1990 (12) TMI 70 - HC - Income Tax

Summary

Issues:
1. Proper service of notice under section 6(2) of the Act to a minor.
2. Failure to appoint a court guardian for representation of the minor during proceedings before the Competent Authority.

Detailed Analysis:
Issue 1:
The judgment involves two connected appeals against the same order of the Competent Authority, Madras, dated February 16, 1990. The first appellant, Kalyanasundaram, was detained under the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974, and received a notice under section 6(1) of the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976, regarding certain properties. The properties were ostensibly owned by his minor son, Sethuraman, who was served a notice under section 6(2) through Kalyanasundaram. However, Kalyanasundaram refused to accept the notice, leading to a dispute about proper service on the minor. The Competent Authority proceeded to forfeit the properties without ensuring proper service on Sethuraman, the minor. The court held that the failure to serve a notice under section 6(2) to the minor was fatal to the proceedings, and the order of the Competent Authority was set aside on this ground.

Issue 2:
The judgment further delves into the Competent Authority's failure to appoint a court guardian for the representation of the minor, Sethuraman, during the proceedings. Despite Sethuraman becoming a major during the pendency of the case, he did not participate in the proceedings. The court emphasized that in such situations, it was incumbent upon the Competent Authority to make appropriate arrangements for proper representation on behalf of the minor, either through the natural guardian or by appointing a court guardian. The failure to appoint a court guardian or ensure proper representation for the minor was deemed a serious lapse, leading to the setting aside of the Competent Authority's order. The court directed the Competent Authority to decide the matter afresh, with both appellants required to appear before the authority on a specified date for further proceedings.