Rational nexus and post-decisional review upheld a securities fraud attachment scheme without prior hearing.

Temporal classification of securities offences under the Ordinance was upheld because the date-based grouping had a rational nexus with the urgent legislative aim of tackling large-scale market manipulation and recovering siphoned public funds. The challenge to the Custodian's power to notify a person and attach property without a prior hearing also failed, because immediate action was justified by the need to prevent dissipation of assets and the scheme provided effective post-decisional supervision and relief before the Special Court. The statutory framework was therefore treated as neither arbitrary nor contrary to natural justice, Articles 14 or 19.

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Issues: (i) whether the date-wise classification of offences relating to transactions in securities under the Ordinance was arbitrary and lacked nexus with the legislative object; (ii) whether the power of the Custodian to notify a person and attach property under Section 3, without a prior hearing, violated natural justice and Articles 14 and 19.

Issue (i): whether the date-wise classification of offences relating to transactions in securities under the Ordinance was arbitrary and lacked nexus with the legislative object.

Analysis: The object of the Ordinance was to deal urgently with large-scale manipulations in securities involving public funds of banks and financial institutions, to bring offenders to book and to secure and recover siphoned-off funds. The classification of offences committed between 1 April 1991 and the promulgation of the Ordinance was held to have a direct nexus with that object. Even if some transactions within that period might not be directly connected with the scandal, the extraordinary nature and magnitude of the situation justified an all-embracing temporal classification.

Conclusion: The classification was upheld as reasonable and not unconstitutional.

Issue (ii): whether the power of the Custodian to notify a person and attach property under Section 3, without a prior hearing, violated natural justice and Articles 14 and 19.

Analysis: Although Sections 3(2) and 3(3) did not provide for a pre-notification hearing or a reasoned order, Section 3(4) subjected the attached property to the directions of the Special Court. That post-decisional control enabled the Special Court to hear both sides, require reasons, and order release of property or de-notification where appropriate. The urgency of preventing dissipation of public funds justified immediate action, and the availability of effective redress before the Special Court prevented the provision from being arbitrary or unreasonable. Section 11 was also treated as an independent mechanism for later disposal of attached property.

Conclusion: The challenge to Section 3 failed and the provisions were held not to violate natural justice or Articles 14 and 19.

Final Conclusion: The petition challenging the constitutional validity of the Ordinance and the notification was rejected, and the writ jurisdiction was not invoked.

Ratio Decidendi: A statutory scheme for urgent attachment and notification of persons involved in a securities fraud is valid where the classification has a rational nexus with the urgent object and the absence of a pre-decisional hearing is offset by effective post-decisional supervision and relief before the Special Court.

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