LI Network
Published on: November 14, 2023 at 13:36 IST
The Supreme Court issued a significant clarification regarding the application of the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 (SAFEMA) after the withdrawal or revocation of a detention order under the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 (COFEPOSA).
The Supreme Court bench comprising Justice Vikram Nath and Justice Ahsanuddin Amanullah, ruled that SAFEMA provisions would be applicable to individuals against whom a detention order has been issued under COFEPOSA, unless falling under the exceptions provided in the proviso to section 2(2)(b) of SAFEMA.
Section 2 of SAFEMA delineates the scope of its application, specifically addressing situations where an order of detention has been made under COFEPOSA. The proviso to section 2(2)(b) outlines four contingencies under which SAFEMA would not apply.
The case under consideration involves appeals from the Bombay and Delhi High Courts, where orders of property forfeiture under SAFEMA were upheld.
The appellants contested these decisions, arguing that, as the COFEPOSA detention order was subsequently revoked, SAFEMA proceedings were not maintainable under section 2(2)(b).
The appellant’s contention centered on the belief that SAFEMA could only be applicable when there is an existing order of detention under COFEPOSA. Once the COFEPOSA detention order is revoked, they argued, SAFEMA would not apply.
In response, the Union opposed this argument, asserting that SAFEMA would not apply only if the revocation falls under the specific conditions outlined in the four clauses of the proviso to section 2(2)(b).
The Supreme Court carefully analyzed the case and observed that, except for the contingencies listed in the proviso, SAFEMA would apply to any person against whom a detention order was issued under COFEPOSA. The court examined the case in light of these contingencies and found that none of them applied.
Considering the specifics of section 2(2)(b), the court noted that the revocation in this case was not based on the conditions specified in the proviso clauses. Instead, the revocation occurred based on a statement provided by the Union of India before the court, allowing a complaint under the relevant statute to be lodged.
Consequently, the Supreme Court found no merit in the appeals and dismissed them.
The case titles for reference are “THANESAR SINGH SODHI (D) THR. LRS v. UNION OF INDIA AND ORS (CIVIL APPEAL NO.5500 OF 2011)” and “SUJATA S. SHETTY v. UNION OF INDIA AND ORS. (CRIMINAL APPEAL NO.730 OF 2014).”
