2023 INSC 997 Civil Appeal No.5500 of 2011 Page 1 of 19

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL/CRIMINAL APPELLATE JURISDICTION

CIVIL APPEAL NO.5500 OF 2011

THANESAR SINGH SODHI

(D) THR. LRS. …APPELLANT S

VERSUS

UNION OF INDIA AND ORS. …RESPONDENT S

WITH

CRIMINAL APPEAL NO.730 OF 2014

SUJATA S. SHETTY …APPELLANT

VERSUS

UNION OF INDIA AND ORS. …RESPONDENT S

J U D G M E N T

VIKRAM NATH, J.

These two appeals challenge the impugned

orders of the High Court more or less on the same

and similar grounds as such have been taken up

together and being decided by this common order. In

Civil Appeal No.5500 of 2011, challenge is to an order

Civil Appeal No.5500 of 2011 Page 2 of 19

passed by the Division Bench of the Delhi High Court

dated 26.03.2010 whereby Writ Petition (Civil)

No.1212 of 1995 was dismissed confirming the order

of forfeiture of properties under section 7 of The

Smugglers and Foreign Exchange Manipulators

(Forfeiture of Property) Act, 1976

1. In Criminal Appeal

No.730 of 2014, the challenge is to an order passed

by the Division Bench of the Bombay High Court

dated 03/17.12.2012 dismissing the Writ Petition

No.3878 of 2011 wherein also the order of forfeiture

of properties under SAFEMA was upheld.

2. Before the High Court, the main ground of

challenge in both the cases was that as the detention

order passed under section 3 of the Conservation of

Foreign Exchange and Prevention of Smuggling

Activities Act, 1974

2 has been subsequently

1

SAFEMA

2

COFEPOSA

Civil Appeal No.5500 of 2011 Page 3 of 19

revoked/withdrawn as such SAFEMA proceedings

would become non est and untenable. An additional

ground taken in Civil Appeal No.5500 of 2011 was to

the effect that even the criminal complaint filed under

the Customs Act, 1962

3 wherein the appellant had

been discharged on the ground that there was no

evidence, would further render the proceedings

under SAFEMA as untenable.

3. At the outset, the arguments advanced by the

learned senior counsel for the appellant appears to

be quite attractive and forceful but when the facts

and law of the case are scrutinised, we are of the firm

view that argument has to fail resulting into

dismissal of the appeals.

4. For sake of brevity, we are reproducing the facts

of Civil Appeal No.5500 of 2011 and will briefly refer

3

The Act 1962

Civil Appeal No.5500 of 2011 Page 4 of 19

to the facts in the other Criminal Appeal No.730 of

2014.

5. An order under section 3(1) of COFEPOSA for

detaining the appellant was passed by competent

authority on 02.01.1978. The representation dated

12.01.1978 made by the appellant against the

detention order was rejected by the appropriate

authority on 15.02.1978. The appellant thereafter

preferred Cr. W.P. No.6 of 1978 before the Delhi High

Court which was dismissed by a detailed speaking

order by judgment dated 25.09.1978. This order of

the Delhi High Court dismissing Cr. W.P.No.6 of 1978

was not carried any further and became final.

6. However, wife of the appellant preferred petition

under Article 32 of the Constitution of India before

this Court on 04.10.1978 which was registered as

W.P.No.4446 of 1978. In the said petition, the

detention order dated 02.01.1978 was challenged

Civil Appeal No.5500 of 2011 Page 5 of 19

along with other ancillary reliefs. The said petition

was clubbed with group of petitions and were finally

dismissed as withdrawn by order dated 27.10.1978

passed by this Court, on the undertaking given on

behalf of the Union of India that the detention order

would be withdrawn and a complaint would be filed

for prosecuting the detenues which included the

appellant and others also. Consequent to the

undertaking given before this Court, detention order

against the appellant was revoked on 09.11.1978.

This closes the chapter relating to the detention

order, challenge to its validity and revocation.

7. On 10.02.1981, the authority under section 6 of

SAFEMA issued show cause notice to the appellant

to disclose the sources of income, earnings or assets

from which he acquired:

i) House No.2/32 A, Punjabi Bagh, New Delhi;

Civil Appeal No.5500 of 2011 Page 6 of 19

ii) M/s Apsara Hotel, Arya Samaj Road, New

Delhi; and

iii) the deposits with the Bank of India, Karol

Bagh, New Delhi.

8. Reply was given to the aforesaid show cause

notice by the appellant on 21.03.1981. After

considering the reply, notice dated 21.03.1983 was

given under section 7(1) of SAFEMA affording him

opportunity of being heard. Vide order dated

16.09.1983, the competent authority under SAFEMA

forfeited the properties under section 7 thereof.

Aggrieved by the same, the appellant preferred an

appeal before the Appellate Tribunal on 07.10.1983.

9. Simultaneously, the appellant also preferred

W.P.(Civil) No.12547 of 1983 before the Delhi High

Court on 25.11.1983 wherein it challenged the vires

of SAFEMA as also the proceedings initiated under

Civil Appeal No.5500 of 2011 Page 7 of 19

the said Act. During the pendency of the writ petition,

further proceedings before the Appellate Tribunal

under SAFEMA were stayed by the Delhi High Court.

10. In the meantime, as there was challenge to the

vires of SAFEMA before various High Courts, all such

pending matters were transferred to this Court

clubbed together with the title being Attorney

General for India vs. Amratlal Prajivandas and

others

4

. This group of petitions came to be decided

vide judgment dated 12.05.1994. This Court upheld

the vires of SAFEMA and accordingly, where appeals

were pending before the Appellate Tribunals, were

directed to be disposed of and be decided on their own

merits.

11. The Appellate Tribunal vide order dated

02.03.1995 upheld the forfeiture order passed by the

competent authority on 16.09.1983. The appellate

4

(1994)5 SCC 54

Civil Appeal No.5500 of 2011 Page 8 of 19

orders were challenged before the Delhi High Court

by way of W.P.(C) No.1212 of 1995. During the

pendency of writ petition, an interim order was

passed on 06.04.1995 staying the order passed by

the appellate tribunal on 02.03.1995. The said writ

petition came to be dismissed vide judgment dated

26.03.2010 which is impugned in the present appeal.

12. Two additional facts relating to the complaint

under the Act 1962 may also be noted here to

complete the factual scenario.

13. After the statement was given before this Court

as recorded in the order dated 27.10.1978 passed in

Writ Petition Nos.4446-4447 of 1978 for filing the

complaint for prosecution, the same was filed under

section 135(1)(b) of the Act 1962 and under section

85 of Gold (Control) Act, 1968

5. The Additional Chief

Metropolitan Magistrate, New Delhi vide order dated

5

The Act 1968

Civil Appeal No.5500 of 2011 Page 9 of 19

30.10.1981 discharged the appellant and closed the

proceedings of the criminal complaint. Further,

consequent to the said discharge, the custom

authorities vide order dated 03.08.1987 set aside the

penalties imposed against the appellant under the

Act 1962 as also the Act 1968.

14. Insofar as the Criminal Appeal No.730 of 2014

is concerned, the facts in brief are that the order of

forfeiture dated 26.06.2001 was challenged before

the Appellate Tribunal which dismissed the appeal

vide order dated 20.08.2002. Aggrieved by the same,

the writ petition was preferred before the Bombay

High Court being Crl. W.P. No.1260 of 2002 which

was dismissed on 25.11.2002 and the SLP(Crl.)

No.5558 of 2002 filed against the said order was also

dismissed on 09.01.2003 by this Court. Thereafter,

the appellant therein, filed a second petition being

W.P.No.3878 of 2011 before the High Court of

Civil Appeal No.5500 of 2011 Page 10 of 19

Bombay again challenging the same forfeiture order

dated 25.06.2001 on the ground that the order of

detention under COFEPOSA had been subsequently

revoked by order dated 11.11.2009 passed by the

Director (COFEPOSA) as such the order of forfeiture

under SAFEMA which was challenged afresh has

been untenable once the order of detention had been

revoked. The Bombay High Court dismissed the

second petition and held that no second petition

would lie for the same relief once the earlier petition

had been dismissed.

15. In the aforesaid facts of the case, learned senior

counsel appearing for the appellant has strenuously

urged with great vehemence that the impugned

proceedings under the SAFEMA could not be

maintained and the impugned orders need to be

quashed as the proceedings under COFEPOSA for

detention stands revoked and also in Civil Appeal

Civil Appeal No.5500 of 2011 Page 11 of 19

No.5500 of 2011 that even the criminal complaint

had been closed as the appellant was discharged and

further the penalty under the Act 1962 and the Act

1968 have also been revoked.

16. Learned counsel for the appellant had placed

strong reliance on section 2(2) (b) of the SAFEMA to

support his submissions that once the detention

order under COFEPOSA had been revoked, the

proceedings under SAFEMA could not be maintained.

The submission is that provisions of SAFEMA could

be made applicable only against the person in respect

of whom the order of detention has been made under

COFEPOSA. Once the order of detention itself had

been revoked for whatever reasons there would be no

order of detention against such person under

COFEPOSA and therefore, no applicability of

SAFEMA.

Civil Appeal No.5500 of 2011 Page 12 of 19

17. On the other hand, Shri Vikramjit Banerji,

learned Additional Solicitor General submitted that

the arguments advanced by the appellant are

misplaced. According to him, provisions of SAFEMA

can be invoked against the person in respect of whom

the order of detention under COFEPOSA had been

made subject to the exception given under the proviso

to section 2(2)(b) of SAFEMA. Until and unless any of

the four clauses under the proviso can be said to be

attracted to the present appellant, the appellant

cannot derive any benefit out of the same. It is only

where the revocation is for the reasons and situations

given under four clauses of the proviso that SAFEMA

would not be applicable to such a person against

whom the detention order had been passed under

COFEPOSA.

18. Mr. Banerji also submitted that the proceedings

under the Act 1962 and the Act 1968 and the

Civil Appeal No.5500 of 2011 Page 13 of 19

complaint and the withdrawal of penalty under the

said provisions also would not be of any help to the

appellant in as much as the appellant would be liable

to be proceeded with proceedings under SAFEMA as

there was an order of detention under COFEPOSA

against which representation was rejected and writ

petition before the High Court had been dismissed on

merits. The said order of the High Court had attained

finality. Any subsequent withdrawal or revocation of

the detention order which was not covered by any of

the four clauses under proviso to section 2(2) (b) of

SAFEMA, cannot be of any help to the appellant to

canvas that once an order of detention had been

revoked, the provisions of SAFEMA would become

inapplicable.

19. Primarily, the argument of the appellant is two-

fold: firstly, benefit is said to be derived from the

revocation of the detention order passed under

Civil Appeal No.5500 of 2011 Page 14 of 19

COFEPOSA and secondly, the dismissal of the

complaint and the withdrawal of the penalty under

the Act 1962 and Act 1968.

20. In so far as the second argument is concerned,

it has no relevance to the applicability or non-

applicability of the impugned proceedings and

forfeiture under SAFEMA. They were independent

proceedings under the provisions of the Act 1962 and

the Act 1968.

21. Now coming to the first argument relating to

revocation of the detention order passed under

COFEPOSA. SAFEMA was enacted to provide for the

forfeiture of illegally acquired properties of smugglers

and foreign exchange manipulators and for matters

connected therewith or incidental thereto as such

activities were having a deleterious effect on the

national economy. Section 2 provided for the

Civil Appeal No.5500 of 2011 Page 15 of 19

application of the provisions of the Act only to the

persons specified in sub -section (2) thereof.

According to sub-section (2)(b) every person in

respect of whom an order of detention has been made

under COFEPOSA, the Act would be applicable

subject to four clauses mentioned under the proviso

thereto. For the purposes of this case, the relevant

provisions are confined to Section 2(2)(b) and its

proviso. As such the same is reproduced below:

“Section 2. Application.-

Xx xx xx

(2) The persons referred to in sub-section (1) are

the following, namely:-

Xx xx xx

(b) every 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 (52

of 1974)

Provided that-

(i) such order of detention, being an order to

which the provisions of section 9 or section 12A

of the said Act do not apply, has not been

revoked on the report of the Advisory Board

under section 8 of the said Act or before the

Civil Appeal No.5500 of 2011 Page 16 of 19

receipt of the report of the Advisory Board or

before making a reference to the Advisory Board;

(ii) such order of detention, being an order to

which the provisions of section 9 of the said Act

apply, has not been revoked before the expiry of

the time for, or on the basis of, the review under

sub-section (3) of section 9, or on the report of

the Advisory Board under section 8, read with

sub-section (2) of section 9, of the said Act; or

(iii) such order of detention, being an order to

which the provision of section 12A of the said Act

apply, has not been revoked before the expiry of

the time for, or on the basis of, the first review

under sub-section (3) of that section, or on the

basis of the report of the Advisory Board under

section 8, read with sub-section (6) of section

12A, of that Act; or

(iv) such order of detention has not been set

aside by a court of competent jurisdiction;”

22. A perusal of the above quoted provision makes

it clear that apart from the four contingencies given

in clauses (i) to (iv) above, every person against whom

an order of detention has been passed under

COFEPOSA, the provisions of SAFEMA would apply.

In the present case, it is an admitted position that an

order of detention under COFEPOSA was made

against the appellants.

Civil Appeal No.5500 of 2011 Page 17 of 19

22.1. The order of detention had not been revoked

on the report of the Advisory Board or before the

receipt of the report of Advisory Board or before

making a reference to the Advisory Board. Further,

it was an order of detention passed under Section

3 of COFEPOSA. Section 9 and Section 12 A of

COFEPOSA had no application to the detention

order. As such, clause (i) would not be applicable.

22.2. Clause (ii) would also not be applicable in as

much as neither the detention order was made to

which provisions of Section 9 of COFEPOSA would

apply nor had it been revoked before the expiry of

the time on the basis of review on the report of the

Advisory Board.

Civil Appeal No.5500 of 2011 Page 18 of 19

22.3. Further, clause (iii) would also not be

applicable as Section 12A of COFEPOSA had no

application to the detention order.

22.4. Lastly, the detention order had not been set

aside by the Court of competent jurisdiction.

Therefore, clause (iv) would have no application.

23. To the contrary, in the present case against the

detention order, the appellant had made a

representation which had been rejected. Thereafter

the said order was challenged before the High Court

by way of a writ petition which had also been

dismissed on merits by a detailed order upholding the

detention order. The revocation however had been

made on a statement given on behalf of the Union of

India before this Court in order to institute a

complaint under the relevant statute. The said

revocation is not contemplated under Section 2(2)(b)

Civil Appeal No.5500 of 2011 Page 19 of 19

and its proviso, and, therefore, no benefit can be

extended to the appellant(s) on the said count.

Therefore, in our view, the impugned judgment does

not suffer from any infirmity warranting interference.

The appeals lack merit and are, accordingly

dismissed.

24. Pending application(s), if any, stand disposed of.

……………………………………J.

(VIKRAM NATH)

……………………………………J.

(AHSANUDDIN AMANULLAH)

NEW DELHI

NOVEMBER 09, 2023