The summer vacation division bench comprising Justice R Mahadevan and Justice M Govindaraj before whom the appeal moved by the Deputy Director, Directorate of Enforcement, Chennai, came up for hearing on Friday, stayed the Appellate Tribunal’s order.
The matter relates to a property purchased by Pothy’s measuring about 12,945 sq ft from Dhanalakshmi, the daughter of one ‘don’ Sridhar Dhanapal, who is a history-sheeter and reportedly ran a real estate business worth more than Rs 500 crore near Chennai.
Since Dhanapal is facing several criminal proceedings including offences under Prevention of Money Laundering Act (PMLA), the property in question was attached by the PMLA authorities on the basis that it was purchased using proceeds of the crimes committed by Sridhar.
Following this, Pothys filed an interim application before the Appellate Tribunal, New Delhi, stating that they were innocent and they had not committed any offence. It was submitted that they had made the purchase only for acquiring free ingress and egress from the main road to the property which they already owned.
The plea sought to stay the operation of notice of physical possession of the land by the Enforcement Directorate dated January 11, 2017.
Based on this, the Appellate Tribunal directed Pothys to pay 50 per cent of the purchase amount to the account of Deputy Director, Directorate of Enforcement, Chennai and use the property as a passage.
Objecting to this, the ED in its appeal contended that the tribunal has failed to consider that the term ‘use of proceeds of crime’ and projecting or claiming the same is also an offence of money laundering.
It also submitted that the tribunal has failed to consider that the direction to “use the confirmed property” is by itself without any jurisdiction and on this ground alone, the impugned order is liable to be set aside.
The appeal also noted that Pothys instead of making payment to the actual seller Dhanalakshmi, had put the sale consideration into the bank account of Kumari, wife of Sridhar, who is residing along with her husband in Dubai, who is not a seller in the said transaction, clearly proving that transaction involves money laundering.