2008 (4) TMI 745 - SC - Customs

Principle of Constructive Res Judicata - proceedings for forfeiture of properties - period of limitation - Classification

Issues Involved:
1. Validity of the proviso appended to Section 68C of the Narcotic Drugs and Psychotropic Substances Act, 1985 (NDPS Act).
2. Jurisdiction of the Competent Authority to initiate proceedings against a citizen residing outside India.
3. Constitutionality of the proviso to Section 68C with respect to Article 14 of the Constitution of India.
4. Validity of the show cause notice issued under Section 68E read with Section 68H of the NDPS Act.

Detailed Analysis:

1. Validity of the Proviso Appended to Section 68C of the NDPS Act:
The primary issue in this appeal was the validity of the proviso appended to Section 68C of the NDPS Act, as it stood prior to its amendment by Act No. 9 of 2001. The original proviso stated, "Provided that no property shall be forfeited under this Chapter, if such property was acquired by a person to whom this Act applies before a period of six years from the date on which he was charged for an offence relating to illicit traffic." This was amended to include a period of six years from the date of arrest, issuance of a warrant, or detention order. The appellant contended that the classification made by the statute, which did not provide a period of limitation for persons detained under preventive detention, was arbitrary and violated Article 14 of the Constitution.

2. Jurisdiction of the Competent Authority:
The appellant initially contended that the Competent Authority had no jurisdiction to initiate proceedings under the NDPS Act against a citizen residing outside India. However, this contention was not pressed during the proceedings before the Supreme Court.

3. Constitutionality of the Proviso with Respect to Article 14:
The appellant argued that the classification made by the proviso to Section 68C, as it stood prior to the 2001 amendment, was ultra vires Article 14 of the Constitution. The Supreme Court upheld the classification, stating that a law can be constitutional even if it affects an individual, and there is a presumption in favor of the constitutionality of an enactment. The Court emphasized that the principle of equality does not mean that every law must have universal application for all persons who are similarly situated. The Court cited previous judgments to support the view that reasonable classification is permissible under Article 14, and the burden of proving that a statute is unconstitutional lies on the person challenging it.

4. Validity of the Show Cause Notice:
The appellant contended that the show cause notice did not contain the necessary reasons as required under Section 68E read with Section 68H of the NDPS Act. However, the Supreme Court noted that the contentions raised in the appeal were not raised before the Appellate Authority or the High Court, and the order of the High Court dated 15.12.1999 had attained finality. The Court held that the proceedings could not be reopened and the principle of 'Constructive Res Judicata' applied to writ proceedings. The Court also noted that the documents necessary to determine the question were not before it.

Conclusion:
The Supreme Court dismissed the appeal, concluding that the proviso to Section 68C, as amended in 2001, did not violate Article 14 of the Constitution. The Court held that the classification made by the statute was reasonable and had a substantial relation to the object sought to be achieved. The appeal was dismissed with costs, and the counsel's fee was assessed at Rs. 50,000.

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