Follow norms while setting up PMLA panel - indusviva

Follow norms while setting up PMLA panel - indusviva

HYDERABAD: The Telangana High Court said the appointment of Adjudicating Authority under Prevention of Money Laundering Act (PMLA), shall follow the guidelines under Section 6 of Act. The authority should comprise more than one member and one of them must be a judicial member.

The court observed that unless the adjudicating authority was constituted as per the provisions of the PMLA, then there would be no legality and validity to the proceedings initiated by the said authority.

A division bench of the High Court was dealing with the petition filed by Abhilash Thomas, CEO of the IndusViva Healthsciences Pvt Ltd. He challenged the provisional attachment of the properties of the company by the Enforcement Directorate (ED) and requested to set aside the notices issued by the adjudicating authority under PMLA, which was to confirm the attachment of properties within 180 days.

Earlier, based on an FIR filed at the Cyberabad police commissionerate on charges of flouting the rules of consumer protection (direct selling) of healthcare products to the tune Rs 1,500 crore through the multi-level marketing, the ED had initiated provisional attachment orders. Later, it forwarded to the adjudicating authority under PMLA to get the approval of attachments, which is statutory.

When the adjudicating authority issued notices to the firm, its management approached the High Court challenging that the said authority was not constituted as per the rules of PMLA. They brought to the notice of the court that there was no judicial member in the authority and only one person was chairing the authority.

Going through the records, the court stayed the proceedings initiated by the adjudicating authority. But, the High Court did not agree to the request of the IndusViva Pvt Ltd to stay the provisional attachment of properties belonging to it, made by the ED.