Orissa High Court
Case Details
Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 25-Sep-2025 15:06:47 IN THE HIGH COURT OF ORISSA AT CUTTACK W.P.(C) No.26993 of 2025 Shakti Ranjan Dash & Ors. …. Petitioner (s) M/s. Manoj Ku. Mishra, Sr. Adv. Along with Mr. Tanmoy Mishra, Adv. Director of Enforcement & Anr. -versus- …. Opposite Party(s) Mr. Gopal Agarwal, Sr. Adv. Along with Associates CORAM: DR. JUSTICE SANJEEB K PANIGRAHI Order No. 02. ORDER 25.09.2025 1. This matter is taken up through hybrid arrangement. 2. The present Writ Petition has been filed seeking release of 13 numbers of vehicles seized by the Opposite Parties during the raid conducted at the premises of the Petitioners on 30.08.2025 under Section 17 of the Prevention of Money Laundering Act, 2002 (hereinafter referred to as “PMLA, 2002” for brevity). 3. The brief factual matrix as borne out from the records of the
Facts
case is that an FIR. No. 9 of 2016 was registered by CID, Shimla on 03.04.2016 thereby alleging offences under various provisions of IPC and PC Act against another company named Page 1 of 8 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 25-Sep-2025 15:06:47 M/s ITCOL and other private persons. It is alleged that the said ITCOL availed loan from public banks and mis-utilised and/or siphoned off the money. The Petitioners herein are neither an accused in the said FIR nor in the subsequent charge sheets filed. An ECIR No. SHSZO/02/2019 came to be registered on 28.05.2019. On the basis of said FIR and based on the Prosecution Complaint which came to be lodged on 02.11.2023, a Provisional Attachment Order No. 03/2023 ("PAO”) was passed by Opp. Parties on 02.11.2023. Thereafter, on 1.04.2024 the said order was confirmed under Section 8 of the PMLA, 2002. The said confirmation order dated 01.04.2024 has been challenged by the Petitioners and the same is pending before the Tribunal. Meanwhile, the Opp. Parties have on 13.08.2025 served a summons under Section 50 of the PMLA, 2002 directing the Petitioners to appear before it. On 25.08.2025 the Petitioners appeared before it and submitted the necessary information and documents as directed. While the matter stood thus, the Opp. Parties carried out search and seizure at the premises of the Petitioners at Bhubaneswar on 30.08.2025 during which the vehicles in question have been seized.
Legal Reasoning
Court is of the view the petitioners have a prima facie case in its favour, inasmuch as the agency investigating the predicate offence has noted that there is no illegality on the part of the petitioner and most of the transactions have been found to be genuine. This Court is, further, of the view that repeated summons, coupled with multiple attachment and seizure actions in respect of the same transactions, prima facie reflects excess of power, particularly when the earlier attachment is already under scrutiny before the Appellate Tribunal. Insofar as the seized vehicles are concerned, it is well settled that vehicles are prone to rapid deterioration and loss of value if left unused. They are perishable in nature and exposure to elements of weather caused damage, thereby frustrating the very object of seizure which is to secure the value of property. 10. The High Court of Delhi in the case of Orissa Infrastructure Pvt. Ltd. & Anr Vs. Union of India & Ors.1 and M/s Alstone Manufacturing Pvt. Ltd. Vs. Union of India2 has exercised its 1 W.P.(Crl) 1717 of 2025 2 W.P.(Crl) 1891 of 2025 Page 5 of 8 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 25-Sep-2025 15:06:47 powers under Article 226 of the Constitution of India for releasing vehicles in quite identical factual situations and background. It has been reiterated by several jurisdictional High Courts which have decided against keeping the vehicles in custody for a prolonged period. The general law relating to release of vehicles seized in connection with a crime pending investigation or trial by the Magistrate, in the most universal of its dimension has been laid down by the Supreme Court in Sunderbhai Ambalal Desai vs. State of Gujarat3. It may be trite to mention at this juncture that this Court in the case of Ashish Ranjan Mohanty Vs. State of Odisha & Others4 while dealing with a public interest litigation after discussing the legal position on the point has laid down broad based parameters to be followed in matters relating to seized vehicles and has also framed a Standard Operating Procedure (SOP) for the same. 11. In the present case, there is an ex facie dichotomy in so far as the finding rendered by the investigating agency i.e. the CID and the Opp. Parties as to whether the proceeds of crime have trickled into the accounts of the Petitioner and his companies herein. On one hand, the agency investigating the predicate offence i.e. the CID has stated in its charge-sheet that most of the transactions of the Petitioner and his companies appear to 3 2002 (10) SCC 283 4 W.P.(C) No. 31622 of 2021 Page 6 of 8 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 25-Sep-2025 15:06:47 be genuine, thereby omitting the Petitioner and his companies herein as an accused. On the other hand, the Opp. Parties have made out a case that the proceeds of crime have, in fact, found their way into the accounts of the Petitioners. One cannot lose sight of the fact that the seizure and attachment of the vehicles is after a period of almost 2 years from the date of the provisional attachment order (dated 02.11.2023) without any change in circumstances or any justification recorded therefor. 12. In such circumstances, the scales of equity must tilt in favour of the Petitioners. The ends of justice would be met if the interest of the Opp. Parties is secured while simultaneously protecting the property from damage. Accordingly, in the peculiar facts and circumstances of the case at hand, it is directed that the vehicles seized from the Petitioners shall be released in favour of the Petitioners furnishing security in the form of a Fixed Deposit Receipt (FDR) of value equivalent to half of the IDV value of the vehicles, before the Opp. Parties. Upon such security being furnished, the Opp. Parties shall release the vehicle within a period of seven (7) days from the date of receipt of such security. 13. As a parting note, the Opp. Parties are advised and will do well to see that the coercive powers including seizure under the law are not exercised whimsically and/or in a vexatious manner. It is expected that great circumspection must be exercised Page 7 of 8 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 25-Sep-2025 15:06:47 including to consider factors like the period of offence as alleged which must adhere to the principle of nexus, proportionality and procedural safeguards. It must also be borne in mind the fact that the process of subsequent searches and seizure ought not to be done in a piecemeal fashion de hors any sound reasoning therefor. 14. It is clarified that the present order is passed in the peculiar facts and circumstances of this case, and shall not be treated as a precedent. 15. The present Writ Petition, accordingly, stands disposed of in terms of the aforesaid directions as hereinabove. Ordered accordingly. Judge (Dr. Sanjeeb K Panigrahi) B. Jhankar Page 8 of 8
Arguments
4. Ld. Sr. Counsel Mr. Mishra appearing for the petitioners claims that the amount received by them is on account of a genuine contractual transaction i.e. supply of iron and manganese ore. They have entered into agreements with the accused company Page 2 of 8 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 25-Sep-2025 15:06:47 for the same. It is vehemently submitted that the Petitioners are not privy to bank fraud committed by the ITCOL as the predicate agency (i.e. CID) itself noted that most of the transactions were genuine and no illegality is made out qua the petitioners. Moreover, that the CID’s charge sheet dated 19.03.2020 records that (i) there was actual production undertaken by ITCOL requiring procurement of raw materials including from the Petitioners (ii) payments to Petitioners were part of legitimate expansion activities and purchases (iii) contractual supply arrangements existed for minerals and (iv) monies received by Petitioners were rightfully spent. The CID has clearly concluded that no scheduled offence is made out insofar as these payments are concerned. Therefore, the Petitioner was not made an accused by the CID. The Ld. Sr. Counsel for the petitioners has further submitted that the seizure is vexatious, illegal, arbitrary demonstrated by the fact that one of the vehicles seized by the Opp. Party No.1 belongs to a company where the petitioner is neither a director nor a shareholder. 5. Per Contra, Ld. Sr. Counsel Mr. Gopal Agarwal appearing on behalf of the Opp. Parties submitted that the Petitioners should avail of the remedy as prescribed under the applicable rules, more specifically Rule 4 and the proviso thereto, of the Prevention of Money- Laundering (Taking possession of Page 3 of 8 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 25-Sep-2025 15:06:47 attached or frozen properties confirmed by the Adjudicating Authority) Rules, 2013. He has submitted that the Petitioners should await the confirmation of the attachment by the Adjudicating Authority and thereafter approach the Authority who may release the vehicles by furnishing a security equivalent to the value of the vehicles seized. He has however, fairly stated that notwithstanding the same, this Court is not denuded from the exercise of its powers under Article 226 of the Constitution given the fact that such a provision exits in law. 6. Heard the Ld. Sr. Counsel for the parties and perused the records of the case. 7. From records it appears that the Petitioners have been repeatedly summoned by the Opp. Parties under Section 50 of the PMLA, 2002 on as many as nine occasions, namely on 14.12.2020, 15.12.2020, 25.05.2022, 26.05.2022, 09.06.2022, 05.08.2022, 13.01.2023, 16.02.2023 and lastly on 25.08.2025 i.e. after the passing of the provisional attachment order on 2.11.2023. 8. The prosecution complaint was filed on 03.03.2021, and thereafter a provisional attachment order came to be passed on 2.11.2023, i.e., after a period of almost two and half years. The said provisional attachment is presently under challenge before the Appellate Tribunal. While the aforesaid attachment order Page 4 of 8 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 25-Sep-2025 15:06:47 remains pending adjudication, the Petitioner was again summoned under Section 50 of the Act on 25.08.2025. Soon thereafter, a search and seizure was conducted on 30.08.2025, which has resulted in the seizure presently under challenge. 9. On consideration of the aforesaid sequence of events, this