S. 8(8) PMLA | Bonafide Individuals Suffering Loss Due To Money Laundering Can Approach Special Court To Restore Attached Property: J&K High Court

The Jammu and Kashmir and Ladakh High Court has ruled that individuals who, in good faith, suffer losses due to money laundering offences are entitled to approach the Special Court to seek restoration of attached properties. This ruling, based on Sec 8 Sub Sec 8 of the Prevention of Money Laundering Act, 2002, emphasizes that such individuals, despite taking reasonable precautions and not being involved in money laundering, can claim under the Act.\r

The case involved investors in a real estate project named "Palm Springs" in Srinagar. Despite their thorough checks confirming the project's legitimacy, the Enforcement Directorate attached the properties linked to it, alleging they were purchased using proceeds from the Adarsh Credit Cooperative Society Ltd scandal. The petitioners challenged this attachment, arguing they were bona fide purchasers and were deprived of their property without being involved in money laundering activities.\r

The court, after considering arguments, explained that the petitioners could approach the Special Court under the Act for redress. It pointed out that any person aggrieved by an order of the Adjudicating Authority has the right to file an appeal before the Appellate Tribunal. The court dismissed the petition, stating that the petitioners should have first exhausted the statutory remedies provided under the Act, which are considered equally efficacious.