh (now State of Telengana) (Serial No. 42 of the list of",,,
properties attached) valued at Rs. 16,27,500/-.",,,
10. It is alleged by Aurobindo that substantial portion of the properties attached involves properties of APL Research Ltd., which is a 100% subsidiary",,,
of Aurobindo Pharma Ld. Pertinently, APL Research Centre Ltd. has not been accused of any crime whatsoever, whether of any Schedule Offence",,,
or any offence under the PMLA, nor is it alleged to be in possession of proceeds of crime.",,,
11. It is submitted by Aurobindo Pharma Ltd. that a fixed deposit No. 0033605 dated 29.08.2012 for a sum of Rs. 3 Crores owned by the Aurobindo,,,
Investor,"Alleged benefit (Rs.
Cr)","Investment into
Jagati","Investment into
Janani
Aurobindo &
promoters",8.6,3,-
Trident,4.3,7,-
Hetero,8.6,15,4.5
Total,21.5,25,4.5
,Total for 75 Acres,"Per acre cost for NUA of 45
Acres",
Lease Premium Paid,Rs. 5.25 Crores,Rs. 11.6 Lakhs,
Cost of Construction and
development of land",Rs. 4.49 Crore,Rs. 9.9 Lakhs,
Compensation paid to erstwhile
farmers",Rs. 1 Crore,Rs. 2.22 Lakhs,
Total Cost,Rs. 10.74 Crores,Rs. 23.58 Lakhs/acre,
would bely the fanciful claims of wrongful gain made by it in the Provisional Attachment Order. However, despite the appellant producing the same,",,,
the Ld. Adjudicating Authority has proceeded to deal with the same.,,,
28. It is stated by Hetero, the Company Hetero Labs Ltd. that at the time of the attachment, it had invested over Rs. 320 crores on setting up a",,,
formulations unit, which started commercial operations in April 2011, employing 1,700 people. The total investments made by the appellant and its",,,
group company, till the Financial Year 2016, is approximately Rs. 660 crores towards capital expenditure, having approximately 1,900 people on its",,,
rolls. The turnover for the appellant for the Financial year 2016 is around Rs. 7,000 crores and it has paid a sum of over Rs. 600 crores in direct and",,,
indirect taxes to the Government. Almost, the similar is the arguments of Aurobindo on merit. They have denied all allegations raised against them. It",,,
was alleged by them that due process has not been followed rather all investigating agencies including ED and Adjudicating Authority while passing,,,
the orders have not understood the matter and facts of the case.,,,
29. The Respondent no. 1 and the Ld. Adjudicating Authority have found fault with allotment process on these grounds, viz.",,,
a. That the allotment was made on the same day as the application by the appellant viz. 17.11.2006;,,,
b. That no advertisements were issued by APIIC for allotment of the land;,,,
c. That oral directions were given by the then Chief Minister Mr. Y.S.R. Reddy, to Mr. B. P. Acharya (VC, APIIC), who then orally directed Mr.",,,
T.L. Ramachandran (CGM, Projects, APIIC) to allot the land in favour of the Appellant on concessional rate.",,,
30. In reply, it is submitted by the appellants that the finding that the file was processed in one day is contrary to the record in as much as the letter",,,
dated 12.09.2017 clearly indicates that prior discussions were ongoing between the Appellant, Aurobindo Pharma Ltd. and APIIC, at least two months",,,
prior to the in-principal allotment, for setting up of the pharma SEZ. This fact is again corroborated by the statement of Mr. Srinivasa Reddy made",,,
under Section 50 of the PMLA, 2002, wherein he states that he had met Mr. B. V. Acharya, then CMD of APIIC, from April 2006 to November",,,
2006 for discussing the allotment of the land. The relevant extract of his statement is as follows:,,,
“We have met 5-6 times, Shri B. P. Acharya (and I), between April 2006 to November 2006 to discuss the objective of allotment of land",,,
for Pharmaceutical SEZ.â€,,,
[Emphasis supplied],,,
31. It is stated by the appellants that the question of non-issuance of advertisement by APIIC is concerned, to the best knowledge of the appellant, it",,,
appears that APIIC has not released advertisements for allotments of lands for other SEZâ€s. Reliance is also place on the decision of the Honâ€ble,,,
Supreme Court of India in Kasturi Lal Lakshmi Reddy v. State of Jammu and Kashmir (1980) 4 SCC ,1 which has been cited with approval by the",,,
constitutional bench in the Presidential Reference No. 1 of 2012, relating to Allocation of Natural Resources, which clearly reiterates the settled",,,
position of law that auctions are not the only constitutional mandate and further held that Government has the power to negotiate directly with private,,,
proponents. The relevant paragraphs from Kasturi Lal Lakshmi Reddy (supra) are extracted and reproduced below:,,,
“14. …,,,
The Government, therefore, cannot, for example, give a contract or sell or lease-out its property for a consideration less than the highest",,,
that can be obtained for it, unless of course there are other considerations which render it reasonable and in public interest to do so. Such",,,
considerations may be that some Directive Principle is sought to be advanced or implemented or that the contract or the property is given not,,,
with a view, to earning revenue but for the purpose of carrying out a welfare scheme for the benefit of a particular group or section of",,,
people deserving it or that the person who has offered a higher consideration is not otherwise fit to be given the contract at the property.,,,
These considerations are referred to only illustratively for there may be an infinite variety of considerations which may have to be taken into,,,
account by the Government in formulating its policies and it is on a total evaluation of various considerations which have weighed with the,,,
Government in taking a particulars action, that the Court would have to decide whether the action of the Government is reasonable and in",,,
public interest.,,,
32. It is not denied by the respondent no. 1 that the land was allotted to the appellant as an “Anchor Client†to encourage other investors to make,,,
investments, given that it is a leading pharmaceutical company in India. The allotment of land was not cancelled.",,,
33. It is submitted by the appellants that the Reliance by the Ld. Adjudicating Authority on purported oral directions given by the then Chief Minister,,,
Mr. Y. S. R. Reddy, to Mr. B.P. Acharya (VC, APIIC), who then orally directed Mr. T.L. Ramachandran (CGM, Projects, APIIC) is merely",,,
observations in as much as no evidence was placed before it the form of statements of witnesses or documents to support such an assumption.,,,
34. Prima facie, it appears to us that if the allegations made by the Respondent No. 1 are taken to be correct, then it would be a case where the",,,
Appellants have paid a bribe of Rs. 29.50 Crores for obtaining a benefit of Rs. 21.5 Crores, as per the Respondent No. 1â€s quantification, which is",,,
not in practical and possible.,,,
35. It is not denied by the respondent no. 1 that the appellants and the other accused approached the Honâ€ble High Court at Hyderabad under,,,
Section 482 of the Cr. P.C. seeking quashing of the aforementioned proceedings in C.C. No. 8 of 2012. The Honâ€ble High Court was pleased to,,,
issue notice in the said petition and vide Order dated 18.04.2016 granted interim stay of proceedings in C.C. No. 8 of 2012, which continues to remain",,,
in force as date. No charges framed against the appellants in appeal No. FPA-PMLA-435/DLI/2013 and FPA-PMLA-436/DLI/2013. The lease-,,,
deeds have not been cancelled either by the State Government or by any Court. The lease rental amount are being received by the Authority. The,,,
private parties are not involved in the complaint filed under the schedule offence.,,,
36. As far as merit of the case is concerned which is filed against Jagati and Janani, we do not wish to express any opinion as the same is to be",,,
decided by the Special Court as per law after trial. Similarly, we are not expressing any opinion as to whether the land was allotted to the private",,,
parties with due process of law or not as admittedly despite of change of many averments in the state, the lease has not been cancelled nor any",,,
statement is made that the state is likely to cancel the lease-deeds.,,,
37. At this stage, our only concern is as to whether the provisional attachment order is sustainable or not. We have also to see as to whether the",,,
mandatory condition precedents contained in section 5 of PMLA, 2002 and in order to decide the present appeal, what is proper order which to be",,,
passed at this stage.,,,
38. It is not denied by the respondent no. 1 that for an attachment to be sustainable under Section 5(1) of the Prevention of Money Laundering Act,",,,
2002, the preconditions as laid under clause (a), (b) and (c) ought to be satisfied. The failure to fulfil any of the preconditions as given in the provision,",,,
would render the Provisional Attachment Order would be bad in law.,,,
39. It is an admitted position the properties attached have been attached as value representing the proceeds of crimes. Therefore, the action of",,,
Respondent No.1 in attaching part of such value as a Fixed Deposit and the rest in the nature of Immovable Properties, that too multiple lands spread",,,
across various parts of the erstwhile state of Andhra Pradesh and unconnected to the transaction in question seems unreasonable. In the recent,,,
judgement rendered by the Division Bench of Delhi High Court on 11.01.2017, in the case of J. Sekar Vs. Union of India & Ors. in WP(C )",,,
5320/2017 in para 48 the aspect of attachment of property for value thereof has been dealt with.,,,
48. The above definition is to be read with Section 2(1)(b) which defines “property†to mean any property or assets “of every,,,
description, whether corporeal or incorporeal, moveable or immoveable, tangible or intangible†including title to or interest in such a",,,
property and their assets, wherever located. The explanation to Section 2(1)(b) defines property to mean property to mean property of any",,,
kind used in the commission of an offence under the PMLA itself or of any scheduled offence. Therefore, the expression “value of any",,,
such property†would be a value equivalent to the value of a property derived or obtained directly or indirectly by any person as a result,,,
of criminal activity. The property itself may no longer be available but the equivalent value of such a property, whether held in cash, etc.,",,,
would be available for attachment.,,,
40. The Honâ€ble Bombay High Court therein reiterated the mandatory nature of S. 5(1)(c) of PMLA, 2002 as under:",,,
“11. …Section 5 authorises the Director or any other officer not below the rank of Deputy Director authorised by Director for the,,,
purposes of the said section to resort to action of ""attachment of property"" if he has reason to believe and the reason of such belief has",,,
been recorded in writing arrived at on the basis of material in his possession. That action is intended to freeze the proceeds of crime, which",,,
property, is derived or obtained directly or indirectly as a result of criminal activity relating to a scheduled offence or value of any such",,,
property until the criminal action for the scheduled offence is taken to its logical end against the accused named therein. The proceeds of,,,
crime means any property or assets of every description, whether corporeal or incorporeal, movable or immovable, tangible or intangible",,,
and includes deeds and instruments evidencing title to, or interest in, such property or assets, wherever located - which has been derived or",,,
obtained, directly or indirectly, as a result of criminal activity relating to a scheduled offence or the value of such property. The proceeds of",,,
crime may be or can be in possession of “any personâ€. Be it a person charged of having committed a scheduled offence ""or otherwise"".",,,
In the case of any other person in possession of of crime, if it is also found that he has directly or indirectly attempted to indulge or",,,
knowingly assisted or knowingly is a party or is actually involved in any process or activity connected with the proceeds of crime and,,,
projecting it as untainted property, he shall be liable to be prosecuted for offence under section 3 read with section 4 of the Act of 2002",,,
â€" in addition to suffering the action of attachment of the proceeds of crime in his possession. Attachment of proceeds of crime in,,,
possession of any person (other than the person charged of having committed a scheduled offence) will, therefore, be legitimate within the",,,
sweep of Section 5 of the Act of 2002 In our opinion, the thurst of section 5 is to attach every property involved in money-laundering",,,
irrespective of whether it is in possession of the person charged of having committed a scheduled offence or any other person- provided,,,
however it must be shown to be proceeds of crime and further, that 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 the Act.â€",,,
[Emphasis supplied],,,
41. In paragraphs 54 & 56 of Aslam Mohammed Merchant vs. Competent Authority, where the Honâ€ble Supreme Court of India held as under:",,,
“54. Non- application of mind on the part of the competent officer would also be evident from the fact that a property named `Rose Villa',,,
which was the subject matter of the decision of this Court in Fatima Amin, was also included herein.",,,
Once the show cause notice is found to be illegal, the same would vitiate all subsequent proceedings.",,,
…,,,
56. Submission of Mr. Singh that the appellants have not been able to discharge the burden of proof which was on them from the impugned,,,
orders, it would appear that they have utterly failed to prove their own independent income; they being close relative of the detune as in",,,
terms of the statutory requirements, it was for them to show that they had sufficient income from those properties.â€",,,
[Emphasis supplied],,,
42. In the present case, even assuming that the preconditions as given under Section 5(1)(a) and (b) had been satisfied by Respondent No. 1, the",,,
requirement under Section 5(1)(c) has not been fulfilled, as is evident from the bare perusal of the Provisional Attachment Order passed against the",,,
Appellant as the Provisional Attachment Order is contrary to the express mandate of S. 5 (1) (c) of PMLA in as much as the Respondent No.1 has,,,
even failed to record his satisfaction that the property attached as “proceeds of crime†in the present case are likely to be concealed, transferred",,,
or dealt with in any manner which may result in frustrating proceedings relating to confiscation under the Act.,,,
43. It is clear that the Adjudicating Authority is ex facie is evident from its finding that the “properties provisionally attached are involved in money,,,
launderingâ€, which is not only factually incorrect, but also contrary to its own unequivocal elsewhere finding that “[w]hat the Additional Director",,,
has attached is the value of any such property representing proceeds of crime. For such attachment a direct nexus between proceeds of crime and the,,,
property is not â€" and cannot be â€" a precondition.†The said error committed in the order is admitted by the respondent.,,,
It is not denied by the respondent no. 1 before us that it is an admitted position that the attached properties are not per se proceeds of crime, but, have",,,
only been attached as value equivalent to the proceeds of crime allegedly in the Appellantâ€s possession. On the face of record and admitted position,,,
there is an inherent contradiction as the confirmation of the provisional attachment is contingent on a finding by the Ld. Adjudicating Authority under,,,
S. 8(3) of the PMLA that the “property (attached) is involved in money launderingâ€.,,,
44. The Adjudicating Authorityâ€s confirmation of the provisional attachment has once again given incorrect finding as the impugned order goes on to,,,
hold as follows:,,,
“[i]f the proceeds of crime or the property acquired by using such tainted money is not traceable or identifiable at the time when the,,,
Director or any officer authorized by him intends to attach the proceeds of crime it is logical that statute permits him to attach any other,,,
property of equivalent value.,,,
45. A mistake in the impugned order is that the Ld. Adjudicating Authority has failed to take note of the fact that one of the Immovable Properties of,,,
the appellant is valued by the Respondent No. 1 at Rs. 7.55 Lakhs and the attachment has been limited to Rs. 5.89 Lakhs, which is not only incorrect",,,
but also inexecutable. Furthermore, there is nothing in the Provisional Attachment Order to indicate as to why the Respondent No. 1 did not seek to",,,
secure this meagre amount by attachment of money instead of proceeding against admittedly unconnected immovable properties belonging to the,,,
appellant.,,,
46. In the impugned order, the Adjudicating Authority has not compared the difference between the sale and lease. It is not denied by the respondent",,,
no. 1 during the course of argument that it was lease and no sale. The entire investigation, the attachment and the subsequent actions against the",,,
appellant had proceeded on a complete misconception and failure to appreciate the natural distinction between freehold property and leasehold,,,
property. The finding are totally erroneous. The nature of a lease have been compared to price fixed by Price Fixation Committee of Andhra Pradesh,,,
Industrial Infrastructure Corporation (“APIICâ€) for the purpose of sale of non-SEZ land and thereby resulted in a loss to the exchequer.,,,
47. The Appellants i.e. private parties well established company with turnover in excess of Rs. Thousand of crores. The question of proceeds of crime,,,
not being available for the purpose of confiscation does not even arise and the extraordinary power of provisional attachment has been exercised by,,,
the Respondent No. 1 without having due regard for the provisions of Section 5 (1) of the PMLA.,,,
48. Therefore, even assuming that the allegations made against the Appellantâ€s were true, and that an order of attachment was necessary in the",,,
circumstances, the simplest recourse would have been to attach the said amount in the hands of statutory authorities holding the Appellantâ€s funds,",,,
rather than attaching various immovable properties spread across the state, which are required to be preserved and maintained by the Enforcement",,,
Directorate, incurring additional costs to do the same, at the cost of the public exchequer.",,,
49. On the face of record, we fail to understand as to why instead of attaching a sum of alleged bribe amount in the form of cash by an FD or",,,
otherwise, recourse has been taken to attach several immovable properties spread across the state of Andhra Pradesh by a company which is paying",,,
taxes worth hundred crores of rupees of taxes. There is also no valid justification about the attachment of portion of 82 cents of Land at,,,
Lankelapalem, Nakapalli District Vishakhapatnam, valued at Rs. 7.55 Lakhs, i.e. only to the extent of Rs. 5.89 Lakhs in the case of Hetero.",,,
50. It appears to us that the Respondent No. 1â€s failure to comply with the express mandate of Section 5 of the PMLA renders the entire,,,
proceedings illegal and the Ld. Appellate Authority ought to set aside the Impugned Order and the Provisional Attachment Order on this ground alone.,,,
51. It is undisputed fact that the appellant herein is simply the lessee and have not become the owner of the properties as the first arrangement,,,
between the Government and the appellant. It is also a matter of fact that the Trident has not challenged the order by filing of the appeal before us.,,,
52. The case of the respondent no. 1 is that the Aurobindo promoters and the Hetero Drugs have allegedly taken the benefit of 17 crores and 20 lakhs,,,
and by the Trident to the tune of Rs. 2.3 crores. The total investment of the Aurobindo and Hetero is the tune of Rs. 18 crores in the company of,,,
Jagati and Rs. 5.5. crores by Hetero in the company Janani.,,,
53. It is alleged by all the private parties appellants/investors that the investments made with Jagati and Janani are genuine investments that have no,,,
nexus to the allotment of land or the alleged undue benefit granted. The Adjudicating Authority did not appreciate the sound logic and reasoning,,,
provided by Mr. Mr. M. Srinivasa Reddy, Director, M/s Hetero Drugs Ltd., in his statement under Section 50 of the PMLA, 2002, to demonstrate the",,,
bona fide commercial investments made by the Appellant. The relevant extract of his statement is as follows:,,,
“Looking at the future potential of real estate companies and boom, we invested in Janani Infrastructure at the Premium Value of Rs. 102",,,
per share.,,,
…,,,
With regards to Jagati Publications they have informed us that in their business plan, they can achieve circulation of 5 to 6 Lakh copies at",,,
the time of the launch as they have more than 10 Lakh Congress workers who they felt would subscribe to the newspaper.â€,,,
[Emphasis supplied],,,
In fact, in the present case, Jagati Publicationâ€s circulation is far in excess of those projected.",,,
54. It was the case of investors i.e. private parties that the investments made into M/s Jagati Publications Ltd and M/s Janani Infrastructure are,,,
genuine investments and advances made in course of bona fide commercial transactions. The allegations as to overvaluation and ante-dating of,,,
valuation reports with respect to M/s Jagati Publications Ltd. are completely baseless and erroneous. The premium fixed for the shares of M/s Jagati,,,
Publications Ltd. is based on sound commercial analysis, including cogent valuation. The premium fixed contemporaneously by other market",,,
participants would evince that the premium of M/s Jagati Publications Ltd. shares is justified.,,,
55. The record circulation has been achieved by the new paper “sakshi†as soon as it commenced its operations would evidently show the market,,,
capabilities of M/s Jagati Publications Ltd. Many other persons, against whom no allegations exists also invested in M/s Jagati Publications Ltd. at",,,
premium of Rs.350 per share but no actions are taken by the CBI and ED. It is alleged that about 60 investors have made the investment in the,,,
companies but CBI and ED have initiated the action only against few investors which is clear case of discrimination. Counsel for the respondent has,,,
not denied the said fact but it was stated by him that in most of the cases, actions have taken against the investors where they have taken benefits",,,
from the Government.,,,
56. It is also argued on behalf of the appellants that all the investments/advances by private parties in the Jagati Publications Ltd., to M/s Janani",,,
Infrastructure Pvt Ltd. are genuine investments made in course of bona fide commercial transactions.,,,
57. In order to buy peace, after the arguments the learned counsel for the appellants private parties submitted that although the respondent no. 1 has",,,
no case at all against them for attachment of their properties and both the orders i.e. Provisional Attachment Order as well as impugned order are,,,
totally perverse and illegal, still they without prejudice are ready to secure the amount till the time the Special Court gives the final judgement as to",,,
whether any criminality against the appellants Jagati and Janani are involved or not as well as the issue of investment made by them. The said offer is,,,
given subject to the condition that the orders of attachment of immovable property is quashed as the individual property of the appellant were attached,,,
against the value thereof.,,,
Sl.
No.",Details of asset/property,Amount involved,
1.,"34 acres and 13 cents vide Sale Deed No. 2245/07 at
Parwada with Unit VI, Nakkapalli (Portion and parcel
of land), District Vishakhapatnam",Rs. 517.97 Lakhs,
2.,"1 acre land vide Sale Deed No.
1132/2007 dated 19.02.2007, Dy. No.
72/1A, at Lankelapalem with Unit VI, Nakapalli,
District Vishakapatnam",Rs. 19.71 Lakhs,
3.,"65 cents land vide Sale Deed No.
3111/2008 dated 23.09.2008, Sy. No.
71/4, ACO. 65 cent at Lankelapalem with Unit VI,
Nakapalli, District Vishakhapatna",Rs. 16.43 lakhs,
4.,"Fixed Deposit No. 723199 dated 14.08.2012 vide
Account No. 62241727017, valid up to 14.08.2015 in
the name of M/s Hetero Drugs Ltd., at State Bank of
Hyderabad, Sanathnagar Branch",Rs. 3 crore,
5.,"82 cents Land vide Sale Deed No.
3087/2006 dated 05.06.2006 Survey No. 71/3 at
Lankelappalem with Unit VI, Nakapalli, District
Vishakhapatnam","Rs. 7.55 lakh (Attachment
Limited to Rs. 5.89 Lakh only)",
65. We accept the undertaking, the Aurobindo is also directed to deposit Rs. 9.90 Crores with the respondent in view of release of properties.",,,
66. The statement made on behalf of Aurobindo in para 3 to 5 are reproduced here under:-,,,
3. That the aforesaid properties of the APL Research Centre Ltd. have been purchased by it through legitimate sources of income and,,,
admittedly have no nexus or connection with the alleged undue benefit stated to have been received by its parent company viz. Aurobindo,,,
Pharma Ltd. in the course of the allotment of land at Jadcherla, Mahboobnagar District of the erstwhile State of Andhra Pradesh or the",,,
transfer of land of 30.33 acres at Export Promotion Industrial Park at Pashmylaram, Medak District from Aurobindo Pharma Ltd. to M/s",,,
Trident Life Sciences Ltd.,,,
4. That the attachment of Immovable properties of APL Research Ltd. is completely illegal in view of the fact that it is not accused in the CBI,,,
FIR or the Chargesheet or the ECIR. In fact admittedly, APL Research Centre Ltd. is not connected with in any manner to any of the",,,
transactions that form part of the allegations and as such, attachment of its assets ought to be set aside on this ground alone.",,,
5. That, however, without prejudice to the rights and contentions of the appellant on merits in the instant appeal, the appellant company is",,,
willing to furnish a fixed deposit for a sum of Rs. 9.90 crores in lieu of release of the aforementioned immovable properties from provisional,,,
attachment under the PMLA.,,,
67. We accept the undertaking thus the impugned order as well as PAO is modified. The Hetero shall deposit for a sum of Rs. 5.60 crores by way of,,,
FDR with the respondent no. 1 within six weeks from today as deposit of the said amount the attachment of all the attached properties in view of the,,,
attached properties shall stand released.,,,
68. The impugned order and the provisional attachment order is modified to the extent that the Aurobindo shall deposit for a sum of Rs. 9.90 crores by,,,
way of FDR with the respondent no. 1 and a sum of Rs. 5.60 crores by way of FDR with the respondent no. 1 within six weeks from today as deposit,,,
of the said amount the attachment of all the attached properties in view of the attached properties shall stand released forthwith as we are of the,,,
considered of the opinion that the provisional attachment order has been passed contrary to the facts and law. The same is not sustainable particularly,,,
when the appellants are prepared to secure the amount. The said deposit of private parties shall without prejudice and will be treated as securities,,,
against the attachment of properties.,,,
69. The all appeals filed by the private parties and MPs are disposed of. No costs.,,,
70. Now, we shall deal with the appeals filed by Jagati and Janani. The attachments against the Jagati and Janani were effected as under:-",,,
i) M/s. Jagati Publications Pvt. Ltd. â€"  Fixed Deposits worth for Rs 14.5 Crs.,,,
ii) M/s. Janani Publications Pvt. Ltd. - Land and properties for Rs 15 Crs.,,,
71. Section 24 reads as under:,,,
Section 24 Burden of Proof :- In any proceeding relating to proceeds of crime under this Act,-",,,
(a) in the case of a person charged with the offence of money-laundering under section 3, the Authority or Court shall, unless the contrary",,,
is proved, presume that such proceeds of crime are involved in money launder; and",,,
(b) in the case of any other person the Authority or Court, may presume that such proceeds of crime are involved in money laundering.]",,,
72. With regard to the other attachments are concerned, the definition of proceeds of crime reads as follows:",,,
“proceeds of crime†means any property derived or obtained, directly of indirectly, by any person as a result of criminal activity",,,
relating to a scheduled offence or the value of any such property;,,,
And the definition of “property†means any property or assets of every description, whether corporeal or incorporeal, movable or",,,
immovable, tangible or intangible and includes deeds and instruments evidencing title to, or interest in, such property or assets, wherever",,,
located;,,,
It is submitted that the concept is best understood, in the words as beautifully explained in Regina V. Wright (Robert), [2014] 1WLR 2913,",,,
Para 12, by Court of Appeal:",,,
12 We bear in mind that the purpose of the statutory scheme is to strip an offender of benefit derived from an offence, not to compensate",,,
loss. We think it right to return to section 76(4)(5) where the language of the 2002 Act is clearly focused on the obtaining of property, or a",,,
pecuniary advantage as a result of, or in connection with, conduct.â€",,,
73. If the allegations made by the Respondent No. 1 are taken to be correct, then it would be a case where the Appellants private parties have paid a",,,
bribe of Rs. 29.50 Crores for obtaining a benefit of Rs. 21.5 Crores, as per the Respondent No. 1â€s quantification, which is not possible as per facts",,,
and admissions of the respondent no. 1.,,,
74. From the entire gamut of the matter and material placed on record, it appears to us that the allegation of bribe and cheating are yet to be",,,
considered by the Special Court. It is yet to be examined as to whether any criminality is involved or not. There is no denial on the part of the,,,
appellants that investment was made. There are two versions, the version of the respondent is that the investors have bribed the amount. The second",,,
version is that it was a genuine investment.,,,
75. The issue of discrimination would also have to be decided by the Special Court. Further, as the burden of proof has not been discharged by the",,,
appellant, their request for release of all the properties cannot be acceded to.",,,
76. As regard Hetero and Aurobindo, they have agreed to secure total sum of Rs. 15.50 crores till the complaints are finally decided by the Special",,,
Court. As against Jagati and Janani, we are of the view that remaining Rs. 15 crores must be secured by Jagati and Janani without-prejudice as the",,,
total amount of bribery as per CBI and ED is Rs. 29.50 crores. The ED has already attached fixed deposit of Rs. 14.50 crores from Jagati. Subject to,,,
deposit of balance of Rs. 15 crores, properties of Janani shall stand released. In case the sum of Rs. 15 crores is not deposited by the appellant within",,,
six weeks from the date of order then the provisional attachment of land and property as per provisional attachment order shall continue till the final,,,
outcome of the matter which is pending before the special judge.,,,
77. These directions are passed without prejudice in order to secure the entire alleged amount. The fate of securing of Rs. 29.50 crores in respect of,,,
M/s. Janani & Jagati would be dependent upon the final decision passed by the Special Court.,,,
78. Two said appeals as well as MPs are disposed of.,,,
79. No costs,,,
