Delhi High Court on PMLA Search & Seizure: Tribunal Must Reconsider Appeal Afresh.

Headnote:

The Delhi High Court set aside the Appellate Tribunal’s order directing the de-freezing of cash and electronic items seized from the premises of late Amlendu Pandey during a PMLA search. The Court held that the Tribunal had incorrectly assumed that a search under Section 17 of the PMLA requires a prosecution complaint against the person whose premises are searched. It clarified that the statutory requirement is only that a prior complaint or report related to the scheduled offence exists, even if against other accused. Because the Tribunal failed to consider the actual grounds of appeal—such as the legitimacy of the seized cash and the existence of a live-link with money laundering—the matter was remanded for fresh adjudication.

Background:

The Enforcement Directorate (ED) conducted searches in connection with a long-running investigation into alleged money laundering by Hassan Ali Khan and associates, based on earlier Income Tax raids (2007) and a prosecution complaint filed in May 2011.

During continued investigation, ED searched the premises of Amlendu Pandey on 09.02.2016 under Section 17 of PMLA and seized a laptop, pen drive, mobile phones, and ₹26.30 lakh cash.

ED sought retention of the seized items under Section 17(4). The Adjudicating Authority confirmed retention on 28.06.2016.

Pandey filed an appeal before the Appellate Tribunal. He died on 25.05.2017, after which his daughter was substituted as LR.

The Tribunal, on 21.05.2019, allowed the appeal and directed de-freezing of seized assets, largely on the ground that no prosecution complaint had been filed against Pandey himself.

Court’s Observations:

Section 17 PMLA permits search of any person’s premises, not only that of a person named in a prosecution complaint.

The statutory requirement (pre-2019 amendment) was only that a prior complaint or report relating to the scheduled offence existed, not that it must be against the same individual.

A prosecution complaint had been filed in 2011 in the Hassan Ali Khan case; thus, the statutory precondition for search was fully satisfied.

The Tribunal committed an error by assuming that a complaint must exist against Pandey himself, which is not required under Section 17.

The Tribunal failed to examine the real issues, including:

Whether the seized cash was connected to money laundering

Whether Pandey’s explanation of legitimate agricultural income and property transactions was credible

Whether ED had a valid live-link between seized items and laundering activity

Both parties agreed before the High Court that the Tribunal had not considered these issues and the matter could be reconsidered.

The Court therefore held that the Tribunal’s order was unsustainable and required fresh adjudication.

Legal Provisions Discussed:

Section 17, Prevention of Money Laundering Act, 2002 – Search and seizure powers.

Section 5(5), PMLA – Attachment process (distinguished from Section 17).

Section 42, PMLA – Appeal to High Court.

Sections 467, 420, 471 IPC – Scheduled predicate offences.

Sections 10(3) & 12(1), Passports Act, 1967 – Offences linked with wrongful passport acquisition.

Decision:

The High Court set aside the Appellate Tribunal’s order dated 21.05.2019.

The matter was remanded to the Appellate Tribunal for fresh consideration, with directions to:

Provide full opportunity of hearing to both sides

Examine all grounds raised, especially regarding legitimacy of the seized cash

Decide the appeal strictly in accordance with law

The appeal was accordingly disposed of.

Case: Deputy Director, Directorate of Enforcement v. Amlendu Pandey (Deceased) through LR

Court: High Court of Delhi at New Delhi

Coram: Justice Vivek Chaudhary & Justice Manoj Jain

Date of Decision: 21 November 2025

Misc. Appeal (PMLA) No.: 8 of 2022