TMI Blog2008 (9) TMI 956X X X X Extracts X X X X X X X X Extracts X X X X ..... (E), Mumbai admeasuring 550 sq.ft. In the possession of Smt.Neeta N. Bhanusali; IV. Shop No.7, known as Pooja Dairy in Bldg. No.7, Neelam Nagar, Gavanpada, admeasuring about 400 sq.ft. In the name of Neeta N. Bhanusali; V. Shop No.2, known as Shivanand Dairy in Shrinivas Bldg; M.G.Road, Chatkopar (E), admeasuring about 400 sq.ft. These three residential flats and two shops are hereinafter referred to as t he properties in issue for the sake of brevity. Even according to the Respondents in terms of the relevant documents of title/tenancy the Petitioner is the owner/holder of the properties in issue. 3. The present petition arises out of an action taken by the respondents for forfeiture of the properties in issue u/s 68-I of the Narcotic Drugs and Psychotropic Substances Act, 1985 (hereinafter referred to as the said Act for the sake of brevity). An appeal filed by the petitioner ultimately before the Appellate Tribunal for Forfeited Properties (hereinafter referred to as t he said Tribunal for the sake of brevity) challenging the impugned action of forfeiture came to be dismissed on 1st March 2000 and thereby the order of the Competent Authority issued ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er the said Act; 20.3.1997 : The Competent Authority under the said Act not only confirmed the order of freezing the properties in issue in exercise of its power u/s 68-F(2) of the said Act but also by the same document issued a show cause notice u/s 68-H of the said Act calling upon the said Iqbal Mirchi and the husband of the petitioner as to why the properties in issue which were subject matter of the freezing order dated 26th February 1997 should not be held as illegally acquired properties and consequently be forfeited to the Central Government as provided by Section 68-I of the said Act. 11.12.1997 : This High Court disposed off Criminal Writ Petition No.909 of 1997 filed by the petitioner challenging the freezing order dated 26th February 1997 and confirmed the order dated 29th March 1997 by directing the petitioner to appear before the said Tribunal; 12.2.1998 : The Tribunal dismissed the appeal of the petitioner and directed her to co-operate with the competent authority in the case involving the issue of forfeiture; 16.11.1998 : Another Writ Petition No.479 of 1998 filed by the petitioner for the same matter was dismissed as untenable. 14.10.1999 : The Comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red to be set at liberty forthwith, if not required in any other case. 6. We have given the aforesaid chronology as also the subsequent developments of acquittal of the husband of the petitioner from offence registered against him in CR No.7 of 1994 principally because it is this CR which is used as the sole bridge for connecting the husband of the petitioner with Iqbal Mirchi and the Respondents are using this bridge to reach the Petitioner for as the basis of the impugned action taken in respect of the properties in issue. 7. The relevant portion of the very first order freezing the property in issue dated 26th February1997 reads thus :- ... ... WHEREAS Mr.Iqbal Mohamed Memon @ Iqbal Mirchi is an accused in Narcotics Cell C.R.No.7/94, under section 8(c) r/w 22, 29 N.D.P.S. Act, and WHEREAS a detention order has been passed by the Detaining Authority Govt. of Maharashtra against the said Mr.Iqbal Mohamed Memon @ Iqbal Mirchi vide order No.SPL.3(A)/PND/0194/60,dated 02.,09.1994, and WHEREAS, Mr.Nitin Khimji Bhanushali, aged 35 years resident of Flat No.801, Bldg. No.6, Neelam Nagar Co-op. Housing Society, Gavanpada, Mulund (East), Mumbai-400 081 and Flat No.60, Bldg. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lso against the petitioner. 9. It appears that for the first time the name of the petitioner featured in this communication which ultimately culminated into passing of the impugned order. However, it is worthwhile to note that admittedly even a copy of this communication has not been served on the petitioner. The learned counsel appearing for the respondents was not able to controvert this assertion of the petitioner. More shocking is the last paragraph of this communication which reads thus :- This freezing order has been served on the concerned persons except Mr.Nitin Khimji Bhanishali (emphasis supplied) Thus, it is abundantly clear that the freezing order in respect of the property in question not only was not served on the petitioner but also was not served even on the husband of the petitioner. Thus, till this stage, it is apparent that the action was being taken against the petitioner with respect to the properties in issue held by her, not just without giving any opportunity of being heard to her but also without even serving the orders so issued on the petitioner or even on her husband. 10. The other portion, which is also relevant for our consideration in r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bhanushali. The agreement copy of the said flat is not available with the society 5. Shop no.2, ground floor, known as Shivanand Dairy in Shivniwas Bldg; Rajawadi, M.G.Road, Ghatkopar (E), Mumbai. The said shop is in the name of Mrs.Neeta Nitin Bhanushali. One Mr.Gulabrai Jhamromal Kurani is owner of the Shivniwas Bldg. His statement has been recorded. He stated that he has transferred the said shop premises in the name of Mrs.Neeta Nitin Bhanushali in the year 1993. Mr.Nitin Bhanushali approached him with earlier tenant Mr.Somabhai for transferring the said shop in the name of Mrs.Neeta Bhanushali. He has produced the rent receipt copy in the name of Mrs.Neeta Bhanushali for the month of July 1993. ... ... ... (emphasis by us) Thereafter, the order of confirmation of action of freezing the properties in issue vide order dated 30th March 1997 came to be passed by the Competent Authority under the said Act. The last portion of this very same order reads thus :- ... ... Therefore, I, A.K.Mehta in exercise of powers conferred in me under section 68-F(2) of the said Act, hereby confirm the said freezing order dated 26.02.1997 made by the afores ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ilable to me which includes your own statements in which you have admitted that you were associated with Iqbal Mirchi in Narcotics trafficking and also the statement of your wife Mrs.Neeta Nitin Bhanushali wherein she has admitted that the properties mentioned in the annexure to the freezing order (made by Shri Rade, Inspector of Police, C.B; C.I.D.; on 26.02.1997) were acquired by you in her name from income earned in the illegal business of Narcotics drugs in association of Shri Iqbal Memon and after carefully examining and considering the relevant information available to me. I have reason to believe that the properties described in the scheduled to the freezing order dated 26.02.1997 which are held by you either in your name or in the name of your wife, are illegally acquired properties traceable to the illegal activities of Iqbal Mirchi, within the meaning of provisions of Sec.68-B(g) and Section 68-C of the NDPSA. ... ... ... A perusal of this portion, which is the only portion in the show cause notice set out as the basis for issuing such a show cause notice, shows that the same has been issued on the basis of some r elevant information available to the competent auth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that there was no relevant information available with the competent authority at the time of issuance of this show cause notice on the basis of which the competent authority could have had reason to believe that the properties in issue are illegally acquired as contemplated by the aforesaid provisions of the said Act. 15. The second ground given in the show cause notice are that the husband of the petitioner made a statement admitting his association with Iqbal Mirchi in Narcotic trafficking. Firstly, copy of such a statement is not produced on record of this petition nor is it annexed to the affidavit-in- replies filed on behalf of the respondents. We are, therefore, unable to appreciate even this second ground given in the show cause notice. Assuming that such a statement was made by the husband of the petitioner and that such a statement was before the competent authority while issuing the aforesaid show cause notice, at the highest, the statement was made to the effect that the husband of the petitioner was associated with Iqbal Mirchi in Narcotic trafficking. This statement, as is referred to in the aforesaid show cause notice, does not at all state anything as to the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... given in the show cause notice by the Competent Authority as a reason to believe for issuing the show cause notice u/s 68-H of the said Act also is without any substance at all. 17. In view of the aforesaid observations made and findings recorded by us, it is clear that the competent authority had issued the show cause notice u/s 68-H of the said Act without there being any reason to believe as contemplated by provisions of Sections 68-B(g) and 68-C of the said Act. 18. On the basis of the aforesaid show cause notice the competent authority further conducted the proceedings and has passed an order on 14th/15th October 1999 u/s 68-D of the said Act and had declared the properties in issue to be the illegally acquired properties. A further order is also passed for forfeiture to the Central Government of the properties in issue u/s 68-I of the said Act. This composite order calls upon the petitioner u/s 68-U of the said Act to surrender the possession of the properties in issue. 19. A perusal of the aforesaid order of forfeiture that has been issued by the competent authority demonstrates that this order has been passed only and only on the ground that the petitioner h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e proceedings against her properties are not contemplated under the NDPS Act. This argument can only be applied to the independent properties of the relative and not to the properties illegally acquired by the State and held in the name of his/her relative like in this case. As there is no material on record to suggest that properties in question purported to be in the name of Smt.Neeta N. Bhanushali were independently acquired by her from her legal sources, the same were rightly freezed by the Mumbai Police so that forfeiture proceedings could be initiated. 20. From the foregoing, it is evident that neither the AP-1 nor his wife Smt.Neeta N. Bhanushali had any evidence to prove the legality of the properties under notice for the simple reason that the properties have been acquired from the earnings of illegal drug trafficking. Smt.Neeta N. Bhanushali has only tried to delay the due process of law by moving the ATFP and the High Court. Her latest ploy of iling SLP in the Apex Court is also directed to further delay the proceedings. 21. Since the Aps and the noticee have failed to prove that the properties in question have been acquired out of their legal sources of income, I, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arance and did not adduce any evidence. Neeta Nitin Bhanushali after obtaining several adjournments before the Competent Authority, requested by her letter dated 28.8.1999 that the Competent Authority may send all copies and notices of order to her husband who was confined in jail, with which request, the Competent Authority complied. No material or evidence, except a copy of the balance sheet and a computation of income statement were placed before the competent authority by either of the appellants. The competent authority had no option but to pass the impugned order based on the record and the materials before him. 10. It was nextly contended by the learned counsel that the burden of proving that the properties are illegally acquired properties lay on the competent authority and that it was not necessary for the appellants to prove that the properties were not illegally acquired properties. This contention is also based on the premise that Neeta is not a person to whom Chapter VA is applicable and is rejected in view of our holding that she is a person within the meaning of section 68-A(2)(d) and Sec.68-B(b)VII. 11. In order to appreciate the contention of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income from illegal drug trade carried out in association with the detenu. 22. The aforesaid extracted portion of the impugned judgement of the Tribunal will demonstrate that the Tribunal proceeded on the ground that the burden was squarely on the petitioner which, according to the Tribunal, she failed to discharge and that therefore, the order of forfeiture was sustainable. We will test the legality of this approach hereunder. But before we do that we must refer to one more aspect of the impugned judgement of the Tribunal. 23. The Tribunal has also referred to the contention of the respondents herein that the petitioner had given a statement before the Police on 15th February 1997 whereby she is supposed to have admitted that her husband had acquired the concerned properties in her name from the income earned by him in the illegal business of Narcotic Trafficking undertaken by him in association with Iqbal Mirchi. By referring to this statement in para 18 of the impugned judgement, the Tribunal has observed that sections 25 and 26 of the Cr.P.C. will have no application to this statement as this alleged statement of the petitioner cannot by any stretch of imagination be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re, totally at loss to know as to how, in law, the alleged statement of the petitioner could have been relied upon either by the competent authority or by the Tribunal to start with the assumption that the properties in issue were illegally acquired as provided by the provisions of the said Act. 26. We have stated hereinabove that we will deal with the issue of burden of proof at a later stage in this judgement. We are considering it now hereunder. A perusal of Chapter-V-A of the said Act demonstrates that this chapter lays down a self-sufficient scheme as to forfeiture of property acquired from illicit trafficking. The analysis of the scheme will show that u/s 68-H of the said Act, a notice can be issued as to forfeiture of a property if the competent authority has firstly reason to believe and secondly after re cording in writing such ' reasons to belief' that such properties are illegally acquired as contemplated by the provisions of this chapter. The statutory requirement firstly to have a reason to such a belief and secondly recording of such reason to belief, means that the competent authority while issuing a notice as contemplated by section 68-H of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not have been taken against the petitioner for having failed to discharge such burden which was wrongly cast on the petitioner. 29. We are supported in law by the judgement of the Supreme Court delivered in the case of Aslam Mohamed Merchant Vs. Competent Authority and others reported in 2008 (5) AIR BOM R 306. The relevant paragraphs of this judgement read as under : The Paragraph 16 of the Supreme Court Judgement sets out the issue that was considered, and the discussion as to its consideration that is relevant for our purpose is in the following terms : ISSUE. 16. The core question which, therefore, arises for consideration is what are the statutory requirements for initiating a valid proceeding. 24. ............Analysis of the aforementioned provisions clearly establish that a link must be found between the property sought to be forfeited and the income or assets or properties which were illegally acquired by the person concerned 28. It is, however, beyond any doubt or dispute that a proper application of mind on the part of the competent authority is imperative before a show cause notice is issued. Section 68-H of the Act provides for tw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9, which is the very judgement that is relied by the said Tribunal in its impugned judgement and order. The same judgement is also relied before us by the learned counsel appearing for the respondents. However, in view of the aforesaid latest Supreme Court judgement which considers that judgement also, we need not dwell upon the same herein. 31. The learned counsel for the petitioner contended that no action could have been initiated against the petitioner, even if the case of the respondents is considered in its totality, as the same would mean that the action is taken against the petitioner because she is the wife of an alleged associate of one Iqbal Mirchi against whom the detention order still stands and has remained unexecuted, which is issued under the said Act. In the submission of learned counsel for the petitioner it is almost like a case where the respondents are taking action against an associate of an associate of Iqbal Mirchi, the main accused, which, in his submission, was not permissible in law. We are unable to accept this contention of the learned counsel for the petitioner for the simple reason that if, and of course, only if the competent authority had ' r ..... X X X X Extracts X X X X X X X X Extracts X X X X
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