Uttarakhand HC Stays Enforcement Directorate's Order To Provisionally Attach Property Worth ₹70 Crore Linked To Congress Leader

The ED took this action in January this year under the Prevention of Money Laundering Act (PMLA) 2002, claiming that the registered value of the attached land is ₹6.56 crore, while its market price is reportedly over ₹70 crore.

ED claims that one Sushila Rani, in conspiracy with other persons, registered two Powers of Attorney (POA) in the name of Birender Singh Kandari and Narender Kumar Walia of the land in question.

This land was sold by Kandari, a close associate of Rawat, to Mrs. Deepti Rawat (Rawat's wife) and Mrs. Laxmi Rana by using this Power of Attorney against an insignificant amount, which was much below the Circle Rates prescribed by the revenue authorities for that area.

As per ED, a part of this land was used to construct Doon Institute of Medical Sciences under the Purna Devi Memorial Trust, managed by Rawat's son, Tushit Rawat.

Challenging the order of the ED, Rawat argued in the HC that the same was not in conformity with the provisions under Section 5(1)(b) of Act of 2002, which provides that there has to be a reason to believe that the property in-question, is 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.

Against the backdrop of this submission, a bench of Justice Pankaj Purohit prima facie opined that the ingredient contained in Section 5(1)(b) of the Act of 2002 was not made out and there was no likelihood of property being transferred or alienated, etc.

“From the reading of the impugned order, it is reflected that the first ingredient contained in Section 5(1)(a) of Act of 2002 is made out, but so far as the provision of Section 5(1)(b) of Act of 2002 is concerned, it is nowhere reflected from the order impugned that there is reason to believe to the respondent-Deputy Director, Enforcement Directorate, that the property in-question, is 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 this Chapter,” single judge observed as it stayed the order impugned.

The Court also directed the respondent to file their counter within two weeks. The matter has now been posted for further hearing on May 14.