TMI Blog2013 (7) TMI 1185X X X X Extracts X X X X X X X X Extracts X X X X ..... ority under SAFEMA, declaring that the properties and assets of late Sarbani Devi Jalan (mother of the writ petitioner) as described in the notice under section 6(1) of SAFEMA, including property lying and situated at 10, Digambar Jain Temple Road, Kolkata 700 007 (hereinafter referred to as the said house at Calcutta) are illegally acquired properties and forfeited to the Central Government free from all encumbrances. 2. At the outset, Mr. Roy, learned senior counsel appearing for the respondents in A.P.O. No. 107 of 2013 submitted that the said appeal preferred on behalf of the Union of India had abated due to non substitution of the legal heirs of respondent No. 1/writ petitioner, Manilal Jalan, since deceased. He relied on State of Gujarat v. Sayed Mohd. Bakir El Edross, AIR 1981 SC 1921 in support of his submission. 3. Mr. Tarafder, learned counsel, appearing for the appellant/Union of India, admitted that no steps had been taken to substitute the heirs of respondent No. 1. He, however, submitted that the department would be at liberty to agitate its case in the appeal preferred by the writ petitioner. Accordingly, A.P.O. No. 107 of 2013 having abated is dismissed. 4. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or assessment orders to establish that each and every item covered under the said notice was self acquired property and none of the said items, including the house at Calcutta, ought to have been held to be illegally acquired property under SAFEMA and that the proceedings against her was liable to be dropped. 11. After consideration of such reply, the Competent Authority issued notice under section 7(1) of SAFEMA calling upon Sarbani Devi Jalan for an oral hearing at Calcutta. 12. Sarbani Devi Jalan by letter dated 29th April, 1977 again called upon the Competent Authority to disclose the reasons in writing for arriving at a reasonable belief as contemplated under section 6(1) of the Act. The Competent Authority, however, declined to do so. 13. Under such circumstances, Sarbani Devi Jalan moved a writ petition before this Court challenging the constitutional validity of the provisions of SAFEMA. In the course of hearing of the said writ petition, His Lordship the Hon'ble Mr. Justice T.K. Bose (as His Lordship then was) directed the Competent Authority to disclose materials/reasons on the basis of which notice dated 7th March, 1977 was issued under section 6(1) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice under section 6(1) of the Act are illegally acquired properties and were liable to forfeiture to the Central Government. Learned Single Judge further held that as the Competent Authority had recorded that Sarbani Devi had made an independent investment of ₹ 19,853/- for purchase of the house at Calcutta the writ petitioner ought to be permitted to redeem the said property on payment of find in lieu of forfeiture in terms of section 9 of SAFEMA and granted such relief to him. 22. The writ petitioner preferred appeal being APO No. 297 of 2009 against the order of the learned Single Judge to the extent the order of the learned Single Judge dismissed his writ petition challenging the finding of the Appellate Tribunal and the Competent Authority that the properties and/or assets were illegally acquired properties and liable to be forfeited to the Central Government. The writ petitioner having died during the pendency of the appeal, the present appellants being his legal heirs have been substituted and are prosecuting the said appeal. 23. The department had, on the other hand, challenged the order of the learned Single Judge to the extent it permitted the house at Cal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... himself as the facts relating to the acquisition of the properties in question were in the personal knowledge of the parents of the writ petitioner who had already died at the time of the oral hearing. 26. Mr. Tarafdar, learned Advocate, appearing for the department submitted that Sarbani Devi Jalan was a person covered under SAFEMA in terms of section 2(2)(c) thereof being the wife of the detenu, Nathmal Jalan. Drawing our attention to the notice under section 6(1) of the Act he submitted that Sarbani Devi Jalan was proceeded under the Act for being in possession of illegally acquired property in view of section 3(c)(iii) and (iv) of SAFEMA. 27. He further submitted that in terms of the order passed by this Court in the earlier writ petition resume of materials and/or reasons recorded in writing by the Competent Authority had been supplied to Sarbani Devi Jalan. It cannot be argued by the appellants or their predecessor-in-interest that the principles of natural justice had been violated in the instant case. He further submitted that delay in completion of the proceeding was due to factors beyond the control of the authorities as the constitutional validity of the Act was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore the receipt of the report of the Advisory Board or before making a reference to the Advisory Board; or (ii) such order of detention, being an order to which the provisions of section 9 of the said Act apply, has not been revoked before the expiry of the time for, or on the basis of, the review under sub-section (3) of section 9 or on the report of the Advisory board under section 8, read with sub-section (2) of section 9, of the said Act; or (iii) such order of detention, being an order to which the provisions of section 12A of the said Act Apply, has not been revoked before the expiry of the time for, or on the basis of, the first review under sub-section (3) of that section, or on the basis of the report of the Advisory Board under section 8, read with sub-section (6) of section 12A, of that Act; or (iv) such order of detention has not been set aside by a Court of competent jurisdiction; (c) every person who is a relative of person referred to in clause (a) or clause (b); ....................................... Explanation 2:-For the purposes of clause (c), relative , in relation to a person, means- (i) spouse of the person; (ii) brother or si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sons or that the same had not been supplied to Sarbani Devi Jalan resulting in infraction of the principles of natural justice. 35. We have perused the resume of materials and/or reasons in the instant case. In the said resume of materials/reasons, the Competent Authority has recorded as thus: She purchased house property at 10, Digambar Jain Temple Road, Calcutta (formerly, 10, Dayahatta Road, Calcutta) on 15.12.1958 for a cost of ₹ 120000/- and incurred registration charges of ₹ 5933/- (total ₹ 125933/-). She declared income of ₹ 89,500/- in respect of the income tax assessment years 1951-52 to 1959-60 against which taxes paid amount to ₹ 9647/- leaving a balance of ₹ 79853/-. Besides, she declared initial capital in the business at ₹ 5000/- and a gift of ₹ 15000/- from her mother Smt. Sarawati Devi which were stated to be utilized in the purchase of property. The maximum amount which she could have for investment had been made out to be ₹ 99853/- against the aggregate investment made of ₹ 125933/-. This leaves an unexplained and unproved investment of ₹ 26018/-. There is also evidence to show that Sarba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y any means, wholly or partly traceable to any property referred to in sub-clauses (i) to (iii) or the income or earnings from such property; 37. Section 3(i)(c)(iii) of SAFEMA, inter alia, provides that any property acquired by a person to whom the Act applies is liable to be forfeited if it cannot be proved that the said property was acquired from known sources of income, earnings or assets of such person is attributable to any act to which legislative competence of the Parliament does not extend. 38. Section 3(i)(c)(iv), inter aha, provides that any property acquired by such person for a consideration or by any means wholly or partly traceable to any property referred to in section 3(i)(c)(iii) (supra) is also illegally acquired property. Section 8 of SAFEMA puts the burden of proof upon such person to establish that the properties proceeded against are not illegally acquired properties. 39. Resume of materials/reasons in the instant case shows that the house property at Calcutta of Sarbani Devi Jalan was valued at ₹ 1,25,933/-. The maximum amount she could have invested from her known sources of income was 99,853/-. Therefore, a part of the value of the said prop ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... detenu and the property sought to be forfeited. In fact, if such a condition is imposed, the very purpose of enacting SAFEMA would be frustrated, as in many case it would be almost impossible to show that the property was purchased or acquired from the money provided by the convict or detenu. In the present case, the appellant is the wife of the detenu and she has failed to establish that she had any income of her own to acquire the three properties. In such circumstances, no other inference was possible except that it was done so with the money provided by her husband. 43. In the said judgment the Apex Court considered the case of Fatima Mohd. Amin v. Union of India, (supra) and distinguished the said judgment in the following manner: 16. The judgment in Fatima Mohd. Amin relied upon by the learned counsel for the appellant can be of no assistance to him. On facts, the Court found that the notice issued by the competent authority did not disclose any reasons and thus the same did not meet the requirement of sub-section (1) of section 6 of the Act. As shown above, this is not the case here as the reasons for belief have been clearly recorded by the competent authority. 4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for matter connected therewith or incidental thereto. Whereas for the effective prevention of smuggling activities and foreign exchange manipulations which are having a deleterious effect on the national economy it is necessary to deprive persons engaged in such activities and manipulations of their ill-gotten gains; And whereas such persons have been augmenting such gains by violations of wealth tax, income tax or other laws or by other means and have been increasing their resources for operating in a clandestine manner; And whereas such persons have in many cases been holding the properties acquired by them through such gains in the names of their relatives, associates and confidants; 50. From the statements and objects of the aforesaid legislation it is clear that the law was enacted to deprive persons, their relations, associate and/or confidantes from enjoying illegal gains of smuggling and foreign exchange manipulations by forfeiting illegally acquired properties standing in their names. Under the scheme of the Act, forfeiture of illegally acquired property was therefore speedier means of recovering such property in favour of the Government and denying the wr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hmal Jalan and the legal heir of Sarbani Devi, the notice under section 6 of SAFEMA cannot be said to be illegal in law. 53. The other argument advance by the learned Senior Counsel that the writ petitioner was prejudiced in the course of oral hearing under section 7 of SAFEMA inasmuch as he and his brothers were minors at the time of acquisition of the properties by their late mother in 1958 is also wholly without substance. The writ petitioner in the instant case did not participate in the oral hearing before the competent authority in spite of notice and therefore cannot be heard on the score of denial of effective opportunity to defend himself in violation of principles of natural justice. Notice under section 6(1) of the Act was served upon the mother Sarbani Devi Jalan. During her lifetime, she submitted an elaborate reply to such notice. There was no reference to any fact pertaining to her personal knowledge in the said reply relating to the acquisition of the properties in question. Her defence was wholly based upon income tax returns and the assessment orders passed by the income tax authorities. In view of the nature of her defence as disclosed in her reply which was w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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