PMLA Attachment of Equivalent Value Includes Properties Lawfully Acquired Prior to the Alleged Scheduled Offence

The Enforcement Directorate (ED) initiated an investigation based on FIR No. 129/2022 alleging a "Coal Levy Scam" in Chhattisgarh, where an illegal extortion of ₹25 per tonne of coal was collected through civil servants and a private syndicate led by Suryakant Tiwari

Appellant Ranu Sahu (IAS), while posted as Collector in Korba and Raigarh, allegedly facilitated the syndicate and received ₹5.52 Crores as bribe/Proceeds of Crime (PoC)

The ED alleged this PoC was layered through family members (the other Appellants) to acquire 100 properties

The Adjudicating Authority (AA) confirmed the Provisional Attachment Order (PAO) on 09.10.2023

The Appellants challenged this before the Appellate Tribunal (SAFEMA), which dismissed their appeals on 16.10.2025

The Appellants moved the High Court, arguing many attached properties were acquired prior to the alleged crime and that no "scheduled offence" survived in the predicate FIR

The Court primarily applied Section 2(1)(u) of the PMLA, which defines "Proceeds of Crime" to include the property derived from crime OR the "value of any such property" if the original tainted asset is unavailable

Sections 3 and 4 were applied regarding the definition and punishment of money laundering

PMLA proceedings are independent of the naming of an accused in a predicate offence, as established in Vijay Madanlal Choudhary v. Union of India

A person not named in the scheduled offence can still be prosecuted under PMLA, confirming the precedent in Pavana Dibbur v. ED

Section 50 of the PMLA regarding the evidentiary value of statements made to ED officers and Sections 22, 23, and 24 regarding the legal presumptions and the shifting burden of proof on the accused

The Court reasoned that "Proceeds of Crime" is an expansive term; under the second limb of Section 2(1)(u), if direct PoC is siphoned off or vanished, the ED is statutorily empowered to attach any other property of equivalent value, even if acquired lawfully prior to the crime

The Court observed that the Appellants failed to provide credible agricultural or business sources for the funds used for acquisitions during the "scam period"

Regarding the disappearance of scheduled offences, the Court cited Saumya Chaurasia v. ED, noting that the predicate offence (Section 384 IPC) was not dropped but rather referred to the Chhattisgarh Police for further investigation, thus maintaining the jurisdictional foundation for PMLA

The Court rejected the coram non-judice argument, following the Madras High Court’s view in G. Gopalakrishnan, holding that single-member benches of the AA are legally valid

The court found that the diary entries seized from the syndicate were sufficiently corroborated by WhatsApp chats and Section 50 statements, which carry judicial sanctity

It held that properties of equivalent value acquired prior to the commission of a crime are liable for attachment to secure the interests of the State

The Court affirmed that PMLA is a distinct, standalone offence, and the confirmation of attachment by the AA and Tribunal was based on a "reason to believe" supported by a prima facie nexus between the properties and the coal syndicate

The Court upheld the common final order dated 16.10.2025, maintaining the attachment of the properties