The Enforcement Directorate (ED) filed charges against two major opposition figures on Tuesday (April 5), including Shiv Sena, MP Sanjay Raut and AAP leader and Delhi Minister Satyendra Jain. In Mumbai, the agency has placed a provisional attachment on properties totaling Rs 115 crore that are related to three individuals, including Raut’s wife, Varsha Raut.
At the same time, the ED took properties from five businesses that were thought to be linked to Jain and his family in Delhi. The money was worth Rs 4.81 crore. In all of these instances, the central agency acted according to the Anti-Money Laundering Act (PMLA).
Former Jammu and Kashmir Chief Minister Farooq Abdullah was prosecuted by the Enforcement Directorate in January 2021. Karti Chidambaram, the son of former Union Minister and top Congress leader P Chidambaram, was also prosecuted.
It was part of an investigation into alleged money laundering in a case involving the Jammu and Kashmir Cricket Association. Farooq’s case involved his home in Srinagar, as well as two other homes in Tangamarg and Sunjwan, as well as commercial properties on Srinagar’s Residency Road.
Immovable properties worth over Rs 50 crore were attached in Karti’s case (related to the INX Media case), including a bungalow in Somerset, the United Kingdom; a tennis club in Barcelona, Spain; agricultural land in Kodaikanal; a bungalow in Ooty; and 50% of a house owned by Karti and his mother, Nalini, in Jor Bagh, New Delhi.
What happens when the ED seizes an accused’s property?
Does this mean that Raut, Jain, or anyone else can’t go into these homes or offices right away? Not always. The ED’s “provisional attachment orders” do not mean that a property will be immediately sealed.
Farooq Abdullah, for example, maintained his residence while the case was pending in the courts. Even after 50% of their property in New Delhi was attached, the Chidambaram family continued to enjoy it. In 2020, the Enforcement Directorate issued an eviction notice to Karti, who successfully defended herself.
How long is the attachment order of the ED valid?
Provisional attachment orders issued by the ED are valid for 180 days and must be validated by the adjudicating authority in accordance with the Prevention of Money Laundering Act (PMLA). If it is not verified, the property is withdrawn from attachment automatically.
If it is affirmed, the accused may appeal within 45 days to the Appellate Tribunal and then to the competent High Court and Supreme Court.
What does the law say about property attachment?
Attachment is used to deprive an accuser of the advantages associated with the attached asset. In addition, the law makes sure that the accused’s property is off-limits until the end of the trial.
Generally, however, attributes in use are not sealed until the situation reaches its logical conclusion. Typically, the accused obtains release of the property from appeal tribunals or high courts, or obtains a stay, allowing him or her to continue enjoying it while the case is continuing in the courts.
What is business management?
Businesses that are currently operating are not closed. As a result, a working hotel can be linked to the PMLA while still running. In connection with the Air India case, the Enforcement Directorate attached the Holiday Inn Hotel at Delhi’s IGI airport in 2018. However, the hotel continues to accommodate visitors in the regular manner.
The statute permits the Enforcement Directorate to retain operating revenues. However, firms may get a restraining order from the courts, pending the result of the lawsuit.
What justification does the ED have for seizing the possessions of charged individuals?
Proceeds of crime, defined as money earned through criminal conduct, are attached according to the ED Director’s instruction. If the wealth can’t be attached, the agency can attach property that has the same value as the wealth.
In the PMLA, the term “proceeds of crime” refers to “any property that is derived or acquired, directly or indirectly, by any person as the result of criminal activity relating to a scheduled offence, or the value of any such property, or, if such property is taken or held outside the country, the property equivalent in value that is held inside or outside the country,”
While the idea of attaching property that is equal to the profits of a crime has been debated, several court decisions have backed the ED’s interpretation of the words “the value of any such property.” This means that the agency can attach any property of equal value to the accused.
Additionally, the legislation provides for the attachment of similar local property if investigations demonstrate that the accused has deposited profits from crime overseas where they cannot be attached.
What happens to sealed assets?
Attached homes may stay locked for years, eventually succumbing to the elements. People who own these kinds of properties have a way to keep them in good shape, but it hasn’t been decided yet.
Attached cars are transported to Central Warehousing Corporation facilities, where the Enforcement Directorate pays for parking. Vehicles deteriorate as lawsuits go on for years. Neither the accused nor the Enforcement Directorate retrieved anything from the car at the conclusion of the trial. Indeed, the agency may wind up paying more rent than the vehicle is worth.
Published by – Kiruthiga K
Edited by – Kritika Kashyap
