PMLA Appellate Tribunal Upholds ED Retention Of ₹67.5 Lakh Seized In Shine City Money Laundering Probe

The Appellate Tribunal under the Prevention of Money Laundering Act has upheld the Enforcement Directorate's retention of Rs. 67.5 lakh seized from Vivek Gupta, who came under the agency's scanner over his alleged links with Shine City Infra Project Managing Director Rashid Naseem.

The tribunal held that Gupta failed to substantiate the source of the cash and noted that he has since been named as an accused in the ED's prosecution complaint.

Chairman Justice Munishwar Nath Bhandari dismissed Gupta's appeal against an April 2024 order of the Adjudicating Authority. The order had permitted retention of the seized cash, digital devices, and other articles.

The searches were conducted as part of the ED's investigation into allegations that Shine City Infra Project Pvt. Ltd. induced members of the public to invest in real estate projects by promising high returns.

According to the order, investors were also issued post-dated cheques which were later dishonoured. The company and its directors were accused of cheating investors by inducing them to part with their money.

Gupta's residence in Delhi was among the premises searched. During the search, officials seized Rs. 67.5 lakh in cash, documents, a mobile phone, and other articles. The tribunal noted that the search was conducted after investigators found Gupta's close nexus with Naseem.

The order records that Gupta, in a statement under the PMLA, admitted meeting Naseem in Dubai. He also admitted receiving large sums from Shine City companies into his personal account, HUF account and the accounts of his company, Vardhman Buildtech Pvt. Ltd.

Before the tribunal, Gupta argued that the retention order had been passed in violation of the principles of natural justice. According to him, copies of all relied-upon documents had not been supplied. He also maintained that he had no connection with the alleged offence.

To explain the source of the seized cash, he relied on documents relating to scrap sales. These included weight slips issued by a Dharamkanta.

The ED countered that the only relied-upon documents were the panchnamas prepared during the searches. It submitted that copies of those documents had already been supplied. The agency also questioned the documents produced to explain the source of the cash.

Rejecting the challenge, the tribunal found that the panchnamas were the only relied-upon documents. It noted that copies had been furnished to Gupta.

"No such procedure was applied by the appellant in this case, and, therefore, it is not a case of non-supply of RUDs, rather whatever was relied as document had been supplied to the appellant. In view of the above, I find no illegality in the action of the respondents.", it noted.

The tribunal observed that if Gupta wanted copies of any other documents, he could have sought them under the procedure available under the Act. Since no such request was made, it found no merit in the allegation that the proceedings suffered from any procedural irregularity.

On Gupta's contention that the seized cash had come from scrap sales, the tribunal found the explanation unconvincing. It noted that the documents relied upon did not disclose the names of purchasers.

They also did not contain invoices, GST particulars, or other details capable of establishing the source of the money. The tribunal further observed that Gupta had failed to disclose the source of the cash when the search was conducted.

"The type of document submitted by the appellant can be created by anyone at any time. The disclosure of source by producing such documents cannot be accepted, thus the appellant failed to substantiate the source for possession of the cash.", it noted.

The tribunal also rejected Gupta's argument that he had no connection with the alleged offence. It noted that the ED had filed a prosecution complaint on April 21, 2026. Gupta was arrayed as Accused No. 2 in that complaint. The ED had also sought confiscation of the seized amount.

"It is a fact that by filing of the prosecution complaint, the respondents have not only sought the confiscation of the amount of Rs.67,50,000/- but retention of the digital devices and data, etc. In the light of the above, I do not find any illegality in the order passed by the Adjudicating Authority.", it observed.

Holding that retention of the cash, digital devices and other seized material remained justified, the tribunal declined to interfere with the Adjudicating Authority's order.

The appeal was dismissed. The tribunal clarified that the seized cash and articles would remain subject to the final outcome of the trial.

For Appellant: E Krishna Das

For Respondent: Anubha Bhardwaj