OPTO Circuit India Ltd. Versus Axis Bank & Ors.

IN THE SUPREME COURT OF INDIA
   CRIMINAL APPELLATE JURISDICTION
   CRIMINAL APPEAL NO.102  OF 2021
   (Arising out of SLP (Criminal) No.4171 of 2020)
OPTO Circuit India Ltd.            Versus
Axis Bank & Ors.                                         
3 Judge bench , through the  J U D G M E N T of A.S. Bopanna, J., held that

Section 17 of PMLA

where under the freezing of
such property or record is also provided.

Section 17 of
PMLA reads as hereunder: ­
17.  Search   and   seizure­   (1)  Where   the
Director   or   any  other   officer  not   below   the
rank   of   Deputy   Director   authorized   by   him
for the purposes of this section, on the basis
of information in his possession, has reason
to   believe   (the   reason   for   such   belief   to   be
recorded in writing) that any person­
(i) has   committed   any   act   which
constitutes money­laundering, or
(ii) is in possession of any proceeds of
crime   involved   in   moneylaundering, or
(iii) is   in   possession   of   any   records
relating to money­laundering, or
(iv) is   in   possession   of   any   property
related to crime
 
Page 7 of 21
then,   subject   to   the   rules   made   in   this
behalf,   he   may   authorise   any   officer
subordinate to him to­
(a) Enter   and   search   any   building,
place,   vessel,   vehicle   or   aircraft
where   he   has   reason   to   suspect
that   such   records   or   proceeds   of
crime are kept;
(b) Break   open   the   lock   of   any   door,
box, locker, safe, almirah or  other
receptacle   for   exercising   the
powers   conferred   by   clause   (a)
where   the   keys   thereof   are   not
available;
(c) seize any record or property found
as a result of such search;
(d) place   marks   of   identification   on
such record of property, if required
or   make   or   cause   to   be   made
extracts or copies therefrom;
(e) make   a   note   or   an   inventory   of
such record or property;
(f) examine  on  oath  any  person,  who
is   found   to   be   in   possession   or
control  of  any  record  or  property,
in   respect   of   all  matters   relevant
for   the   purposes   of   any
investigation under this Act:
(1A) Where it is not practicable to seize such
record   or   property,   the   officer   authorised
under sub­section (1), may make an order to
freeze such property whereupon the property
shall   not   be   transferred   or   otherwise   dealt
with, except with the prior permission of the
officer making such order, and a copy of such
order   shall   be   served   on   the   person
concerned:
 
Page 8 of 21
Provided that if, at any time before its
confiscation   under   sub­section   (5)   or   subsection (7) of section 8 or section 58B or subsection   (2A)   of   section   60,   it   becomes
practical   to   seize   a   frozen   property,   the
officer  authorised under  sub­section  (1) may
seize such property.
(2) The authority, who has been authorised
under sub­section (1) shall, immediately after
search   and   seizure   or  upon   issuance   of   a
freezing order forward a copy of the reasons
so   recorded   along   with   material   in   his
possession, referred to in that sub­section, to
the   Adjudicating   Authority   in   a   sealed
envelope,   in   the   manner,   as   may   be
prescribed   and   such   Adjudicating   Authority
shall keep such reasons and material for such
period, as may be prescribed.
(3) Where   an   authority,   upon   information
obtained  during  survey  under  section  16,   is
satisfied   that   any   evidence   shall   be   or   is
likely  to  be  concealed  or  tampered  with,  he
may,   for   reasons   to  be  recorded   in  writing,
enter and search the building or place where
such   evidence   is   located   and   seize   that
evidence:
Provided that no authorisation referred
to   in   sub­section   (1)   shall   be   required   for
search under this sub­section.
(4) the   authority   seizing   any   record   or
property   under   sub­section   (1)   or   freezing
any record or property under sub­section (1A)
shall,   within   a   period   of   thirty   days   from
such seizure or freezing, as the case may be,
file   an   application,   requesting   for   retention
of such record or property seized under subsection (1) or for continuation of the order of
 
Page 9 of 21
freezing served under sub­section (1A), before
the Adjudicating Authority.
(emphasis supplied)
9. A perusal of the above provision would indicate
that the pre­requisite is that the Director or such other
Authorised Officer in order to exercise the power under
Section 17 of PMLA, should on the basis of information in
his possession, have reason to believe that such person
has committed acts relating to money laundering and
there is need to seize any record or property found in the
search.  Such belief of the officer should be recorded in
writing.   Sub­section (1A) to Section 17 of PMLA provides
that the Officer Authorised under sub­section (1) may
make an order to freeze such record or property where it
is not practicable to seize such record or property.  Subsection (2) provides that after search and seizure or upon
issuance of a freezing order the Authorised Officer shall
forward   a   copy   of   the   reasons   recorded   along   with
material in his possession to the Adjudicating Authority
in a sealed envelope.   Sub­section (4) provides that the
 
Page 10 of 21
Authority seizing or freezing any record or property under
sub­section (1) or (1A) shall within a period of thirty days
from such seizure or freezing, as the case may be, file an
application before the Adjudicating Authority requesting
for retention of such record or properties seized.
10. For the purpose of clarity, it is emphasised that the
freezing   of   the   account   will   also   require   the   same
procedure since a bank account having alleged proceeds
of crime would fall both under the ambit property and
records.