Trivandrum Apollo Towers v. Union of India

Judgment: https://lawyerslibrary.in/books/lwua/

Case Citation: 2025 KER 26139 : 2025 KLT OnLine 1713
Court: High Court of Kerala at Ernakulam
Bench: Nitin Jamdar, CJ; S. Manu, J.
Date of Decision: 24 March 2025
Writ Appeal No.: 556 of 2025

Writ Petition – Classification as Civil or Criminal Writ Petition – Jurisdiction – Roster Allocation – Prevention of Money-Laundering Act, 2002 – Freezing of Bank Accounts – Interim Relief.

Facts

The appellants, engaged in hotel construction, challenged an order dated 24 February 2025 in W.P.(C) No. 44196 of 2024, where the Single Judge rejected interim relief to lift the freeze on their bank accounts, imposed by the Enforcement Directorate under Section 17(1A) of the Prevention of Money-Laundering Act, 2002. The appellants alleged the hotel property was built using proceeds of crime. The appeal raised a preliminary issue regarding whether the writ petition was a Civil Writ Petition (W.P.(C)) or a Criminal Writ Petition (W.P.(Crl.)), as this classification determines the appropriate roster and jurisdiction.

Held

The Division Bench disposed of the appeal, directing the Single Judge to determine whether W.P.(C) No. 44196 of 2024 is a Civil or Criminal Writ Petition. If classified as a Criminal Writ Petition and outside the Single Judge’s roster, the impugned order would be a nullity per the Supreme Court’s ruling in Garden Reach Shipbuilders and Engineers Limited v. Grse Limited Workmens Union (2025 SCC OnLine SC 582). If deemed a Civil Writ Petition within the roster, the appellants were permitted to restore the appeal for further consideration. The court emphasized the importance of roster allocation to ensure jurisdictional validity.

Cases Referred:

1. N.Prakash v. Manoj Kumar (2025 (1) KLT 835)
2. Garden Reach Shipbuilders and Engineers Limited v. Grse Limited Workmens Union (2025 SCC OnLine SC 582)

Counsel: Jaikrishna R., Akhilesh P., C.S. Arun Shankar, Narayani Harikrishnan for Appellants; Krishna T.C., C.K. Karunakaran, Akshara Raju for Respondents.

Parties

• Appellants/Petitioners: Trivandrum Apollo Towers Pvt. Ltd. and Hotel City Plaza Pvt. Ltd., represented by Korambapalamkunnath Sabith.
• Respondents: Union of India, Enforcement Directorate, Adjudicating Authority (PMLA), Axis Bank Ltd., Dhanalaxmi Bank Ltd., HDFC Bank Ltd., State Bank of India Ltd.

Background

The appellants, engaged in hotel construction, challenged an order dated 24 February 2025 in W.P.(C) No. 44196 of 2024, where a Single Judge rejected their request for interim relief to lift a freeze on their bank accounts. The freeze was ordered by the Assistant Director, Enforcement Directorate, under Section 17(1A) of the Prevention of Money-Laundering Act, 2002 (PMLA), alleging the hotel property was built using proceeds of crime from unsecured loans. The appellants filed a writ petition challenging the freeze and sought to restrain further PMLA proceedings. The appeal raised a preliminary issue: whether the writ petition was a Civil Writ Petition (W.P.(C)) or a Criminal Writ Petition (W.P.(Crl.)), as this classification affects roster allocation and jurisdictional validity.

Key Issues

1. Whether W.P.(C) No. 44196 of 2024 is a Civil or Criminal Writ Petition.
2. Whether the Single Judge’s order was within jurisdiction, given the roster allocation for Civil and Criminal Writ Petitions.
3. The legal effect of an order passed outside the assigned roster.

Arguments

• Appellants: Argued that the Single Judge erred in rejecting interim relief and that the writ petition’s classification (Civil or Criminal) needed clarification to determine jurisdiction.
• Respondents: Submitted that the writ petition appeared to be a Criminal Writ Petition, but the Single Judge should first determine its nature.

Court’s Analysis

The court emphasized the distinction between Civil and Criminal Writ Petitions, referencing N.Prakash v. Manoj Kumar (2025 (1) KLT 835). A Criminal Writ Petition arises from proceedings that could lead to imprisonment, fines, or property forfeiture, or relate to investigations or trials under special statutes like the PMLA. The court also cited Garden Reach Shipbuilders and Engineers Limited v. Grse Limited Workmens Union (2025 SCC OnLine SC 582), which held that orders passed outside the assigned roster are without jurisdiction and void. Since Civil and Criminal Writ Petitions are assigned to different benches under the Kerala High Court’s roster, the classification of the writ petition was critical.

Decision

The Division Bench disposed of the appeal, directing the Single Judge to determine whether W.P.(C) No. 44196 of 2024 is a Civil or Criminal Writ Petition. If classified as a Criminal Writ Petition and outside the Single Judge’s roster, the impugned order would be a nullity. If deemed a Civil Writ Petition within the roster, the appellants could restore the appeal for further consideration. The court did not address the merits of the interim relief or the PMLA proceedings.

Legal Precedents

• N.Prakash v. Manoj Kumar (2025 (1) KLT 835): Clarified the distinction between Civil and Criminal Writ Petitions.
• Garden Reach Shipbuilders and Engineers Limited v. Grse Limited Workmens Union (2025 SCC OnLine SC 582): Held that orders outside the roster are void.

Significance

This case underscores the importance of proper roster allocation in judicial proceedings and the jurisdictional implications of misclassifying writ petitions. It reinforces the principle that orders passed without proper jurisdictional authority are nullities, ensuring procedural fairness in high court proceedings.

Multiple Choice Questions (MCQs)

1. What was the primary issue raised in the Writ Appeal No. 556 of 2025?
   a) Validity of the Enforcement Directorate’s order under PMLA
   b) Classification of the writ petition as Civil or Criminal
   c) Grant of interim relief to unfreeze bank accounts
   d) Merits of the hotel construction business Answer: b) Classification of the writ petition as Civil or Criminal
2. Which statutory provision was invoked by the Enforcement Directorate to freeze the appellants’ bank accounts?
   a) Section 17(1A) of the Prevention of Money-Laundering Act, 2002
   b) Section 5 of the Kerala High Court Act, 1958
   c) Section 226 of the Constitution of India
   d) Section 17 of the Criminal Procedure Code Answer: a) Section 17(1A) of the Prevention of Money-Laundering Act, 2002
3. What did the Supreme Court hold in Garden Reach Shipbuilders and Engineers Limited v. Grse Limited Workmens Union as cited in the case?
   a) Writ petitions must always be classified as civil
   b) Orders passed outside the assigned roster are void
   c) Interim relief cannot be granted in PMLA cases
   d) The Chief Justice has no authority over roster allocation Answer: b) Orders passed outside the assigned roster are void
4. What was the court’s directive regarding the classification of W.P.(C) No. 44196 of 2024?
   a) The Division Bench classified it as a Criminal Writ Petition
   b) The Single Judge was tasked with determining its classification
   c) The writ petition was dismissed as invalid
   d) The classification was deemed irrelevant Answer: b) The Single Judge was tasked with determining its classification
5. If the writ petition is found to be a Criminal Writ Petition and outside the Single Judge’s roster, what would be the consequence of the impugned order?
   a) It would be upheld as valid
   b) It would be treated as a nullity
   c) It would be sent to the Supreme Court
   d) It would be automatically restored Answer: b) It would be treated as a nullity

Frequently Asked Questions (FAQs)

1. What was the main contention in Trivandrum Apollo Towers Pvt. Ltd. v. Union of India?
   The primary contention was the classification of the writ petition (W.P.(C) No. 44196 of 2024) as either a Civil Writ Petition or a Criminal Writ Petition, as this determined whether the Single Judge had jurisdiction based on the court’s roster allocation.
2. Why was the classification of the writ petition significant?
   The classification was significant because Civil and Criminal Writ Petitions are assigned to different Single Judges and Division Benches under the Kerala High Court’s roster. An order passed outside the assigned roster could be deemed void, as per the Supreme Court’s ruling in Garden Reach Shipbuilders (2025 SCC OnLine SC 582).
3. What action did the Enforcement Directorate take against the appellants?
   The Enforcement Directorate, under Section 17(1A) of the Prevention of Money-Laundering Act, 2002, ordered the freezing of the appellants’ bank accounts, alleging that the hotel property was built using proceeds of crime from unsecured loans.
4. What was the outcome of the appeal filed by the appellants?
   The Division Bench disposed of the appeal, directing the Single Judge to determine whether the writ petition was a Civil or Criminal Writ Petition. If classified as a Criminal Writ Petition outside the Single Judge’s roster, the impugned order would be a nullity. If a Civil Writ Petition within the roster, the appellants could restore the appeal.
5. How did the court define a Criminal Writ Petition?
   A Criminal Writ Petition, as per N.Prakash v. Manoj Kumar (2025 (1) KLT 835), arises from proceedings that could lead to imprisonment, fines, or property forfeiture, or relate to investigations, inquiries, or trials under special or general statutes, such as the PMLA.
6. What role did the Garden Reach Shipbuilders case play in this judgment?
   The Garden Reach Shipbuilders case (2025 SCC OnLine SC 582) was cited to establish that any order passed by a bench outside its assigned roster is without jurisdiction and void, emphasizing the importance of proper roster allocation.
7. What happens if the Single Judge determines the writ petition is a Civil Writ Petition?
   If the Single Judge determines it is a Civil Writ Petition within the assigned roster, the impugned order would be considered within jurisdiction, and the appellants were permitted to restore the appeal for further consideration by the Division Bench.