TMI Blog2016 (9) TMI 166X X X X Extracts X X X X X X X X Extracts X X X X ..... levant provisions accepts the findings of the tribunal and holds that the notice under section 6 must establish the link or nexus and in the absence of the same, the entire proceedings would stand vitiated. The returns and the explanations must have been considered. The notice itself, proceeds on the basis that many properties are agricultural lands. There is also a reference to revenue records. The income tax authorities have also accepted the agricultural income. The conduct and the findings only reflect the non suiting of the legal norms by the authority. It is also not in dispute that the remittances from Malaysia was made through proper banking channel and the properties were purchased from agricultural income and remittances. Indisputably the properties are individual properties without any nexus to the convict/detenu. The object of the act is to ensure that the properties purchased out of smuggling activities or by illegal means in violation of the provision of the SAFEM Act cannot be permitted to be enjoyed by the convict/detenu or a relative holding the property as benami. The forfeiture of a relative’s property has to be read in the context and objects of the Act. It i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the convict and his/her relatives, if source of acquisition of the same cannot be proved to be out of legal sources. b. Since as per section 6(1) of the act, the competent authority was of the belief that the properties of the 1st respondent are illegally acquired properties, a show cause notice under section 6(1) was issued, calling upon the 1st Respondent to indicate the sources of income, failing which the same would be forfeited. c. The 2nd Respondent also failed to note that the Petitioner need not spell out any link or nexus either in the reasons recorded for the belief to issue a show cause notice or in the show cause notice issued under section 6(1). The provisions of the act in section 2(2)(c) along with explanation 2, section 3(1)(c)(iii) and section 6(1) do not speak about the illegally acquired properties of the convict. Section 3(1)(c)(iii) states that 'any property acquired by such person and not that of the convict'. As per section 8, the burden of proving that any property specified in the notice served under section 6 is not illegally acquired property shall be on the person affected. d. Unless the person affected proves the legal source of inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rival submissions on either side and also perused the materials placed on record, including the relevant provisions of the act. 8. The points for determination can be narrowed down as under:- a. Whether the Tribunal was right in holding that the notice is defective and unsustainable? b. Whether the Tribunal was right in holding that the independent properties of a relative of a convict or detenu,cannot be forfeited? 9. Upon perusal of the notice under section 6 of the SAFEM Act dated 10.01.1992, it is evident that it is a printed proforma. In the notice, the petitioner has stated that he has reason to believe that the properties were acquired by illegal means. The 1st respondent is treated as the independent owner of the properties. There is nothing to show that these were the properties acquired by the convict in the name of the 1st respondent. The statement of reasons, which have been recorded has not been referred in the notice. A perusal of the statement of reasons indicates that the petitioner has initiated the proceedings based on the income tax proceedings of the 1st respondent, wherein certain explanations of the 1st respondent was accepted by the income tax au ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... perty was derived from or used in the illicit traffic. 34. 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. 39. Section 68-H of the Act provides for two statutory requirements on the part of the authority viz: (i) he has to form an opinion in regard to his `reason to believe'; and (ii) he must record reasons therefor. 45. . Our attention, however, has been drawn to a decision of a two Judge Bench of this Court in Kesar Devi (Smt.) Vs. Union of India and Others [(2003) 7 SCC 427] wherein Fatima Mohd. Amin (supra) was distinguished by a Bench of this Court, inter alia, opining that no nexus or link between the money of the debt and property sought to be forfeited is required to be established under the Scheme of the Act, stating; 10...The condition precedent for issuing a notice by the competent authority under section 6(1) is that he should have reason to believe that all or any of such properties are illegally acquired properties and the reasons for such belief have to be recorded in writing. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Upon perusal of the relevant provisions under the NDPS Act, It is evident that section 68 is parimateria to section 3 and 68B to Section 2 ( c) of the SAFEM Act. Also, the apex court in the Judgement referred supra, has followed the ratio laid down under the SAFEM Act, while interpreting the scope of notice under section 6. It is also pertinent to mention here that the petitioner is the competent authority both under the SAFEM Act and NDPS Act as evident from the proceedings dated 30.09.2005. Therefore, it is safe to conclude that the notice under section 6 must explicitly establish the link between the properties and the convict/detenu as per the law laid down by the apex court. 13. Reliance was also placed by the learned Additional Solicitor General on the judgement reported in CDJ 2011 MHC 3203 (The competent authority vs Hameed Abdul Kader). Upon perusal of the judgement, it is evident that the facts and the averments in the notice are different from that of the case on hand. In that case, it was not disputed that the convict also contributed to the purchase of the properties and the notice had specific reference or link to the effect of establishing the link. 14. In th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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