The Delhi High Court has ruled that the Supreme Court’s directions extending limitation periods during the COVID-19 pandemic are also applicable to proceedings under the Prevention of Money Laundering Act (PMLA), specifically those concerning adjudication and confirmation of property attachment under Section 8.
A Division Bench of Justices Anil Kshetrapal and Harish Vaidyanathan Shankar was examining whether the pandemic-related extensions could be applied to the 180-day statutory time limit under Section 8(3) of PMLA, which governs the confirmation of provisional attachments made under Section 5. The Court concluded that these extensions indeed apply, as the Supreme Court’s orders were intended to protect litigants across all judicial and quasi-judicial proceedings, whether under general or special laws, unless such laws expressly excluded them.
The Court highlighted that proceedings under Section 8 of PMLA are quasi-judicial in nature. The Adjudicating Authority, in deciding whether to confirm or vacate a provisional attachment, exercises powers that affect substantive property rights. These proceedings involve issuing notice, granting hearings, considering evidence, and rendering reasoned decisions. Therefore, they cannot be treated as purely administrative in character.
The matter came up in two connected cases—an appeal filed by the Enforcement Directorate (ED) against an earlier single-judge ruling, and a writ petition challenging a provisional attachment order. The central issue was whether the statutory period of 180 days for confirming attachments, which expired during the pandemic, should be strictly enforced or whether the Supreme Court’s limitation extension orders could be applied to excuse the delay.
The Bench observed that provisional attachment under Section 5 triggers subsequent proceedings under Section 8. After a complaint is filed within 30 days as required by Section 5(5), the Adjudicating Authority must confirm or vacate the attachment within 180 days. However, when extraordinary circumstances such as the COVID-19 pandemic made it impossible to adhere to the statutory deadline, the strict interpretation of the time limit would result in unfairness. The Court invoked the principle that no one should suffer due to the act of the court, holding that pandemic-related delays fell squarely within the scope of the Supreme Court’s extension orders.
The Court further reasoned that there was no express exclusion in PMLA that prevented the application of such extensions. On the contrary, the equitable purpose of the Supreme Court’s directions was to safeguard rights during unprecedented disruptions. Therefore, it would be contrary to justice to penalize parties for delays beyond their control.
In its final order, the High Court allowed the ED’s appeal, setting aside the single-judge ruling that had refused to apply the limitation extensions. At the same time, it dismissed the separate writ petition filed against the provisional attachment, thereby upholding the attachment proceedings in light of the extended limitation.
Through this decision, the Delhi High Court reinforced that statutory timelines under PMLA, including those governing attachment confirmation, must be read harmoniously with the Supreme Court’s extraordinary COVID-19 orders. This ensures that parties are not prejudiced by procedural deadlines that could not realistically be met due to the pandemic, while also preserving the integrity of adjudication under the money laundering framework.
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