IMPORTANT POINT
Under the scheme of the SAFEMA, there is no requirement on the part of the competent authority to mention or establish any nexus or link between the money of the convict or detenu and the property sought to be forfeited.

Headnote:(i) Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976-Sections 6(1), (2) and 8-Forfeiture of properties under-Detention order under COFEPOSA Act-Whether it is open to a person to assail validity of a detention order passed under COFEPOSA Act while challenging proceedings initiated under SAFEMA regarding forfeiture of property-(No)-Attorney General for India v. Amratlal Prajivandas, (1994) 5 SCC 54 : Relied on-Conservation of Foreign Exchange and Prevention of Smuggling Activities Act. (Para 6)
       (ii) Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976-Sections 6 and 8-Forfeiture of properties-Burden of proof-Detention under COFEPOSA Act-No requirement of mentioning any link or nexus between the convict or detenu and property ostensibly standing in name of the person to whom notice has been issued-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-Wife of detenu claiming herself to be the owner failed to establish that she had any income of her own to acquire three properties-No other inference was possible except that it was done so with the money provided by her husband, detenu-COFEPOSA Act-Section 3(1).
       Held : The condition precedent for issuing a notice by the competent authority under Section 6(1) is that he should have reason to believe that all or any of such properties are illegally acquired properties and the reasons for such belief have to be recorded in writing. The language of the Section does not show that there is any requirement of mentioning any link or nexus between the convict or detenu and the property ostensibly standing in the name of the person to whom the notice has been issued. Section 8 of the Act which deals with burden of proof is very important. It lays down that in any proceedings under the 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. The combined effect of Section 6(1) and Section 8 is that the competent authority should have reason to believe (which reasons have to be recorded in writing) that properties ostensibly standing in the name of a person to whom the Act applies are illegally acquired properties, he can issue a notice to such a person. Thereafter, the burden of proving that such property is not illegally acquired property will be upon the person to whom notice has been issued. The statutory provisions do not show that the competent authority, in addition to recording reasons for his belief, has to further mention any nexus or link between the convict or detenu (as described in Sub-section (2) of Section 2) and the property which is sought to be forfeited in the sense that money or consideration for the same was provided by such convict or detenu. If a further requirement regarding establishing any link or nexus is imposed upon the competent authority, the provisions of Section 8 regarding burden of proof will become otiose and the very purpose of enacting such a Section would be defeated. (Para 9)
        We are, therefore, clearly of the opinion that under the Scheme of the Act, there is no requirement on the part of the competent authority to mention or establish any nexus or link between the money of the convict or detenu and the property sought to be forfeited. In fact, if such a condition is imposed, the very purpose of enacting SAFEMA would be frustrated, as in many cases it would be almost impossible to show that the property was purchased or acquired from the money provided by the convict or detenu. In the present case, the appellant is the wife of the detenu and she has failed to establish that she had any income of her own to acquire the three properties. In such circumstances, no other inference was possible except that it was done so with the money provided by her husband. (Para 12)

JUDGMENT

G.P. Mathur, J.-This appeal has been preferred by special leave against the judgment and order dated 12.1.1996 of a Division Bench of Rajasthan High Court by which the special appeal preferred by the appellant against the judgment and order dated 19.7.1995 of a learned Single Judge was dismissed and the order passed by the Appellate Tribunal for Forfeited Property, New Delhi, was affirmed.

2. The appellant is widow of late Jagannath Sharma. The Customs and Central Excise Authorities of Jaipur recovered 5 gold bars from Jagannath Sharma on 24.7.1969. On 8.4.1972 Police Authorities recovered 15 gold bars from Radha Ballabh and on 15.11.1972 two gold bars of foreign origin were recovered from Ram Parekh and both of them gave statements that they had bought the same from Jagannath Sharma. On 11.10.1973 police recovered 38 gold bars from one Ram Prasad Sharma and the documents showed that the same belonged to Jagannath Sharma. Jagannath Sharma was then detained under MISA on 8.10.1974, but the detention order was revoked and he was released in November, 1974. Thereafter, he was again detained on 4.8.1975 under COFEPOSA Act by an order passed by the Deputy Secretary to the Home Department, Government of Rajasthan, Jaipur. The detention order was passed on the ground that the State Government was satisfied that with a view to prevent Jagannath Sharma from dealing in smuggled goods and engaging in transporting or concealing or keeping smuggled goods, it was necessary to make an order under Section 3(1) of the COFEPOSA Act to detain him.

3. Proceedings for forfeiture of three properties, namely, (1) House property Ho. D-48, Bapu Nagar, Jaipur; (2) House property known as Haldia House, Johari Bazar, Jaipur (Municipal No. JD-JMC-1/106/1948); and (3) House Property in Mehandi Ka Chowk, Ramganj Bazar, Jaipur (Municipal No.GD-JMC-1/276/1948) were initiated under the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 (for short "SAFEMA"). A notice under Section 6(1) of SAFEMA (hereinafter referred to as "the Act") was issued to the appellant Smt. Kesar Devi with regard to Bapu Nagar property and a similar notice was issued to the appellant s husband Jagannath Sharma with regard to the other two properties, namely, Haldia House and Mehandi Ka Chowk. Jagannath Sharma gave a reply that the aforesaid two properties did not belong to him but belonged to his wife. Thereafter, the competent authority issued a letter dated 27.4.1977 purporting to be a notice under Section 6(2) of the Act to the appellant. In this letter apart from enclosing a copy of the notice under Section 6(1) issued to Jagannath Sharma as required by clause (2) of Section 6, the competent authority called upon the appellant to produce evidence if she was the real owner of the aforesaid property, and if so, to indicate the source of her income, earnings or assets out of which or by means of which she had acquired the properties." In her reply dated 5.5.1977, the appellant asserted that she was the absolute and exclusive owner of all the three properties and the same had been purchased out of her own individual income and they had nothing to do with her husband Jagannath Sharma. The competent authority, after considering the material on record passed an order under Section 7(1) of the Act on 28.7.1977 against the appellant forfeiting Bapu Nagar property. A separate order was passed against Jagannath Sharma on the same date forfeiting the other two properties. The orders were passed on the finding that though the ostensible owner of the properties was Smt. Kesar Devi but the real owner was her husband Jagannath Sharma. In appeal, the appellate Tribunal vide its order dated 26.10.1977 set aside the order and remanded the matter to the competent authority to enable the appellant and her husband to cross-examine the witnesses and also to produce such witnesses in support of their case, as they may desire. Thereafter, the competent authority, af

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2003 Supreme(SC) 697

IMPORTANT POINTUnder the scheme of the SAFEMA, there is no requirement on the part of the competent authority to mention or establish any nexus or link between the money of the convict or detenu and the property sought to be forfeited.

Cases Referred (2)

IMPORTANT POINT
Under the scheme of the SAFEMA, there is no requirement on the part of the competent authority to mention or establish any nexus or link between the money of the convict or detenu and the property sought to be forfeited.