Service of notice was a must under Rule 11.

ORDER.-On the basis of some reliable information that the petitioner had received a payment from a local person unauthorisedly as per the instructions of a person resident outside India, his person was searched under section 19-A of the Foreign Exchange Regulation Act, 1947 while he was travelling in a bus at Tambaram on 12th May, 1973. The search resulted in the seizure of Indian currency of Rs. 50,000 and two bus tickets. It is further stated in the counter-affidavit that on interrogation, the petitioner voluntarily admitted in writing that the amount was received at Madras on the previous day from an unknown person as per the instruc-tions of his uncle Sri Latheef of No. 9, Queen St., Penang, and he was carrying the money to his native place, Abhiramam, Ramanathapuram District, for the purchase of property for his uncle as instructed in the letter. Thereafter, the petitioner filed this writ petition praying for the issue of a writ of mandamus or any other appropriate writ directing the respondents herein to return the sum of Rs. 50,000 seized from him on 12th May, 1973. In the affidavit originally filed in support of the writ petition, the petitioner challenged the applicability of section 5 of the Foreign Exchange Regulation Act. He also contended that the impugned action was violative of Articles 14, 19 and 31 of the Constitution. The learned counsel for the petitioner did not press any of these contentions at the time of argument. But he has raised an additional ground in W.M.P. No.2417 of 1975. In this, he had stated that the seizure of the documents under section 19-G was effected on 12th May, 1973, but no notice commencing the proceedings under section 23 was served on him within a period of one year and that, therefore, the respondent could not retain the money any longer. Accordingly, he was entitled for a return of the sum of Rs. 50,000. Since this point arises in view of the subsequent events which happened after the filing of the writ petition, I have permitted the petitioner to raise this additional ground.

2. It appears that subsequent to the seizure, on 10 th April, 1974 a show cause notice bearing T4/26/M/74/(SCN) for alleged violation of section 5 (1) (a) of the Foreign Exchange Regulation Act, 1947 was issued by the Additional Director of Enforcement, Enforcement Directorate, New Delhi, to the petitioner to his address at No. 297, Thambu Chetti Street Madras-1. This is the address which the petitioner had given in the original writ petition. This notice sent by registered post acknowledgment due was returned unserved with a note ‘left’ by the postal authorities. When the petitioner through his lawyer issued a notice on 16th July, 1974 for the return of the money since the period of one year had expired, the respondent replied by letter dated 20th July, 1974 addressed to the advocate for the petitioner that they had already sent a notice on 10th May, 1974 which was returned unserved with a note aforesaid and enclosed a copy of the said notice and stated that in those cicumstances, the question of return of seized currency does not arise.

3. Section 19-G confers a power on the competent authority to retain the document seized in accordance with the provisions of the Act for a period not exceeding one year and if before the expiry of the said period of one year “any proceeding’ under section 23 has been commenced” until the disposal of those proceedings, including proceedings, if any, before the appellate Board and the High Court. The other part of the provision is not relevant to be quoted for the purpose of their case.

4. The question for consideration is whether any proceedings under section 23 have been commenced in this case in order to give an extended period beyond the period of one year. Section 23-D of the Act states that for the purpose of adjudicating under clause (a) of sub-section (1) of section 23 whether any person has committed a contravention, the Director of Enforcement shall hold an enquiry in

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