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Telangana HC reserves orders in ED appeal against Mussadilal firm

DECCAN CHRONICLE | Vujjini Vamshidhar

Published on: March 25, 2023 | Updated on: March 25, 2023

Telangana High Court

Hyderabad: A division bench of the Telangana High Court has reserved its verdict on appeals filed by the Enforcement Directorate, challenging the orders of a single judge which had directed the agency to release gold and jewellery worth over Rs 53.98 crore and cash of Rs 1.75 crore that were confiscated from Musaddilal Gems and Jewels (India) Private Limited.

The ED had attached the properties following its raids on the residences of the firm’s directors Shashank Gupta, Rudrakash Gupta and Vandana Gupta on October 17, 2022, in relation to money laundering allegations against Sukesh Gupta of MBS Jewellers.

Sukesh Gupta is under ED investigation for allegedly duping the MMTS under the guise of purchasing gold.

The single judge on January 11 ordered the release of the properties on the ground that the ED had failed to comply with the procedures under the Prevention of Money Laundering Act (PMLA).

Challenging the single judge orders, the ED filed an appeal, which was heard by a division bench comprising Chief Justice Ujjal Bhuyan and Justice N. Tukaramji which issued status quo orders.

In the final hearing, Additional Solicitor General A.R.L. Sundaresan, representing the ED, quoted citations in which Supreme Court had allowed the attachment of property. He submitted that though the directors of the Musaddilal Gems and Jewellers are not directly involved in business with Sukesh Gupta of MBS Jewellers, Anurag Gupta, the husband of Vandana Gupta, and the father of Shashank and Rudrakash Gupta, were business partner with Sukesh Gupta.

Dama Sheshadri Naidu, senior counsel, representing the directors of Mussaddilal Gems, submitted that the raids were wrong in relation to his clients as they were not related to MBS Jewellers owner Sukesh Gupta and they were running their own business. He drew attention of the court that the technical issues where the ED had failed in following the provisions like not recording the reasons for searches and immediately not submitting the records of seizure properties. The bench then reserved orders.