Asset Management Under
Foreign Exchange Management
Act
- PRESENTED BY
DEPARTMENT OF REVENUE
GOVT. OF INDIA
ASSET MANAGEMENT UNDER THE FOREIGN
EXCHANGE MANAGEMENT ACT, 1999
1. The seized Indian from the unlicensed remitters are kept as a term deposit receipt with a
nationalized bank;
2. The seized foreign currencies from the unlicensed remitters are converted to Indian currencies
by ways of encashment through an Authorised Dealer bank/ Full Fledged Money Changer and
the proceeds of those foreign currencies in Indian currencies are kept as term deposit receipt
with a nationalized bank;
3. Upon adjudication of the contraventions under FEMA, 1999, the Adjudicating Authority, may,
in addition to imposition of penalty (which can be upto thrice the sum involved), can order
confiscation of the seized Indian and foreign currencies to the Central Government.
Directorate of Enforcement thereafter credits the proceeds of the term deposit receipts to the
designated Central Government account.
ASSET MANAGEMENT UNDER THE PREVENTION
OF MONEY LAUNDERING ACT, 2002
• Indian currencies seized under section 17 of PMLA are credited to the Personal Deposit account maintained in the
name of Directorate of Enforcement with banks authorized to conduct treasury operations on behalf of Government of
India;
• Foreign currencies seized under section 17 of PMLA are encashed into Indian currencies through an Authorised Dealer
bank/Full Fledged Money Changer and the proceeds credited to the Personal Deposit account maintained in the name
of Directorate of Enforcement with banks authorized to conduct treasury operations on behalf of Government of India;
• Seized valuables like bullion, jewellery is kept in bank lockers held in the name of the Head of Offices of the
Directorate of Enforcement;
• Amount freezed in bank accounts/ investments freezed under PMLA are kept in the same state till the retention of the
same is confirmed by the Ld. Adjudicating Authority, PMLA.
• If the provisional attachment of movable and immovable properties is confirmed by the Ld. Adjudicating Authority
(PMLA), the said properties are taken possession in terms of the Prevention of Monay- Laundering (Taking Possession
of Attached or Frozen Properties Confirmed by the Adjudicating Authority) Rules, 2013 (hereafter referred as “Rule”)
SAFE KEEP AND CONFISCATION OF INDIAN AND FOREIGN
CURRENCIES TRANSACTED BY UNLICENSED REMITTERS
• The seized foreign currencies from the unlicensed remitters are converted to Indian
currencies by ways of encashment through an Authorised Dealer bank/ Full Fledged
Money Changer and the proceeds of those foreign currencies in Indian currencies are
kept as term deposit receipt with a nationalized bank;
• Upon adjudication of the contraventions under FEMA, 1999, the Adjudicating
Authority, may, in addition to imposition of penalty (which can be upto thrice the
sum involved), can order confiscation of the seized Indian and foreign currencies to
the Central Government. Directorate of Enforcement thereafter credits the proceeds
of the term deposit receipts to the designated Central Government account.
Manner of taking possession of movable property
1. Where the attached property confirmed under sub-section (3) of section 8 of the Act is a movable property, the
authorized officer shall take physical possession of such property and deposit it in a warehouse or a storage place.
2. Where the attached property confirmed by the Adjudicating Authority, is liable to speedy and natural decay or the
expense of maintenance is likely to exceed its value, the authorized officer shall sell such property with the leave of the
concerned Special Court or Adjudicating Authority, as the case may be, and deposit the sale proceeds in the nearest
Government Treasury or branch of the State Bank of India or its subsidiaries or in any nationalised bank in fixed deposit
and retain the receipt thereof:
Provided that where the owner of the property furnishes the fixed deposit receipt of a nationalised bank equivalent to the value of
property in the name of Director of Enforcement, the authorised officer may accept and retain such fixed deposit receipt as security
and send a report to the Special Court or Adjudicating Authority, as the case may be, for information and appropriate action:
Provided further that where the movable property is a mode of conveyance of any description, the authorised officer, after obtaining
its valuation report from the Motor Licensing Authority or any other authority, as the case may be, may accept and retain the fixed
deposit receipt of a nationalised bank equivalent to the value of the movable property as security in the name of Director of
Enforcement and send a report to the Special Court or Adjudicating Authority, as the case may be, for information and appropriate
action.
• (3) Where the attached property confirmed by the Adjudicating Authority consists of cash, government or
other securities or bullion or jewellery or other valuables, the authorized officer shall cause to deposit it in
a locker in the name of the Director of Enforcement or in the form of fixed deposit receipt, as the case may
be, in State Bank of India or its subsidiaries or in any nationalised bank and retain the receipt thereof.
• (4) Where the attached property confirmed by the Adjudicating Authority is in the form of shares,
debentures, units of mutual fund or instruments, the authorised officer shall cause to get such shares,
debentures, units of Mutual Fund or instruments to be transferred in favour of the Director of Enforcement.
• (5) Where the property confirmed by the Adjudicating Authority is in the form of money lying in a bank or
a financial institution, the Authorized Officer shall issue a direction to the bank or financial institution, as
the case may be, to transfer and credit the money to the account of the Directorate of Enforcement.
Manner of taking Possession of Immovable
Property
• (1) Where the immovable property confirmed by the Adjudicating Authority is in the form of a land, building, house, flat,
etc., a notice shall be issued to the Registrar having jurisdiction of the area alongwith the provisional attachment order and
order of the Adjudicating Authority confirming such attachment requiring the Registrar not to transfer or create any
interest in such property until further orders and a copy of the order confirming the attachment shall be affixed at a
conspicuous part of the property;
• (2) Where the immovable property confirmed by the Adjudicating Authority is in the form of a land, building, house, flat,
etc., and is occupied by the owner, the authorized officer shall issue a notice of eviction of ten days so as to prevent the
person from enjoying such property and after issuing of such notice if the premises is not vacated within the stipulated
time, such occupant shall be evicted and the possession shall be taken by seeking the assistance of the local Authorities in
terms of section 54 of the Act;
• (3) Where the immovable property confirmed by the Adjudicating Authority is in the form of a land, building, house, flat,
etc., and is given on lease or rent to a third party which is registered in accordance with the provisions of section 17 of the
Registration Act, 1908, the authorized officer shall issue a direction to the occupant to pay the lease amount or rent in the
form of Demand Draft payable to the Directorate of Enforcement;
• (4) Where the immovable property confirmed by the Adjudicating Authority is in the form of a land, building, house,
flat, etc., and is given on lease or rent to any third party where the registration is optional in accordance with the
provision of section 18 of the Registration Act, 1908, the authorized officer shall proceed to get the premises vacated
and the possession shall be taken by seeking the assistance of local Authorities in terms of section 54 of the Act;
• (5) Where the immovable property confirmed by the Adjudicating Authority is in the form of a land, building, house,
flat, etc., and is under joint ownership, the authorized officer may accept the equivalent value of fixed deposit to the
extent of the value of the share of the concerned person in the property estimated by the authorized officer, to be
involved in money laundering; and
• (6) Where the immovable property confirmed by the Adjudicating Authority is in the form or nature of productive
asset or an establishment which is producing goods or a factory, etc., and where the manufacturing process or activity
is being carried out, the authorized officer may take possession with a direction to the person in-charge of the
concerned establishment or factory that gross income and any other monetary benefits which accrue there from shall
be deposited in the account of the Directorate of Enforcement.
Mode of Serving of Notice
• (1) The authorized officer shall serve a notice on all the concerned parties for
taking possession of immovable property in Form I, appended to these rules
and affix the same at conspicuous part of such property and shall also be
served by publication in a local newspaper.
• (2) The authorized officer, for taking possession of property which is in the
nature of productive asset, shall serve a notice on all concerned parties in
Form II, appended to these rules and affix the same at conspicuous part of
such property and such notice shall also be published in a local newspaper.
Confirmed attached property in the
custody of Court
• (1) Where the confirmed attached property is in the custody of any court,
the authorized officer shall make an application to such court by providing
a copy of the provisional attachment order issued under sub-section (1) of
section 5 and the order under subsection (3) of section 8 passed by the
Adjudication Authority.
• (2) The application referred to in sub-rule (1) shall contain a relief that
such property and any interest or dividend payable thereon may be
released in favour of the Directorate of Enforcement.
Confirmed attached property hypothecated or mortgaged or
pledged to
bank, financial institutions, etc
• Where the confirmed attached property is hypothecated or mortgaged or
pledged to any bank, financial institution, etc., the authorised officer shall
direct such bank, financial institution, etc., that such property and any
interest or dividend payable thereon shall be retained subject to further
orders of the authorised officer.
Property Management
under PMLA, 2002.
Management of Properties under PMLA,
2002
• The receipt and management of confiscated properties under PMLA are
governed by the Prevention of Money-Laundering (Receipt and Management of
Confiscated Properties) Rules, 2005.
• In terms of section 10 (1) of PMLA, Central Government has designated
Special Directors of the Regional offices as Administrators for management of
confiscated properties under PMLA.
• The Administrator shall, at the time of receiving the confiscated properties,
ensure proper identification of such property with reference to its particulars
mentioned in the order confiscating such property.
Management of confiscated property
• (1) Where the property confiscated is of such a nature that its removal from the place of
attachment is impracticable or its removal involves expenditure out of proportion to the value of
the property, the Administrator shall arrange for the proper maintenance and custody of the
property at the place of attachment.
• (2) If the property confiscated consists of cash, Government or other securities, bullion,
jewellery or other valuables, the Administrator shall cause to deposit them for safe custody in
the nearest Government Treasury or a branch of the Reserve Bank of India or State Bank of
India or its subsidiaries or of any authorised bank.
• (3) The Administrator shall maintain a register containing the details in Form I for recording
entries in respect of moveable property, such as cash, Government or other securities, bullion,
jewellery or other valuables.
• (4) The Administrator shall obtain a receipt from the Treasury or the bank,
as the case may be, against the deposit of moveable properties stated in
subrule (3) of this rule.
• (5) The Administrator shall maintain a register containing the details in
Form II for recording entries in respect of property other than the
properties referred to in sub-rule (3) of this rule.
Assistance to the Administrator
• The Central Government may provide from time to time such members of
staff and other persons as it thinks fit to assist the Administrator in
exercise of his powers and performance of duties under these rules.
THANK YOU
