PMLA Appellate Tribunal quashes attachment of Kiran Mazumdar’s UB Property in Mallya probe

The Appellate Tribunal, Prevention of Money Laundering Act has set aside the attachment of Biocon Ltd Chairman Kiran Mazumdar’s property in Kingfisher Towers, Bangalore, by the Enforcement Directorate..A similar order setting aside the attachment of a property belonging to one Vijay Mathias in the same real estate project was also passed by the Appellate Tribunal..The real estate project, Kingfisher Tower, was developed by Vijay Mallya’s United Brewers (Holding) Ltd (UBHL) and Prestige Estate Project Pvt. Ltd..The two flats in the real estate project were attached by the ED pursuant to an enforcement case investigation report (ECIR) against Vijay Mallya, M/s Kingfisher Airlines Ltd. (KAL) and others under Prevention of Money Laundering Act (PMLA), 2002 in a matter of IDBI Loan of Rs. 900 Crore..These properties, along with several other properties belonging to the accused persons in the ECIR, was attached as “value thereof” of the proceeds of crime..The appeal before Justice Manmohan Singh was for a determination as to whether the subject Properties were involved in the money-laundering case or not..The Appellate Tribunal noted that Mazumdar was the purchaser of the Property, for which she paid the complete consideration through duly documented legal banking channels..The purchase was done prior to the date of registration of the FIR or the ECIR at an arms-length transaction..Similarly, the complete transaction pertaining to the purchase of the property by Mathias was done at arms-length, and stood concluded much prior to the registration of the FIR and the registration of the ECIR..It was Appellants’ case that the property was attached without any notice and opportunity to be heard. It was also claimed that at the time of issuance of the Provisional Attachment Order there was no Confirmation Order that any proceeds of crime have flowed to UBHL..The Appellant Tribunal held that the ED had failed to establish, even prima facie, any collusion/connection of Mazumdar and Mathias with UBHL or Kingfisher Airlines Ltd. or Mr. Vijay Mallya..Appellate Tribunal also rejected ED’s submission that Mazumdar was a Director in a company associated with the aforesaid companies..The Appellate Authority held that by making the entire payment, the Appellants became stake-holder as the amount paid by them was not proceed of crime..Both the Appellants were also not involved in the money laundering case, as they were not named as one of the accused in the ECIR or the FIR, hence, the question of link and nexus in the criminal activities directly or indirectly does not arise..Hence, the Appellate Authority held,.“As far as the impugned order(s) dated 11.2.2016 is concerned, the said order is not sustainable in law and the facts of the present case. The same is set-aside against the appellant with regard to flat in question. The provisional order is also quashed accordingly by allowing the appeal..However, it is clarified that this tribunal has decided the appeal pertaining to the order passed on the attachment of flat allegedly purchased by the appellant. The finding shall have no bearing with regard to the merit of other proceedings pending against the accused parties including extradition proceedings.”.Kiran Mazumdar was represented by Senior Advocate Sudhir Nandrajog, and Advocates Arshdeep Singh, Meena Venugopal, Prija Jha and Manish Jha..Vivek Mathias was represented by Senior Advocate Rajiv Nayar, and Advocates Arshdeep Singh, Akshay Gupta and Manish Jha..Enforcement Directorate was represented by Advocate Rajeev Awasthi..Read orders–.Kiran Mazumdar:.Vikas Mathias: