SAFEMA Tribunal upheld ED's attachment of ₹2.65 crore properties, rejecting claims of family loans due to lack of documentation and evidentiary support.
The SAFEMA Tribunal has upheld the Enforcement Directorate’s attachment of immovable properties worth ₹2.65 crore under the Prevention of Money Laundering Act (PMLA), rejecting the appellant’s claim that funds were sourced from an undocumented 'family loan.' The appellant failed to produce loan agreements, bank trails, or witness testimony to substantiate the claimed indebtedness.
Standard of Proof in PMLA Defences
The Tribunal observed that while a person need not disprove money laundering beyond reasonable doubt, the explanation offered must be 'credible, plausible and supported by material.' In this case, oral assertions about familial financial assistance without documentary backing were deemed insufficient. The bench noted that even intra-family transactions involving large sums must comply with basic financial hygiene and leave an auditable trail.
Assertions of loans from relatives, especially where no repayment terms, interest, or security exist, cannot override statutory presumptions under Section 24(3) of PMLA.
Impact on Defensive Strategies
The ruling underscores that tax or origin defences in PMLA proceedings must be evidentially anchored. Merely declaring income in tax returns or invoking familial trust will not suffice if contradictory financial behavior exists. Lawyers should ensure clients maintain contemporaneous records for all high-value personal or family transactions, including gifts or loans, particularly when linked to assets under ED scrutiny.
Citations
- PMLA, 2002, Section 24(3)
