2006 (8) TMI 585 - HC - Customs

Summary

Issues Involved:
1. Delay in the issuance and execution of the detention order.
2. Non-submission of relevant documents to the detaining authority.
3. Non-application of mind by the detaining authority.

Detailed Analysis:

1. Delay in the Issuance and Execution of the Detention Order:
The petitioner challenged the detention order on the grounds of undue delay in its issuance and execution. The investigation into the detenu's activities began in June 2004, and a complaint was filed on 01-10-2004. The detention order was issued on 05-08-2005 and executed on 21-09-2005. The petitioner argued that the delay remained unexplained, thus vitiating the detention order.

The respondent countered that the delay was justified due to the complex nature of the investigation involving large sums of foreign currency and forged documents. The detaining authority required thorough investigation into the sources of the foreign currency, which took time. The detaining authority's satisfaction that the detenu had the propensity to continue his activities unless detained was based on detailed and prolonged investigation.

The court, referencing various judgments, including "Rajender Kumar Natwar Lal Shah v. State of Gujarat," emphasized that mere delay does not automatically invalidate a detention order. The court must consider whether the delay has snapped the nexus between the prejudicial activities and the detention order. In this case, the court found that the delay was justified due to the extensive investigation required and upheld the detention order.

2. Non-Submission of Relevant Documents to the Detaining Authority:
The petitioner argued that the detaining authority did not consider crucial documents, such as the orders from two writ petitions filed by the detenu for defreezing his bank accounts and the Commissioner of Customs' order dated 06-05-2005. The petitioner claimed that these documents would have shown that the detenu could not continue his activities due to the frozen bank accounts.

The detaining authority responded that the main ground for detention was the detenu's illegal acquisition of foreign currency and fabrication of documents. The freezing of bank accounts did not prevent the detenu from continuing his activities through other means. The court agreed with the detaining authority, stating that the detenu could still indulge in similar activities by opening other bogus accounts. The court found no merit in the argument that the non-submission of these documents indicated non-application of mind by the detaining authority.

3. Non-Application of Mind by the Detaining Authority:
The petitioner contended that the detaining authority did not apply its mind, as evidenced by the reference to adjudication proceedings likely to be initiated, despite such proceedings already having commenced. The detaining authority clarified that the reference was to adjudication proceedings under the Foreign Exchange laws, which had not yet started.

The court found that the detaining authority had considered all relevant materials and had applied its mind appropriately. The mention of future adjudication proceedings did not vitiate the detention order, as the primary reason for detention was the detenu's prejudicial activities affecting the country's foreign exchange resources.

Conclusion:
The court dismissed the writ petition, upholding the detention order. It concluded that the delay in issuing and executing the detention order was justified due to the complex investigation required. The non-submission of certain documents did not affect the validity of the detention order, and there was no evidence of non-application of mind by the detaining authority. The court emphasized that the detenu's activities posed a significant threat to the augmentation of foreign exchange resources, necessitating preventive detention.