KHANNA J. - (1.) THIS will dispose of two appeals, bearing Nos. 3 and 4/Cal/1989 moved by Shri Chandan Kumar Saha and Shri Gaur Chandra Saha, respectively. They are against two similar orders of the Competent Authority, Calcutta, under section 7(1) and (3) of the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 (hereinafter referred to as 'the SAFEMA'), forfeiting their respective balances of capital in the partnership business 'Lakshmi Bhandar', P.O. Dhubri, District Goalpara, Assam. This firm was constituted in the year 1972 with three partners, two of whom are the appellants before us and the third is Gopal Chandra Saha. Chandan Kumar Saha had then introduced Rs. 31,900 as his capital in the partnership while the investment of Gaur Chandra Saha was Rs. 34,100. They have been assessed to income -tax ever since. At no stage was the genuineness of these investments disputed by the Income -tax Officer.
(2.) THE assessment orders for the initial years filed before us show that they were under section 143(1) of the Income -tax Act. Subsequently, the assessments were said to be under section 143(3). The appellants have, however, filed copies of their submissions in writing made on May 17, 1974, before the Income -tax Officers in which they had explained as per the Income -tax Officers verbal enquiry regarding the deposit of capital amounts, that they had been withdrawn from their individual books of accounts and they were assessed earlier also individually. These writings thus bring out that the Income -tax Officer did make enquiries about the source of these investments, though he still chose to make the assessments under section 143(1). The ground on which the proceedings under the SAFEMA were initiated was that Gopal Chandra Saha, the third partner in Lakshmi Bhandar, was detained under the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act on November 5, 1975, and this detention was revoked by the Government and he was released on March 22, 1977, on the lifting of the Emergency. The Competent Authority, therefore, felt that both the appellants being partners of the said firm, Gopal Chandra Saha, the detenu fell within the mischief of the term 'person' under section 2(2)(b) of the SAFEMA against whom forfeiture proceedings could be taken. Notices under section 6(1) of the SAFEMA were issued on January 11, 1978, after recording in writing that he was satisfied that these were fit cases for their issue of those notices.
(3.) THE records of the proceedings of the Competent Authority show that the counsel for the parties appeared in the proceedings and filed explanations. The Competent Authority recorded on March 29, 1978, that the cases were partly heard and the matters adjourned to April 22, 1978. The proceedings on the adjourned date show that the cases were adjourned to May 6, 1978, giving another opportunity to lead evidence. No hearing was held on May 6, 1978, and, thereafter, for more than ten years, the cases were kept in cold storage. They were again revived on May 16, 1988, by another incumbent of the office of the Competent Authority who, after observing that he had gone through the records and considered the materials available, and having applied his mind and agreed with the reasons recorded by the earlier Competent Authority, which led to the issue of notices under section 6(1), decided to continue the proceedings from the stage at which they were left by his predecessor.;