Gold smuggling and UAPA terrorism provisions require material showing threat to India's economic security before bail can be denied.

Gold smuggling, without material showing an intention to threaten India's economic security, does not prima facie fall within Section 15(1)(a)(iiia) of the UAPA, which is directed at damage to monetary stability through counterfeit currency or similar mischief. The Court examined the statutory scheme and held that the provision was not meant to treat every smuggling activity as a terrorist act. As the record disclosed no prima facie material of a terrorist intention, and one appellant faced no recovery with his name emerging only later in investigation, the bail rejections could not be sustained. The appeals were allowed and bail was granted on stipulated terms.

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Issues: Whether smuggling of gold, in the absence of material showing an intent to threaten the economic security of India, falls within Section 15(1)(a)(iiia) of the Unlawful Activities (Prevention) Act, 1967 and whether the bail orders rejecting the appellants' applications were liable to be set aside.

Analysis: Section 15(1)(a)(iiia) of the Unlawful Activities (Prevention) Act, 1967 speaks of damage to the monetary stability of India by production, smuggling or circulation of high quality counterfeit currency, coin or other material. The Court examined the statutory setting, including the Second Schedule to the Act, and held that the provision was not intended to treat every form of smuggling as a terrorist act. It preferred the view that gold smuggling, by itself, does not prima facie establish the requisite threat to economic security. The record also did not disclose material showing that the accused intended to commit a terrorist act or damage the economic security of the country. For one appellant, no recovery was made and his name surfaced only later in investigation, leaving no prima facie material against him.

Conclusion: Smuggling of gold, without more, does not attract Section 15(1)(a)(iiia) of the Unlawful Activities (Prevention) Act, 1967, and the rejection of bail could not be sustained on the material placed before the Court.

Final Conclusion: The appeals were allowed, the bail rejections were set aside, and the appellants were directed to be released on bail on furnishing the stipulated bonds and sureties.

Ratio Decidendi: Smuggling of gold does not prima facie constitute a terrorist act under Section 15(1)(a)(iiia) of the Unlawful Activities (Prevention) Act, 1967 unless the record shows an intention to threaten the economic security of India through the mischief targeted by that provision.

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