Jammu and Kashmir High Court has asked Enforcement Directorate (ED) to file reply in former Chief Minister Farooq Abdullah's plea challenging the jurisdiction of the central agency to attach his assets in Jammu and Kashmir Cricket Association (JKCA) case.
While hearing the petition, a division bench of Pankaj Mithal and Vinod Chatterji Koul directed the ED to file counter affidavit to the
petition within three weeks and allowed the petitioner to file rejoinder affidavit thereafter.
The Court listed the petition for final disposal on May 11 along with LPA (293/2019) filed by former JKCA treasurer Ahsan Ahmad Mirza against a single bench order which had dismissed Mirza's petition against his trial court proceedings.
Pointing out that presently the petitioner has only been served with a show cause notice in which next date fixed is 20 April and the fact that the order of attachment is provisional in nature which is valid for a period of 180 days only, the bench said: "We do not consider it to be an appropriate case to pass any interim order at this stage particularly when the laundering of 43.69 crores of the amount is not in dispute which in all fairness ought to be returned to the public body i.e., JKCA."
"In the light of the dismissal of the earlier writ petition against which LPA (293/2019) is pending but without any interim protection, it is all the more reason for us not to pass any interim order at this stage," the Bench said.
The court issued the directions while hearing through video conference Sidharth Luthra, Senior Counsel, assisted by Shri Singh and Areeb Kawoosa on behalf of Abdullah and Tushar Mehta, Solicitor General of India, assisted by Zoheb Hossain Advocate on behalf of ED.
Citing Prevention of Money Laundering Act (PMLA), advocate Luthra submitted that the petitioner can only be proceeded under the said Act in connection with the scheduled offence as per the Schedule-A of the Act.
"The offences under Sections 406 and 409 of RPC are not the scheduled offences and merely for an offence under Section 120-B RPC, the petitioner is not liable to be proceeded with under the PMLA," he told the court.
Luthra further submitted that "the Schedule enlists the offence of criminal conspiracy under Section 120-B Indian Penal Code as one of the scheduled offences and does not refer to any offence under RPA much less under Section 120-B RPC".
The order of provisional attachment, he said, does not contain any reason to believe nor does the properties inherited by him (Farooq) or received in gift from his ancestors or any property which has been privately acquired by him are liable to attachment as they are not "proceeds of the crime".
He submitted that the order of provisional attachment greatly undervalues the properties attached so as to attach almost all the properties of the petitioner. "Therefore, the entire proceedings are without jurisdiction and are malafide".
In defence, Tushar Mehta, Solicitor General of India, however, submitted that the PMPLA has been enacted by the Parliament in view of the political declaration adopted by the Special Session of the United Nations General Assembly calling upon the member states to adopt national money laundering legislation.
He argued that India being the member State accordingly enacted the Act and extended it to the whole of India.
"Thus, it cannot be said that the enactment is beyond the legislative competence of the Parliament," Solicitor General said.
He said as the Act is applicable to the whole of India, it is applicable to the Jammu & Kashmir also and the reference to Section 120-B in the Schedule to the Act refers to Section 122-B of RPC as they are corresponding and similar.
"The investigation clearly disclose that the petitioner has committed an offence of money laundering within the meaning of Section 3 of the PMLA and that he is one of the beneficiaries of the proceeds of the crime. The time of the commission of the scheduled offence is not relevant but the commission of the act of money laundering alone is material which is a continuing offence and it continues till the time the money so laundered is being projected as untainted," the SG said.
"Both sides attempted to rely upon certain precedents which we need not to discuss as we are not adjudicating upon the various issues raised at this stage without giving an opportunity to the respondents to file their response," the court said after hearing the parties.
On march 18, a single judge bench of the court had referred the plea to the division bench after observing that the genesis of the proceedings against the petitioner Dr Farooq Abdullah as also former treasurer of Jammu and Kashmir Cricket Association (JKCA) Ahsan Ahmad Mirza lie in the case which is pending trial before the designated Court. The issues, the court said, being common were therefore required to be considered together.
The CBI had charge sheeted six persons including the petitioner and the then Treasurer, JKCA, for causing loss to the Association to the tune of Rs.43.69 crores.
Proceedings were initiated against the then Treasurer of the JKCA who had challenged the same by filing WP in 2019.
The petition was dismissed vide judgment dated 15.10.2019 but against the same LPA (293/2019) is pending before the Division Bench of the Court.
It was in view of the pendency of the LPA that the Single Judge vide order dated 18.03.2021 expressed opinion that the matter be considered by the Division Bench.
The petition is seeking quashing of Original Complaint dated 15.01.2021 pending before Adjudicating Authority under PMLA along with the Provisional Attachment Order dated 18.12.2020 issued in ECIR dated 28.12.2018 as well as notice dated 05.02.2021 issued under Section 8 Prevention of Money Laundering Act, 2002 by the Adjudicating Authority.
Vide the PAO, the ED has attached several properties belonging to the petitioner. It has attached assets of Farooq Abdullah and others and put it worth Rs 11.86 crore in connection with its money laundering probe linked to alleged financial irregularities in JKCA.