Quashing One Predicate FIR Does Not End Attachment Based on Another: Delhi High Court

The Delhi High Court restored the Enforcement Directorate’s attachment appeal, faulting the SAFEMA Appellate Tribunal for ignoring a second, live FIR on which the provisional attachment also rested.

The Delhi High Court has set aside an order of the Appellate Tribunal under the Prevention of Money Laundering Act, 2002 (PMLA) that released Piramal Capital and Housing Finance Ltd.’s property from attachment merely because one predicate first information report (FIR) had been quashed, when the attachment also rested on a second FIR [Deputy Director, Directorate of Enforcement v. Piramal Capital and Housing Finance Ltd., 2026-juristway.com-3393-HC(Delhi)-PMLA].

Justice Navin Chawla wrote the order for a Bench with Justice Arun Bhardwaj. The Adjudicating Authority confirmed Provisional Attachment Order No. 03/2024 dated 23 Feb 2024 on 31 Jul 2024. The Appellate Tribunal reversed it on 16 Apr 2026 only because the High Court had quashed FIR No. RC2172018A0004 on 14 Oct 2025, and the Supreme Court had dismissed the CBI’s petition against that order.

The Directorate of Enforcement (ED) pointed out that another FIR, No. RC 2172018A0003 dated 1 May 2018, under Sections 420 and 120B of the Indian Penal Code and the Prevention of Corruption Act, 1988, was also a basis of the attachment. A charge sheet had been filed in that case, and a prosecution complaint under Section 45 of the PMLA was pending. The order had already been set aside by consent in two connected appeals.

The Court held that the Appellate Tribunal had based its order only on the quashed FIR without considering the other FIR. It added that the effect of quashing an FIR on an attachment must be independently considered, as the Supreme Court held in Directorate of Enforcement v. Bhupesh Arora (SLP (Crl.) No. 13532/2026), where it observed that quashing a predicate FIR on a compromise does not obliterate the existence of proceeds of crime.

The appeal was allowed after condoning a delay of 57 days. The matter was remanded to the Appellate Tribunal for fresh consideration, with all contentions open, and listed before it on 18 Nov 2026 along with the connected appeals. The Court requested disposal within two months of first listing.

2026-juristway.com-3393-HC(Delhi)-PMLA