AgustaWestland Case: PMLA Appellate Tribunal Upholds ED Attachment Of ₹6.33 Crore Properties Of Media Exim

The Appellate Tribunal under the Prevention of Money Laundering Act (PMLA) in New Delhi on Thursday upheld the attachment of properties acquired by Media Exim Pvt. Ltd. using about Rs 6.33 crore alleged to be linked to proceeds of crime in the AgustaWestland VVIP helicopter deal, dismissing appeals filed against the Enforcement Directorate's action.

A single-member bench of V. Anandarajan rejected appeals filed by J.B. Subramaniyam, Bhanu Nanda and Media Exim Pvt Ltd challenging the Adjudicating Authority's order dated July 24, 2015, which had confirmed a provisional attachment order issued on March 19, 2015 attaching bank deposits, a vehicle, and immovable property standing in the name of the company.

The case originates from a CBI FIR registered on March 12, 2014 on a complaint by the Ministry of Defence alleging payment of kickbacks in the procurement of 12 VVIP helicopters from AgustaWestland. The Enforcement Directorate registered an ECIR on July 3, 2014 and initiated proceedings under the PMLA.

According to the ED, funds amounting to about Rs 6.33 crore were transferred from Global Services FZE, Dubai, a company linked to alleged middleman Christian Michel James, to Media Exim Pvt Ltd between 2005 and 2007 and were used to acquire movable and immovable assets. The agency alleged that the company had been incorporated at the instance of Michel and used to hold and invest the funds received from him.

The appellants argued that the remittances were received several years before the 2010 helicopter contract and therefore could not be treated as proceeds of crime. They also claimed the transactions were part of legitimate business dealings relating to media CD rights and that the amounts were later refunded with RBI approval.

Rejecting these contentions, the tribunal held that attachment under the PMLA is not limited to property directly derived from the scheduled offence and can extend to property representing the value of illicit gains.

“The property has been attached as 'proceeds of crime or value thereof'. The value of proceeds of crime is as much a part of the definition of proceeds of crime under section 2(1)(u) as the proceeds of crime directly derived from a scheduled offence. Where the property is attached as value of the proceeds of crime, the date of acquisition thereof, i.e., whether the same has been acquired prior to or after the date of the alleged offence is immaterial,” the tribunal held.

The tribunal also relied on statements recorded under Section 50 of the PMLA. It noted that the director of Media Exim had admitted that the company had no real business activity and that properties were purchased using funds received from Michel's company.

“For the detailed reasons discussed above, there is ample material to establish that the Appellant was in possession of proceeds of crime and that the receipt of money by the appellant company was not towards any legitimate commercial transactions and constituted 'proceeds of crime' within the meaning of Act,” the tribunal observed.

Dismissing the appeals, the tribunal said:

“In light of the detailed discussions above, I do not find any reason to interfere with the order of the Ld. Adjudicating Authority confirming the PAO whereby, various properties of the appellants herein were attached. Accordingly, the appeals fail and are hereby dismissed.”