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Although the arguments by appellants appeared to be quite attractive and forceful but when the facts and law of the case were scrutinized, top court was of the firm view that the argument had to fail resulting into dismissal of the appeals
The Supreme Court has said revocation of a detention order passed under the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 (COFEPOSA) would not necessarily have a bearing on the independent proceedings initiated for forfeiture of the ill-gotten properties under the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 (SAFEMA).
A bench of Justices Vikram Nath and Rajesh Bindal rejected contentions made by Thanesar Singh Sodhi (Dead) through his legal representatives and Sujata S Shetty against the Delhi (2010) and Bombay (2012) High Courts order respectively against forfeiture of properties under the SAFEMA.
In case of Sodhi, the forfeiture order was passed on September 16, 1983 in respect of a house in Punjabi Bagh, a hotel and a bank account. In Shetty's case, the forfeiture order was passed on June 25, 2001.
Before the High Courts, the main ground of challenge in both the cases was that as the detention order passed under Section 3 of the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 has been subsequently revoked/withdrawn as such SAFEMA proceedings would become non est and untenable.
In Sodhi's case, an additional ground taken in was to the effect that even the criminal complaint filed under the Customs Act, 1962 wherein the appellant had been discharged on the ground that there was no evidence, would further render the proceedings under SAFEMA as untenable.
The bench, however, said the arguments appeared "to be quite attractive and forceful but when the facts and law of the case are scrutinised, we are of the firm view that argument has to fail resulting into dismissal of the appeals".
Dealing with the argument relating to revocation of the detention order passed under the COFEPOSA, the bench pointed out SAFEMA was enacted to provide for the forfeiture of illegally acquired properties of smugglers and foreign exchange manipulators and for matters connected therewith or incidental thereto as such activities were having a deleterious effect on the national economy.
The court further said Section 2 provided for the application of the provisions of the Act only to the persons specified in sub-section (2) thereof. According to sub-section (2)(b) every person in respect of whom an order of detention has been made under COFEPOSA, the Act would be applicable subject to four clauses mentioned under the proviso thereto, it noted.
Referring to four contingencies given in clauses (i) to (iv) of the provision, the bench pointed out every person against whom an order of detention has been passed under COFEPOSA, the provisions of SAFEMA would apply. In the present case, it was an admitted position that an order of detention under COFEPOSA was made against the appellants, the court noted.
Against the detention order, the appellant had made a representation which had been rejected. Thereafter the said order was challenged before the High Court by way of a writ petition which had also been dismissed on merits by a detailed order upholding the detention order, the bench pointed out.
"The revocation however had been made on a statement given on behalf of the Union of India before this Court in order to institute a complaint under the relevant statute. The said revocation is not contemplated under Section 2(2)(b) and its proviso, and, therefore, no benefit can be extended to the appellant(s) on the said count," the bench said.
Court thus dismissed the appeals as lacking merit, by holding that the judgements do not suffer from any infirmity, calling for its interference.
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