COMPETENT AUTHORITY Vs. HAMEED ABDUL KADER

JUDGEMENT

(1.) This Writ Appeal, at the instance of the Competent Authority under the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976, challenges the order dated 31 March, 2009 in W. P. No. 7944/1999, quashing the proceedings initiated by the said Authority and culminated in passing an order of forfeiture of the property which was later confirmed by the Appellate Tribunal.

(2.) The first respondent along with his brother T. S. A. Omar Farooq purchased the immovable property at No. 4, Vanniar Street, Chennai by a registered Sale Deed dated 21 March, 1966. The first respondent purchased only half share and the document pertaining to the remaining half share was executed in favour of his brother. The said T. S. A. Omar Farooq was involved in smuggling activities and as such, proceedings were taken against him under the provisions of Conservation of Foreign Exchange and Prevention of Smuggling Activities Act ('for short, COFEPOSA'), which resulted in his detention. Thereafter, the appellant issued a notice to the first respondent on 16 July, 1977 to show cause as to why the properties shown in the notice should not be declared to be illegally acquired properties and forfeited to the Central Government. The notice was accompanied by a statement of reasons as provided under Section 6(l) of the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 (for short SAFEMA).

(3.) The first respondent in his explanation before the Competent Authority contended that the immovable property was purchased out of his own funds as well as loan amount obtained from his brother and remittance from a relative. Similar justification was made with respect to movable properties mentioned in the notice. The said explanation was considered by the Competent Authority. The Competent Authority was of the view that the immovable property was purchased with tainted money and, as such, the same should be forfeited to the Central Government. Accordingly, the appellant issued an order dated 24 November, 1995 under Section 7(1) of SAFEMA whereby and whereunder, the properties shown in the show cause notice were forfeited to the Central Government.