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TMI Blog1993 (3) TMI 96X X X X Extracts X X X X X X X X Extracts X X X X ..... landestine manner; AND WHEREAS such persons have in many cases been holding the properties acquired by them through such gains in the name of their relatives, associates and confidants." It would equally be relevant to notice the Statement of Objects and Reasons appended to the Bill. The Statement sets out the mischief the Act was intended to meet and counteract. It reads : "Smuggling activities and foreign exchange manipulations are having a deleterious effect on the national economy. Persons engaged in such malpractices have been augmenting their ill-gotten gains by violation of laws relating to income-tax, wealth-tax or of other laws. In many cases, such persons have been holding properties acquired through ill-gotten gains in the names of their relatives, associates and confidants. This accumulation of ill-gotten wealth gives increasing power, influence and resources to those who carry on such clandestine activities and even tend to confer social status and prestige which is quite contrary to the healthy socio-cultural norms. These activities pose a serious threat to the economy and the security of the nation. In conjunction with various other steps taken by the Governmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... riate in the circumstances. Section 8 enacts a special rule of burden of proof. It says, "in any proceedings under this Act, the burden of proving that any property specified in the notice served under Section 6 is not illegally acquired property shall be on the person affected." Section 9 provides for imposing fine in lieu of forfeiture where the authority finds that a property acquired by such person has only been partly acquired with illegally acquired income/assets. It is not necessary to refer to the other provisions except Section 24, which gives an over-riding effect to the provisions of the Act over any other law for the time being in force. Section 26 confers the rule-making power upon the Central Government. The appellant in Civil Appeal No. 1391 of 1979, Tekchand was a dealer in watches. The appellants in Civil Appeal Nos. 1392 and 1393 of 1979 are his sons. In the year 1976, Parliament had enacted the Voluntary Disclosure of Income and Wealth Act, 1976, hereinafter referred to as the Voluntary Disclosure Act. This Act was also preceded by an Ordinance issued on October 8, 1975. The Act was given effect on and from the said date. The Ordinance and the Act provided fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in these proceedings. On February 22,1978 notices under Section 6 of the Act (SAFEMA) were served upon Tekchand and his two sons calling upon them to show-cause why the properties mentioned in the notices be not forfeited to Central Government. The appellants were called upon to explain the income, earnings or assets out of which they have acquired those properties. Explanations were furnished by all the three. In his explanation Tekchand stated inter alia that he had made a disclosure of a sum of Rs. 25,000/- in form-A under the Voluntary Disclosure Act which was accepted by the Competent Authority and a certificate issued to him in that behalf. He filed a copy of the said certificate. He also set out the manner in which the said sum was utilised after the disclosure. He submitted that he cannot be asked to explain the source from which he obtained the said sum of Rs. 25,000/-. Calling upon him to do so, he submitted that it would violate the immunity granted to him under the Voluntary Disclosure Act. Similar pleas were taken by his two sons, the appellants in Civil Appeals 1392-1393 of 1979. Their objections were over-ruled by the Competent Authority who by his Order dated Oc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tention under COFEPOSA is not enough. Not only there must have been an order of detention under the said Act, the other conditions prescribed in the proviso to clause (b) should not also have taken place. It is for this reason that the words "has been made" were used in clause (b) of Section 2(2). In this context Explanation 4 appended to Section 2(2) becomes relevant. The Parliament anticipated that a contention may be raised by persons proceeded against under SAFEMA that proceedings under the Act can be taken only in those cases where they have been detained under COFEPOSA or convicted under Customs Act or FERA after the coming into force of SAFEMA. With a view to repel any such contention Explanation 4 states : "Explanation 4. - For the avoidance of doubt, it is hereby provided that the question whether any person is a person to whom the provisions of this Act apply may be determined with reference to any facts, circumstances or events (including any conviction or detention) which occurred or took place before the commencement of this Act." If the contention of the learned counsel is correct and if that was the intention of the Parliament, they would have said that such ques ..... X X X X Extracts X X X X X X X X Extracts X X X X
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