1987 (5) TMI 35 - HC - Customs

Summary

Issues:
1. Challenge to the detention order under COFEPOSA Act.
2. Alleged misdeclaration of exported goods under the DEEC Scheme.
3. Grounds for detention being punitive in nature.
4. Adequacy of documents provided to the detenu for representation.

Analysis:

Issue 1: Challenge to the detention order under COFEPOSA Act
The petitioner challenged the detention order under Section 3(1) read with Section 2(f) of the COFEPOSA Act. The detention order was passed on the grounds of alleged engagement in smuggling activities and dealing in smuggled goods. The petitioner sought to assail the order on various grounds during the hearing.

Issue 2: Alleged misdeclaration of exported goods under the DEEC Scheme
The petitioner, a company involved in the manufacture and export of garments, was found to have misdeclared goods intended for export under the DEEC Scheme. The goods seized upon examination revealed discrepancies in the materials used, with a mix of polyster and cotton fabrics, contrary to the declared content. The petitioner's involvement in such misdeclaration led to the initiation of criminal proceedings under the Customs Act.

Issue 3: Grounds for detention being punitive in nature
The petitioner argued that the detention order was punitive rather than preventive, as the detenu, the Managing Director of the company, had no other import/export licenses and the Advance Licenses had been exhausted. The petitioner contended that the detention was unnecessary as there was no indication of prior or future involvement in smuggling activities, especially considering the inability to obtain further licenses under the DEEC Scheme.

Issue 4: Adequacy of documents provided to the detenu for representation
The petitioner raised concerns about the adequacy of documents provided for representation against the detention. It was alleged that essential documents crucial to the case were not supplied promptly, hindering the detenu from making a comprehensive representation. The delay in providing vital documents undermined the detenu's ability to present a meaningful defense.

In the judgment, the court found merit in the petitioner's arguments, emphasizing the preventive nature of detention laws and the lack of evidence supporting the necessity of detention in this case. The court concluded that the detention order appeared punitive and unwarranted, especially in light of ongoing criminal proceedings. Additionally, the delay in providing crucial documents for representation further weakened the grounds for detention. Consequently, the court quashed the detention order and ordered the immediate release of the detenu, unless required otherwise by a competent authority.