( 1 ) THE action taken by the competent authority under the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 (hereinafter referred to as SAFEMA) against the properties held by or on behalf of Hari Kishan Sarin has given rise to the present proceedings. The petitioners are impugning the decision of both the competent authority and the appellate authority forfeiting the property in question.

( 2 ) SAFEMA was enacted to provide for forfeiture of illegally acquired properties of smugglers and foreign exchange manipulators, whether such property is held in their own name or in the name of their relatives, associates and confidants. Section 2 (1) makes provisions of the Act applicable to persons specified in sub-section (2 ). Sub-section (2) defines "every person" and clause (b) stipulates that the same includes a person in respect of whom an order of detention has been made under the Conservation of Foreign exchange and Prevention of Smuggling Activities Act, 1974 (hereinafter referred to as the COFEPOSA Act ). Clauses (c), (d ). and (e) of sub-section (2) of Section 2 provide that the person referred to in sub-section (1) includes a relative of such a person, associate of such a person and any holder of any property which was at any time previously held by such a person.

( 3 ) IN terms of explanation 2 to the said Section, "relative" includes any lineal ascendant or descendant of the person which would thus include the mother of such a person.

( 4 ) SECTION 4 provides that it would not be lawful for any person to whom the Act applies to hold any illegally acquired property after tke commencement of the Act whether such property is held by himself or through any person on his behalf and such property is liable to be forfeited to the Central Government in accordance with the provisions of the Act. Section 5 provides for the appointment of the competent authority.-

( 5 ) A notice is required to be issued under Section 6 where the competent authority has reason to believe that any of such properties is illegally acquired property and Section 7 provides for the forfeiture of the property. Section 8 stipulates that the burden of proving that any property specified in the notice served under Section 6 is not illegally acquired property, would be on the person affected. The said Sections are as under:

( 6 ) NOTICE of forfeiture - (1) If, having regard to the value of the properties held by any person to whom this act applies, either by himself or through any other person on his behalf, his known sources of income, earnings or assets, any other information or material available to it as a result of action taken under section 18 or otherwise, the competent authority has reason to believe (the reasons for such belief to be recorded in writing) that all or any of such properties are illegally acquired properties, it may serve a notice upon such person (hereinafter referred to as the person affected) calling upon him within such time as may be specified in the notice, which shall not be ordinarily less than thirty days, to indicate the sources of his income, earnings or assets, out of which or by means of which he has acquired such property, the evidence on which he relies and other relevant information and particulars, and to show cause why all or any of such properties as the case may be should not be declared to be illegally, acquired properties and forfeited to the central Government under this Act. (2) Whereas notice under sub-section (1) to any person specifies any property as being held on behalf of such person by any other person, a copy of the notice shall also be served upon such other person.

( 7 ) FORFEITURE of property in certain cases - (1) The competent authority may, after considering the explanation, if any to the show cause notice issued under section 6, and the materials available before it and after giving to the person affected (and in a case where the person affected ho