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2017 (2) TMI 753 - AT - CustomsSeizure of the deposits and balance thereof in the subject property - natural justice - the appellant has failed to discharge the burden of proof as required u/s 8 of the SAFEM (FOP) Act, 1976 despite being provided sufficient opportunities for the same. Hence, the deposits and balance thereof in the subject property were forfeited to the Central Government, free from all encumbrances, in terms of the provisions of Section 7(1) and (3) of SAFEM (FOP) Act, 1976 - Held that - the notice was not served upon the applicant which was mandated u/s 6(2) of SAFEM (FOP) Act, 1976 - It is well-settled salutary principle that if a statute provides for a thing to be done in a particular manner, then it has to be done in that manner and in no other manner - the impugned order dated 17th March, 2016 is not sustainable as far as the said property of the applicant is concerned, as the same is passed contrary to the provisions of Section 6(2) of the SAFEM (FOP) Act, 1976 and the same is accordingly set aside - property to be released - appeal allowed - decided in favor of appellant.
Issues Involved:
1. Legality of the detention order under the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974. 2. Validity of the forfeiture order under the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976. 3. Non-issuance of notice under Section 6(2) of the SAFEM (FOP) Act, 1976. 4. Ownership and acquisition of the property at 238, Dhruv Apartments, Plot No. 4, I.P. Extension, Delhi-110092. Detailed Analysis: 1. Legality of the Detention Order: The appellant was detained under the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974. The Supreme Court quashed the detention order, noting that the detaining authority's claim that the appellant might continue smuggling despite the retention of his passport was speculative and unsupported by evidence. The Court emphasized that the primary mover of the smuggling activities was the proprietor of M/s. B.D. Denim, and the appellant was merely a pawn. This finding invalidated the detention order, leading to the appellant's release. 2. Validity of the Forfeiture Order: The Competent Authority issued an order on 17th March, 2016, forfeiting the appellant's properties under the SAFEM (FOP) Act, 1976. The appellant challenged this order, particularly concerning the property at 238, Dhruv Apartments. The Competent Authority held that the appellant failed to explain the source of deposits in his bank accounts, thereby not discharging the burden of proof under Section 8 of the SAFEM (FOP) Act, 1976. Consequently, the deposits and balances were forfeited to the Central Government. 3. Non-Issuance of Notice under Section 6(2) of SAFEM (FOP) Act, 1976: The appellant and his wife, Mrs. Sumita Gulati, contended that the Competent Authority did not serve a notice to Mrs. Sumita Gulati, the registered owner of the disputed property, as required under Section 6(2) of the SAFEM (FOP) Act, 1976. The Tribunal found that the failure to issue a notice to Mrs. Sumita Gulati was a violation of the statutory requirements, as she was not given an opportunity to be heard, which is a fundamental principle of natural justice. 4. Ownership and Acquisition of the Property: The appellant admitted that the property at 238, Dhruv Apartments was purchased in the name of his wife from their joint account. Mrs. Sumita Gulati provided evidence of the purchase through registered documents and demand drafts drawn from their joint account. The Tribunal noted that the Competent Authority did not serve a notice to Mrs. Sumita Gulati, despite being aware that the property was in her name. This procedural lapse rendered the forfeiture order unsustainable. Conclusion: The Tribunal set aside the forfeiture order dated 17th March, 2016, concerning the property at 238, Dhruv Apartments, Plot No. 4, I.P. Extension, Delhi-110092. The decision was based on the failure to comply with Section 6(2) of the SAFEM (FOP) Act, 1976, which mandates serving notice to the person in whose name the property stands. The property was ordered to be released from forfeiture forthwith.
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