INDIA Law and Practice Contributed by: Vijayendra Pratap Singh, Asif Ahmed, Tanmay Sharma and Bhanu Jindal, AZB & Partners
by a third party, the court may (following the sub - mission of an application) direct the third party to disclose such assets. The opposite party may also be required to answer specific questions (termed “interrogatories” ) served by the claim - ant. A failure to answer such interrogatories or to comply with an order of discovery may lead to dismissal of the defendant’s defence, as if they had not defended the suit at all, under Order XI Rule 21 of the CPC. Additionally, if the defend - ant is eventually found to have given false infor - mation, they may also be proceeded against for perjury. At the same time, the court may impose costs on any party if it believes that such party has issued interrogatories that are unreasonable, vexatious or exceedingly lengthy in any manner. Cross-Undertakings As explained in 1.7 Prevention of Defendants Dissipating or Secreting Assets , a party can be put to terms and be directed by the court to deposit a certain amount. Further, under Sec - tion 144 of the CPC, a court has the power to restore a party to its original position where an order against it is subsequently vacated or modi - fied. This power includes the power of the court to order that a party be paid such costs as are properly consequential on such variation, rever - sal or modification. 2.2 Preserving Evidence Criminal Proceedings Law enforcement agencies often have their own manuals or rules that provide for the preserva - tion and storage of evidence. For example, the CBI manual provides that all documents and material objects seized during an investigation must be promptly sealed in a scientific manner and deposited in the designated property room. Furthermore, the details of such documents and material objects must be entered in the submod - ule of crimes, or in the register where the sub -
module is not operational. These documents/ items can be issued to the investigating officer as and when required for the purpose of inves - tigation, by proper receipt. Further, such docu - ments/items should be returned as soon as they are not required by the investigating officer. The manual also states that every investigating offic - er shall be personally responsible for the safe custody of such documents/items at all stages of the investigation. As mentioned in 1.3 Claims Against Parties Who Assist or Facilitate Fraudulent Acts , 1.5 Propri- etary Claims Against Property and 1.7 Preven- tion of Defendants Dissipating or Secreting Assets , under the PMLA, the ED is entitled to attach any property that it reasonably suspects is “proceed of crime” . Attachment enables preservation of such pro - ceeds of crime as may be used as evidence in the trial. Under the PMLA, specific rules have also been enacted under the Prevention of Money Laundering (Receipt and Management of Confiscated Properties) Rules, 2005, which pro - vide for proper identification, maintenance and custody of confiscated properties. In the case of attachment of an asset that is of a depreciat - ing nature, courts may order sale of the asset in order to realise its maximum value, even during the pendency of the trial. Pursuant to the Financial Action Task Force (FATF) highlighting use of cryptocurrencies in money laundering activities, enforcement agen - cies in India have also begun to attach crypto - currencies and assets of such exchanges as proceeds of crime. As a measure of statutory recognition, in March 2023 the government of India (for the first time) formally brought “cryp- tocurrency” and “virtual digital assets” under the regulatory ambit of the PMLA. It is now man -
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