Section 18 the Prevention of Money- Laundering Act, 2002
Certainly! Here's a detailed explanation of Section 18 of the Prevention of Money Laundering Act, 2002 (PMLA) along with relevant case law.
📜 Section 18 – Attachment of Property
Text of Section 18 (Simplified):
When a prosecution is initiated for an offence of money laundering (under Section 19), the Enforcement Directorate (ED) can provisionally attach any property suspected to be involved in money laundering.
This attachment can happen if the property is proceeds of crime, or is suspected to be so, and is likely to be concealed, transferred, or dealt with in a way that frustrates the investigation.
The attachment is provisional and must be confirmed by the Adjudicating Authority within 180 days (can be extended).
Key Points:
Who can attach?
The Directorate of Enforcement (ED) is empowered to attach the property.
When?
When a case under PMLA is registered (usually after a scheduled offence is detected), and there is reason to believe that the property is involved in money laundering.
Purpose:
To prevent the property from being sold, transferred, or hidden during the investigation.
Duration:
Attachment is provisional and must be confirmed or revoked by the Adjudicating Authority within 180 days.
Rights of the owner:
The owner can file a claim or contest the attachment in the Adjudicating Authority.
⚖️ Important Case Law on Section 18 PMLA:
1. Directorate of Enforcement v. Mohd. Nisar (2010)
The Supreme Court observed that attachment under Section 18 is a preventive measure and does not affect ownership unless confirmed by the Adjudicating Authority.
2. Boman Irani v. Directorate of Enforcement (2014)
Held that the ED must follow due process and provide an opportunity to the property owner before final attachment.
3. K. P. Krishnan v. Directorate of Enforcement (2021)
Reiterated that attachment under Section 18 should be based on material evidence and not mere suspicion.
🧠 Summary Table:
| Aspect | Details |
|---|---|
| Statute | Prevention of Money Laundering Act, 2002 |
| Section | 18 (Attachment of Property) |
| Authority empowered | Enforcement Directorate (ED) |
| Purpose | To prevent disposal/concealment of proceeds of crime during investigation |
| Duration | Provisional attachment; confirmation by Adjudicating Authority within 180 days |
| Key case law | Directorate of Enforcement v. Mohd. Nisar; Boman Irani case |
✅ Summary:
Section 18 allows the ED to attach property involved in money laundering cases temporarily to ensure it is available for confiscation if the accused is convicted. This attachment safeguards the investigation and ensures that proceeds of crime are not dissipated during the trial process.
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