The main legal point established in the judgment is the importance of adhering to statutory time limits and the limited scope for condonation of delay under section 12(4) of SAFEMA. The judgment also clarifies the express exclusion of the applicability of section 5 of the Limitation Act under section 29(2) of the Limitation Act.

B. P. Colabawalla, J.

1. Rule. Respondents waive service. By consent of the parties, rule made returnable forthwith and heard finally.

2. By this Petition under Article 226 of the Constitution of India, the Petitioners seek to challenge the order dated 12th March 2013 passed by the Appellate Tribunal for Forfeited Property, New Delhi, Respondent No.1 herein. Challenge is also laid to the order dated 23rd September, 2011 passed by the passed by Respondent No.2 under section 7 of the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 (for short “SAFEMA”). Respondent No.2 is the Competent Authority under SAFEMA.

3. The brief facts to decide the present controversy is that Respondent No.3 is a sole proprietor of M/s. Aakar Prints and Packs and was the owner of a flat bearing No.G-2, Sushobhit CHS, Charkop, M.G. Road, Sector-2, Kandivli (W), Mumbai-67 (for short, the “suit property”) alongwith a Mitsubishi Lancer car bearing registration No.GJ-18-AB-1171. The Petitioner claims to be the mortgagee of the suit property in the facts and circumstances narrated hereafter.

4. On 23rd August 2006, an order of detention was passed against Respondent No.3 under section 3(1) of the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 (for short, “COFEPOSA”). In view of the said detention, the provisions of SAFEMA were made applicable to Respondent No.3 as he was a notified person under the provisions of section 2(2)(b) of SAFEMA. Ms. Pravina L. Patel, 3rd Respondent's wife was also covered under the definition of “relative” as defined under section 2(2)(c) of SAFEMA. Thereafter, an enquiry in relation to Respondent No.3's properties were initiated by the authorities in October/November 2006. Summons were also issued to Respondent No.3 and his wife in January 2008 and Respondent No.3's statement was also recorded in March 2008. Thereafter, further enquiries were conducted which finally culminated in a show cause notice dated 1st September, 2010 being issued to Respondent No.3 and his wife under section 6 of SAFEMA for various properties including the suit property and calling upon them to explain the sources of income through which they were acquired.

5. The above show cause notice was thereafter adjudicated and Respondent No.2, by an order of forfeiture dated 23rd September, 2011, passed under section 7 of SAFEMA held that the suit property was an illegally acquired property and stood forfeited to the Central Government free from all encumbrances. The aforesaid finding was rendered by Respondent No.2 on the basis that Respondent No.3 and his wife failed to produce sufficient evidence to prove that the suit property was acquired from legal sources. Pursuant to this order, Respondent No.2 put his lock on the suit property.

6. Being aggrieved by the aforesaid order, Respondent No.3 and his wife thereafter, filed an appeal before Respondent No.1. This appeal was also dismissed on 11th March, 2013.

7. In the meanwhile, on 5th January 2010, the Petitioners, at the request of Respondent No.3, sanctioned to him a cash credit facility to the tune of Rs.35,00,000/-. The Petitioners contend that the repayment of the aforesaid cash credit facility was inter alia secured by creation of an equitable mortgage of the suit property. It is stated that this mortgage was created on 29th January, 2010. In view of defaults being committed by Respondent No.3 in repayment, his account was classified as a non-performing asset with effect from 15th December, 2010 and the Petitioners initiated action under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short, the “SARFAESI Act”). Accordingly, the Petitioners issued a notice dated 1st January, 2011 under section 13(2) of the SARFAESI Act calling upon Respondent No.3 to pay the total outstanding amount of Rs.35,79,092/- and interest within 60 days of receipt thereof, failing which