Supreme Court Upholds Detention Order despite Document Non-Supply

Gautam Jain Versus Union of India & Another

Gautam Jain Versus Union of India & Another - 2017 (345) E.L.T. 586 (SC), 2017 AIR 230, 2017 (1) SCR 366, 2017 (3) SCC 133, 2017 (1) JT 367, 2017 (1) ... Issues Involved:
1. Validity of the Detention Order under Section 3(1) of the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974.
2. Non-supply of certain relied upon documents to the appellant.
3. Applicability of the principle of severability under Section 5A of the Act.
4. Infringement of Article 22(5) of the Constitution of India.

Detailed Analysis:

1. Validity of the Detention Order under Section 3(1) of the Act:
The detention order dated 23.09.2009 was passed to prevent the appellant from acting in a manner prejudicial to the conservation and augmentation of foreign exchange. The grounds of detention detailed various activities involving Hawala payments and the seizure of Indian currency and incriminating documents from the appellant’s business and residential premises. The appellant's involvement in these activities was substantiated by statements from various individuals and the appellant himself, despite his subsequent retraction.

2. Non-supply of Certain Relied Upon Documents:
The appellant argued that not all documents relied upon by the respondents were supplied, specifically those related to the statement of Pooran Chand Sharma. The High Court acknowledged this failure but upheld the detention order by invoking the principle of segregation under Section 5A of the Act. The High Court observed that the documents not supplied were material and their non-supply deprived the appellant of his right to make an effective representation.

3. Applicability of the Principle of Severability under Section 5A of the Act:
The appellant contended that the principle of severability was inapplicable as the detention order was based on a single ground with multiple instances supporting it. However, the High Court and subsequently the Supreme Court found that the detention order was based on multiple grounds, each constituting a separate basis for detention. The Supreme Court referred to various judgments to elucidate the concept of 'grounds' and concluded that each act of the appellant mentioned in the detention order was a separate ground. Therefore, even if one ground failed, the detention order could still be sustained on the remaining grounds.

4. Infringement of Article 22(5) of the Constitution of India:
The appellant argued that the non-supply of documents violated Article 22(5) of the Constitution, which mandates the communication of grounds for detention and the opportunity to make a representation. The Supreme Court acknowledged this infringement but held that the principle of severability under Section 5A still applied. The Court noted that the constitutional validity of Section 5A had been upheld in previous judgments, and thus, the detention order could be sustained on other grounds despite the non-supply of certain documents.

Conclusion:
The Supreme Court dismissed the appeal, upholding the High Court's application of the principle of severability and finding that the detention order was based on multiple grounds. The Court also dismissed the writ petition challenging a similar detention order, adopting the same reasoning.