Prevention of Money Laundering Act, 2002
The Appellate Tribunal: Sections 25 to 42
Orders of the Adjudicating Authority confirming attachment, and penalty orders of the Director, FIU-IND, are not final. Chapter VI of the PMLA provides an appeal to the Appellate Tribunal, a specialised body with the powers of a civil court but free of its procedural rigidity, and a further appeal to the High Court under Section 42. This note covers the Tribunal's constitution, the appeal under Section 26, its powers and procedure, the appeal to the High Court, and when a writ petition lies despite these remedies.
The appeal staircase from the Adjudicating Authority, the Tribunal's working, and the writ side door
1. The Tribunal: Section 25
i. Constitution. Since the Finance Act, 2016, the Appellate Tribunal constituted under the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 functions as the Appellate Tribunal under the PMLA.
ii. Jurisdiction. It hears appeals against orders of the Adjudicating Authority and against orders of the Director, FIU-IND, under Section 13.
2. The Appeal: Section 26
Aspect | The position |
|---|---|
Who may appeal | The Director, or any person aggrieved by an order of the Adjudicating Authority; a reporting entity aggrieved by an order of the Director, FIU-IND under s. 13 |
Person aggrieved | Anyone whose property, right or interest is affected by the order, including third parties such as banks, purchasers and family members in possession |
Limitation | Within forty-five days from the date on which a copy of the order is received |
Condonation | The Tribunal may entertain an appeal after that period if satisfied there was sufficient cause |
Orders | After hearing the parties, confirming, modifying or setting aside the order appealed against |
Time for decision | As expeditiously as possible, with an endeavour to decide within six months |
3. Procedure and Powers: Section 35
§ A flexible, fair procedure Not bound by the Code of Civil Procedure. The Tribunal regulates its own procedure, guided by the principles of natural justice. Civil court powers. Summoning and enforcing attendance and examining on oath; discovery and production of documents; receiving evidence on affidavits; requisitioning public records; issuing commissions; reviewing its own decisions; dismissing for default or deciding ex parte; and setting aside such orders. Judicial proceedings. Its proceedings are judicial proceedings for the offences of false evidence and related offences. Representation. Parties may appear in person or through legal practitioners or authorised representatives, under Section 39. Bar on civil courts. Civil courts have no jurisdiction over matters the Tribunal or Adjudicating Authority is empowered to decide, under Section 41. |
4. Appeal to the High Court: Section 42
§ The second appeal • Who. Any person aggrieved by a decision or order of the Appellate Tribunal. • When. Within sixty days from communication of the decision; the High Court may allow a further period not exceeding sixty days on sufficient cause. • On what. On any question of law or fact arising out of the Tribunal's order. Unlike many statutes that confine second appeals to questions of law, Section 42 extends to questions of fact. • Beyond. A further challenge lies to the Supreme Court by special leave under Article 136. |
5. Alternative Remedy and Writ Jurisdiction
§ When a writ lies despite the appeal The general rule. Where the Act provides an effective appellate remedy, High Courts ordinarily decline to entertain writ petitions against provisional attachment orders or orders of the Adjudicating Authority, and direct the petitioner to the statutory route. The exceptions. Following Whirlpool Corporation v. Registrar of Trade Marks, (1998) 8 SCC 1, a writ may be entertained despite an alternative remedy where there is a violation of a fundamental right, a breach of natural justice, action wholly without jurisdiction, or a challenge to the validity of the statute. In PMLA practice. Writs are more often entertained against actions that lack the statutory foundation altogether, such as a freeze without recorded reasons, or an attachment where no scheduled offence exists. |
6. Frequently Asked Questions
Within what time must an appeal be filed before the Appellate Tribunal?
Within forty-five days of receiving the Adjudicating Authority's order, under Section 26, with power to condone delay for sufficient cause.
Is the Tribunal bound by the Code of Civil Procedure?
No. Under Section 35, it regulates its own procedure, guided by natural justice, while having specified civil court powers.
On what questions does an appeal lie to the High Court?
On any question of law or fact arising out of the Tribunal's order, within sixty days, under Section 42.
Can a writ be filed against a provisional attachment order?
Ordinarily the statutory appeal must be pursued, but a writ may lie where there is a breach of fundamental rights or natural justice, action without jurisdiction, or a challenge to the statute's validity.