Bombay HC set aside ₹25 crore PMLA attachment, ruling no proven link between disputed transactions and proceeds of crime. Lawful business receipts cannot be treated as tainted without credible evidence.
PMLA Attachment Requires Nexus with Crime Proceeds: Bombay HC
The Bombay High Court set aside a ₹25 crore provisional attachment under PMLA, holding that the Enforcement Directorate failed to establish a necessary nexus between the property under seizure and the proceeds of crime. The Court emphasized that mere suspicion or temporal proximity with alleged offences is insufficient to justify attachment.
Justice Avinash Dhosale, in Avinash Bhosale v. ED, scrutinized transactions involving property acquisitions and found them supported by legitimate business receipts. The ED could not demonstrate that the funds originated from predicate offences listed under PMLA. The Court reiterated that lawful income cannot be conflated with illicit proceeds absent concrete linkage.
The burden is on the ED to show not just a transaction, but a direct or indirect connection between such transaction and actual proceeds of crime,the Court ruled, dismissing the cross-appeal.
This judgment strengthens procedural safeguards in PMLA enforcement and cautions against overreach in asset attachment. Practitioners must challenge attachments at the earliest opportunity where evidence linking assets to predicate offences is circumstantial or missing. Courts are increasingly insisting on evidentiary benchmarks for invocation of PMLA’s drastic powers.
Citations
- Avinash Bhosale v. Union of India, 2026
