A.P.SEN - (1.) THIS petition for special leave directed against the judgment and order of the Bombay High Court dated 3/05/1986 and the connected petition under Art. 32 of the Constitution raise common questions and therefore they are disposed of by this common order. The petitioner by a petition under Art. 226 filed before the High Court prayed for the issuance of a writ of habeas corpus which is also the prayer before us for the release of her husband Mohanlal Jatia, who has been detained by an order of the Additional Secretary to the Government of India, Ministry of Finance, Department of Revenue dated 13/12/1985 under sub-s. (1) of S. 3 of the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 on being satisfied that it was necessary to detain him "with a view to preventing him from acting in any manner prejudicial to the augmentation of foreign exchange."
(2.) INTELLIGENCE gathered by the Directorate of Revenue Intelligence, Bombay was that one Subhash Gadia, the brother-in-law of the detenu Mohanlal Jatia, a very rich and prosperous businessman of Bombay, was under-invoicing the imports of yarn from Japan. On the basis of the said information the officers of the Directorate of Revenue Intelligence and officers of the Customs, Bombay searched his residential premises at A-121, Sea Lord Cuffe Parade, Colaba, Bombay under the Customs Act, 196 2/06/1985 which resulted in seizure of certain documents. As the seized documents not only revealed violation of the provisions of the Customs Act but also indicated certain payments and transactions in violation of the Foreign Exchange Regulation Act, 1973, the matter was referred to the office of the Enforcement Directorate for purposes of investigation from the angle of the Foreign Exchange Regulation Act on 24/10/1985. The aforesaid Subhash Gadia was summoned under S. 40 of the Foreign Exchange Regulation Act and his statement was recorded by R. C. Singh, an officer of the Enforcement Directorate, Bombay on 5/11/1985. In his statement of even date, Subhash Gadia stated that he went to Japan in 1970 seeking employment with a proprietary concern known as Messrs Greenland Corporation, Tolo Building, Osaka, Japan owned by a Nepali national and was engaged in exporting yarn, fibre, fabrics, chemicals etc. to India and Middle-East countries. Messrs J. M. Trading Corporation, 701, Tulsiani Chambers, 212 Nariman Point, Bombay (of which Mohanlal Jatia is a partner) are the sole-selling agents of Messrs Greenland Corporation for yarn and fibre. He further revealed that Satyanarayan Jatia, the elder brother of Mohanlal Jatia who is the partner of Messrs J. M. Trading Corporation, Bombay had been staying in Japan for some 35 years and was the sole representative of Messrs Greenland Corporation in Japan. While explaining the entries in the seized documents from his residence on 27/06/1985, Subhash Gadia admitted that the bunch marked S. G. 6 containing pages 1 to 94 are written by him in his own writing and that these contained accounts relating to his trade or business including imports and cash transactions and payments. He further confirmed that all the transactions reflected in these documents were his real business transaction dealings and some of which were not reflected in his regular account books. While explaining page 94 of the seized bunch S. G. 4, he stated that this page contained coded account in Indian rupees of his firm Messrs Piyush Corporation and that on the left side of this page credit entries were shown in Indian rupees with two zeros (00) missing and that while writing his account he had deleted two zeros in the credit side as well as debit side (right side) of the page. While decoding the codes he stated that the figure 8582/38 written on the right hand side was actually Rs. 8,58,238 and this amount had been debited against A/S investment. Further, that A/S investment was his private investment abroad in US dollars which had been utilised by him for under-invoicing of several imports etc. Paragraph 44 of the grounds of detention revealed transactions relating to the detenu Mohanlal Jatia and it is extracted : "44. When confronted with the documents seized from Subhash Gadia's residence even though you have denied any connection in respect of various unauthorised transactions between you, Greenland Corporation, Japan and others abroad, but the following documents clearly revealed that you have been indulging in various unauthorised transactions in violation of provisions of Foreign Exchange Regulation Act, 1973. JUDGEMENT_367_3_1987Html1.htm The Additional Secretary to the Government of India, Ministry of Finance, in exercise of his powers conferred by sub-s. (1) of S. 3 of the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 ('COFEPOSA') ordered the detention of the aforesaid Mohanlal Jatia by an order dated 13/12/1985 on being satisfied that it was necessary to detain him "with a view to preventing him from acting in any manner prejudicial to the augmentation of foreign exchange". The petitioner thrice approached the High Court with petitions under Art. 226 of the Constitution seeking to challenge the impugned order of detention. Immediately after the passing of the impugned order i.e. on 16/12/1985. she moved the first of these petitions being W.P. No. 2530/85 for an appropriate writ or direction to quash the impugned order of detention and applied for stay. The writ petition was admitted but stay was refused. On appeal, a Division Bench in Writ Appeal No. 1162/85 granted interim stay till the disposal of the appeal. On 28/02/1986 the Division Bench dismissed the appeal as well as the writ petition. By its subsequent order dated 4/03/1986 the Division Bench granted stay of execution up to 4/04/1986 on certain terms and conditions. The petitioner filed a petition under Art. 136 in this Court for grant of special leave being SLP No. 3742/86. The Court by its order dated 3/04/1986 dismissed the petition and ordered the detenu to appear before the Commissioner of Police, Bombay on the next day i.e. on 4/04/1986 when the impugned order of detention was to be served upon him and directed that the impugned order was to become effective. The further direction made by this Court was that the detenu should immediately be released on parole for a period of 10 days subject to certain terms and conditions. On 4/04/1986 the detenu appeared before the Commissioner of Police, Bombay when he was served with the impugned order of detention together with the grounds of detention and the relevant documents. In compliance with the direction of this Court, the detenu was released on parole. On 7/04/1986 the petitioner filed second petition under Art. 226 of the Constitution being W.P. No. 385/86 for quashing the impugned order of detention along with an application for extending the period of parole. On 14/04/1986 the parole period having expired, the detenu was taken into custody and lodged in the Central Prison, Bombay. The writ petition came up for hearing before the High Court on 18/04/1986 and admitted but the application for extending the period of parole was rejected. Aggrieved by the refusal of interim relief, the petitioner again moved this Court under Art. 136 of the Constitution which was dismissed as withdrawn.
(3.) IT appears that the impugned order of detention was mainly challenged on two grounds, namely ; (1) There was no material on which the satisfaction of the detaining authority could be reached that the detention of the detenu was necessary under S. 3(l) of the COFEPOSA with a view to preventing him from acting in any manner prejudicial to the augmentation of foreign exchange. And (2) There was total non-application of mind on the part of the detaining authority to the material on record, and in particular to the factual mis-statements contained in Para 44 of the grounds of detention as detailed in entries 'A to F'. The Division Bench of the High Court did not feel impressed with any of these submissions and by its judgment and order dated 23/05/1986 dismissed the writ petition. Thereafter, on 6/05/1986 the petitioner filed the present petition under Art. 136 of the Constitution. On 11/07/1986 she also filed a petition under Art. 32 challenging the continued detention of her husband. On 18/07/1986 the Court issued notice both on the Special Leave Petition as well as the writ petition and in the meanwhile directed that the petitioner's husband be released on parole for a week. The court by its subsequent order dated 25/07/1986 extended the period of parole till 20/08/1986. The writ petition filed in this Court on 11/07/1986 is principally based on the ground that there was failure on the part of the detaining authority to consider the alleged representation dated 11/04/1986 made by the detenu against the impugned order of detention addressed to the President of India which was presented through one Ashok Jain at the President's Secretariat on 15/04/1986 and there had thus been an infraction of the constitutional safeguards enshrined in Art. 22(5) and S. 11 of the COFEPOSA which rendered the continued detention of the detenu without the due process of law and thus illegal, unconstitutional and void. The other substantial question raised is that R. C. Singh was not a gazetted officer of Enforcement within the meaning of S. 40 of the Act and therefore the statements recorded by him could not be regarded as valid statements under S. 40 and thus did not form the basis upon which the satisfaction of the detaining authority could be reached.;