Karnataka High Court
Sri Mohammed Saqi vs The Directorate Of Enforcement on 14 September, 2020
Author: John Michael Cunha
Bench: John Michael Cunha
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 14TH DAY OF SEPTEMBER 2020
BEFORE
THE HON'BLE MR. JUSTICE JOHN MICHAEL CUNHA
WRIT PETITION NO.9797 OF 2020(GM-RES)
A/W
WRIT PETITION NO.9812 OF 2020(GM-RES)
WRIT PETITION NO.9797 OF 2020
BETWEEN:
1. SRI MOHAMMED SAQI
S/O. YAHYA MOHAMOOD QURASHI,
AGED ABOUT 40 YEARS,
R/AT NO. 7/2, FLAT NO. 401,
FOURTH FLOOR,
ALEXANDRIA STREET,
RICHMOND TOWN,
BANGALORE-560 025.
2. MOHAMMED TABREZ
S/O. MOHAMMED MUKTAR AHMED,
AGED ABOUT 37 YEARS,
R/AT NO. 7/2, FLAT NO. 401,
FOURTH FLOOR,
ALEXANDRIA STREET,
RICHMOND TOWN,
BANGALORE-560 025.
...PETITIONERS
(BY SRI: SIRAJUDDIN AHMED, ADVOCATE)
2
AND:
1. THE DIRECTORATE OF ENFORCEMENT
(FOREIGN EXCHANGE MANAGEMENT ACT AND
PREVENTION OF MONEY LAUNDERING ACT)
OFFICE AT NO.10-A, JAM NAGAR HOUSE,
AKBAR ROAD,
NEW DELHI-110 001.
2. THE TAHSILDAR
BANGALORE NORTH TALUK,
GROUND FLOOR, KANDAYA BHAVAN,
K.G. ROAD,
BANGALORE-560 009.
3. MOHAMMED MANSOOR KHAN
S/O. ABID ALI KHAN,
AGED ABOUT 50 YEARS,
NO. 48, 38TH CROSS ROAD,
TILAK NAGAR,
BANNERGHATTA MAIN ROAD CROSS,
BANGALORE-560 041.
...RESPONDENTS
(BY SRI: MADHUKAR DESHPANDE, ADVOCATE FOR R1;
SRI: R. SRINIVASA GOWDA, AGA FOR R2)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 &
227 OF THE CONSTITUTION OF INDIA, PRAYING TO DIRECT THE
RESPONDENTS NOT TO DISPOSSESS THE PETITIONERS
WITHOUT RETURNING THE AMOUNT DEPOSITED AS PER THE
LEASE AGREEMENT OR TO PROCEED WITH DUE PROCESS OF
LAW AND ETC.
3
WRIT PETITION NO.9812 OF 2020
BETWEEN:
MR. SYED SAJID IQBAL
SON OF BASHEER SADATH
AGED ABOUT 56 YEARS
NO.13, 7TH CROSS
K.G HALLI, ARABI COLLEGE
BENGALURU-560043
...PETITIONER
(BY SRI: S R SREEPRASAD, ADVOCATE)
AND:
1. THE DEPUTY DIRECTOR
DIRECTORATE OF ENFORCEMENT
GOVERNMENT OF INDIA
3RD FLOOR, 'B' BLOCK
BMTC, SHANTINAGAR,
BANGALORE-560027
2. THE DIRECTORATE OF ENFORCEMENT
FOREIGN EXCHANGE MANAGEMENT ACT
AND PREVENTION OF MONEY LAUNDERING
ACT, GOVERNMENT OF INDIA
10-A, JAMNAGAR HOUSE, AKBAR ROAD
NEW DELHI-110001 .
3. MR. MOHAMMED MANSOOR KHAN
AGED ABOUT 43 YEARS
SON OF MR.ABID ALI KHAN
NO.24, I FLOOR, I CROSS
SOMESHWARA NAGAR, I BLOCK
4
JAYANAGAR,
BANGALORE-560011.
...RESPONDENTS
(BY SRI:MADHUKAR DESHPANDE, ADVOCATE FOR R1 AND R2)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 &
227 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH THE
NOTICE OF EVICTION DATED 25.8.2020 PRODUCED AT
ANNEXURE-A IN RESPECT OF THE FIRST FLOOR PORTION OF
THE FLAT CONSISTING OF 3 BEDROOMS HALL, KITCHEN
CARVED OUT OF LARGER EXTENT OF THE PREMISES BEARING
NO.77, POTTERY TOWN, BANGALORE-560046, ISSUED BY THE
R-2
THESE WRIT PETITIONS COMING ON FOR ORDERS,
THROUGH VIDEO CONFERENCE, THIS DAY, THE COURT MADE
THE FOLLOWING:
ORDER
Sri Madhukar Deshpande, learned Standing Counsel appearing for Directorate of Enforcement, takes notice for respondent No.1 in W.P.No.9797/2020 and for respondent Nos.1 and 2 in W.P.No.9812/2020.
2. Heard learned counsel for petitioners and learned Standing Counsel for respondents/Directorate of Enforcement and learned AGA for respondent No.2 in W.P.No.9797/2020. 5
3. Petitioners have invoked the jurisdiction of this Court to protect possession of the premises alleged to have been taken by them on lease from respondent No.3.
4. Undisputedly, prosecution is initiated against respondent No.3 under the provisions of the Prevention of Money
-laundering Act, 2002 (hereinafter referred to as "Act") and in the course of the investigation, the properties alleged to have been involved in money-laundering and the proceeds of the offences covered under the Act have been attached under Section 5(1) of the Act and the order of attachment is confirmed in accordance with section 8(3) of the Act.
5. In this context, Section 5(4) of the Act provides that:-
"(4) Nothing in this section shall prevent the person interested in the enjoyment of the immovable property attached under sub-section (1) from such enjoyment.
Explanation. - For the purposes of this sub- section "person interested", in relation to any 6 immovable property, includes all persons claiming or entitled to claim any interest in the property."
6. Petitioners claim interest in the attached property on the basis of unregistered lease deeds said to have been executed between them and respondent No.3. The genuineness of these lease deeds are seriously contested by respondent Nos.1 and 2 and it is contended that the agreement of lease put forward by the petitioners are unregistered and cannot be attached with any legal value. In this regard, it is pertinent to note that Rule 5(4) of the Prevention of Money-laundering (Taking Possession of Attached or Frozen Properties Confirmed by the Adjudicating Authority) Rules, 2013 provides that, "Where the immovable property confirmed by the Adjudicating Authority is in the form of a land, building, house, flat, etc., and is given on lease or rent to any third party where the registration is optional in accordance with the provision of section 18 of the Registration Act, 1908, the authorized officer shall proceed to get the premises vacated and the possession shall be taken by seeking 7 the assistance of local Authorities in terms of section 54 of the Act."
7. In the instant case, the lease agreement put forward by the petitioners is ostensibly for a period more than 11 months which require registration in terms of section 17 of the Registration Act. Under the said circumstances, no relief could be granted to the petitioner under Articles 226 & 227 of the Constitution of India and the only remedy available to the petitioners is to take recourse to section 26 of the Prevention of Money-laundering Act, 2002 by preferring an appeal before the Appellate Tribunal.
8. Hence, without expressing any opinion on the disputed contentions urged by the parties, the parties are directed to exhaust the appeal remedy provided under section 26 of the Prevention of Money-laundering Act, 2002. However taking into consideration the difficulties faced by the litigants in approaching the appellate forums on account of the prevailing situation, it is hereby ordered that respondents shall not take coercive action against the petitioners for a period of 15 days 8 from the date of release of the order so as to enable the petitioners to take further orders from the Appellate Tribunal.
Both the petitions are disposed of in terms of the above order.
Sd/-
JUDGE Bss