BAJRANGLAL AGARWALA Vs. COMPETENT AUTHORITY

JUDGEMENT

(1.) THE order of the Appellate Tribunal under the provisions of the Smugglers and Foreign Exchange Munipulators (Forfeiture of Property) Act, 1976 (hereinafter referred to as the 'Act') is challenged in this writ application, The said order of the Appellate Tribunal has been annexed as Annexure -2 to the writ application.

(2.) THE brief facts of the case are that the Competent Authority under the Act served a notice on the petitioner requiring the petitioner to disclose his source of income and assets out of which the petitioner has acquired the properties mentioned in the Schedule to the notice The Competent Authority has served the notice in the purported exercise of his power Under Section 6(1) of the Act. In the aforesaid notice, four items of property have been mentioned, namely, the house property situated on holding No. 120 in Ward No. 3 of Boudh Notified Area Council the assets of business carried on under the name and style of M/s. Bajrang Medical Stores situated at Boudhraj; the Life Insurance Policy No. 10628553 for Chouthmal Agarwalla of Boudh in the district of Phulbani. A copy of the notice has been annexed as Annexure -3 to the writ application. The petitioner filed his explanation to the said show cause notice indicating therein how he has acquired the aforesaid property and assets out of his own personal income and savings therefrom. The Competent Authority heard the matter and passed the final order directing forfeiture of all the proporties mentioned in the notice on a conclusion that the properties were illegally acquired. The said order of forfeiture was obviously in exercise of power Under Section 7(1) of the Act. The petitioner assailed the order of the Competent Authority by filing an appeal before the Appellate Tribunal. The Appellate Tribunal by the impugned order came to the conclusion that the initial investment of Rs. 5,000/ - in the business could not be said to be a property illegally set aside the order of forfeiture passed by the Competent Authority in respect of those two items of property. So far as the land and the building standing thereon as well as the investment of Rs. 5,000/ - which was given on loan to Chouthmal Agarwalla are concerned, the Appellate Tribunal came to hold that the petitioner had failed to establish that the sum was out of his own resources and accordingly confirmed the order of forfeiture passed by the Competent Authority in respect of those two items. It is this order of the Appellate Tribunal under Annexure -2 which is being assailed in this writ application.

(3.) BEFORE examining the correctness of the submissions made by the learned counsel for the petitioner, it would be appropriate to notice the basic object with which the Act had been enacted. Thus it appears, the Parliament anacted the Act for effective prevention of smuggling activities and foreign exchange manipulations which have a deleterious effect on the national economy. It was intended that the persons engaged in such ativites and manipulations should be deprived of their ill -gotten gains. It was also found out that such persons engaged in. smuggling activities and been holding properties in the names of their relatives, associates and confidants. The Government thought of cleaning the social fabric and resuscitating the national economy and for this purpose by making legislation wanted ito assume necessary powers to deprive such persons of their illegally acquired properties so that the smuggling and clandestine activities could be effectively prevented.