TaxTMI 
TaxTMI 
2024 (8) TMI 726
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....r hearing the parties. The brief facts of the case are as under: 1st Show Cause Notice It is stated that a Show Cause Notice was issued on 23rd May, 1995 to the Appellant and their relatives to show cause as to why the property mentioned in the notice should not be forfeited under SAFEMA. The Show Cause Notice was issued on the ground that one Mohammed Ahmed Umar Dossa was detained under Section 3(1) of Conservation of Foreign Exchange & Prevention of Smuggling Activities Act, 1974 (COFEPOSA) vide order dated 20th March, 1993 by the Government of Maharashtra. The order of detention was neither revoked nor quashed or set aside by any Court of Competent Jurisdiction. An order was passed thereupon against the Appellant for forfeiture of property being relative of the detenue thus covered by Section 2(2)(b) of SAFEMA. The Competent Authority passed an order on 29th February, 2000 pursuant to the first Show Cause Notice. On a challenge to the order, this Tribunal vide its order dated 19th September, 2002 dismissed the Appeal. Aggrieved by the order of this Tribunal the Appellant preferred a Writ Petition before Bombay High Court which quashed the order of this Tribunal on 06th Apri....
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....edings before designated TADA Court (bomb blast). The Court vide its order dated 05th November, 1999 released several properties involved in the impugned Show Cause Notice and the Government has not filed appeal to challenge the said order. Thus, in the light of the aforesaid and judgment of the Apex Court in the case of "Amina Ahmed Dossa & Ors. v/s. State of Maharashtra" reported in 2001 (2) SCC 675, the impugned order deserves to be set aside. It is further submitted that even properties attached under TADA are under challenge at the instance of Appellant and his relatives in the Criminal Writ Petition filed in the year 2001 itself and the Bombay High Court vide its order dated 17th April, 2001 admitted the appeal and is pending for hearing. The Writ Petition was filed in reference to the judgment of the Apex Court in the case of Amina Ahmed Dossa (Supra). The Appellant and his relatives have also filed Declaratory Suits before the High Court of Bombay which were later on transferred to Bombay City Civil Court and the same are pending for hearing and final disposal. We have considered the common issues raised by the Appellant and find that the judgment of the Apex Court in the....
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....uch time as may be specified in the notice, which shall not be ordinarily less than thirty days, to indicate the sources of his income, earnings or assets, out of which or by means of which he has acquired such property, the evidence on which he relies and other relevant information and particulars, and to show cause why all or any of such properties, as the case may be, should not be declared to be illegally acquired properties and forfeited to the Central Government under this Act. (2) Where a notice under sub-section (1) to any specifies any property as being held on behalf of such person by any other person. A copy of the notice shall also be served upon such other person. Section 7 Forfeiture of property in certain cases. (1) The competent authority may, after considering the explanation, if any, to the show- cause notice issued under section 6, and the materials available before it and after giving to the person affected (and in a case where the person affected holds any property specified in the notice through any other person, to such other person also) a reasonable opportunity of being heard, by order, record a finding whether all or any of the properties in qu....
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....ncumbrances. (2) Where any person is accused of any offence under this Act or any rule made thereunder, it shall be open to the Designated Court trying him to pass an order that all or any properties, movable or immovable or both belonging to him, shall, during the period of such trial, be attached, and where such trial ends in conviction, the properties so attached shall stand forfeited to Government free from all encumbrances. (3) (a) If upon a report in writing made by a police officer or an officer referred to in sub-section (1) of Section 7, any Designated Court has reason to believe that any person, who has committed an offence punishable under this Act or any rule made thereunder, has absconded or is concealing himself so that he may not be apprehended, such court may, notwithstanding anything contained in Section 82 of the Code, publish a written proclamation requiring him to appear at a specified place and at a specified time not less than fifteen days but not more than thirty days from the date of publication of such proclamation. (b) The Designated Court issuing a proclamation under Clause (a) may, at any time, order the attachment of any property, movable or im....
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.... The reference of the judgment of the Apex Court in the case of "Aslam Mohammed Merchants v/s. Competent Authority & Ors." reported in 2008 (14) SCC 186 has been given. It was stated that in para 23 of the said judgment, the Apex Court found the relevant provision of SAFEMA and NDPS Act to be pari-materia for recording reason to believe. According to the Appellant no link or nexus to the income of Detenue with the property has been given thus on the strength of the judgment of the Apex Court (Supra), the impugned order deserves to be set aside. We have considered the submissions of the aforesaid and to appreciate the arguments. We have gone through the judgment in the case of "Aslam Mohammed Merchants v/s. Competent Authority & Ors. (Supra). We have already quoted Section 6 to 8 of SAFEMA. Section 6 of the Act does not mandate or cast burden on the Competent Authority to show link or nexus of the property with the income of the Detenue or the accused rather if it has reason to believe, that properties had been acquired illegally, a notice is to be served on the person. It is to call upon to disclose the sources of his income, earning or assets out of which he has acquired such pro....
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....illegally acquired properties of the convict or detenu, acquired or kept in their names, do not escape the net of the Act. It is a well-known fact that persons indulging in illegal activities screen the properties acquired from such illegal activity in the names of their relatives and associates. Sometimes they transfer such properties to them, may be, with an intent to transfer the ownership and title. In fact, it is immaterial how such relative or associate holds the properties of convict/detenu - whether as a benami or as a mere name-lender or as a bona fide transferee for value or in any other manner. He cannot claim those properties and must surrender them to the State under the Act. Since he is a relative or associate, as defined by the Act, he cannot put forward any defence once it is proved that that property was acquired by the detenu - whether in his own name or in the name of his relatives and associates. It is to counteract the several devices that are or may be adopted by persons mentioned in clauses (a) and (b) of Section 2(2) that their relatives and associates mentioned in clauses (c) and (d) of the said sub- section are also brought within the purview of the Act. T....
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....ship firm or private company referred to in clause (iii); (vi) the trustee of any trust where (a) the trust has been created by such convict/detenu; or (b) the value of the assets contributed by such convict/detenu to the trust amounts, on the date of contribution not less than 20% of the value of the assets of the trust on that date; and (vii) where the competent authority, for reasons to be recorded in writing, considers that any properties of such convict/detenu are held on his behalf by any other person, such other person. It would thus be clear that the connecting link or the nexus, as it may be called, is the holding of property or assets of the convict/detenu or traceable to such detenu/convict. Section 4 is equally relevant in this context. It declares that "as from the commencement of this Act, it shall not be lawful for any person to whom this Act applies to hold any illegally acquired property either by himself or through any other person on his behalf". All such property is liable to be forfeited. The language of this section is indicative of the ambit of the Act. Clauses (c) and (d) in Section 2(2) and the Explanations (2) and (3) occurring therein shall have to be con....
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....t did not or do not belong to such detenu/convict. We do not think that Parliament ever intended to say that the properties of all the relatives and associates, may be illegally acquired, will be forfeited just because they happen to be the relatives or associates of the convict/detenu. There ought to be the connecting link between those properties and the convict/detenu, the burden of disproving which, as mentioned above, is upon the relative/associate. In this view of the matter, the apprehension and contention of the petitioners in this behalf must be held to be based upon a mistaken premise. The bringing in of the relatives and associates or of the persons mentioned in clause (e) of Section 2(2) is thus neither discriminatory nor incompetent apart from the protection of Article 31-B." In that regard we may further refer to the other judgment of the Apex Court in the case of the "Kesar Devi v/s. Union of India" reported in 2003 (7) SCC 427. The judgment aforesaid has been referred by the Apex Court in the case of Aslam Mohammed Merchants v/s. Competent Authority & Ors. (Supra) wherein the Apex Court did not agree with the view taken in the case of Kesar Devi (Supra). The relev....
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....nt of establishing any link or nexus on the part of the competent authority has been laid down therein. In the said paragraph, the Bench dealt with contention of the counsel for the petitioners that extending the provisions of SAFEMA to the relatives, associates and other "holders" is again a case of overreaching or of over-breadth, as it may be called - a case of excessive regulation. Xxxx 12. The judgment of a court is not to be interpreted like a statute where c every word, as far as possible, has to be given a literal meaning and no word is to be ignored. The observations made have to be understood in the context of the facts and contentions raised. As mentioned earlier, Explanation (2) appended to clause (c) of sub-section (2) of Section 2 gives a very long list of relations. The combined effect of clauses (iii) and (vii) of the Explanation is that a convict or detenu's wife's sister's lineal descendant whether male or d female and howsoever low is also included even though the relationship is quite remote. In those cases where the relationship is a very remote one, the competent authority may have to indicate some link or nexus while recording reasons for beli....
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....onsiderable merit in the submission of the appellant. The High Court has not referred to the facts, nor considered the validity of the notices issued under Section 6 of the Act and the orders of forfeiture under Section 7 of the Act with reference to the facts and provisions of SAFEMA and the decisions of this Court. The impugned order cannot therefore be sustained. " The paras of the judgment quoted above makes distinction between the provision of SAFEMA & NDPS defining illegality acquired property. It is held to be materially different. The judgment in case of Bishwanath Bhattacharya v/s. Union of India & Ors. in Civil Appeal No. 772-773/2014 dated 21.01.2014 is again on the subject and the relevant para of the said judgment is also quoted here under:- "38. The Act does not provide for the confiscation of the properties........The conviction or the preventive detention contemplated under Section 2 is not the basis or cause of the confiscation but the factual basis for a rebuttable presumption to enable the State to initiate proceedings to examine whether the properties held by such persons are illegally acquired properties. It is notorious that people carrying on activities ....
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....cause proceedings or hearing remain pending and taken up by the Authority posted from time to time. The requirement is for passing of the order by Authority who has heard the case. In the instant case the final hearing was made by the Competent Authority on 23rd May, 2005 said to be for few minutes without any proof has resulted in pronouncement of order. It was by the same Authority. The written arguments itself show that the Appellant remain present on the date of hearing though said to be only of 10 to 15 minutes. It is however a fact that the order has been passed by the same Authority. Thus, arguments in reference to the principle of natural justice is not made out and therefore rejected summarily. The facts of each case are taken separately Abida Mohd. Dossa in Appeal No. FPA-4/BOM/2005 The Flat No. 604 on 6th Floor of the building known as Bagh-e- Rehmat (Rajput Villa) Society, Agripada, in Bombay has been forfeited. It is stated that the Appellant married the Detenue on 04th May, 1975. She filed the suit in the year 1983 bearing no. 783/1983 on account of constraint relationship with the Detenue causing cruelty and thereby consent decree dated 16th August 1983 was passe....
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....e" or "premium". It remains a transaction exclusively between the owner of the property and the tenant. Both the owner and tenant, in privy, strike the deal and the owner transfers his rights and interest in the property to the tenant. The law cannot remain a mute spectator when two persons unite to defeat the purposes of the laws of the land. In this connection, a reference may be made to Section 114 of the Evidence Act. The same is quoted hereunder for ready reference: - "114. Court may presume existence of certain facts The Court may presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events, human conduct and public and private business, in their relation to the facts of the particular case." In case, the contention of the appellant being tenants in the property is accepted, there is no reason for them to challenge the forfeiture of the property being protected by the realm of the provisions of the Rent Act and who can be affected by the forfeiture is the owner of the property and not the tenant. On a bare reading of the terms of the rent agreement relied upon by the appellants, it would show that th....
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....tenant rather he can continue the tenancy even with change of title. It is more so if no padgi or premium has been paid by the Appellant. On a bare reading of the terms of the rent agreement relied upon by the appellants, it would show that the appellants are virtually owning ownership rights in the property. However, the appellants have failed to show any source for acquiring the said properties. So far as Flat No. 611-C, of Meena Apartment is concerned, the source said to have been disclosed but we do not find any material on record to accept the contention. It is contented by the Appellant that he was having income out of gifts and further received Rs. 11,70,000/- under the Foreign Exchange Immunity Scheme, 1991 during the year ended 31st March 1992. The remittance under FEIS is only a mode of transfer and not evidence for receipt of genuine money by the Appellant. Further, the sum of Rs. 2 Lakh said to have been taken as loan from Ms. Hadia Haroon Merchant but no document for it has been submitted. It could have been Income Tax Return and loan agreement but no such document has been submitted. As regards Shop No. 1, on the Ground Floor of Ruksana Palace, Plot No. 57/54A, Mohd....