GAYATRI AGARWAL Vs. UNION OF INDIA

JUDGEMENT

(1.) This writ petition under Article 226 of the Constitution of India for a writ of habeas corpus has been filed by the petitioner for the release of her husband Shri Sita Ram Aggarwal (hereinafter to be referred as "the detenu") who had been detained on 21/09/05 pursuant to a detention order No.673/01/2005-Cus VIII dated 05.08.2005 passed by Sh. R.K. Gupta, Joint Secretary, Govt. of India, Ministry of Finance in exercise of powers under Section 3(1) of the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 ('COFEPOSA Act' for short).

(2.) The facts leading to the passing of the detention order in respect of the petitioner"s husband as culled out from the pleadings of the parties and other material placed on record are like this: The detenu is an exporter of shawls and readymade garments. He has been carrying on the export business as a sole proprietor of M/s. GandS International, Sadar Bazar, Delhi. The detenu is alleged to have acquired during 2002-04 foreign currency of the value of over eighty crores of rupees from unauthorized sources in violation of the provisions of Foreign Exchange law. After depositing that much foreign currency in cash in his aforesaid Firm"s bank account with United Western Bank Ltd., Karol Bagh, New Delhi showing it as advance payments for export of some items from foreign tourists visiting India on the basis of forged Currency Declaration Forms(CDFs) and other forged supporting documents the detenu took certain incentives from the Government. The detenu while indulging in these activities defrauded the Government to the tune of Rs.9.5 crores under Duty Exemption Pass Book(DEPB) and about Rs.78 lakhs under Duty Drawback Schemes by way of export incentive when, in fact, no export proceeds had been received. The Duty Drawback amounts earned by the detenu clandestinely and fraudulently used to be credited in his account with Punjab National Bank, IGI Airport. In this manner the detenu had allegedly acted prejudicially to the augmentation of foreign exchange resources of the country thereby necessitating his preventive detention.

(3.) Initially the detenu was arrested by the Customs officials on 03/08/04 for violations of the provisions of the Customs Act. He had allegedly given wrong value and description of the exported shawls and garments. On completion of usual investigation, during which statement of the detenu was recorded wherein he admitted having indulged in aforesaid illegal activities, a complaint was filed in the Court of Addl. Chief Metropolitan Magistrate, New Delhi on 1/10/04 for the offences under Sections 132/135 of the Customs Act. The detenu was granted bail by this Court on 19/01/05. On 30/5/05 show cause notice was issued to him by the Customs Department. A proposal was thereafter made to the competent authority for the preventive detention of the detenu but while examining that proposal the detaining authority found that acquisition of huge amount of foreign currency by the detenu had not been investigated. Accordingly the matter was referred back for investigation into the sources of acquisition of foreign currency by the detenu. The matter was then referred to the Enforcement Directorate which was the authority to deal with violation of Foreign Exchange laws. After completion of that investigation the matter was then taken up by the detaining authority which found that the detenu"s acitivities of acquiring foreign currency from illegal sources and depositing the same in his bank by using forged CDFs etc. were prejudicial to the augmentation of foreign resources of the country and the manner in which he had been carrying on that activity showed that he had the potentiality and propensity to continue indulging in that activity unless detained preventively. That subjective satisfaction of the detaining authority led to the issuance of the detention order on 05/08/05. In the detention order the detaining authority also observed that he was satisfied that the proximity between the date of the incident and the date of issue of the detention order was maintained. Due to non-availability of the detenu at his given address the detention order could be executed on 21/09/05.