P.P. ABDULLA AND ANR. versus THE COMPETENT AUTHROITY AND ORS.

Citation: [2006] SUPP. 10 S.C.R. 983 · Decided: 14-12-2006 · Supreme Court of India · Bench: S.B. SINHA · Disposal: Appeal(s) allowed

Judgment (excerpt)

.... 
P.P. ABDULLA AND ANR. 
A 
v. 
THE COMPETENT AUTHROITY AND ORS. 
DECEMBER 14, 2006 
[S.B. SINHA AND MARKANDEY KA TJU, JJ.] 
B 
Smugglers and Foreign Exchange Manipulators (Forfeiture of property) 
Act, 1976-ss. 6 (I) and 7 (!)-Notice and consequent forfeiture ofproperty-
Propriety of-Held: Forfeiture was illegal-As there is nothing recorded in C 
writing by the Authority establishing such link or nexus between the property 
sought to be forfeited and the alleged illegally acquired money. 
Interpretation of Statutes-Interpretation of provisions of confiscation-
Held: Order of confiscation being stringent, the provisions thereof has to be 
construed strictly and the statute must be strictly complied with. 
D 
Notice was issued against appellant under Section 6 (1) of Smugglers 
and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 
for forfeiture of his property alleging that the properties purchased by 
him and the building constructed thereon attracted the provisions of the 
Act. Consequently, the concerned authority ordered forfeiture of the E 
property to the Government of India. Appellate Authority upheld the 
order of the concerned Authority. Appellant challenged the orders of the 
appellate Authorities, which was allowed by Single Judge of High Court 
holding that the orders of forfeiture could not be maintained. The appeal 
thereagainst by competent authority was allowed by Division Bench of High F 
Court. Hence the present appeal. 
Allowing the appeal, the Court 
HELD: 1. It has been expressly stated in Section 6 (1) of Smugglers 
and Foreign Exchange Manipulators (Forfeiture of Property Act, 1976) 
that the reason to believe of the competent authority must be recorded in G 
writing. In the counter-affidavit it has also been stated that the reasons 
in the notice under Section 6(1) were recorded in writing. This is not 
sufficient. Whenever the statute required reasons to be recorded in writing 
983 
H 
984 
SUPREME COURT REPORTS [2006] SUPP. 10 S.C.R. 
A then it is incumbent on the respondents to produce the said reasons before 
the Court so that the same can be scrutinized in order to verify whether they 
are relevant and germane or not. This can be done either by annexing the 
copy of the reasons along with the counter-affidavit or by quoting the reasons 
somewhere in the counter-affidavit. Alternatively, ifthe notice itself contains 
B the reason of belief, that notice can be annexed to the counter-affidavit or 
quoted in it. In the notice under Section 6(1) it has not been alleged that there 
is any such link or nexus between the property sought to be forfeited and the 
alleged illegally acquired money of the appellant. The said notice has to be 
held to be illegal. Consequently the order passed in pursuance of the said 
notice is declared as null a·nd void. (986-C-E; 986G-H; 987-A-B) 
c 
Fatima Mohd. Amina (dead) through LRs. v. Union of India and Anr., 
(2003) 7 sec 436, relied on. 
2. An order of confiscation is a very stringent order and hence a 
provision for confiscation has to be construed strictly, and the statute must 
D be strictly complied with, otherwise the order becomes illegal. In the 
present case the contents of the notice, even if taken on face value, do not 
disclose any sufficient reason warranting theimpugned action against the 
appellant as, the condition precedent for exercising the power under the 
Act did not exist. (986-E-Gl 
. E 
CRIMINAL APPELLATE JURISDICTION: Criminal Appeal No. I 318 of 
2006. 
From the final Judgment and Order dated 3 I. f.2006 of the High Court 
ofKeraia at Ernakulam in W.A. No. 1541/2005. 
F 
C.K. Sasi · for the Appellant. 
G 
Mohan Parasaran, A.S.G., B.B. Ahuja, Sahdev Singh, T.A. Khan and 
B.V. Balaram Das, for the Respondents. 
The Judgment of the Court was delivered by 
MARKANDEY KATJU,J. Leave granted. 
This appeal has been filed against the impugned judgment of the Kerala 
High Court dated 31.1.2006 in W.A. No.1541 of2005. 
H 
Heard learned counsel for the parties and perused the record. 
P.P. ABDULLA v. COMPETENT AUTHROITY [MARKANDEY KATJU, J.] 
985 
The facts of the case are that the appellant was convicted under the A 
Customs Act, 1962 in a case relating the seizure of 700 bars of foreign gold 
from him. Alleging that certain properties purchased by the appellant and the 
building constructed thereon attracted the provisions of the Smugglers and 
Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 (hereinafter 
r

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