2018 (1) TMI 568 - HC - FEMA

Brother of the present respondent was detained under the provisions COFEPOSA Act - Held that - No substance in any such ground for the simple reason that the law is well settled as interpreted and decided by the Honourable Supreme Court. The petitioner has also tried to compare several other judgments and Special Act like TADA and NDPS Act to plead and to induce by this Court to believe that it would be difficult to get direct evidence to control grave offence and, therefore, burden of proof rests upon respondents to prove that what is pleaded by the authority is not correct rather than to ask the authority to prove that what is pleaded by them is correct fact. It is difficult to believe such submission. Petitioner has gone to the extent of challenging the impugned order by describing it as a non speaking order when it is pleaded that the Appellate Tribunal has neither considered the issue raised by the petitioner nor discussed the fact of the case. As already recorded herein above and perusal of impugned judgment, makes it very much clear that the factual details are well discussed in such judgment and all issues are properly dealt with and answered by the Appellate Tribunal with reasonings and citations of relevant cases. Therefore, there is no substance in the petition when it is trying to misguide the judicial proceedings.

Summary

Issues:
1. Forfeiture of properties under SAFEMA.
2. Validity of show-cause notice under SAFEMA.
3. Nexus between properties and detenue's illegal activities.
4. Interpretation of judgments by Appellate Tribunal and Supreme Court.
5. Burden of proof in special acts.
6. Article 227 jurisdiction in verifying authority's order.
7. Previous court decisions on similar matters.

Analysis:

1. The judgment involves the forfeiture of properties under the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 (SAFEMA). The petitioner, Union of India, alleged that the respondent acquired properties illegally and did not file income tax returns adequately.

2. The validity of the show-cause notice issued under SAFEMA was challenged by the respondent. The Appellate Tribunal quashed the notice, citing lack of evidence connecting the properties to the detenue's illegal activities.

3. The issue of nexus between the properties and the detenue's illegal activities was crucial. The Appellate Tribunal found ample evidence that the properties were independently acquired by the respondent and not traceable to the detenue, leading to the quashing of the show-cause notice.

4. The interpretation of judgments by the Appellate Tribunal and the Supreme Court played a significant role. The Tribunal relied on previous decisions to conclude that the show-cause notice lacked nexus between the properties and illegal earnings, leading to the appeal being allowed.

5. The burden of proof in special acts was discussed, with the petitioner arguing for a statutory presumption of guilt. However, the Tribunal emphasized the need for establishing a clear connection between the properties and illegal activities.

6. The jurisdiction under Article 227 was invoked to verify the authority's order. The Court emphasized the need to adhere to Supreme Court judgments and dismissed the petition challenging the Appellate Tribunal's decision.

7. Previous court decisions on similar matters were cited to support the Appellate Tribunal's ruling. The Court upheld the Tribunal's decision to quash the show-cause notice, emphasizing the importance of establishing a clear nexus between the properties and illegal activities.