MUMBAI, Nov. 21 -- In a relief for the Enforcement Directorate (ED)'s Mumbai unit probing the Rs.9,200-crore bank loan default cases of Vijay Mallya's defunct Kingfisher Airlines Limited (KAL), the Karnataka high court has restored the ED's attachment of a Bengaluru flat while investigating a case related to alleged unpaid loans worth Rs.750 crore from IDBI Bank. Holding the attachment of the flat as "lawful" in its November 14 order, the high court upheld the agency's challenge against an August 2019 order of the Appellate Tribunal, (Prevention of Money Laundering Act), New Delhi, which had quashed it. The court pointed out that the flat was owned by United Breweries (Holdings) Limited (UBHL) which was then controlled by Mallya, of which KAL was a fully-owned subsidiary at the time of the attachment. It added that UBHL's earlier 'Agreement To Sell' with a local developer, who paid around Rs.18.38 crore by September 2011, was not legally tenable as it was an unregistered agreement, and the title was not transferred. The 8,321-square-feet flat, Number 7A, was among a few under-construction flats at Kingfisher Tower, Bengaluru, which were attached by the ED on June 11, 2016, as per the provisions of the PMLA Act. The ED's provisional attachment of the flat had earlier been confirmed in December 2016 by the Adjudicating Authority, PMLA. The aggrieved developer challenged the Adjudicating Authority's 'confirmation' before the Appellate Tribunal, which quashed the provisional attachment order. The ED thereafter approached the high court against the Appellate Tribunal's order in October 2019. The high court ruled in favour of the ED on two key questions which were in the agency's appeal against the Appellate Tribunal's order: 1. Whether the developer's firm could be said to be the owner of the flat on the basis of an unregistered 'Agreement To Sell', and 2. Whether the flat could be attached as 'proceeds of crime' under the provisions of Section 2(1)(u) of PMLA, 2002. The court said that the payment of the "almost entire consideration" for the flat, even before the unregistered agreement to sell being executed "would cause a huge shadow of doubt of bona fides and genuineness of these transactions". "Without registration of the sale deed, no right, title, interest in the immovable property can be transferred," it said. "A contract of sale (Agreement to Sell), which is not a registered deed of conveyance, would fall short of the requirements of the Transfer of Property act." The court ruled that the developer's firm did not have any title over the flat, and the property belonged to UBHL. The high court further ruled, "The Enforcement Directorate was well within its powers to attach the aforesaid property. being equivalent to the value of the proceeds of crime as defined under Section 2(1)(u) of the PMLA, 2002. We are also of the considered view that the No Objection of the official liquidator for registration of the sale deed despite the pendency of the proceedings for restoration of the properties in favour of the consortium of banks, and the pendency of this appeal, was not a bona fide act."...