In Dash Exports Private Limited v. Directorate of Enforcement (MISC. APPEAL(PMLA) 4/2026, decided 6 November 2026), a Division Bench of the High Court of Delhi comprising Justice Navin Chawla and Justice Arun Bhardwaj allowed an appeal under Section 42 of the PMLA, holding that a provisional attachment order passed before the approval of a resolution plan under Section 31 of the IBC cannot survive that approval, where the incoming resolution applicant satisfies the conditions of Section 32A. The ruling resolves a recurring friction point between the Enforcement Directorate’s attachment powers and the clean-slate promise of corporate insolvency resolution.
The case in one view
| Case | Dash Exports Pvt. Ltd. v. Directorate of Enforcement, MISC. APPEAL(PMLA) 4/2026 |
|---|---|
| Court | High Court of Delhi, Division Bench (Navin Chawla and Arun Bhardwaj JJ) |
| Decided | 6 November 2026 (reserved 13 October 2026) |
| Provisions | Sections 5, 26 and 42, PMLA, 2002; Sections 31 and 32A, IBC, 2016 |
| Outcome | Appeal allowed; Tribunal order set aside; attachment no longer subsists; FDR of Rs 3.01 crore to be released in two weeks |
The timeline that framed the dispute
The Division Bench’s reasoning
The court’s analysis proceeds in three steps. First, the pre-/post-approval distinction drawn by the Tribunal, in the court’s assessment at para 32, is “an artificial distinction” finding “no support either in the plain language of Section 32A” or in the Supreme Court’s judgment upholding the provision. Second, the trigger for Section 32A is the approval of the resolution plan: once control passes to a qualifying third party, that party takes the debtor’s properties free from encumbrances, including a PMLA attachment. Third, this reading is not retrospective — it does not annul the attachment as originally made, but operates prospectively from approval to release the property.
From the judgment (para 36): once the resolution plan is approved under Section 31, the attachment order under Section 5 of the PMLA “can no longer subsist against the property of the corporate debtor”, provided the person taking control satisfies Section 32A’s conditions.
Decisive, too, was what the ED did not argue: it was not contended that the resolution applicant was a promoter, a related party or an abettor, that the property fell outside the plan, or that control had not genuinely changed. With no statutory exception invoked, the Tribunal’s insistence on a Special Court finding before release was held unsustainable, and its order was set aside.
Why the ruling matters
The appeal was allowed with no order as to costs, and the Rs 3.01 crore fixed deposit furnished earlier to secure the title deeds was directed to be released within two weeks of the judgment.
Frequently Asked Questions
What does Section 32A of the IBC do?
Introduced in 2020, Section 32A protects a corporate debtor and its property once a resolution plan is approved and control passes to a person who was not a promoter, related party or person involved in the alleged offence. The debtor's liability for pre-CIRP offences ceases, and action against its property in connection with such offences — including attachment — is barred, so that the new management takes the business on a clean slate.
Why did the timing of the attachment not matter?
The ED argued that Section 32A(2) applies only to attachments made after plan approval, so its earlier provisional attachment survived. The court called this an artificial distinction with no support in the text of Section 32A or in the Supreme Court's decision upholding the provision. The trigger is the approval of the plan: once it occurs, a qualifying acquirer takes the property, in the court's words, "free from all encumbrances, including the attachment order under the PMLA."
Is this a retrospective wiping out of the ED's order?
The court said no. The attachment was valid when made; Section 32A operates prospectively from the plan's approval to release the property. As para 36 holds, once the plan is approved, the attachment "can no longer subsist" against the corporate debtor's property, provided the person taking control satisfies Section 32A's conditions.
What happened to the money deposited in this case?
Under an earlier High Court order, a fixed deposit of Rs 3.01 crore had been furnished in the ED's favour to secure release of title deeds. With the appeal allowed, the court directed that the FDR be released to the appellant within two weeks of the judgment, with no order as to costs.