A.S.V.Krishnam Raju (dead) v. The Deputy Director of Enforcement

Judgment

(Per Hon’ble Sri Justice Ninala Jayasurya) The present Appeal has been preferred against the order of the Appellate Tribunal under SAFEMA at New Delhi, dated 13.05.2024 passed in FPA-PMLA-227/HYD/2011. Vide said order, the Appellate Tribunal dismissed the Miscellaneous Application i.e., MP-PMLA- 12750/HYD/2023 (Misc.), seeking to bring on record the Legal Representative of the deceased appellant, as also the appeal.

2. Heard Mr. C.V.Narasimham, learned counsel for the appellant and Mr.Josyula Bhaskar Rao, learned counsel for the respondent.

3. The brief narrative of the case for better appreciation and adjudication of questions of law may be stated thus:

4. One Mr.A.S.V.Krishnam Raju filed the above said appeal i.e., FPA- PMLA-227/HYD/2011 under Section 26 of the Prevention of Money Laundering Act (for short “the PMLA”) against the orders passed by the Adjudicating Authority in OC No.38/2009, dated 14.01.2010. The genesis for the complaint was a letter dated 07.01.2009 addressed by Mr. B.Ramalinga Raju to the shareholders of M/s.SCSL (Satyam Computer Services Limited) intimating that books of accounts of M/s.SCSL were falsified and the financial figures were inflated and the FIR registered on

09.01.2009 on a complaint by one of the investors against Mr.Ramalinga Raju and other promoters of M/s.SCSL under Section 120B r/w Section 406, 420, 467, 471 and 477-A of the Indian Penal Code. The case was 3 NJS, J & JS, J CMSA_11_2024 subsequently taken over by the CBI. Since the commission of offence under Section 467 of IPC is a scheduled offence under the PMLA, the Enforcement Directorate registered a case by filing ECIR dated

23.01.2009. Based on the charge sheet filed by the CBI dated

07.04.2009 and further investigations, having come to a conclusion that the offences of money laundering within the meaning of Section 3 of PMLA was committed, the Deputy Director of Enforcement Directorate, Hyderabad Zone Unit / the respondent issued a Provisional Attachment Order PAO No.1/2009, dated 18.08.2009, provisionally attaching the various properties of M/s SCSL and its Directors, including the properties

of the appellant in the above mentioned appeal i.e., Mr.A.S.V.Krishnam Raju.

5. Subsequently, respondent filed a complaint vide OC No.38/2009 before Adjudicating Authority as required under Section 5 (5) of the PMLA and the said authority issued notices to the defendants therein. Mr. A.S.V.Krishnam Raju, who was arrayed as defendant No.102 in the complaint, submitted his objections along with others. Thereafter, the Adjudicating Authority vide orders dated 14.01.2010 confirmed the order of Provisional Attachment and directed that the attachment of the properties shall: (a) continue during the pendency of the proceedings relating to the schedule offences before the Trial Court; and (b) become final after the guilt of the persons is proved in the Trial Court and order of such Trial become final. 4 NJS, J & JS, J CMSA_11_2024

6. Aggrieved by the orders of the Adjudicating Authority Mr.A.S.V.Krishnam Raju filed the above mentioned appeal raising various grounds. During the pendency of the appeal, he died on 20.03.2018 leaving behind his legal heir one Smt.A.Santhi Padma Nagaveni, daughter. Seeking to record her as Legal Representative of deceased- appellant in the appeal pending before the Appellate Tribunal under SAFEMA, she filed a miscellaneous application and the same was dismissed vide impugned order. The Hon’ble Appellate Tribunal also dismissed the Appeal as abated in view of the death of the appellant in the said Appeal. Aggrieved by the said order, Smt.Nagaveni, filed the present appeal.

7. Mr. Narasimham, learned counsel made submissions, inter alia, that the late Mr.A.S.V.Krishnam Raju, who was working as Assistant General Manager in M/s.Maytas Properties Ltd., purchased agricultural property of an extent of Ac.6-00 cents, for a valuable sale consideration out of the salary amounts received from M/s MAYTAS Pvt. Ltd., and the same was attached by the Enforcement authorities and the Adjudicating Authority confirmed the same without considering the objections of the Mr.Krishnam Raju. He submits that assailing the said order of the Adjudicating Authority an appeal vide FPA-PMLA-227/HYD/2011 was filed raising various factual and legal contentions and during the pendency of the said appeal Mr.Krishnam Raju died on 20.03.2018. He submits that the appeal was filed in the year 2010 and on receipt of intimation about its 5 NJS, J & JS, J CMSA_11_2024 hearing in the year 2023 received from the counsel representing Mr.Krishnam Raju, his daughter filed an application No.MP-PMLA- 12750/HYD/2023 (Misc.) to record her as legal representative of the deceased-appellant before the Hon’ble Appellate Tribunal, but the same was dismissed vide Order dated 13.05.2024 and the Tribunal also dismissed the Appeal on the premise that the same is abated. In elaboration, he submits that the Appellate Tribunal rejected the LR application on the ground that the same was filed beyond the normal period of limitation of 90 days as prescribed under Article 120 of the Limitation Act, 1963 read with Order XXII of the Code of Civil Procedure (for short ‘C.P.C.’), and such an application beyond the reasonable period of 90 days may be filed, but it should be supported with an application for condonation of delay by explaining the reasons, but no such application was filed in the instant case. He submits that the order under challenge is misconceived, violative of principles of natural justice and not sustainable. Referring to the provisions of the PMLA and the decisions of the Hon’ble Supreme Court of India, he seeks to set aside the order of the Appellate Tribunal.

8. The arguments of the learned counsel may be summarized as follows: a) Section 72 of the PMLA enables the continuation of the appeal, even if the original appellant dies during the pendency of the appeal. 6 NJS, J & JS, J CMSA_11_2024 b) The Appellate Tribunal went wrong in dismissing the appeal as abated when the legal representative of the deceased-appellant had filed an application to come on record so as to continue the proceedings. c) The Appellate Tribunal went wrong in dismissing the LR application by referring to Limitation Act without appreciating that the said Act does not apply to the proceedings before the quasi-judicial authorities and Tribunals, but only to the Courts in terms of Section 29(2) of the Limitation Act. d) Application of the provisions of C.P.C., i.e., Order 22 of C.P.C., by the Appellate Tribunal in the light of Section 35 (1) of the PMLA providing specifically that the Appellate Tribunal is not bound by the procedure laid down by the C.P.C., is wholly unsustainable. e) No separate procedure with regard to filing of LR application under PMLA is prescribed nor were any rules framed, in the absence of which, dismissal of LR application on the premise that the same is barred by limitation is not tenable. f) When PMLA does not prescribe limitation, resort cannot be made to the Limitation Act. g) The impugned order is violative of principles of natural justice as the Appellate Tribunal did not give opportunity for filing a petition to condone the delay in making application for bringing the LR on record, assuming that the time limit under the Limitation Act is applicable. h) When the special statute does not contain a provision for limitation, a broader and liberal approach shall be adopted while dealing with the applications filed by the Legal Representatives of the deceased parties. 7 NJS, J & JS, J CMSA_11_2024 i) An appeal is statutory right and cannot be denied on technical grounds, more particularly when the right to property proposed to be denied. j) The Appellate Tribunal went wrong in not noting that the property of the applicant’s father was not confiscated, but only attached and that on the death of the appellant, the property attached has to be released.

9. The learned counsel also referred to the decisions of the Hon’ble Supreme Court in Ganesan Rep. by its Power Agent G. Rukmani Ganesan v. Commissioner, Tamilnadu Hindu Religious and Charitable Endowments Board and Others1; M.P. Steel Corporation v Commissioner of Central Excise2; Consolidated Engg. Enterprises v. Principal Secretary, Irrigation Department and Others3; L.S. Synthetics Ltd. v. Fairgrowth Financial Services Ltd.,4 Commissioner of Sales Tax, UP, Lucknow v. Parson Tools and Plants, Kanpur5; U. Subadramma v State of Andhra Pradesh6; Indus Ind Media and Communication Ltd., Vs Telecom Disputes Settlement and Appellate Tribunal and another7 etc., and seeks to set aside the order under appeals by answering the questions of Law in favour of the appellant.

10. Per contra, learned counsel the respondent made submissions to sustain the order of the Appellate Tribunal. He submits