2001 (5) TMI 904 - HC - Companies Law

Summary

Issues Involved:
1. Legality of the detention order under COFEPOSA.
2. Application of mind by the detaining authority.
3. Procedural safeguards under Article 22 of the Constitution.
4. Distinction between approval and satisfaction for detention orders.

Issue-wise Detailed Analysis:

1. Legality of the detention order under COFEPOSA:
The habeas corpus writ petition was filed challenging the detention order passed by the Lt. Governor (LG) of the National Capital Territory of Delhi under Section 3(1) of the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 (COFEPOSA). The detenu was arrested for illicit possession of US $37,500, which was found in his checked-in baggage while traveling from New Delhi to Nepal. The detenu contended that the money was not contraband and was brought for business purposes. Despite his claims and representations, the detention order was passed and served while he was in judicial custody.

2. Application of mind by the detaining authority:
The main contention was that the detaining authority had not applied its mind independently and merely approved the grounds of detention prepared by the sponsoring authority. The petitioner asserted that the grounds of detention were a verbatim reproduction of the complaint and sanction, indicating non-application of mind. The counter-affidavit filed by the detaining authority initially denied this claim, stating that the grounds were prepared after considering all material on record. However, subsequent affidavits revealed discrepancies, suggesting that the LG had merely approved the draft grounds and detention order prepared by officials, without independent application of mind.

3. Procedural safeguards under Article 22 of the Constitution:
The judgment emphasized the importance of procedural safeguards under Article 22, which protects personal liberty. The court highlighted that any deprivation of personal liberty must meticulously accord with the procedure established by law. It was noted that preventive detention laws are strictly construed, and compliance with procedural safeguards is imperative. The court referred to various judicial precedents underscoring the necessity of strict adherence to legal requirements in matters of personal liberty and preventive detention.

4. Distinction between approval and satisfaction for detention orders:
The court examined the distinction between approval and satisfaction in the context of detention orders. Unlike the National Security Act (NSA), where approval of detention orders by the LG is mandated, COFEPOSA requires the detaining authority to arrive at its own satisfaction. The court noted that the LG's role under COFEPOSA is to independently assess the material and not merely approve pre-prepared grounds. The judgment clarified that approval suggests a confirmation of an action already taken, whereas satisfaction requires an independent evaluation by the detaining authority.

Conclusion:
The court concluded that the detaining authority had not applied its mind independently and merely approved the draft order prepared by officials. This lack of independent satisfaction by the detaining authority vitiated the detention order. Consequently, the court quashed the detention order and directed that the detenu be set at liberty forthwith unless required in connection with any other case or proceedings.