In a decisive ruling on June 3, the appellate tribunal in Delhi nullified the Enforcement Directorate’s (ED) attachment of seven properties owned by Praful Patel, his wife Varsha Patel, and their company, Millennium Developers. The tribunal deemed the ED’s actions as harassment with hidden agendas.
In 2022, the ED had provisionally seized seven flats spanning four floors of the Ceejay House Apartments in Worli, Mumbai, valued at around ₹180 crores. The seizure was based on allegations that these properties were purchased from the widow of the notorious drug lord, Iqbal Mirchi.
The adjudicating authority under the Prevention of Money Laundering Act (PMLA) confirmed this provisional attachment on January 5, 2023. The Patels challenged this decision before an appellate tribunal formed under the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act (SAFEMA), leading to the June 3 ruling.
The tribunal pointed out that neither the Patels nor their company were named in the original FIR that prompted the ED’s Enforcement Case Information Report (ECIR). Additionally, there was no evidence linking them to the alleged crime.
The tribunal stated, “Attachment of the above area at 12 to 15 floors of Ceejay House cannot be considered appropriate and legal. It cannot be concluded that a property taken on consideration and the Court decree can be said to be involved in the money laundering. Thus, we quash the impugned orders of attachment as well as the order of the Adjudicating Authority.”
The ED’s ECIR was based on a 1994 FIR against underworld figure Iqbal Mohammad Memon, aka Iqbal Mirchi, who died in 2013. The ED accused the Patels of supporting Mirchi. However, the Patels were not named in the FIR or ECIR. After being summoned, a provisional attachment order was issued against their properties.
During the appeal, the Patels explained that part of the property was previously owned by MK Mohammad, who operated two restaurants illegally. Through adverse possession, Mohammad was declared the owner, and this was later assigned to Hazra Memon, Mirchi’s wife. In 1999, Patel legally acquired the property from Hazra Memon under a court decree.
Patel argued that 14,000 square feet of properties linked to Mirchi’s associates had already been seized separately, and that the double attachment of their property was unnecessary and unrelated to any crime.
The tribunal noted that the ED’s claim regarding the construction violating Floor Space Index (FSI) norms did not qualify as a scheduled offence under the PMLA. This indicated the ED’s intent to harass the Patels.
The tribunal concluded that the Patels’ legally acquired property was unjustly attached and that the true proceeds of crime were already secured with the initial attachment of 14,000 square feet. Thus, the tribunal allowed the Patels’ appeal and overturned the attachment order.
