Income Tax Appellate Tribunal - Mumbai
Mrs. Dhanika Jaggi vs Competent Authority on 23 January, 1998
Equivalent citations: [1998]233ITR26(MUM)
ORDER
Eswara Prasad J. (Chairman)
1. The appellant is the wife of Iqbal Singh Avtar Singh Jaggi who was detained under the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 (COFEPOSA), on November 30, 1976, under an order of detention dated November 27, 1976, of the Government of Maharashtra.
2. The Competent Authority, Mumbai, issued a notice under section 6 of the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1.976 (SAFEMA), dated March 30, 1989, to the appellant to show cause as to why three properties mentioned in the said notice should not be forfeited under section 7 as the provisions of section 2(2)(c) read with Explanation 2(i) of the SAFEMA are applicable to the appellant. In reply to the show-cause notice, the appellant took the stand that the provisions of the SAFEMA are not applicable to her and that the properties are not liable to be forfeited as they are not illegally acquired properties of her husband and there was no nexus with the illegal money generated by her husband. She explained the sources with which she has acquired the properties by herself.
3. After considering the explanation offered by the appellant and the evidence on record, the Competent Authority directed the forfeiture of items (i) and (ii), namely, a flat and the appellant's right, title and interest in the proprietary concern, namely, Soen Ladies Tailors, by an order dated July 31, 1976, under section 7 of the SAFEMA. The third item being the savings bank account was held to be not liable for forfeiture. The appellant has come up in appeal under section 12 of the SAFEMA against the order of the Competent Authority directing the forfeiture of items (i) and (ii).
4. Learned counsel for the appellant, Shri Herjinder Singh, raised a preliminary contention with regard to the maintainability of the proceedings under the SAFEMA against the appellant. He submitted that the husband of the appellant was detained under the COFEPOSA on November 30, 1976, during the period of emergency by virtue of the detention order dated November 27, 1976, and was released on March 21/22, 1977, and that he was kept under detention for a period of three months, 21 days, and the detention order was revoked before the requisite period of four months for review and hence the third proviso to sub-section (2) of section 2 of the SAFEMA is applicable. He contends that though the said contention was raised before the Competent Authority, it was not considered. He submits that the question as to whether the provisions of the SAFEMA are attracted should be considered as a preliminary point and decided and that the merits of the case need not be considered at this stage and that only in the event of this Tribunal holding that the provisions of the SAFEMA are applicable, the merits of the case may be gone into.
5. In reply, Shri Baba Prasad, Deputy Director, appearing for the Competent Authority, agreed that the preliminary point may be decided before going into the merits of the case. He contends that by virtue of the emergency being lifted, all the detenus who were detained during the period of emergency were released and that there was no revocation of the detention order and that the third proviso to sub-section (2) of section 2 of the SAFEMA is not attracted. He contends that at any rate, there was no conscious revocation of the detention order by the Government and unless there was such a revocation order made on application of mind the proviso is not applicable.
6. The contention that the provisions of the SAFEMA are not applicable was raised by the appellant in detail before the Competent Authority but we do not find any reference to the said contention in the order under appeal. In the memorandum of grounds of appeal, the contentions are repeated and are also argued today by learned counsel. As the question goes to the root of the matter as to the applicability of the Act and the jurisdiction of the Competent Authority to forfeit the properties of the appellant, we consider it necessary to decide the question of applicability of the Act, as a preliminary point.
7. It is not disputed that the husband of the appellant was detained on November 30, 1976, by virtue of the order of detention dated November 27, 1976, made by the Government of Maharashtra during the period of emergency. It is also not disputed that the detenu was released on March 21/22, 1997, and the detenu was in prison for a period of 3 months, 21 days. During the period of emergency, the provisions of section 12A of the COFEPOSA were applicable. Under sub-section (3) of section 12A of the COFEPOSA, the question whether the detention of any person in respect of whom a declaration has been made under sub-section (2) of section 12A continues to be necessary for effectively dealing with the emergency, shall be reconsidered by the appropriate Government within four months from the date of such declaration. Evidently, the appropriate Government, namely, the Government of Maharashtra, could not have reconsidered the question whether the detention order should be continued, as the detenu was released within the said period of four months and was not under detention thereafter.
8. The third proviso to section 2(2) of the SAFEMA reads as follows (see [1976] 46 Comp Cas (St.) 120) :
"Such order of detention, being an order to which the provisions of section 12A of the said Act apply, has not been revoked before the expiry of the time for, or on the basis of the first review under sub-section (3) of that section, or on the basis of the report of the advisory Board under section 8, read with sub-section (6) of section 12A, of that Act; or."
9. It has, therefore, to be seen whether the release of the detenu before the expiry of time of four months under the provisions of section 12A of the COFEPOSA was by virtue of an order revoking the detention. It has also to be examined whether the order of revocation should be a conscious order made after application of mind, as it is not disputed that all the detenus who were detained during the period of emergency were released on the lifting of the emergency, by a general order.
10. Learned counsel for the appellant vehemently contended that the fact that the detenu was released would clearly indicate that the detention order was revoked. Therefore, the third proviso to section 2(2) is attracted. The question, therefore, arises as to what is the meaning to be attached to the word "revoked" in the said proviso. The word "revocation by act of the party" is an intentional or voluntary revocation. It is, therefore, clear that an order of revocation of detention made pursuant to lifting of emergency cannot be treated as a revocation, which is an intentional or voluntary revocation. There is obviously no application of mind by the appropriate Government whether to continue the order of detention or not. Unless the appropriate authority reconsiders the entire material on record which led to the detention of the detenu, the order of revocation cannot be said to have been made consciously after application of mind, to attract the third proviso to section 2(2) of the SAFEMA.
11. Learned counsel for the appellant next submitted that the order of detention made against the appellant's husband was illegal and that there was not sufficient material to sustain the same. It is settled law that unless the detention order was questioned by the detenu by himself or by someone on his behalf, the same cannot be allowed to be raised. Admittedly, the order of detention was not challenged before the appropriate forum and cannot be questioned before this Tribunal. In Attorney-General for India v. Amratlal Prajivandas [1995] 83 Comp Cas 804; AIR 1994 SC 2179, (it was held) that a person who did not choose to challenge an order of detention during the emergency when he was detained, or challenged it unsuccessfully, cannot be allowed to challenge it when it is sought to be made the basis for applying the SAFEMA to him. Failure to challenge the detention directly when he was detained, precludes him from challenging it after the cessation of detention, where it is made the basis for initiating action under the SAFEMA. The person who did not challenge (either by himself or through his next friend), the order of detention or challenged it but failed, cannot be allowed to challenge the order of detention when action is taken against him under the SAFEMA.
12. In the face of the judgment of the Supreme Court, the reliance placed on the judgment of the High Court of Bombay in Criminal Application No. 1320 of 1975, dated February 23, 1981, and the judgment of the Delhi High Court in Akhilesh Kumar Tyagi v. Union of India [1995] 60 Delhi Law Times 203 for the appellant is of no avail to him.
13. It was next contended by learned counsel for the appellant that inas-much as an order of confirmation of detention was not passed within the period of four months, further detention after the expiry of the said period ipso facto becomes illegal, basing on the decision of the Supreme Court in Nirmal Kumar Khandelwal v. Union of India, AIR 1978 SC 1155. There is no dispute that the detenu cannot be continued under detention after the expiry of the period for review. But, in the present case, the detenu was released before the expiry of the period of four months and hence the question of continuing the detenu in prison after the expiry of the period of four months did not arise. The said decision is, therefore, of no application in the present case.
14. We have no hesitation in holding that the husband of the appellant was not released by virtue of a conscious order of revocation by the appropriate authority and hence the third proviso to section 2(2) of the SAFEMA does not apply. It, therefore, follows that the provisions of the Act are applicable to the detenu and the appellant being the wife of the detenu is also covered by the provisions of the SAFEMA. We, therefore, overrule the contention of the appellant with regard to the maintainability and application of the provisions of the SAFEMA to the appellant.
15. The appeal will be considered on its merits.