Calcutta High Court (Appellete Side)
Bulti Hossain vs Union Of India & Anr on 25 April, 2025
IN THE HIGH COURT AT CALCUTTA
CONSTITUTIONAL WRIT JURISDICTION
APPELLATE SIDE
Before:
The Hon'ble Justice Om Narayan Rai
WPA 29001 of 2024
Bulti Hossain
Vs.
Union of India & Anr.
For the Petitioner : Mr. Apalak Basu
Mr. Nazir Ahmed
Ms. Sanghamitra Mridha
............Advocates
For the Enforcement : Mr. Vipul Kundalia, Sr. Adv.
Directorate Mr. Anindya Kanan
Mr. Dhirodatto Chaudhuri ...........Advocates
Heard on : 11.04.2025
Judgment on : 25.04.2025
Om Narayan Rai, J.:-
1. The instant writ petition has been filed assailing notice captioned "Eviction
Notice" dated November 19, 2024 issued by the Deputy Director, Directorate
of Enforcement under Rule 5(2) of the Money Laundering (Taking Possession
of Attached or Frozen Properties Confirmed by The Adjudicating Authority)
Rules, 2013 (hereafter the "Rules"). The said notice also indicates that it is
for taking possession of certain properties mentioned therein under Section
Page 1 of 14
8(4) of the Prevention of Money Laundering Act, 2002 (hereafter "PMLA"). By
the said notice the petitioner has been directed to vacate the premises
mentioned therein within a period of ten days and hand over possession
thereof to the issuer of the notice.
A brief factual recount of the case run in the writ petition:
2. One Mr. Firoj Hossain (the petitioner's husband) was a Director of M/s.
Bharat Krishi Samridhi Industries Limited (hereafter "the said company"). A
complaint had been lodged against the said company by one Sk. Mohammad
Aziz in Arambagh Police Station alleging that the said company had induced
the complainant to become it's agent and that the complainant had while
working as such agent collected a sum of Rs. 1,00,000/- (Rupees One Lakh)
from local people and deposited the same in the said company giving such
people (from whom money had been collected) to understand that they would
get in return from the company double the amount deposited. It was also
alleged in the said complaint that the said company had cheated the
complainant and the depositors and had misappropriated the invested
amount. On the basis of such complaint Arambagh Police Station Case
No.243/2013 dated April 20, 2013 was registered against the said company
under Sections 420 and 406 of the Indian Penal Code, 1860.
3. Subsequently the Central Bureau of Investigation (hereafter "CBI"), EO-IV,
Kolkata took over the investigation in the said Arambagh Police Station Case
No.243/2013 in compliance with an order dated May 9, 2014 passed by the
Hon'ble Supreme Court of India in Writ Petition (C) No. 401 of 2013 (Subrato
Chatoraj v. Union of India & Ors.).
4. CBI registered FIR No. RC2252017E0002 dated September 24, 2018 against
the said company and others upon clubbing two other First Information
Reports therewith.
Page 2 of 14
5. On the basis of the aforesaid FIR registered by the CBI, the Kolkata Zonal
Office - I of the Enforcement Directorate registered a complaint being
ECIR/KLZO-1/18/2021 on March 31, 2021.
6. On or about February 6, 2020, the Enforcement Directorate also filed an
application under Section 17(4) of the PMLA inter alia praying for retention of
records/properties seized on January 10, 2020. The said application was
allowed by the adjudicating authority by its order dated November 12, 2020.
7. Subsequently, on the aforesaid complaint being ECIR/KLZO-1/18/2021, the
Deputy Director of Enforcement Directorate passed a Provisional Attachment
Order being PAO No. 03/2022 on February 18, 2022.
8. Thereafter, the Enforcement Directorate filed a complaint under Section 5(5)
of the PMLA before the Adjudicating Authority. The same was registered as
OC No. 1658 of 2022. In the said proceeding being OC No. 1658 of 2022 both
the petitioner and her husband had been arraigned.
9. On or about April 1, 2022 a notice under Section 8 of the PMLA was issued
to the petitioner to which the petitioner replied on May 14, 2022.
10. Ultimately, the provisional order of attachment being PAO No.03/2022
passed by the Deputy Director of Enforcement Directoratein ECIR No.
KLZO/18/2021 was confirmed by the Adjudicating Authority by an order
dated August 22, 2022.
11. Feeling aggrieved thereby, the petitioner preferred an appeal before the
Appellate Tribunal, jointly with her husband. The Appellate Tribunal then
issued a notice to the Enforcement Directorate on January 18, 2023 thereby
calling upon the Enforcement Directorate to file its reply to the appeal
preferred by the petitioner and her husband within six weeks.
12. Subsequently, in the said appeal which had been preferred by the petitioner
and her husband jointly, the Appellate Tribunal passed an order dated
November 22, 2023 thereby directing the petitioner to file a separate appeal
since joint appeal was not maintainable before the Appellate Tribunal.
Page 3 of 14
13. The petitioner, therefore, filed a separate appeal under Section 26 of the
PMLA along with an application seeking stay of the order dated August 22,
2022 passed by the adjudicating authority.
14. During pendency of the said appeal as well as the application seeking stay of
the order dated August 22, 2022 passed by the Adjudicating Authority, the
petitioner was served with a notice issued under Section 8(4) of the PMLA as
well as Rule 5(2) of the Rules.
15. Feeling aggrieved by the aforesaid notice of eviction, the petitioner has
approached this Court by filing the present application under Article 226 of
the Constitution of India.
Submissions of the petitioner
16. Mr. Apalak Basu, learned Advocate appearing for the petitioner submitted
that the impugned notice dated November 19, 2024 is wholly without
jurisdiction.
17. Inviting the attention of this Court to the observations of the Hon'ble
Supreme Court in paragraphs 179, 180 and 181 in the case of Vijay
Madanlal Choudhary and Others v. Union of India and Others1, it was
submitted by Mr. Basu that a notice issued under Rule 5(2) of the Rules for
taking possession under Section 8(4) of the PMLA could not have been issued
by the Respondent Enforcement Directorate before a formal order of
confiscation was passed by the Special Court and that a direction under the
aforesaid provision for taking possession of a property before any formal
order of confiscation was passed should be an exception and not the rule.
18. Mr. Basu further contended that the Hon’ble Supreme Court had in the said
case of Vijay Madanlal1 (supra) clearly observed that the provision of
Section 8(4) of PMLA should be invoked only in exceptional situation keeping
in mind the peculiar facts of the case.
1
(2023) 12 SCC 1
Page 4 of 14
19. It was asserted on behalf of the petitioner that nothing had been brought on
record to show that there was any exceptional circumstance or exceptional
situation justifying the issuance of an eviction notice or a notice for taking
possession of the property under Section 8(4) of the PMLA read with Rule 5(4)
of the Rules.
20. Mr. Basu further added that in the case at hand the notice had been issued
after a gap of almost 2 years 9 months and the notice did not reflect a single
word on exceptional circumstance as mandated by the Hon’ble Supreme
Court in the case of Vijay Madanlal1 (supra).
21. It was further submitted that there was nothing on record to suggest that the
conditions of Rule 5(1) of the Rules had been met or complied with. Mr. Basu
furthered his argument by stressing that the subject property was in anyway
attached and the respondents had brought nothing on record to explain as to
why Rule 5 (1) of the Rules was deemed inadequate and why Rule 5(2) of the
said Rule had been resorted to.
22. Mr. Basu also assailed the said notice on the ground that the same was
cryptic and that it was the duty of the respondent to disclose the exceptional
circumstances since the addressee had (has) a right to know the reason of
deprivation and Courts too needed to know or at least infer from the material
on record the reasons which compelled the Enforcement Directorate to send
the impugned notice of eviction.
23. It was further submitted by Mr. Basu that mere confirmation of attachment
even if upheld by all Courts would not permit the authority to issue notice
under Section 8(4) of the PMLA unless there was an order of confiscation
passed by the Special Court under Section 8(6) of the PMLA. It was
submitted that such action of the respondents amounted to arbitrary
inhibition of the petitioner’s property rights in utter violation of the guarantee
given by the provisions of Article 300A of the Constitution of India. It was
submitted that such constitutional right could not be curtailed without
following the due process of law.
Page 5 of 14
Submissions of the respondent
24. Mr. Vipul Kundalia, learned Senior Advocate appearing for the respondents
submitted that the instant writ petition was not fit to be entertained. He
contended that as the petitioner had already approached the Appellate
Tribunal by filing an appeal under Section 26(1) of the PMLA along with an
application for stay of the order confirming the provisional attachment
passed by the adjudicating authority and as the same were pending
adjudication before the said Tribunal, there could be no reason for this Court
to intervene at this stage. It was asserted that since the statutory appellate
forum was already in seisin of the matter, it would not be proper for this
Court to exercise discretion in favour of the writ petitioner by entertaining
the petition under the highly prerogative writ jurisdiction of this Court.
25. As regards the submission that the notice did not show as to whether or not
there was any exceptional circumstance or situation justifying issuance of
the impugned notice of eviction, it was argued by Mr. Kundalia that the
question as to whether a case of exceptional nature had been made out or
not by the respondent would have to be tested by the Appellate Tribunal
only, before whom the petitioner’s appeal under Section 26(1) of the PMLA
was pending. In order to buttress his aforesaid contention, Mr. Kundalia
relied on an unreported judgment of the High Court of Jammu & Kashmir
and Ladakh in the case of Syed Akeel Shah and Anr. v. Directorate of
Enforcement &Ors. in LPA No. 203/2022; CM No. 5867/2022. Paragraph
12 of the said judgment was placed to emphasize that the question as to
whether a particular case was of exceptional nature or not, could be
determined only by the appellate authority at the time of considering the
merits of the appeal and not by this Court in exercise of its writ jurisdiction.
Relying on the observations made in the same paragraph, it was asserted
that it would always be an open for a person apprehending immediate action
Page 6 of 14
against him to approach the Appellate Tribunal and persuade the authority
to stay the impugned order of attachment.
26. Mr. Kundalia also cited a judgment rendered by the High Court of Punjab
and Haryana in the case of Varinder Pal Singh Dhoot v. Union of India
and Another2 and relied on Paragraphs 21, 22 and 23 thereof to emphasize
that in a similar situation the High Court of Punjab and Haryana had
declined to entertain a writ petition and had left the petitioner therein free to
approach the Appellate Tribunal for seeking appropriate relief by filing an
application in the pending appeal. In the said case the petitioner had been
granted liberty to file an application for stay within a period of 3 days and the
parties were directed to maintain status quo in respect of the eviction notice
till the filing of the appeal.
Reply of the petitioner
27. Mr. Basu, rejoined by submitting that the jurisdiction of the High Court
under Article 226 of the Constitution of India would always be available in
matters of present nature. It is submitted that the subject matter of
challenge before this Court is only a notice issued under Section 8(4) of
PMLA read with Rule 5(2) of the Rules for taking possession of the
petitioner’s properties and not any order passed by the adjudicating
authority. It is submitted that issuance of such notice under Section 8(4) of
the PMLA is only an administrative or ministerial act and there is no
provision of appeal for challenging such notice in the PMLA. It is submitted
that in such view of the matter the instant writ petition can always be
entertained by this Court and mere pendency of the appeal should not inhibit
the writ petition.
Decision of the Court
28. It is now doubtless that this Court’s jurisdiction to entertain a writ petition
under Article 226 of the Constitution of India against any action or order of
2
2024 SCC OnLine P&H 11723
Page 7 of 14
any authority answering the definition of a “State” within the meaning of
Article 12 of the Constitution of India remains uninhibited by any other
remedy (whether by way of appeal or otherwise) that may be provided against
such action or order in any given statute inasmuch writ jurisdiction of this
Court under Article 226 of the Constitution of India forms part of the basic
structure of the Constitution of India. However writ remedy under Article 226
of the Constitution of India being discretionary in nature, the High Court
may be perfectly justified in refusing to exercise its powers under Article 226
of the Constitution of India if the party invoking the same is found to be
amply protected by the available statutory remedy in the sense that the
statutory remedy is efficacious and not illusory or too onerous to be availed.
29. The principal question that falls for consideration by the Court in view of
submissions made by the parties and the material on record is whether or
not this Court should exercise discretion in favour of the petitioner and grant
the reliefs prayed for.
30. In order to answer this question, the impugned notice issued under Section
8(4) of PMLA and Rule 5(2) of the Rules needs to be analyzed first.
31. Section 8(4) of the PMLA that provides for taking possession of an attached
property and which has been referred to in the notice impugned, deserves
notice. The same is extracted herein below:
(4) Where the provisional order of attachment made under sub-
section (1) of section 5 has been confirmed under sub-section (3), the
Director or any other officer authorised by him in this behalf shall
forthwith take the possession of the property attached under section 5 or
frozen under sub-section (1A) of section 17, in such manner as may be
prescribed:
Provided that if it is not practicable to take possession of a property
frozen under sub-section (1A) of section 17, the order of confiscation
shall have the same effect as if the property had been taken possession
of.
32. Rule 5(2) of the Rules which prescribes the notice, reads thus:
Page 8 of 14
(2) Where the immovable property confirmed by the Adjudicating Authority
is in the form of a land, building, house, flat, etc., and is occupied by the
owner, the authorized officer shall issue a notice of eviction of ten days so
as to prevent the person from enjoying such property and after issuing of
such notice if the premises is not vacated within the stipulated time, such
occupant shall be evicted and the possession shall be taken by seeking the
assistance of the local Authorities in terms of section 54 of the Act.
33. A meaningful reading of the notice in the light of section 8(4) of the PMLA
and Rule 5(2) of the Rules would reveal that the order dated August 22, 2022
passed by the Adjudicating Authority (whereby the Provisional Attachment
Order was confirmed) forms the foundation of the impugned eviction notice.
The said notice is in effect a statutory consequence of the order dated August
22, 2022 passed by the Adjudicating Authority.
34. Section 26 of the PMLA provides for an appeal against an order passed by the
Adjudicating Authority. Although this Court has not been shown any
provision whereby the Appellate Tribunal has been vested with power to pass
an interim order in an appeal presented before it, yet having noticed the
powers that have been granted to the said Tribunal by use of the expression
“pass such orders thereon as it thinks fit, confirming, modifying or setting
aside the order appealed against”, this Court is of the view that the Appellate
Tribunal would have implied power to grant stay of the order impugned
before it. This Court holds so on the authority of the law laid down by the
Hon’ble Supreme Court in the case of ITO v. M.K. MOHD. KUNHI 3 where
while considering a somewhat similar situation of absence of a provision
expressly empowering the Income Tax Appellate Tribunal to grant interim
order of stay in an appeal preferred before it, the Hon’ble Supreme Court held
as follows:
6. …………………. The right of appeal is a substantive right and the questions of
fact and law are at large and are open to review by the Appellate Tribunal. Indeed
the Tribunal has been given very wide powers under Section 254(1) for it may3
(1969) 71 ITR 815
Page 9 of 14
pass such orders as it thinks fit after giving full hearing to both the parties to the
appeal. If the Income Tax Officer and the Appellate Assistant Commissioner have
made assessments or imposed penalties raising very large demands and if the
Appellate Tribunal is entirely helpless in the matter of stay of recovery the entire
purpose of the appeal can be defeated if ultimately the orders of the departmental
authorities are set aside. It is difficult to conceive that the legislature should have
left the entire matter to the administrative authorities to make such orders as they
choose to pass in exercise of unfettered discretion. The assessee, as has been
pointed out before, has no right to even move an application when an appeal is
pending before the Appellate Tribunal under Section 220(6) and it is only at the
earlier stage of appeal before the Appellate Assistant Commissioner that the
statute provides for such a matter being dealt with by the Income Tax Officer. It is
a firmly established rule that an express grant of statutory power carries with it by
necessary implication the authority to use all reasonable means to make such
grant effective (Sutherland Statutory Construction, 3rd Edn., Articles 5401 and
5402). The powers which have been conferred by Section 254 on the Appellate
Tribunal with widest possible amplitude must carry with them by necessary
implication all powers and duties incidental and necessary to make the exercise of
those powers fully effective.
(Emphasis supplied by underlining)
35. On the same logic, the Appellate Tribunal would also have power to stay the
operation of the impugned notice of eviction, which has demonstrably been
issued as a consequence of the order confirming the order of attachment.
36. It is not in dispute that the petitioner is already before the Appellate Tribunal
by way of an appeal against the said order dated August 22, 2022 passed by
the Adjudicating Authority and that an application for stay of the operation of
the said order has also been filed by the petitioner in the said appeal. If the
order dated August 22, 2022 is stayed the notice dated November 19, 2024
will lose its foundation and crumble immediately. Therefore, this Court is
unable to agree with the submission of Mr. Basu that merely because there is
no separate provision for appeal against the said notice dated November 19,
Page 10 of 14
2024, the petitioner is remediless and this Court should intervene under
Article 226 of the Constitution of India.
37. As regards the submission of Mr. Basu that the impugned notice does not
disclose the exceptional circumstances on the basis whereof the petitioner
has been sought to be evicted, this Court is of the view that disclosure of
such reason is not at all required in the notice to be issued under Rule 5(2) of
the Rules. Indeed in terms of the law laid down by the Hon’ble Supreme
Court in the case of Vijay Madanlal1 (Supra), it would be imperative upon
the respondent Enforcement Directorate Authorities to demonstrate that
there is an exceptional situation justifying taking of possession of the
relevant property in terms of section 8(4) of the PMLA but the question as to
whether there is any exceptional situation or not, being one of facts, would
again fall within the domain of the Appellate Tribunal only. There is no
reason for this Court to separately entertain a challenge to the notice of
eviction when the same can be easily dealt with by the Appellate Tribunal in
the pending appeal itself. This Court is ad idem with the view taken by the
High Courts of Jammu & Kashmir and Ladakh and Punjab and Haryana, in
the judgments cited by Mr. Kundalia, to that effect that the remedy of a
person aggrieved by a notice of eviction issued under Section 8(4) of the
PMLA read with Rule 5(2) of the Rules of 2013 lies before the Appellate
Tribunal only.
38. Insofar as the petitioner’s submission that the impugned eviction notice is
wholly without jurisdiction, is concerned, this Court is of the prima facie view
that there is no inherent lack of jurisdiction in issuance of the notice
impugned. The reasons therefor are as follows:
a) The notice has been issued after the confirmation of the order of
attachment. Section 8(4) of the PMLA mandates that “Where the
provisional order of attachment made under sub-section (1) of section 5
has been confirmed under sub-section (3), the Director or any other
officer authorised by him in this behalf shall forthwith takePage 11 of 14
the possession of the property attached under section 5………. in such
manner as may be prescribed”.
b) The manner of taking possession has been prescribed in Rule 5 of the
Rules. Rule 5(2) of the Rules mandates that “the authorized officer shall
issue a notice of eviction of ten days so as to prevent the person from
enjoying such property….”
c) Therefore prima facie the notice conforms to the provisions of PMLA and
the Rules and there does not appear to be an error of jurisdiction in
issuance thereof.
c) In the case at hand the Deputy Director of Enforcement Directorate has
issued the notice impugned. It has neither been averred in the writ
petition, nor submitted before the Court; far less demonstrated that the
Deputy Director of Enforcement Directorate who issued the impugned
notice was not authorized to issue the said notice. Therefore this Court
is also unable to hold that the notice was issued by an authority
lacking jurisdiction.
39. As regards the petitioner’s contention that there is nothing on record to show
that the provisions of Rule 5(1) of the Rules have been complied with, this
Court is of the prima facie view that non-compliance or belated compliance
with the provisions of Rule 5(1) would not at the threshold vitiate a notice
under Rule 5(2) of the Rules. Rule 5(1) contemplates notice of the attachment
to the Registrar having jurisdiction over the area where the property is
situated requiring the Registrar not to transfer or create any interest in the
property till further orders are passed. The purpose of such provision is
clearly different from that of Rule 5(2). While the former provision is aimed at
avoiding/preventing encumbrance and transfer of title, the latter is aimed at
securing possession thereof. Both are important but non compliance or
belated compliance of one would not vitiate the lawful compliance with the
other.
40. The point that the notice impugned has been issued after 2 years 9 months
is also not appealing. The statute does not provide for a mandatory time limit
Page 12 of 14
for such notice to be issued. In such situation the length of time taken by the
Respondents to issue the notice impugned cannot be taken advantage of by
the petitioner in the facts of the present case.
41. The next point urged by Mr. Basu that the notice has been issued prior to the
order of confiscation, would definitely stand in case the Respondents fail to
demonstrate that exceptional situation exists justifying issuance of the said
notice. The test laid down by the Hon’ble Supreme Court in the case of Vijay
Madanlal1 (supra) would and must be satisfied but if it can be demonstrated
that exceptional situation obtains in the present case the notice would stand
vindicated. As already held in the preceding paragraphs such aspect as to
whether an exceptional case justifying issuance of the impugned notice has
been made out by the Respondents or not would be decided by the Appellate
Tribunal. Similarly the other contention of Mr. Basu’s that the petitioner’s
right to property has been infringed, would also gain ground only when it is
established that the notice impugned is wholly illegal. Since this Court has
not decided on the legality of the notice and has left it to be decided by the
Appellate Tribunal (such decision being predicated on the answer to the
question as to whether or not exceptional situation exists justifying issuance
of the impugned notice), it will be open to the petitioner to take such point
before the Appellate Tribunal.
42. This Court, therefore, feels that the petitioner should be left free to approach
the Appellate Tribunal and get the hearing of the stay application done
expeditiously. Since the petitioner has approached this Court under Article
226 of the Constitution it would be just and proper for this Court to request
the Appellate Tribunal before whom the petitioner’s appeal under Section 26
of the PMLA is pending to dispose of the petitioner’s appeal as expeditiously
as possible. Insofar as the petitioner’s application for stay of the order dated
August 22, 2022 is concerned, this Court would request the Appellate
Tribunal to consider the same on priority basis and dispose of the same as
expeditiously as possible preferably within a period of 2 months from date.
Page 13 of 14
43. With the aforesaid observations, the writ petition being WPA 29001 of 2024 is
disposed of.
44. Urgent Photostat certified copy of this judgment, if applied for, be given to the
parties upon compliance with all requisite formalities.
(OM NARAYAN RAI, J.)
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