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2025 Supreme(Raj) 1296
2025 RJ-JP 9111
IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR
Mahendar Kumar Goyal, Ashutosh Kumar, JJ.
Piyush Naulakha S/o Sh. Shri Chand Naulakha – Petitioner
Versus
Union of India, Through Ministry of Finance, Department of Revenue Central Economic Intelligence Bureau, COFEPOSA Unit, 6th Floor, B Wing, Janpath Bhawan, Janpath. New Delhi - Respondent
D.B. Habeas Corpus Petition No. 22/2025
Decided On : 01-05-2025
Advocate Appeared :
For the Petitioner : Mr. Vikram Chaudhri, Sr. Adv. with Mr. H.V. Nandwana Mr. Rishi Sehgal Mr. Keshavam Chaudhri Mr. Y.V. Nandwana Mr. Prem Chand Sharma Mr. G.V. Chauhan
For the Respondent : Mr. R.D. Rastogi, Addl. Solicitor General with Mr. C.S. Sinha, CGPC Ms. Priyansha Gupta Mr. Yathartha Asopa Mr. Kinshuk Jain, Senior Standing Counsel for Customs
Advocate Appeared:
For the Petitioner: Mr. Vikram Chaudhri, Sr. Adv. with Mr. H.V. Nandwana Mr. Rishi Sehgal Mr. Keshavam Chaudhri Mr. Y.V. Nandwana Mr. Prem Chand Sharma Mr. G.V. Chauhan
For the Respondent: Mr. R.D. Rastogi, Addl. Solicitor General with Mr. C.S. Sinha, CGPC Ms. Priyansha Gupta Mr. Yathartha Asopa Mr. Kinshuk Jain, Senior Standing Counsel for Customs
Preventive detention under COFEPOSA can be upheld despite procedural delays if sufficient grounds exist for the detaining authority's satisfaction regarding the likelihood of the detenu engaging in prejudicial activities.
Headnote:
(A) Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 - Section 3(1) - Detention order - Legality of detention order challenged on grounds of mala fide, arbitrary grounds, and coercion - Petitioner detained for involvement in fraudulent remittances linked to smuggling activities - Court finds sufficient grounds for detention based on the petitioner's propensity to engage in illegal activities - Delay in representation consideration noted but deemed insufficient to invalidate detention - Detention order upheld. (Paras 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34)
Facts of the case:
The petitioner was detained under the COFEPOSA Act based on allegations of fraudulent remittances linked to smuggling activities. The detention order was issued after a lengthy investigation into the petitioner's financial dealings, which were found to be connected to smuggling operations. The petitioner challenged the legality of the detention order, citing mala fide intentions and procedural lapses.
Findings of Court:
The court found that the detaining authority had sufficient grounds to believe that the petitioner was likely to continue engaging in prejudicial activities if released. The court acknowledged the delay in considering the petitioner's representation but ruled that it did not invalidate the detention order.
Issues: The main issues addressed included the legality of the detention order, the sufficiency of grounds for detention, and the impact of procedural delays on the validity of the detention.
Ratio Decidendi: The court held that the detaining authority's satisfaction regarding the necessity of preventive detention was based on relevant material and that the procedural safeguards, while important, did not negate the grounds for detention. The court emphasized that preventive detention serves a different purpose than punitive measures and that the authority's subjective satisfaction must be respected unless proven otherwise.
Result: The habeas corpus petition was allowed, and the detention order was quashed, leading to the petitioner's release from detention.
JUDGMENT :
MAHENDAR KUMAR GOYAL, J.
1. Initially, arguments were heard and concluded on21.02.2025 and the judgement was reserved. However, during the course of dictation, it transpired that the copy of the letter dated 13.11.2024 issued by the Government of India through Ministry of Finance addressed to the Deputy Secretary, Home Department, Government of Rajasthan, submitted by the petitioner at the time of oral submissions, was not part of the pleadings/record and it could have some bearing on the issue. In view thereof, the matter was listed on 11.03.2025 under the category “to be mentioned”. On that day, the learned senior counsel for the petitioner prayed for time to file an additional affidavit incorporating the aforesaid letter. Thereafter, the additional affidavits and counter affidavits were filed by the respective parties. Learned counsels made their submissions on the letter dated 13.11.2024 as also on the aspect of delay in deciding the representations. The arguments were concluded on 22.04.2025 and the judgement was reserved.
2. This habeas corpus petition under Article 226 of the Constitution of India is filed assailing the legality and validity of the order dated 08.10.2024 passed by the Joint Secretary to the Government of India through Ministry of Finance, Department of Revenue, Central Economic Intelligence Bureau, COFEPOSA Wing (for brevity-`detaining authority’) under Section 3(1) of the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 (for short-`COFEPOSA Act’) whereby, the petitioner has been detained and kept in Central Jail, Jaipur.
3. Shorn of unnecessary details, the relevant facts in brief are that on the basis of complaints dated 12.10.2021 and 09.11.2021 submitted by UCO Bank Branch at Vishakhapatnam and the UCO Bank Branch at Johri Bazar, Jaipur respectively, a case no.CUS/ICFS/MISC/613/2021-Prev-O/o Commr-Cus-Prev-Jodhpur was registered by the Customs Preventive Commissionerate, Jodhpur Headquarters at Jaipur alleging fraudulent bank remittances from India to offshore firms based in Hongkong, Singapore and UAE against alleged import of digital services/IT services whereas, no services were actually imported rather, the remittances were used for funding smuggling of gold items and other precious stones. During the course of investigation, a Look Out Circular (LOC) dated 19.07.2024 was issued against the petitioner. On 22.07.2024, he was de-boarded from a flight at Jaipur Airport while travelling to Dubai and was arrested. A prosecution complaint for the offences under Section 132 and 135 of the Customs Act, 1962 (for short- `the Act of 1962’) was filed against the petitioner on 19.09.2024. On 08.10.2024, a preventive detention order was passed against him under Section 3(1) of the COFEPOSA Act. Vide letter even dated, the detaining authority communicated to the petitioner the grounds of detention. He was granted benefit of bail by this Court vide order dated 16.10.2024. The petitioner as also his wife Smt. Deepika Naulakha submitted their representations for revoking of detention order to the prescribed authorities which came to be rejected.
4. During pendency of the writ petition, the Advisory Board constituted under Section 8 of the COFEPOSA Act forwarded its opinion to the Central Government whereupon, vide order dated 07.01.2025, it confirmed the detention order dated 08.10.2024 directing detention of the petitioner for a period of one year from the date of his detention i.e. 09.10.2024.
5. The order of detention is assailed on the grounds including that it is laced with mala fide to nullify the order extending benefit of bail to him by this Court; is based on non-existing/arbitrary/illegal grounds as also on his statement recorded under coercion which later on, was retracted by him. It is, therefore, prayed in the habeas corpus petition that the order dated 08.10.2024 be quashed and set aside and the respondent be directed to release the petitioner immediately from
