Appellate body okays ED action in Srijan case

AN appellant tribunal that deals with money laundering cases has upheld the Enforcement board of directors’s litigate in the ₹1,000 crore Srijan caseful in Bihar spell rejecting over a dozen appeals filed by the family members, relatives, and associates of the late Manorama Devi—the mastermind behind the fraud and the founder of NGO Srijan Mahila Vikas Sahyog Samiti Limited (SMVSSL)—against attachment of their properties.The tribunal ruled that the NGO “had become a tool for embezzlement and misappropriation of government funds in collusion with government officials, bank officers and other individuals”.The NGO, which worked on imparting training to women in Bihar, allegedly embezzled state funds from the treasuries of Bhagalpur and Banka between 2003 and 2017 in connivance with government and bank officials. The Central Bureau of Investigation (CBI) registered 27 first information reports (FIRs) to probe the irregularities, based on which ED also launched a parallel money laundering probe.The ED probe established that funds worth ₹557-crore were embezzled from the government accounts after being illegally transferred to the bank accounts of SMVSSL, and were then used to acquire properties in the name of family members of Manorma Devi, government officials and others. The agency attached properties worth over ₹18-crore in two tranches, in 2020 and 2021, mostly belonging to the family members and relatives of Manorama Devi. The family members and others challenged the attachment through 15 separate appeals.Rejecting the appeals, the Appellate Tribunal for Forfeited Property (ATFP) in Delhi said in its order last week: “From the evidence collected during the investigation, the inference that SMVSSL became a tool for embezzlement and misappropriation of the government funds in collusion with the government officials, bank officials and other individuals, inescapable.”“I also find from the material placed before me that none of the appellants can claim that any one of them has not received the proceeds of crime which has flowed from and through either late Manorma Devi or SMVSSL. The flow of such proceeds of crime has resulted in beneficial gain to each one of them either in the form of deposits in bank account (s) or in the acquisition of immovable properties or some other benefit. None of the Appellants has been able to produce evidence documentary or otherwise as to show the lawful source of such funds. It is also on record that besides the transfers which occurred through the bank accounts money also moved in cash,” ATFP member Balesh Kumar said in his order.On the other hand, he noted that “the investigation being copious and meticulous has succeeded in linking the tainted funds, partly or completely, to either SMVSSL or late Manorma Devi, which flowed to or through the person involved”.“In view of such facts and circumstances, the attachment of the impugned properties, both movable and immovable cannot be interfered with as the very purpose of PMLA shall be defeated if in case the proceeds of crime cannot be secured till the findings are made by the special court with regard to the conviction or acquittal of the persons involved and with respect to the confiscation or release of the impugned properties,” the order, reviewed by HT, added.