Supreme Court has permitted real estate firm M3M Group to replace provisionally attached property under the Prevention of Money Laundering Act (PMLA) with a substitute asset of equivalent or higher value. The ruling, handed down on July 2, 2025, is being hailed as a historic judgment that weighs up enforcement and economic realism.
The bench of Justice Pamidighantam Sri Narasimha and Justice R. Mahadevan granted the plea while considering a Special Leave Petition preferred by M3M. According to the Court, in some situations, an attached property under PMLA can be substituted with the aim of ensuring continuity of business, subject to the condition that the substituted asset shall satisfy all safeguards of law.
Substitution not dilution, say experts
Legal professionals term the order a landmark development in PMLA jurisprudence. Mr. Parimal Tripathi, Senior Counsel and Sutradhar Associates Head, averred, “This is a progressive order and will have a positive bearing on other pending cases of a similar ilk. Importantly, the substitution mechanism does not water down enforcement power under PMLA. Instead, it enhances procedural fairness and demonstrates maturing jurisprudence that recognises the practical effects of criminal law on business continuity.”
The judgment follows the Court’s previous position in Revati Cements and Anr v. Union of India, when substitution of attached property with fixed deposits was permitted. Now, the Court has applied the rationale to immovable property, permitting economic activity to continue while keeping suspected proceeds of crime on lock.
M3M had tried to substitute provisionally attached land with another piece of equal or larger value so that it could continue to carry on its development business without legal hindrance. The Court ruling allows big-ticket realty projects not to get stalled indefinitely by provisional attachments, particularly where companies are ready to abide by all requirements under PMLA.
White-collar crime specialist Mr. Rohit Sinha had this to say, “This judgment repositions the enforcement narrative. Not all enforcement actions need to paralyse business. Firms such as M3M have shown that it is possible to provide win-win solutions — enforcing the law and facilitating economic development.”
What this means for business and law
The ruling gives a significant precedent that would be useful for other legitimate business entities subjected to the provisional attachment of property. It establishes a judicial appreciation of the necessity to balance aggressive enforcement and continuous economic activity, vitally necessary in capital-intensive industries such as real estate and infrastructure.
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