Search and seizure under foreign exchange law upheld where reasonable belief supported the investigation and procedural safeguards were applied flexibly.

A writ challenge to search and seizure under the Foreign Exchange Regulation Act, 1973 was maintainable where the chairman's residential and office premises were searched and documents seized, because the challenge directly concerned him in his personal and official capacity. The Court held that sections 37 and 38 of the Act permit search and seizure on the authorised officer's reasonable belief that relevant documents are secreted, and that the safeguards in section 165 of the Code of Criminal Procedure, 1898 apply only so far as consistent with the Act's purpose. On the facts, the pending investigation and supporting material justified the search, so the seizure was valid and the writ was dismissed.

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Issues: (i) whether the writ petition was maintainable at the instance of the chairman whose residential and office premises were searched and seized, and (ii) whether the search and seizure under sections 37 and 38 of the Foreign Exchange Regulation Act, 1973 were illegal for want of compliance with the safeguards of section 165 of the Code of Criminal Procedure, 1898.

Issue (i): Whether the writ petition was maintainable at the instance of the chairman whose residential and office premises were searched and seized.

Analysis: The petitioner's residential premises as well as the office premises of Manjog were searched and documents were seized from both places. The objection that the writ was filed only in the petitioner's individual capacity did not prevail because he was the chairman of the concern and the challenge related directly to the search and seizure affecting him personally and officially.

Conclusion: The writ petition was maintainable.

Issue (ii): Whether the search and seizure under sections 37 and 38 of the Foreign Exchange Regulation Act, 1973 were illegal for want of compliance with the safeguards of section 165 of the Code of Criminal Procedure, 1898.

Analysis: Section 37 permits search where the authorised officer has reason to believe that documents useful or relevant to an investigation are secreted, and section 38 similarly authorises seizure on specified belief. The Court treated the Supreme Court's construction of section 37 of the Act as controlling and held that section 165 of the Code of Criminal Procedure, 1898 applies only so far as may be, not in a rigid mutatis mutandis sense. Because the Act is concerned with foreign exchange regulation and secrecy in investigation, deviation from the ordinary search procedure was permissible if justified. The record showed that investigation was pending, that there was material supporting the belief that documents were necessary for the inquiry, and that the search and seizure were carried out on that basis.

Conclusion: The search and seizure were valid and not vitiated for non-compliance with section 165 of the Code of Criminal Procedure, 1898.

Final Conclusion: The challenge to the search and seizure failed, and the writ petition was dismissed.

Ratio Decidendi: Under section 37 of the Foreign Exchange Regulation Act, 1973, the safeguards of section 165 of the Code of Criminal Procedure, 1898 apply only to the extent they are consistent with the statutory purpose, and a justified deviation is permissible where the authorised officer acts on reasonable belief in aid of a pending investigation.

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