Unexplained Delay by Central Government in Deciding Representation Vitiates COFEPOSA Detention: Rajasthan HC - 2025-05-01

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Rajasthan High Court Quashes COFEPOSA Detention Over Unexplained Delay in Deciding Representation

Jaipur: The Rajasthan High Court, Jaipur Bench, has quashed a preventive detention order issued under the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 (COFEPOSA), citing unexplained delay by the Central Government (the appropriate authority) in deciding the detenue's representation. The division bench of Hon'ble Mr. Justice Mahendar Kumar Goyal and Hon'ble Mr. Justice Ashutosh Kumar emphasized that the constitutional right to have a representation decided with utmost expedition under Article 22(5) cannot be compromised.

Case Background

The court was hearing a Habeas Corpus petition (D.B. Habeas Corpus Petition No. 22/2025) filed by Piyush Naulakha , through his wife Deepika Naulakha , challenging the detention order dated October 8, 2024. The order, passed by the Joint Secretary, Ministry of Finance, under Section 3(1) of the COFEPOSA Act, confined Mr. Naulakha to Central Jail, Jaipur.

The detention stemmed from investigations initiated based on complaints from UCO Bank in 2021 regarding alleged fraudulent overseas remittances against non-existent imports of digital services, purportedly funding gold smuggling. Mr. Naulakha was arrested in July 2024, and a prosecution complaint under the Customs Act, 1962, was filed in September 2024. The preventive detention order followed in October 2024, which was later confirmed by the Central Government for one year based on the Advisory Board's opinion.

Petitioner's Arguments

Represented by Senior Advocate Mr. Vikram Chaudhri, the petitioner argued that the detention order was vitiated on several grounds:

* Mala fides: Passed to nullify a bail order.

* Faulty Grounds: Based on non-existent grounds and coerced statements later retracted (both by the petitioner and a co-accused, Ashish Jain ).

* Unwarranted Detention: Petitioner was already in custody, and ordinary law was sufficient.

* Delay in Passing Order: Inordinate delay of nearly three years from the initial complaint snapped the live link.

* Non-Supply of Documents: Failure to supply all relied-upon documents and providing illegible copies hampered the right to effective representation.

* Variance: Discrepancy between the stated purpose (preventing future acts) and grounds (past smuggling).

* Procedural Lapses: Inconsistent stand on deciding representations vis-à-vis the Ankit Ashok Jalan case law.

* Delay in Deciding Representations: Crucially, unexplained delay by both the detaining authority and the Central Government violated the Article 22(5) guarantee.

* Discrimination: Only the petitioner was detained among multiple accused.

Respondent's Arguments

Mr. R.D. Rastogi, Additional Solicitor General, appearing for the Union of India, countered that:

* Maintainability: The petition was initially premature and later flawed for not challenging the confirmation order (preliminary objections rejected by the court).

* Validity: The detention order complied with COFEPOSA and constitutional provisions. All relied-upon documents were supplied.

* Detention Justified: Preventive detention is distinct from prosecution and permissible even if the detenue is in custody, provided the authority is satisfied about the likelihood of release and future prejudicial acts.

* No Undue Delay : The detention order was passed promptly after recent investigations (2023-24) revealed intensified activities, establishing a live link.

* Retraction Issue: Sponsoring authority was unaware of the co-accused's retraction; besides, detention was based on multiple grounds (Sec 5A COFEPOSA).

* Representation Decided Promptly: Detailed explanation provided for the time taken by the detaining authority and the appropriate government, accounting for holidays and procedural steps. Argued that Ankit Ashok Jalan did not mandate waiting for the Advisory Board in all cases.

* No Discrimination: Petitioner was the alleged 'kingpin' justifying differential treatment.

Court's Analysis and Findings

The High Court meticulously examined each ground of challenge against the backdrop of established legal principles governing preventive detention.

Preliminary Objections: Rejected, holding that strict pleading rules don't apply in habeas corpus and non-challenge of the confirmation order (based on non-reviewable Advisory Board opinion) isn't fatal.

Delay in Passing Order: Found no unexplained delay, noting the petitioner's increased activities in 2023-24 provided a proximate link.

Non-consideration of Retraction: Held the petitioner failed to substantiate that the co-accused's retraction was properly communicated. Also invoked Sec 5A COFEPOSA, stating the order could stand on other grounds.

Supply of Documents: Found no merit, stating only relied-upon documents need supply, and the illegibility claim was an afterthought.

Detention during Custody/Prosecution: Reaffirmed that preventive detention is permissible alongside prosecution and during custody if procedural safeguards and subjective satisfaction regarding future risks are met. Found the detaining authority's satisfaction regarding potential bail was based on relevant material (co-accused bail).

Discrimination/Variance/Inconclusive Investigation: Rejected these grounds based on established precedents and the specific facts.

The Crucial Finding: Delay in Deciding Representation

The court zeroed in on the timeline for deciding the representations filed by the petitioner (received Oct 18, 2024) and his wife (received Oct 21, 2024). While accepting the explanation for the time taken by the detaining authority (decision on Oct 30, 2024), the court found fatal flaws in the handling by the appropriate government (Central Government).

The court observed: > "No reason is forthcoming from the respondents as to why comments of the sponsoring authority which, on the petitioner’s representation were received on 24.10.2024 and on his wife’s representation were received on 25.10.2024, were not remitted to the appropriate government immediately thereafter and why did the respondents wait till the decision of the detaining authority on 30.10.2024 before sending the same to the appropriate government."

The court rejected the argument that deciding both representations simultaneously was necessary or justified the delay. It emphasized that the detaining authority and the appropriate government must consider representations independently and promptly.

> "Consideration of the representation by the detaining authority and by the appropriate government operates in different sphere independent to each other and both are under an obligation to decide the same with utmost expediency."

Citing Jaseela Shaji vs. Union of India (2024) , the court reiterated that Article 22(5) mandates utmost expedition, and each day's delay matters. The failure to forward the representations and comments to the appropriate government immediately, without waiting for the detaining authority's decision, constituted an unexplained delay.

Final Decision

Concluding that the unexplained delay by the appropriate government in deciding the representations was fatal to the continued detention, the High Court allowed the habeas corpus petition.

The court ordered: > "Resultantly, the habeas corpus petition is allowed. The detention order dated 08.10.2024 is quashed and set aside and the petitioner is directed to be released from detention forthwith, if not warranted in any other case."