Supreme Court Grants M3M India Permission to Substitute Attached Property
The Supreme Court has allowed real estate major M3M India to substitute property worth ₹317 crore attached by the Enforcement Directorate (ED) under the Prevention of Money Laundering Act (PMLA). This decision will enable M3M to resume work on a key commercial project.
Supreme CourtReal EstateM3m IndiaPrevention Of Money Laundering ActEdReal Estate NewsJul 02, 2025
A bench of Justices PS Narasimha and R Mahadevan passed the order while hearing an appeal filed by M3M challenging an order of the Punjab and Haryana High Court. The company requested permission to substitute the attached land with unencumbered, marketable commercial assets.
The bench allowed the substitution on the basis of a detailed affidavit filed by the ED, which verified that the proposed commercial units located in M3M Broadway, Gurugram, had a total fair market value of ₹317 crore. This included ₹275 crore worth of units initially proposed and another ₹42 crore worth of additional units later offered by the developer.
The ED submitted that it had independently assessed the proposed properties through a registered valuer. While agreeing to the substitution, the agency requested that certain safeguards be imposed. The Supreme Court accepted these safeguards in full and directed that the substitution would only be effective subject to compliance with all nine requirements listed in the ED’s affidavit. These included submission of no-encumbrance certificates, notarised undertakings not to alienate the substituted assets, deposition of title documents, furnishing of indemnity bonds, and full disclosure of the source of funds used for acquisition.
The Court also mandated that any existing or future dealings with third-party investors in the larger commercial project must remain unaffected by the PMLA proceedings. Further, M3M agreed that in case the alternate assets are eventually confirmed to be tainted under the PMLA, possession would be handed over to the ED.
The Court clarified that the substitution will have no bearing on the merits of the ongoing investigation or trial and will not be treated as an acknowledgment of the legitimacy of either the attached or substituted assets. Senior Advocate Dr. Abhishek Manu Singhvi appeared for M3M, while ED was represented by advocate Zoheb Hossain.
Frequently Asked Questions
What is the Prevention of Money Laundering Act (PMLA)?
The Prevention of Money Laundering Act (PMLA) is a law in India that aims to prevent money laundering and to provide for confiscation of property derived from, or involved in, money laundering.
Who are the Justices who passed the order?
The order was passed by Justices PS Narasimha and R Mahadevan of the Supreme Court.
What was the total value of the substituted property?
The total fair market value of the substituted property was ₹317 crore, including ₹275 crore worth of units initially proposed and ₹42 crore worth of additional units.
What are the safeguards imposed by the ED?
The safeguards include submission of no-encumbrance certificates, notarised undertakings not to alienate the substituted assets, deposition of title documents, furnishing of indemnity bonds, and full disclosure of the source of funds used for acquisition.
Who represented M3M and the ED in the Supreme Court?
Senior Advocate Dr. Abhishek Manu Singhvi represented M3M, while advocate Zoheb Hossain represented the ED.
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