Enforcement Directorate v. M/s G2 Corporate Services LLP & Ors.

   IN THE HIGH COURT FOR THE STATE OF TELANGANA



                   AT HYDERABAD







           THE HON’BLE SRI JUSTICE P.SAM KOSHY



                                   AND



 THE HON’BLE SRI JUSTICE SUDDALA CHALAPATHI RAO







   Civil Miscellaneous Second Appeal Nos.30, 31, 32 & 33 of 2019



                               and



    Civil Miscellaneous Second Appeal Nos.1, 2, 3, 4 & 5 of 2020







                           DATE: 19.06.2026







Between:







Enforcement Directorate,



Represented by its Deputy Director,



Govt. of India,



Shakar Bhavan, 3rd Floor,



Basheerbagh, Hyderabad - 500 004.



                                                               …Appellant



                                   AND







M/s. G2 Corporate Services LLP.,



#1-1-151 & 1-1-151/1, 6th Floor,



Sairam Towers, Alexander Road,



Secunderabad - 500 003 and others.



                                                             …Respondents







COMMON JUDGMENT: (per the Hon’ble Sri Justice P.Sam Koshy)







      Heard B.Narasimha Sarma, learned Additional Solicitor General







of India appearing for Mr. Anil Prasad Tiwari, learned Standing Counsel







for Enforcement Directorate; and Mr. S.Niranjan Reddy, learned Senior



                                 Page 2 of 23







Counsel appearing for Mr. Tarun G.Reddy, learned counsel for the







respondents.







2.    Since the lis involved in this batch of appeals being common, they







are heard together and are decided by this Common Judgment.











3.    For convenience, the facts in C.M.S.A.No.30 of 2019 are







discussed hereunder.











4.    The instant is an appeal filed by the appellant / Enforcement







Directorate under Section 42 of the Prevention of Money Laundering







Act, 2002 (for short, ‘PMLA Act’) assailing the order dated 26.07.2019,







passed by the Appellate Tribunal for PMLA Act at New Delhi, in FPA-







PMLA-752/DLI/2014.











5.    The brief facts of the case are that a Special Purpose Vehicle was







constituted for the implementation of the Vodarevu and Nizampatnam







Ports and Industrial Corridor Project (for short “VANPIC Project”). The







VANPIC     Project     was   a    Government-to-Government     initiative







conceptualized pursuant to an arrangement between the Government of







Andhra Pradesh and the Government of Ras al Khaimah, one of the







Emirates of the United Arab Emirates. For the purposes of VANPIC



                               Page 3 of 23







Project, VANPIC Ports Private Limited and another Special Purpose







Vehicle, namely VANPIC Projects Pvt. Ltd., acquired a total extent of







13,221.69 acres of land, comprising both assigned land and patta land.











6.    That in the year 2011, the erstwhile High Court of Andhra







Pradesh, vide its order dated 10.08.2011 in W.P.No.974 of 2011, directed







the Central Bureau of Investigation (CBI) to conduct an investigation







into the allegations that certain investments, allegedly in the nature of







bribes, were made into the companies allegedly controlled by Mr. Y.S.







Jagan Mohan Reddy, son of late Dr. Y.S. Rajshekhar Reddy, the then







Hon’ble Chief Minister of Andhra Pradesh. The High Court further







specifically directed the CBI and the Enforcement Directorate (ED) to







segregate genuine investors from those implicated in the alleged illegal







transactions involving the companies owned by Mr. Y.S. Jagan Mohan







Reddy. Accordingly, as per the aforesaid orders of the High Court, the







CBI registered an FIR bearing RC.No.19(A)/2011-CBI-Hyd, dated







17.08.2011, under Section 120B read with Section 420, 409 & 477-A of







Indian Penal Code, 1860 (for short ‘IPC’) and Section 13(2) read with







Section 13(1)(c)&(d) of Prevention of Corruption Act, 1988, against







Mr. Y.S. Jagan Mohan Reddy and others.



                               Page 4 of 23











7.    It was alleged in the FIR that the Government of Andhra Pradesh







under the leadership of late Dr. Y.S. Rajshekhar Reddy, the then Chief







Minister of Andhra Pradesh, extended various favours / benefits /







concessions to certain private individuals / companies as a quid-pro-quo







for investments made by such individuals and corporate entities in the







companies promoted by Mr. Y.S. Jagan Mohan Reddy.











8.    Subsequently, the ED registered ECIR No.09/HZO/2011, dated







30.08.2011, for investigation under the provisions of the PMLA Act.







Thereafter, the CBI filed several charge sheets pursuant to the FIR







lodged by it in respect of each instance of the alleged quid-pro-quo. The







present case pertains to VANPIC Projects, in respect of which the CBI







filed a charge sheet dated 13.08.2012, for alleged offences under Section







120B read with Sections 409, 420, 467, 468, 471 and 477A of IPC;







however, VANPIC Projects was not arrayed as an accused in the said







charge sheet.







9.    On the basis of CBI’s charge sheet dated 13.08.2012, the







Enforcement Directorate issued the Provisional Attachment Order No.01







of 2014, dated 04.03.2014, whereby 1416.91 acres of land forming part



                               Page 5 of 23







of VANPIC Project was provisionally attached. Thereafter, the ED filed







OC.No.276 of 2014, dated 27.03.2014, to which the respondent and







others filed their reply. Following this, the Adjudicating Authority







confirmed the Provisional Attachment Order dated 04.03.2014.







Aggrieved the respondent preferred an appeal before the Appellate







Tribunal which was registered as FPA-PMLA-752/DLI/2014. While the







aforesaid appeal was pending, the ED passed another provisional







attachment order i.e. Provisional Attachment Order No.06 of 2017, dated







28.07.2017, attaching the remaining 11804.78 acres of land, which forms







part of VANPIC Project, in addition to the earlier attachment.











10.   After hearing the parties, the learned Appellate Tribunal for PMLA







in Appeal No.FPA-PMLA-752/DL1/2024, passed a common order on







26.07.2019, which is the impugned order in the present appeal partly







allowing the appeal, copy of which was served upon the respondent only







on 26.08.2019. While partly allowing the appeal, the learned Appellate







Tribunal passed an order directing the respondent to furnish indemnity







bond as surety amount with an undertaking that, in the event if the final







order is passed by the Court under PMLA against the appellant, they







shall secure the said amount with the appellant, i.e., the respondent



                               Page 6 of 23







before the appellate authority. Rest of the order of attachment of the







properties was set aside and the properties were ordered to be released.







It is this order which is under challenge by the Department of







Enforcement Directorate through the present CMSA under Section 42 of







the PMLA.











11.   The contention of the appellant in the present appeal is that the







Tribunal for PMLA passed the impugned order which is contrary to the







scheme of PMLA, 2002 whereby the Tribunal had rendered the entire







order passed by the appellate authority as also the order by way of







attachment under the PMLA, 2002, a nullity in the eye of law. It was the







further contention of the learned counsel for the appellant that the







Tribunal has failed to take into consideration the submissions which the







enforcement directorate had been contending all along right from the







time when the provisional attachment proceedings were initiated before







the appellate authority as also before the Tribunal. It was the further







contention of the learned counsel for the appellant that the Tribunal had







also ignored the aspect of the adjudicating authority having conducted a







detailed hearing on various dates and after thoroughly examining all the







pleas raised by both parties before the authority, and the adjudicating



                               Page 7 of 23







authority had only thereafter passed an elaborate order on 19.08.2014; all







of which was not properly appreciated or looked upon by the Tribunal







while passing the impugned order. It was also the further contention of







the learned counsel for the appellant that perusal of the impugned order







passed by the Appellate Tribunal would go to show that in fact the







contentions which were discussed, deliberated and decided by the







adjudicating authority as also by the appellate authority have not been







the point of consideration while passing the impugned order and thus it







could be safely contended that the order is a non-speaking order







deserving to be set aside.











12.   Learned counsel for the appellant further contended that the







Tribunal had erred inasmuch as not appreciating the fact that Sri Y.S.







Jagan Mohan Reddy, son of the then Hon’ble Chief Minister, Sri Y.S.







Rajashekar Reddy, had not invested any amount in M/s.Bharati Cement







Corporation Private Limited except for the funds those were received







from Sri Nimmagadda Prasad and thus the cement factory was set up







based upon the purported investments made at exorbitant premiums from







Sri Nimmagadda Prasad and others. It was also the contention of the







learned counsel for the appellant that the Tribunal also failed to consider



                                Page 8 of 23







the aspect that the respondent herein, i.e., M/s.G2 Corporate Services







LLP, of having actually involved in transfer of proceeds of crime from







Sri Nimmagadda Prasad to Sri Y.S. Jagan Mohan Reddy, of the then







Hon’ble Chief Minister, Sri Y.S. Rajashekar Reddy.











13.   As regards the PAO is concerned, learned counsel for the appellant







contended that the Tribunal had failed to appreciate the procedure that







was followed by the adjudicating authority insofar as issuance of show-







cause notice under Section 8(1) of the PMLA-II and also at the time of







receipt of provisional attachment order and the original complaint. He







further contended that the PAO as also the original complaint produced







before the adjudicating authority had sufficient material to form







sufficient reasons to believe and therefore it need not be mentioned for







the second time in the show-cause notice issued under Section 8(1) of







the PMLA-II to the respondent; and therefore, contended that the finding







arrived at by the Tribunal in this regard also is unsustainable.







14.   Per contra, learned counsel for the respondent contended that the







impugned order does not warrant interference for the reason that it had







already been subjected to scrutiny on more than a couple of occasions







more particularly in CMSA.No.76 of 2020, CMSA.No.8 of 2020 and



                               Page 9 of 23







CMSA.No.9 of 2020, wherein the very same order in respect of a







different entity was put to test and the appeal preferred by the







Enforcement Directorate in all the second appeals stood rejected. It was







the contention of the learned counsel for the respondent that a learned







Division bench of this Court on three different occasions having







considered the same and had decided the issue, and thus contended that







Judicial propriety does not permit this Court to take a different view. It







was also contended by the learned counsel for the respondent that a bare







perusal of the impugned order would go to show that the Tribunal vide







the impugned order had thread-bare gone into the entire factual matrix of







the case and had thereafter reached to the conclusion that there are ample







lapses which are reflected from the proceedings drawn by the appellant







including the allegation of pick and chose and the proceedings are drawn







only against selected person thereby, the action is in violation of Article







14 of the Constitution of India, and for all this the Tribunal had rightly







reached to the conclusion.











15.   Lastly, it was contended that even though the Tribunal had passed







an order in favour of respondent, the Court in order to ensure that







sufficient safety and security is taken care of ensuring the proceedings



                              Page 10 of 23







still pending before the concerned PMLA Court, had ordered the parties







to furnish indemnity bond of sufficient amount with the respondent







which would remain as a guarantee in the event if the proceedings are







decided against the respondent wherein the appellant herein can secure







the said amount.











16.   Having heard the contentions and on a perusal of the records, what







is clearly culled out is that the Tribunal vide the impugned order dated







26.07.2019 had partly allowed a batch of appeals which were filed by the







appellant and all of which have been under challenge before the High







Court viz., CMSA.No.30 of 2019, CMSA.No.31 of 2019, CMSA.No.32







of 2019 and CMSA.No.33 of 2019; CMSA.No.1 of 2020, CMSA.No.2







of 2020, CMSA.No.3 of 2020, CMSA.No.4 of 2020, CMSA.No.5 of







2020, CMSA.No.6 of 2020, CMSA.No.8 of 2020 and CMSA.No.9 of







2020. From the information made available to this Bench, it has been







informed that a batch of three appeals, viz., CMSA.No.6 of 2020,







CMSA.No.8 of 2020 and CMSA.No.9 of 2020 stood allowed, where the







High Court dismissed the appeal preferred by the Enforcement







Directorate. From the remaining nine appeals, in five appeals, viz.,







CMSA.No.31 of 2019, CMSA.No.33 of 2019, CMSA.No.1 of 2019,



                                Page 11 of 23







CMSA.No.4 of 2020 and CMSA.No.5 of 2020, this High Court had







already ordered for releasing the attached property on furnishing an







indemnity bond to the extent of value of the attached property. The three







appeals which were dismissed by the High Court confirming the order







passed by the Tribunal, CMSA.No.6 of 2020, CMSA.No.8 of 2020 and







CMSA.No.9 of 2020 have arisen out of the proceedings drawn against







M/s.Vanpic Projects Pvt. Ltd.











17.   It would be relevant at this juncture to take note of the three







appeals which stand adjudicated upon by this High Court in







CMSA.Nos.6, 8 and 9 of 2020. The judgment under challenge in those







three appeals was flowing from the very same common order passed by







the Tribunal.   The allegations and counter-allegations were almost







similar in all the appeals including the present one. The stand taken by







the appellant as also the respective respondents were also similar and







therefore the Tribunal had also proceeded to decide all the twelve







appeals by one common order.          Whether the finding given by the







Tribunal in the course of passing of the impugned order was proper, legal







and justified or not had been dealt with by this Court in the case of



                                        Page 12 of 23







Vanpic Ports Private Limited vs. Directorate of Enforcement 1. A







learned Division Bench of this High Court, while referring to Section







5(1) of the PMLA, reached to the conclusion that the necessity of







recording reason to believe is not reflected in the provisional attachment







order. For ready reference, the relevant portion thereof is extracted







hereunder, viz.,







         “67. Let us now deal with the provisional attachment order passed under sub-



         section (1) of Section 5. After adverting to the factual backdrop and referring



         to the provisions of PMLA including Section 5(1), Joint Director, Enforcement



         Directorate held as follows:











               “21. NOW THEREFORE, on the basis of material in my possession



               as per Annexure-R and in exercise of the powers conferred upon me



               under section 5(1) of 'the PMLA, 2002' (15 of 2003), the authority



               vested in me by the Authorisation dated 07.02.2007 and its



               addendum dated 12.10.2011 issued by the Director of Enforcement



               in exercise of his powers under sub-section (1) of section 5 of 'the



               PMLA, 2002' (15 of 2003), I hereby order for provisional



               attachment of the properties as per Annexure - 'A' and further order



               that the same shall not be transferred, disposed, parted with



               or otherwise dealt with in any manner, whatsoever, by the holders



               having ownership and/or possession until or unless specially



               permitted to do so by the undersigned.”











         68.. Thus, the Joint Director held that on the basis of material in his



         possession and exercising powers conferred upon him under Section 5(1) of



         PMLA and on the basis of the authority vested in him, he ordered provisional







1



    2022 SCC OnLine TS 1793



                               Page 13 of 23







attachment of the properties as per Annexure A. In so far the appellant i.e.,



VANPIC Ports Private Limited is concerned, the property attached by the



Joint Director is at Sl.No.35 of Annexure A and reads as under:











 35.         561.1996 acres of land in            M/s.Vanpic           Rs.23.23



             Prakasham district in                Ports Pvt.           crore



             Andhra Pradesh as per                Ltd.



             Annexure – L enclosed



             with the attachment order







69. From the above it is evident that the Joint Director while exercising power



under Section 5(1) failed to record his reason to believe (there is no reference



to it in the provisional attachment order) that petitioner is in possession of



proceeds of crime in the form of the attached property and that such proceeds



of crime are likely to be concealed etc., which may frustrate any proceeding



relating to confiscation of such proceeds of crime.











70. The above order of provisional attachment was forwarded by the Joint



Director to the adjudicating authority by way of a complaint under sub-



section (5) of Section 5 of PMLA which was numbered as O.C.No.276 of



2014. By the order dated 19.08.2014, the provisional attachment order was



confirmed. Before the adjudicating authority an argument was advanced on



behalf of the appellant that there were no reason to believe for provisional



attachment under sub-section (1) of Section 5. In the absence of reason to



believe attachment could not be sustained. To this, adjudicating authority in



paragraphs 4 and 5 of the adjudication order mentioned that as per the



provisions of Section 5 of PMLA reasons are required to be recorded in



writing by the complainant (attaching authority) but these are not required to



be conveyed to the defendant. Similarly, no reasons are required to be either



recorded in writing or conveyed to the defendant under Section 8 by the



adjudicating authority.



                                  Page 14 of 23







18.   Likewise, referring to paragraph nos.74 and 84 of the impugned







order passed by the Tribunal, the Division Bench, in the case of Vanpic







Ports Private Limited (supra), held at paragraph Nos.72 and 73 of the







above judgment as under, viz.,







      “72. In paragraph 74 of the impugned order dated 26.07.2019,



      Appellate Tribunal noted that the Joint Director i.e., the attaching



      authority did not record valid reason to believe as per requirement



      of Section 5(1). After extracting paragraph 21 of the provisional



      attachment order, Appellate Tribunal noted that the provisional



      attachment order merely paraphrases the language of the section as a



      mere formality which does not amount to valid reason to believe. It was



      held as follows:











           “74. From the Provisional Attachment Order in the present



           appeals, it is evident that the Respondent No.1, i.e. the Joint



           Director, Directorate of Enforcement, has not recorded valid



           "reason to believe" as required. The mandatory pre-



           requisite for provisional attachment required by Section



           5(1) is missing in the present case. It is submitted on behalf of



           appellant that in the above thereof the Adjudicating Authority



           ought not to have even issued notice under S. 8(1) of the Act,



           leave alone confirm the Provisional Attachment Order. The



           relevant para-21 of Provisional Attachment Order is



           reproduced hereunder:











           "21. NOW THEREFORE, on the basis of material in my



           possession as per Annexure - R and in exercise of the powers



           conferred upon me under section 5(1) of 'the PMLA, 2002'



                              Page 15 of 23







       (15 of 2003), the authority vested in me by the Authorization



       dated 07.02.2007 and its addendum dated 12.10.2011 issued



       by the Director of Enforcement in exercise of his powers



       under sub-section (1) of section 5 of 'the PMLA, 2002'(15 of



       2003), I hereby order for provisional attachment of the



       properties as per Annexure - 'A' and further order that the



       same shall not be transferred, disposed, parted with or



       otherwise dealt with in any manner, whatsoever, by the



       holders having ownership and/or possession until and unless



       specifically permitted to do so by the undersigned."



                                                 [Emphasis supplied]



                  The Provisional Attachment Order shows that mere



       the language of section has been mentioned in the "reason to



       believe" after recording the facts and statement under section



       50 of the Act, though the officer concerned has to be satisfied



       as per requirements of Sections 5(1)(a) of the PMLA by



       referring the details of investigation about the attachment of



       properties and proceed of crime for each head, a merely



       formality does not amount to valid reason to belief.”











73. The Appellate Tribunal examined the order of the adjudicating



authority and held that the adjudicating authority overlooked the fact



that   the   provisional attachment      order   suffered     from   serious



jurisdictional infirmity and held as follows:











  "84. The Adjudicating Authority did not notice the said fact or



  ignored the same to the effect that the Provisional Attachment



  Order suffered from serious infirmity including, inter alia, for



  failing    to    comply   with   the   mandatory    preconditions



  under Section 5 (1) (b) of the PMLA. Under the circumstances,



                                    Page 16 of 23







          the following observations in the Impugned Order are



          completely shocking:











          "But it is seen these case laws do not apply to the provisions of



          the PMLA. As per the provisions of Section 5 of the PMLA



          reasons are required to be recorded in writing by the



          Respondent No.1 but these are not required to be conveyed as



          it is to the defendants. It is further seen that while framing the



          PAO and O.C., these have been conveyed in the PAO and O.C.



          and that meets the ends of Justice in as much as defendants



          know what is case against them."











19.     The learned Division Bench in the above judgment further held







that the reason to believe as is required under Section 5(1)(d) of the







PMLA is missing and the order passed by the adjudicating authority







which had been reversed by the Appellate Tribunal suffers from violation







of principles of natural justice as also being violative of provisions of







Section 5 of the PMLA. The other deficiencies and flaws in the order







passed by the adjudicating authority which were interdicted by the







Tribunal were further discussed by the learned Division Bench in the







case of Vanpic Ports Private Limited (supra) at paragraph Nos.74, 75,







76 and 77 which again are reproduced hereunder for ready reference :







viz.,



                             Page 17 of 23







“74. Appellate Tribunal also considered the objection of the appellant



regarding the procedure adopted in the hearing and not allowing the



appellant to file rejoinder and concluded that the order passed by the



adjudicating authority suffers from violation of the principles of natural



justice (para 136).











75.Thereafter, Appellate Tribunal adverted to the show cause notice



issued by the adjudicating authority to the appellant under Section



8(1) and noted that the show cause notice was issued in a mechanical



manner without application of mind and no valid reasons were



mentioned in the show cause notice. It has been held as follows:











       137. The Notice to Show Cause dated 04.04.2014



       under section 8(1) of the Act (hereinafter the "Show Cause



       Notice") issued by the Registrar of this Adjudicating



       Authority to the Appellants was contrary to Section 8



       (1) of the PMLA, for the reason that a Notice to Show



       Cause, under Section 8 (1) of the Act, can only be issued



       (following receipt of a Complaint under Section 5 (5) of



       the Act) after the Adjudicating Authority forms a "reason



       to believe that any person has committed an offence



       under Section 3 or is in possession of proceeds of crime".



       138. A bare perusal of the Show Cause Notice would show



       that the Learned Registrar has issued the same in a



       mechanical manner without even affording an opportunity



       to the Adjudicating Authority to apply its mind. No valid



       reasons are mentioned on the notice itself or any separate



       order is passed before issuance of notice which is



       requirement as per settled law.



                               Page 18 of 23







76.Thus, from the above it is evident that Appellate Tribunal found that



the notice under Section 8(1) was not in conformity with the



requirement of the statute and that the adjudicating authority did not



form any reason to believe that the noticee had committed an offence



under Section 3 or is in possession of proceeds of crime. Therefore, the



very foundation for issuance of notice under Section 8(1) was absent.



Applying the decision of the Delhi High Court in J.Sekhar v. Union of



India (1 supra), the above omission strikes at the very root of the matter



rendering the adjudication proceedings as well as the provisional



attachment order illegal.











77. Various other flaws vitiating the order of the adjudicating authority



were pointed out by the Appellate Tribunal observing that the same



reflected non-application of mind. Appellate Tribunal opined that no



purpose would be served by continuing with the attachment. Since the



trial before the Special Court may take a number of years, therefore,



the State Government may take a stand about the project. However,



despite saying so Appellate Tribunal adverted to Section 8(8) of PMLA



including the second proviso and relegated the appellant to the Special



Court to seek release of the attached property holding that till such time



attachment     would        continue.   Though     Appellate     Tribunal



extracted Section 8(8) of PMLA, it did not say that it had passed the



order of relegation on the basis of the aforesaid provision. Relevant



portion of the order of the Appellate Tribunal is as under:











       “160. As far as attachment as per details mentioned in



       preceding paras of head vii) and viii) with regard to



       attachment of Rs.23.23 crores of VANPIC Port Pvt. Ltd. i.e.



       about 561 acres land and Rs.27.72 crores spent by VANPIC



       Project Pvt. Ltd i.e. about 855 acres of land is concerned, it



                     Page 19 of 23







is vacant land. The possession is not with the appellants



who being a partner with RAK has spent huge amount.



MOU and agreement have already been executed with



regard to VANPIC Project. The said project was in the



interest of public. Government of Andhra Pradesh is not the



party in the present appeals. This Tribunal is not aware



about the stand of the Andhra Pradesh Government as to



whether it is still interested in the said project as the same



was prime facie between Government to Government. It is



also not aware as to whether Government is now agreeable



to Nimmagadda Prasad and its group as a partner with



RAK or not. Therefore, it is not proper to give any findings



in this regard, otherwise it would amount to enforcement of



MOU and agreement. However, prima facie, this Tribunal



is of the opinion that no purpose would be served to



continue the attachment as the said project was originally



meant for public welfare of Hyderabad. The said project



has already been delayed for more than ten years. The trial,



if conducted if charges are framed, may take number of



years. Therefore, the State Government has to take the



stand about the said project. If necessary, the State



Government     may    obtain    the   advice      from   Central



Government, but the Chief Minister should not involve



himself in said process directly or indirectly.











161. The amended provision of Section 8(8) of PMLA along



with two proviso are reproduced hereunder:-











"Where a property stands confiscated to the Central



Government under sub-section (5), the Special Court, in



                                 Page 20 of 23







            such manner as may be prescribed, may also direct the



            Central Government to restore such confiscated property or



            part thereof of a claimant with a legitimate interest in the



            property, who may have suffered a quantifiable loss as a



            result of the offence of money laundering:











            Provided that the Special Court shall not consider such



            claim unless it is satisfied that the claimant has acted in



            good faith and has suffered the loss despite having taken all



            reasonable precautions and is not involved in the offence of



            money laundering:] [Provided further that the Special



            Court may, if it thinks fit, consider the claim of the claimant



            for the purposes of restoration of such properties during the



            trial of the case in such manner as may be prescribed.]











            162. In view of peculiar facts and circumstances, the



            appellants are granted liberty to approach the Special



            Court on this issue. It is directed that Government of



            Andhra Pradesh may also appear before the Special Court



            and raise its specific stand so that the appropriate order be



            passed by the Special Court. Till that time, the attachment



            shall continue.”











20.   To summarise the entire order passed by the Tribunal which has







been taken note of by this Hon’ble Court while deciding CMSA.No.6 of







2020, the learned Division Bench, in the case of Vanpic Ports Private







Limited (supra), had held aptly at paragraph No.79 as under, viz.,



                              Page 21 of 23







 “79..   If we look at the findings returned by the Appellate Tribunal vis-



à-vis the provisional attachment order and the order of the adjudicating



authority on one hand and the conclusions of the Appellate Authority on



the other hand, it is evident that the conclusions are not consistent with



the findings returned by the Appellate Tribunal; rather wholly



inconsistent. Appellate Tribunal has held that while carrying out the



provisional attachment, the attaching authority did not record reason to



believe that the petitioner is in possession of any proceeds of crime and



that such proceeds of crime were likely to be concealed, transferred etc.,



which may frustrate any proceedings relating to confiscation of such



proceeds as is the mandatory requirement under Section 5(1) of PMLA.



Appellate Tribunal also found fault with the approach adopted by the



adjudicating authority in overlooking the above conditions. The show



cause notice under Section 8(1) of PMLA was issued in a mechanical



manner without application of mind and without forming any reason to



believe that the noticee had committed an offence under Section 3 or was



in possession of proceeds of crime. The adjudicating authority did not



record any reason that the provisional attachment should continue. These



are jurisdictional errors which have been clearly pointed out by the



Appellate Tribunal. The above requirements being the foundation for



attachment - either provisional or confirmation or continuation, in the



absence thereof the provisional attachment order as well as the



confirmation order of the adjudicating authority would be illegal, null



and void, being without jurisdiction. Consequently, the natural corollary



flowing from the findings would be that such property should be released



from attachment. Instead of doing that, Appellate Tribunal relegated the



appellant to the forum of Special Court to seek de- attachment after itself



observing that the trial before the Special Court, if conducted, may take



number of years.



                               Page 22 of 23







21.    It has been informed across the Bench that the order passed by this







High Court in Vanpic Ports Private Limited (supra), dismissing the







appeal insofar as matter relating to Vanpic Ports Pvt. Ltd. and Vanpic







Projects Private Limited are concerned, the matters are already under







challenge before the Hon’ble Supreme Court vide S.L.P.(Civil) Appeal







No.31533 of 2023 and where the Hon’ble Supreme Court had only







issued notice and directed parties therein to maintain status quo in







respect of the subject property, and that final outcome of the said S.L.P.







is still awaited.











22.    Given the fact that in identical set of facts, the learned Division







bench of this High Court had already passed three set of orders on







different dates in three different appeals, this Bench firstly in order to







maintain judicial propriety, and secondly, having been found no strong







case being made out by the learned counsel for the appellant to take a







different view than that which is taken by the learned Division Bench of







this High Court in the case of Vanpic Ports Private Limited (supra), is







inclined to follow the dictum of the same judgment.



                                  Page 23 of 23







23.      Therefore, for reasons alike and for the reasons narrated in the said







order, as also in addition that no additional material or ground having







been found strong enough to interdict the impugned order in the present







batch of appeals insofar as the respondents are concerned, and for all the







reasons aforementioned, the present batch of Appeals filed by the







appellant-Department deserve to be and are accordingly dismissed. No







costs.











24.      As a sequel, miscellaneous petitions pending if any, shall stand







closed.







                                                         ________________



                                                         P.SAM KOSHY, J











                                      _______________________________



                                       SUDDALA CHALAPATHI RAO, J







Date: 19.06.2026



GSD / Ndr