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        2014 (2) TMI 715 - SC - Customs

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        Appeals dismissed, notice under SAFEMA Act upheld, forfeiture valid, no Article 20 violation, no remittance. The court dismissed the appeals, upholding the validity of the notice under Section 6 of the SAFEMA Act, ruling that the forfeiture did not violate ...
                      Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.

                          Appeals dismissed, notice under SAFEMA Act upheld, forfeiture valid, no Article 20 violation, no remittance.

                          The court dismissed the appeals, upholding the validity of the notice under Section 6 of the SAFEMA Act, ruling that the forfeiture did not violate Article 20 of the Constitution, and finding no basis to remit the matter for reconsideration by the High Court.




                          Issues Involved:
                          1. Legality and validity of the notice under Section 6 of the SAFEMA Act.
                          2. Whether the forfeiture under the SAFEMA Act violates Article 20 of the Constitution of India.
                          3. Whether the High Court failed to consider the legality of the order of forfeiture and if the matter should be remitted for reconsideration.

                          Detailed Analysis:

                          1. Legality and Validity of the Notice under Section 6 of the SAFEMA Act:

                          The appellant contended that the notice issued under Section 6 of the SAFEMA Act was defective and illegal as it did not contain the reasons which made the competent authority believe that the properties were illegally acquired. The judgment under appeal noted that although the reasons were not initially provided in the notice dated 4th March 1977, they were subsequently supplied in 1988. The appellant was given an opportunity to respond and was heard before the order of forfeiture was passed. The court concluded that the delayed supply of reasons did not vitiate the subsequent orders of the competent authority and appellate authority. The court rejected the appellant's reliance on *Ajantha Industries v. Central Board of Direct Taxes* (1976) 1 SCC 1001, distinguishing it from the current case as the SAFEMA Act does not expressly require the communication of reasons along with the notice. The court upheld the validity of the notice under Section 6.

                          2. Whether the Forfeiture under the SAFEMA Act Violates Article 20 of the Constitution of India:

                          The appellant argued that the forfeiture under the SAFEMA Act is violative of Article 20 of the Constitution, which prohibits ex post facto laws and double jeopardy. The court examined the provisions of the SAFEMA Act, noting that it applies to persons specified in Section 2(2), including those convicted under certain laws or detained under COFEPOSA. The Act provides for the forfeiture of "illegally acquired property" after an appropriate inquiry under Sections 6 and 7. The court held that the forfeiture is not a penalty but a deprivation of property of persons who cannot explain their legitimate sources of income. The court cited precedents, including *The State of West Bengal v. S.K. Ghosh* (AIR 1963 SC 255) and *R.S. Joshi v. Ajit Mills Ltd.* (1977) 4 SCC 98, to support its conclusion that forfeiture is not a punishment within the meaning of Article 20. The court also noted that the SAFEMA Act is included in the Ninth Schedule, making it immune from challenges based on fundamental rights violations.

                          3. Whether the High Court Failed to Consider the Legality of the Order of Forfeiture and if the Matter Should be Remitted for Reconsideration:

                          The appellant argued that the High Court failed to consider the legality of the forfeiture order and requested a remittance for proper consideration. The court reviewed the writ petition and found that the appellant had not raised any grounds challenging the correctness of the forfeiture order apart from the legal grounds already discussed. The court emphasized that the High Court, in its writ jurisdiction, does not normally reappreciate evidence. Therefore, the court found no reason to remit the matter to the High Court for reconsideration.

                          Conclusion:

                          The appeals were dismissed as devoid of merit. The court upheld the validity of the notice under Section 6 of the SAFEMA Act, ruled that the forfeiture did not violate Article 20 of the Constitution, and found no basis to remit the matter to the High Court for reconsideration.
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                          ActsIncome Tax
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