Chhattisgarh HC dismisses plea seeking substitution of ED-attached properties with fixed deposit

Bilaspur, Sep 1 (IANS) The Chhattisgarh High Court has dismissed a writ petition filed by Hrishabh Soni and his wife Komal Soni seeking substitution of six immovable properties provisionally attached by the Enforcement Directorate (ED) with an equivalent fixed deposit of Rs 4.36 crore under the Prevention of Money Laundering Act (PMLA).

A bench of Justice Bibhu Datta Guru, in an order held that the petitioners failed to establish any statutory or enforceable right to seek such substitution.

The court said that the PMLA and the 2013 Rules framed under it do not provide a general right to replace attached immovable properties with a fixed deposit, except in limited contingencies under Rule 5(5).

The properties had been provisionally attached by the ED on December 9, 2024, as equivalent value of alleged proceeds of crime linked to irregularities in the District Mineral Fund (DMF).

The attachment was later confirmed by the Adjudicating Authority on May 23, 2025.

The petitioners had challenged the confirmation before the PMLA Appellate Tribunal and, during the pendency of those appeals, sought substitution of six properties.

The Tribunal rejected the applications on April 7, 2026.

Before the High Court, the petitioners said that the continued attachment was causing financial hardship and impairing their business activities.

They contended that they were ready to furnish a liquid fixed deposit of equal value and that the properties were attached only as equivalent value, not as direct proceeds of crime.

They also said that the High Court’s extraordinary jurisdiction under Article 226 could mould relief even if the Tribunal lacked power.

The ED opposed the petition, saying that there is no general statutory provision for such substitution and that the petitioners should have availed the statutory appeal under Section 42 of the PMLA instead of filing a writ petition.

The agency also pointed to material indicating alleged siphoning of DMF funds through accommodation entries and payment of commissions.

Rejecting the plea, the High Court held that mere offer of an equivalent fixed deposit does not create a right to substitution.

It noted that Rule 5(5) applies only in cases of joint ownership and uses the expression “may accept”, making acceptance discretionary.

The court also added that hardship alone cannot override the statutory scheme, especially when the validity of the attachment itself remains pending before the Tribunal.

Relying on Supreme Court precedents, the court reiterated that when a special statute provides an efficacious remedy, the High Court should ordinarily not exercise its extraordinary jurisdiction under Article 226.

The writ petition was accordingly dismissed with no order as to costs.

–IANS

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