Property Seized by ED Must be Returned within 365 Days: Delhi HC

Property Seized by ED Must be Returned within 365 Days: Delhi HC

VoM News Desk | February 3, 2024 | 10:06 AM IST | Breaking News, Crime | Follow on Google News

Property Seized by ED Must be Returned within 365 Days: Delhi HC

Property Seized by ED Must be Returned within 365 Days: Delhi HC

In a significant ruling, the Delhi High Court has stated that properties seized by the Enforcement Directorate (ED) under the Prevention of Money-laundering Act (PMLA) should be returned if the investigation does not result in any proceedings within 365 days. Justice Navin Chawla emphasized that the continuation of seizure beyond this period, without pending proceedings related to any offense before a court, violates Article 300A of the Constitution and is confiscatory in nature. The court’s decision came in response to a petition filed by the resolution professional of Bhushan Power and Steel Limited (BPSL), challenging the continued seizure of documents, records, digital devices, gold, and diamond jewelry.

Court Directs Return of Seized Property in Absence of Proceedings

In cases where there are no proceedings concerning the seized property, the court directed the authorities to promptly return them to the petitioner. The ruling specified that if the investigation extends beyond 365 days without leading to any proceedings under the Act, the seizure lapses, and the property must be returned. The ED was instructed to return documents, digital devices, and other materials seized during a search-and-seizure operation in August 2020 to the petitioner, unless a competent court issues an order to the contrary.

Confiscation Violates Constitutional Principles

The court clarified that retaining documents and properties is permissible for investigative or adjudicative purposes but can only extend beyond 365 days if proceedings are initiated before a special court. However, in this case, as the investigation did not result in a complaint or supplementary complaint, the court held that the seizure was no longer valid. The ruling emphasized that a continued seizure beyond 365 days, without pending proceedings related to any offense, violates Article 300A, constituting a confiscatory action lacking legal authority.

This ruling sets a precedent for the timely conclusion of investigations, preventing prolonged seizures without legal justification and reinforcing constitutional principles.

VoM News Desk

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