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Gautam Jain Versus Union of India & Another

2017 (1) TMI 398 - SUPREME COURT

Principle of segregation - Detention order - Section 3(1) of the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 - High Court has come to the conclusion that there were various grounds which formed the basis of the detention order and even if the documents pertaining to one particular ground were not furnished, that ground could be ignored applying the principle of segregation and on remaining grounds the detention order was still sustainable - whether the princ .....

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Different instances would be treated as different 'grounds' as they constitute basic facts making them essentially factual constituents of the 'grounds' and the further particulars which are given in respect of those instances are the subsidiary details. - When we apply the aforesaid test to the facts of this case, we are inclined to agree with the conclusion of the High Court that the order of detention is based on multiple grounds inasmuch as various different acts, which form separate gro .....

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ment of Pooran Chand Sharma were not given and for this very reason, the High Court rightly held that such a ground cannot be relied upon by the respondents in support of the order. However, that would not mean that if there are other grounds on which the detention order can be sustained, principle of severability would become inapplicable. If this is accepted, it would mean that provisions of Section 5A of the Act cannot be applied at all. While rejecting such a contention, it would be sufficie .....

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Abhay Manohar Sapre, JJ. JUDGMENT A.K. Sikri, J. Detention order dated 23.09.2009 was passed by respondent No.2 against the appellant under Section 3(1) of the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 (hereinafter referred to as the 'Act') whereby the appellant was directed to be detained. Initially, this order was challenged by the appellant at pre-execution stage by filing writ petition in this Court under Article 32 of the Constitution of Indi .....

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11.2013 and 22.11.2013, the appellant was served with the Grounds of Detention as well as copies of certain relied upon documents with translation thereof. According to the appellant, complete set of documents, which were relied upon by the respondents, were not supplied. He made a representation on 03.12.2013 to the detaining authority requesting revocation of the detention order or in the alternative supply complete documents/information, which was followed by another representation dated 06.1 .....

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the High Court has accepted the plea of the appellant that there was failure on the part of the respondents to furnish certain documents qua one particular allegation in the detention order, it has still upheld the detention order invoking the principle of segregation of grounds enumerated in Section 5A of the Act. In nutshell, the High Court has come to the conclusion that there were various grounds which formed the basis of the detention order and even if the documents pertaining to one parti .....

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ances were given in the Grounds for Detention annexed with the detention order which cannot be treated as different grounds. It is, thus, argued that those instances forming part of detention order were, in fact, only further particulars or subsidiary facts rather than basic facts which are integral part of, and constitute the grounds of the detention order. It is this aspect of the matter which needs examination in the present case. 4. With the aforesaid introductory note, we may now take stock .....

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lant was indulging in making and receiving Hawala payments upon the instruments received from abroad by him; and the appellant was making such Hawala payments from his business premises at Chandni Chowk as well as residential premises at Ashok Vihar. On receiving an information to this effect, searches were conducted at the business place of the appellant. Indian currency in the sum of ₹ 2,04,00,000/- as well as various incriminating documents were found and seized. Likewise, from the resi .....

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ording Hawala transactions given by the appellant in his statement are also mentioned. Retraction of the statement is also taken note of, stated to have been considered by the Department but found to be an afterthought. 6. As mentioned above, in the writ petition filed by the petitioner in the High Court, plea taken by the appellant to challenge the detention order was failure on the part of the respondents to supply certain relied upon documents contained in pages 1 to 25, mentioned in the stat .....

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ht to make effective and purposeful representation before the Advisory Board and the Central Government and, thus, vitiated the detention order, more so, when these were not supplied in support of specific request made in this behalf. 7. The aforesaid factual position was not disputed by the respondents. However, the respondents argued that the documents in question were not material and, therefore, non-supply thereof did not act to the prejudice of the appellant. This plea of the respondents is .....

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eration. The said assertion is contrary to specific words and statement made in paragraphs 37, 38 and 41 of the detention order and should not and cannot be accepted. On being questioned, learned counsel for the respondent submitted that he does not have a copy of the documents or material found during the course of search in the place of Pooran Chand Sharma on 3rd September, 2009. We were, however, shown copy of statement of Pooran Chand Sharma dated 3rd September, 2009. Pooran Chand Sharma was .....

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ence to the factual matrix in the grounds of detention. The document with the entry formed the basis of the assertions made in paragraphs 37, 38 and 41 of the grounds of detention. 8. Notwithstanding the same, the High Court has taken the view that paragraphs relating to seizure details in case of Pooran Chand Sharma implicating the appellant constitute a separate ground, which was severable on the application of the principle of segregation, as the detention order was based on multiple grounds. .....

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ly, 'preventing him (i.e. the appellant) from acting in any manner prejudicial to the conservation and augmentation of foreign exchange in future' and the Grounds of Detention which were given in support thereof were, in fact, various instances to support the said ground. In order to buttress this submission, he referred to the provisions of Section 3 of the Act and argued that it spells out many 'grounds' on which order of detention can be passed. Section 3 of the Act reads as u .....

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ding a foreigner), that, with a view to preventing him from acting in any manner prejudicial to the conservation or augmentation of foreign exchange or with a view to preventing him from - (i) smuggling goods, or (ii) betting the smuggling of goods, or (iii) engaging in transporting or concealing or keeping smuggled goods, or (iv) dealing in, smuggled goods otherwise than by engaging in transporting or concealing or keeping smuggled goods, or (v) harbouring persons engaged in smuggling goods or .....

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on which the order has been made shall be made as soon as may be after the detention, but ordinarily not later than five days, and in exceptional circumstances and for reasons to be recorded in writing not later than fifteen days, from the date of detention. 10. Submission is that the order was passed only on one ground, viz. activities of the appellant were prejudicial to the conservation and augmentation of foreign exchange. According to him, other grounds mentioned in Section 3 are those refe .....

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n the counter affidavit filed by the respondents in the High Court. Therefore, the 'Grounds of Detention' need to be read cumulatively even as per the respondents, which would clearly show that these grounds were composite and not separate. It was argued that in such circumstances, the principle of severability could not be applied. In support of his submission, he referred to the judgment of this Court in A. Sowkath Ali v. Union of India & Ors. (2000) 7 SCC 148 where the issue of ap .....

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etention. This Court in view of Section 5-A held that the detention order should not vitiate on the ground of non-application of mind if subjective satisfaction was arrived at on the basis of other independent objective factors enumerated in the grounds. The Court held: If even ignoring the facts stated in the confession by the detenu the inference can still be drawn from other independent and objective facts mentioned in the grounds, then the order of detention cannot be challenged merely by th .....

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s used to come with gold bars etc. These materials were in addition to the statements and confessions made by the detenus under Section 108 of the Customs Act. So even if those statements which were retracted as such could not be taken into consideration, there are other facts independent of the confessional statement as mentioned hereinbefore which can reasonably lead to the satisfaction that the authorities have come to. In view of Section 5-A of the COFEPOSA Act there was sufficient material .....

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ction 108 of the Customs Act was an inadmissible ground as the subsequent retraction of the confessional statement was not considered by the detaining authority, still then that would not make the detention order bad, for in the view of this Court, such order of detention shall be deemed to have been made separately on each of such grounds. Therefore, even excluding the inadmissible ground, the order of detention can be justified. The High Court has also overruled the contention of the detenu in .....

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have no bearing on the validity of this impugned order which can be sustained on the material set out in the grounds of detention itself. Placing reliance on decision of this Court in Prakash Chandra Mehta v. Commr. and Secy., Govt. of Kerala wherein it has been observed that the grounds under Article 22(5) of the Constitution do not mean mere factual inferences but mean factual inferences plus factual material submitted that in the present case the factual material set out in the grounds of de .....

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valid for any other reason whatsoever, then that will not vitiate the order of detention. This case considered the aforesaid decisions relied on behalf of the State. Mr. Chaudhri submitted that the instant case falls in the category mentioned in Vashisht Narain Karwaria v. State of U.P. & Anr. (1990) 2 SCC 629 11. After taking note of the aforesaid judgments, the Court, in A. Sowkath Ali, recorded its conclusion in para 27 as under: 27. Firstly, we find that the question of severability unde .....

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of India [1991 Supp (2) SCC 153] . Coming back to the present case we find really it is a case of one composite ground. The different numbers of the ground of detention are only paragraphs narrating the facts with the details of the document which is being relied on but factually, the detention order is based on one ground, which is revealed by Ground (1)(xvi) of the grounds of detention which we have already quoted hereinbefore. Thus on the facts of this case Section 5-A has no application in .....

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elevancy with the object of detention, and proximity with the time when the subjective satisfaction forming the basis of the detention order was arrived at, it would be legitimate for the Court to infer that such material must have influenced the District Magistrate in arriving at his subjective satisfaction and in such a case the Court would refuse to accept the bald statement of the District Magistrate that he did not take such material into account and excluded it from consideration. It is el .....

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making process. Therefore, in a case where the material before the District Magistrate is of a character which would in all reasonable probability be likely to influence the decision of any reasonable human being, the Court would be most reluctant to accept the ipse dixit of the District Magistrate that he was not so influenced and a fortiori, if such material is not disclosed to the detenu, the order of detention would be vitiated, both on the ground that all the basic facts and materials whic .....

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the Act cannot be resorted to. According to him, in such circumstances, the detention order would be void ab initio and, therefore, question of sustaining such an order taking umbrage of Section 5A of the Act would not arise. 14. Learned counsel for the respondents, on the other hand, extensively read out the discussion contained in the impugned judgment and submitted that the High Court rightly applied, on the facts of this case, the principle of severability which is statutorily recognised un .....

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gally unsustainable (See Vashisht Narain Karwaria). On the other hand, if the detention order is founded on one composite ground, though containing various species or sub-heads, the detention order would be vitiated if such ground is found fault with (See A. Sowkath Ali). Thus, in the instant case, outcome of the appeal depends upon the question as to whether detention order is based on one ground alone or it is a case of multiple grounds on which the impugned detention order was passed. 16. In .....

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cient to bring home to the detenue the knowledge of the grounds of his detention. The abbreviation F.I.U. occurs four times in these grounds, but each time in conjunction with PAK, and twice in association with the words Pak Officers . The collocation of words and the context in which F.I.U occurs makes its purport sufficiently intelligible. Grounds within the contemplation of Section 8(1) of the Act means materials on which the order of detention is primarily based. Apart from conclusions of fa .....

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om he was supplying the information about the Indian Army. He was informed about the places in Pakistan which he was visiting. He was further told that in lieu of the supply of this information he had been receiving money from Pakistan. Nothing more was required to be intimated to enable him to make an effective representation. The facts which were not disclosed were not basic facts, and their non-disclosure did not affect the petitioner's right of making a representation. As recited in the .....

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3(3) of the COFEPOSA, includes not only conclusions of fact but also all the 'basic facts' on which those conclusions are founded, they are different from subsidiary facts or further particulars of these basic facts. The distinction between 'basic facts' which are essential factual constituents of the 'grounds' and their further particulars or subsidiary details is important. While the 'basic facts' being integral part of the 'grounds' must, according to .....

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cable, with reasonable expedition. It follows, that if in a case the so-called grounds of detention communicated to the detenu lack the basic or primary facts on which the conclusions of fact stated therein are founded, and this deficiency is not made good and communicated to the detenu within the period specified in Sec. 3(3) the omission will be fatal to the validity of the detention. If, however, the grounds communicated are elaborate and contain all the basic facts but are not comprehensive .....

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l particulars, exceeds marginally, the maximum fixed by the statute for communication of the grounds it may still be regarded reasonable , while in the facts of another case, even a delay which does not exceed 15 days, may be unjustified, and amount to an infraction of the second constitutional imperative pointed out in Khudi Ram's case (supra). 18. Another judgment, elucidating law on the subject, is State of Gujarat v. Chamanlal Manjibhai Soni (1981) 2 SCC 24. Following discussion therefro .....

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y for the purpose of preventing smuggling and all the grounds whether there are one or more, would be relatable only to various activities of smuggling and we cannot conceive of any other separate ground which could deal with matters other than smuggling because the act of smuggling covers several activities each forming a separate ground of detention and the Act deals with no other act except smuggling. Indeed, if the interpretation of the High Court in respect of Section 5-A is accepted, then .....

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ality of circumstances considered by the detaining authority, if one irrelevant or unsustainable element has entered in the process of subjective satisfaction, the process of arriving at subjective satisfaction being comprehensive, the said element would disturb the entire process of subjective satisfaction and consequently, even if one statement which could not have been relied upon appeared before the mind's eye of the detaining authority, it could easily be seen that its subjective satisf .....

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not be correct to say that the object of the Act constitutes the ground of detention. If this is so, in no case there could be any other ground for detention, except the one which relates to smuggling. In our opinion, this is neither the object of the Act nor can such an object be spelt out from the language in which Section 5-A is couched. What the Act provides is that where there are a number of grounds of detention covering various activities of the detenu spreading over a period or periods, .....

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d have been influenced by the vague or irrelevant ground. It was to displace the basis of these decisions that the Parliament enacted Section 5-A in order to make it clear that even if one of the grounds is irrelevant but the other grounds are clear and specific that by itself would not vitiate the order of detention... 19. From the above noted judgments, some guidance as to what constitutes 'grounds', forming the basis of detention order, can be easily discerned. In the first instance, .....

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erm 'grounds'. No other provision in the Act defines 'grounds'. Section 3(3) deals with communication of the detention order and states that 'grounds' on which the order has been made shall be communicated to the detenue as soon as the order of detention is passed and fixes the time limit within which such detention order is to be passed. It is here the expression 'grounds' is used and it is for this reason that detailed grounds on which the detention order is pas .....

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be treated as different 'grounds' as they constitute basic facts making them essentially factual constituents of the 'grounds' and the further particulars which are given in respect of those instances are the subsidiary details. This view of ours gets strengthened from the discussion in Vakil Singh's case where 'grounds' are referred to as 'materials on which the order of detention is primarily based'. The Court also pointed out that these 'grounds' mu .....

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t has dissected the order of detention, which we find is the correct exercise done by the High Court, in paras 11 and 12 of the impugned judgment and, therefore, we reproduce the same: 11. We would, therefore, at this stage like to refer to the grounds mentioned in the detention order. Detention order in paragraph 1 states that the petitioner has been indulging in making and receiving hawala payments upon instructions received from abroad from his business premises in Chandni Chowk and residence .....

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hat the main work of the petitioner was receiving and making payments in India on instructions from Sultan Bhai, Maama @ Manu, Mithu Bhai, Hirani and Jabbar Bhai, based in Dubai. Shankar decodified the figures mentioned in the bunch of documents as seized. He had further stated that the petitioner was making and receiving hawala payment to tune of ₹ 2 crores per day on instructions from Dubai and received and made payments to the tune of ₹ 180 crores in the last three months. Detenti .....

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FEMA which gives details of foreign exchange arranged from abroad for different persons in India and de-codifying of various details, have been alluded with significance. Detention order also mentions statements of Rajiv Kumar, Jitender Kumar Verma and Raj Kumar Bindal under Section 37 of FEMA and retractions made by different persons whose statements were recorded under Section 37 of FEMA, etc. Searches in different premises on 17th December, 2009 and the seizure including seizure of cash made .....

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1. In fact, in this very manner, the matter was approached and dealt with by this Court, thereby upholding the detention order, in Prakash Chandra Mehta v. Commissioner and Secretary, Government of Kerala & Ors. 1985 (Supp.) SCC 144, as is clear from the following discussion therein: 71. Section 5-A stipulates that when the detention order has been made on two or more grounds, such order of detention shall be deemed to have been made separately on each of such grounds and accordingly that if .....

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ing or keeping the smuggled goods, or engaging in transporting or concealing or keeping smuggled goods the detention of the detenu is necessary. This satisfaction was arrived at as inferences from several factors. These have been separately mentioned. One of them is the contention but this ground was taken into consideration without taking note of the retraction made thereafter. But the inference of the satisfaction was drawn from several factors which have been enumerated before. We have to exa .....

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and organisations. Pratap Sait and others to whom gold has been sold by the father are relevant grounds from which an inference can reasonably be drawn for the satisfaction of the detaining authority for detaining the detenus for the purpose of Section 3(1)(iii) and 3(1)(iv). We are of the opinion that the impugned order cannot be challenged merely by the rejection of the inference drawn from confession. The same argument was presented in a little different shade, namely, the fact of retraction .....

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er other grounds should have been taken into consideration or not is not relevant at the stage of the passing of the detention order. This contention, therefore, cannot be accepted. If that is the position then in view of Section 5-A of the Act there was sufficient material to sustain this ground of detention. 22. The Court thereafter discussed its earlier judgment in Chamanlal Manjibhai Soni (already noted above) in identical manner in the case of Madan Lal Anand v. Union of India & Ors. (1 .....

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e inapplicable. Article 22(5) of the Constitution of India reads as under: Article 22(5) When any person is detained in pursuance of an order made under any law providing for preventive detention, the authority making the order shall, as soon as may be, communicate to such person the grounds on which the order has been made and shall afford him the earliest opportunity of making a representation against the order. This provision commands communication of the grounds on which the order of detenti .....

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