TaxTMI 
TaxTMI 
2018 (8) TMI 1611
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....of them states that the concerned Joint Secretary who issued the order is satisfied that each of the Petitioners is required to be prevented from "smuggling goods, abetting the smuggling of goods, or engaging in transporting, or concealing or keeping smuggled goods or dealing in smuggled goods in future". 2. In W.P. (Crl) No. 1971 of 2018, the Petitioner is Mr. Sanjay Agarwal and in W.P. (Crl) No. 1977 of 2018, the Petitioner is Mr. Ajay Agarwal, the brother of Mr. Sanjay Agarwal. 3. It must be noted at the outset that identical detention orders were passed against the above two Petitioners as well as a third Petitioner Mr. Preet Kumar Agarwal, who is the son of Mr. Sanjay Kumar Agarwal. Mr. Preet Kumar Aggarwal had filed W.P. (Crl) No. 1978 of 2018. However, the Advisory Board declined to confirm the detention order in the case of Mr. Preet Kumar Agarwal and consequently, the aforementioned writ petition filed by him was rendered infructuous. It was disposed of as such by this Court by a separate order passed on 21st August 2018. 4. As far as the present two petitions are concerned, since the background facts are common, they are being disposed of by this common order. Backgro....
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.... Agarwal to Dubai. However, instead of bringing it to Dubai, Mr. Preet Kumar Agarwal passed on the boxes containing the gold jewellery to his father Mr. Sanjay Agarwal who was waiting outside the airport. Mr. Sanjay Agarwal in turn booked the consignment of the said gold jewellery with Indigo Airlines Domestic Cargo so as to transfer the same from Kolkata to Hyderabad. After booking those boxes containing the gold jewellery, Mr. Sanjay Agarwal boarded another Indigo Airlines flight to Hyderabad travelling on a ticket booked in the name of his son Mr. Preet Kumar Agarwal. 9. According to the Respondents, even in the past, the Petitioners had followed the same modus operandi with boxes containing gold jewellery being booked for transport from Kolkata to Hyderabad in the names of the firms controlled by Mr. Sanjay Agarwal or his relatives or employees. The dates of these transactions were more or less coinciding with the date when identical quantity of gold jewellery was shown to have been exported or carried by hand to Dubai/UAE. According to the Respondents, this showed that even on those occasions, gold jewellery meant for export were diverted to the domestic market after completi....
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....s on behalf of the Petitioners 17. This Court has heard the submissions of Mr. Vikram Chaudhri, learned Senior Counsel appearing for the Petitioners; Mr. Amit Mahajan, learned Central Government Standing Counsel appearing for the Union of India; and Mr. Satish Agarwala, learned Senior Standing Counsel appearing for the DRI. 18. One of the first grounds urged by Mr. Chaudhri is that both in the detention orders as well as in the grounds of detention, the disjunctive 'or' is used in the reasons for justifying the detention of each of the Petitioners in exercise of the powers under Section 3(1) COFEPOSA. Relying on the decisions of the Supreme Court in Jagannath Misra v. State of Orissa AIR 1966 SC 1140 and Ananta Mukhi @ Ananta Hari v. State of West Bengal (1972) 1 SCC 580, it is submitted that such casualness in the drafting of detention orders would vitiate them as it reflected non-application of mind by the Detaining Authority. 19. Secondly, it is contended that there is a variance in the subjective satisfaction in the impugned detention orders when compared with the grounds of detention. In respect of Mr. Sanjay Agarwal, it is pointed out that while the detention order seeks t....
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....Court in Rekha v. State of Tamil Nadu (2011) 5 SCC 244, Munagala Yadamma v. State of Andhra Pradesh (2012) 2 SCC 386, and Yumman Ongbi Lembi Leima v. State of Manipur (2012) 2 SCC 176, it is submitted that there was nonapplication of mind by the Detaining Authority and many of the RUDs which were prepared at Barasat, West Bengal were dated 30th May 2018 but were included in the RUDs to justify the order of detention passed merely two days later. This made it doubtful that the said documents had at all been placed before the Detaining Authority, who appears to have been issuing detention orders in a tearing hurry and in undue haste without due application of mind. It is pointed out that it is not humanly possible for the Detaining Authority to have examined and applied its mind to the 761 pages of the detention proposal and a total of 2283 pages on a single day and to thereafter pass three different detention orders on the basis of the same. Whenever a document was received, the Detaining Authority was required to reformulate the grounds of detention after considering all the material together. It is submitted that the detention orders were, therefore, passed in a mechanical manner ....
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....matter was settled before the Settlement Commission and an order in that regard was passed by the Settlement Commission on 26th June 2018 according immunity from prosecution. The detention orders make no reference to the pendency of the matter of M/s. Kalpataru Jewellers and Exports Corporation before the Settlement Commission. The failure to mention this, leave alone the documents, has vitiated the detention. Even the orders granting anticipatory bail to Mr. Sanjay Agarwal were not placed before the Detaining Authority. 27. Mr. Chaudhri then submitted that the claim of the Detaining Authority that prosecution could not have been lodged prior to a show cause notice being issued to the detenue was fallacious. He relied on the decision in Standard Chartered v Directorate of Enforcement (2006) 4 SCC 278. Submissions on behalf of the Respondents 28. In reply, learned CGSC Mr. Mahajan referred to Section 5A COFEPOSA and submitted that even if there was any defect in the grounds for detention, it would not render the detention order invalid. He placed reliance on the decision in Gautam Jain v. Union of India [decision dated 18th March 2014 of a Division Bench of this Court in W.P. (Cr....
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....discernable from the grounds for detention, it is apparent that Mr. Preet Kumar Agarwal was himself involved in the act of diverting gold meant for export to the domestic market and he was clearly acting in consort with Mr. Sanjay Agarwal. If Mr. Preet Kumar Agarwal is removed out of the picture on account of the non-confirmation of his detention, the case against Mr. Sanjay Aggarwal is considerably weakened. 33. The grounds of detention do notice that all three of them, i.e. Mr. Sanjay Agarwal, Mr. Ajay Agarwal and Mr. Preet Kumar Agarwal, were arrested under the Customs Act and were in judicial custody with their bail applications having been rejected. 34. Paras 33 and 34 of the grounds of detention in respect of Mr. Sanjay Agarwal read as under: "33. I am aware that you are at present under judicial custody and your passport is detained by the DRI, Kolkata. However, there is an immense (sic) possibility that you may be released on statutory bail and thereby you may continue to indulge in such prejudicial: activities of smuggling of goods by way of diverting gold meant for export and therefore, there is a need to issue a Detention Order against you under the COFEPOSA Act, 1974....
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....o doubt observed that a preventive detention order may be passed even against a person already in custody but as noted therein, the law in this regard has been explained in Rameshwar Shaw v. District Magistrate AIR 1964 SC 334 as under: "As an abstract proposition of law, there may not be any doubt that Section 3(1) (a) does not preclude the authority from passing an order of detention against a person whilst he is in detention or in jail, but the relevant facts in connection with the making of the order may differ and that may make a difference in the application of the principle that a detention order can be passed against a person in jail." 39. The Supreme Court in Moideen Koya (supra) also made reference to the decision in Vijay Kumar v. State of Jammu and Kashmir (1982) 2 SCC 43 wherein it was observed: "If the detenu is already in jail charged with a serious offence, he is thereby prevented from acting in a manner prejudicial to the security of the State. Maybe, in a given case there yet may be the need to order preventive detention of a person already in jail. But in such a situation the detaining authority must disclose awareness of the fact that the person against whom ....
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....sis of a detention order, we would expect the various grounds to be joined by the conjunctive "and" and the use of the disjunctive "or" in such a case makes no sense. In the present order however we find that the disjunctive "or" has been used, showing that the order is more or less a copy of S. 3 (2) (15) without any application of the mind of the authority concerned to the grounds which apply in the present case." 44. Section 5A COFEPOSA would not come to the aid of the Respondents where they themselves are unclear as to which of the grounds would apply. This is not an issue of mere vagueness, but of absolute non-application of mind. 45. Apart from the fact that the grant of statutory bail to Mr. Sanjay Agarwal is imminent, there were no real "compelling reasons" as to why the preventive detention order should have been passed. The instances of past conduct referred to have also not been adverted to with any specificity. When this Court pointedly asked whether in relation to the transactions of 2017, any SCN had been issued to Mr. Sanjay Agarwal or the firms connected with him, the answer was in the negative. In other words, it is still not clear whether those transactions in ....