Singh Vs. Union of India & Ors  Insc 593
(5 November 2001)
Mohapatra & Shivaraj V. Patil D.P. Mohapatra,J.
appeal, filed by special leave, by Gurdev Singh father of the detenu Swarn
Singh Sandhu, is directed against the judgment and order dated 1.12.2000 of the
Delhi High Court in Criminal Writ Petition No.352 of 2000, Gurdev Singh vs.
Union of India & Ors., dismissing the writ petition.
commencement of hearing of the case Shri V.A.Mohta, learned senior counsel
appearing for the appellant submitted that though the detenu has already
undergone the period of detention this Court may decide the legality and
validity of the Detention Order since the appellant apprehends that certain
further actions may be taken on the basis of the order of detention which has
spent its force by afflux of time.
pursuance of the detention order passed by the Joint Secretary to the Govt. of
India in the Ministry of Finance (Department of Revenue) on 2nd March, 2000 in
exercise of the power under Section 3(1) of the Conservation of Foreign
Exchange and Prevention of Smuggling Activities Act, 1974 as amended,
(hereinafter referred to as the COFEPOSA Act); Swarn Singh Sandhu was detained
and kept in custody in Central Prision, Nasik. In compliance with the
provisions of Section 3(3) of the COFEPOSA Act read with Clause (5) of Article
22 of the Constitution of India the grounds of detention dated 2nd March, 2000 along with the documents mentioned
and relied upon therein were communicated to the detenu. On receipt of the
detention order and the grounds of detention, the detenu addressed
representations to the Central Government on 5.4.2000 which were rejected on
11.4.2000. This was followed by the writ petition filed on behalf of the detenu
in the Delhi High Court which was dismissed by its judgment and order dated
1.12.2000. The said judgment/order is under challenge in this appeal.
grounds of detention covering 35 pages the detaining authority has set out in
detail the informations received from different quarters regarding misuse of
the facilities provided under the Export Incentive Scheme introduced by the
Govt. of India, Ministry of Commerce, called Duty Entitlement Pass Book (DEPB)
scheme as a part of the Export-Import Policy for the period 1997-2002. The
objective of the scheme was to neutralize the incidence of basic customs duty
on the import content of the export product. The scheme provided for credit of
duty calculated by taking into account the duty payable on the deemed import
content used in the manufacture of the export product. Under the scheme, an
exporter is eligible to claim credit at a specified percentage of FOB value of
credit is made available against the products exported as per the rates
specified in this behalf by the Director General of Foreign Trade (DGFT). Under
the scheme all items except those appearing in the negative list of imports are
allowed to be imported without payment of customs duty against the credit
available under a DEPB. The procedure specified for issue of DEPB scrips
entails submission of an application to the DGFT by the exporter along with the
original EP (Export Promotion) copy of the shipping bill against which the
exports have actually been effected and a certificate of realisation of export
proceeds (BRC) from the respective banks.
paragraph 3 of the grounds of detention it is stated by the detaining authority
that an intelligence was received by the officers of the Directorate of
Vigilance, Mumbai, indicating that certain persons/firms are misusing the DEPB
scheme by manipulating/forging the particulars of the shipping bills and
obtaining the DEPB benefit from the office of the Joint DGFT, Mumbai.
Initially, three such firms namely,
M/s.Pragati Sales Corporation were identified.
investigation made after search of the premises of these firms revealed that
one more company, namely Knomo Exports Ltd. (later changed to M/s. KEL Exports
Ltd.) was also related to exports made by the said three firms.
was a Director of Knomo Exports Ltd. (renamed as M/s.KEL Exports Ltd.). It was
further stated in the grounds of detention that investigations revealed that
the aforementioned three firms have claimed the benefit of DEPB scheme against
exports of various bulk consignments of drugs covered by 32 shipping bills.
These exports were made from the port
of Mumbai. The total FOB value of the bulk
drugs shown to have been exported under these 32 shipping bills amounted to
Rs.29,14,59,690.00 and the said amount was adjusted against the advance
remittances received by M/s.Knomo Exports Ltd. It was stated in the grounds
that all the 32 bank certificates of export realisation show that the total
foreign exchange equivalent to total FOB value has been shown to have been
received by M/s.Knomo Exports Ltd. and the detenu had signed as Director on all
these certificates. The said certificates signed by the detenu were submitted
to the office of the Joint DGFT along with the copies of the DEPB shipping
bills and accordingly DEPB scrips were issued in the name of exporters on
record. The papers submitted to Custom House, Mumbai for verification and
release of DEPB scrips revealed that one Prashant D.Divekar had signed as Proprietor
for all the three aforesaid export firms, whereas the entire foreign exchange
remittance of these exports had been received by M/s.Knomo Exports Ltd. It was
stated in paragraph 5 of the grounds of detention that on detailed examination
and verification of the 32 shipping bills against which DEPB scrips were
obtained by the detenu revealed that the particulars in the shipping bills had
been manipulated in respect of value, quantity and also in respect of names of
the manufacturing companies of the drugs. The values have been inflated by
forging the original entries in the shipping bills including the signatures of
the concerned officers as evident from the documents (i) to (xi) described in
the said paragraph. The said documents included the statement dated 30.8.1999
of the concerned appraiser Shri M.K.Srivastava who was shown to have finally
assessed the 32 shipping bills; the fax letter dated 2.11.1999 from the Asst.Commissioner,
Central Excise, Shimla; Forensic examination report of Central Forensic
Laboratories, CBI, New Delhi dated 15.12.1999 relating to sample shipping bills
of M/s.Empire Exports and M/s.Sharp Medicals. In paragraph 6 of the grounds of
detention, the detaining authority set out in detail various steps taken by the
officers of the Customs Department to ascertain the truth or otherwise of the
allegations of organised activities of the detenu, Ajay Vyas and some others in
taking advantage of the benefit of neutralization of customs duty on imports by
using large number of forged and manipulated shipping bills and altering the
description of the goods and inflating its quantity and value. In the averments
made in several paragraphs of the grounds of detention, the detaining authority
has given the results of the investigations made by the department at different
stages; statements of different persons involved in the case recorded under
Section 108 of the Customs Act, 1962; the steps taken for prosecuting the detenu
and his associate Ajay Vyas under the provisions of the Customs Act; the
unsuccessful attempts made by the detenu and his associate to get bail; the
order of conditional bail granted to the detenu and his attempt to leave Mumbai
for Delhi violating the condition in the bail order.
grounds of detention the detaining authority has also set out in detail the organised
move made by the detenu and his associates to secure similar benefits of the
customs duty in respect of 58 forged and manipulated shipping bills showing
export of garments from Nhava Sheva port in Gujarat. The FOB value of the 58
shipping bills was around 30 crores and this amount was also adjusted against
the advance remittances received by M/s.Knomo Exports Ltd. (later renamed as M/s.KEL
Exports Ltd.) All the related bank certificates of export realisation show that
the total foreign exchange equivalent of the cumulative FOB value has been
shown to have been received by erstwhile company M/s.Knomo Exports Ltd. and the
detenu has signed as Director of M/s.KEL Exports Ltd. on these certificates.
the narration of facts in the grounds of detention, it is clear that the
detaining authority has not only taken note of the allegations made against the
detenu; the materials collected by the investigating agency of the department
against him but has also taken note of the reply given by the detenu at
different stages denying the allegations and levelling counter allegations
against the officers of the department to implicate him.
paragraphs 40 and 41 of the grounds of detention, the detaining authority has stated
While arriving at the subjective satisfaction in your case I have also taken
into consideration the allegations made and pleas taken in various
representations/replies made on your behalf and on behalf of Shri Ajay Vyas.
in view of the materials placed before me, I do not find any merit in these
representations/replies and I accordingly reject them.
Out of the DEPB scrips obtained by you against the said exports in the name of
M/s.Prism Exports A/c M/s KEL Exports Ltd., on the basis of manipulations and
fraud as explained above, duty credit against four DEPB scrips have been utilised
for clearance of four consignments of imported goods without payment of duty to
the extent of Rs.53.3 lakhs approx. These four consignments were cleared in the
Chem. & Pharmaceuticals Pvt. Ltd., Mumbai
M/s.Mangalam Cement, Rajasthan,
Gargi Pvt. Ltd., Dadras (and also Mumbai) and
M/s.Enpro Speciality Chemicals Ankaleshwar, has directly resulted into evasion
of import duty for imports made against them.
paragraph 43, the detaining authority has concluded: Taking into consideration
the foregoing facts and the material on record, I am reasonably satisfied that
your activities amount to smuggling of goods as defined in Section 2(39) of the
Customs Act, 1962 and as adopted in the COFEPOSA Act, 1974 Section 2(e) thereof
since your acts and omissions have rendered the goods involved liable to
confiscation under Section 111 and 113 of the Customs Act, 1962 read inter alia
with Rule 11 and Rule 14 of Foreign Trade (Regulation) Rule, 1993, framed under
Foreign Trade (Development and Regulation) Act, 1992.
44 of the ground of detention, the detaining authority stated that in view of
the facts mentioned in the foregoing paragraphs, he had no hesitation in
arriving at the conclusion that the detenu had been engaged in smuggling goods.
Considering the nature and gravity of the offence and the well organised manner
in which the prejudicial activities had been indulged in by the detenu, his
role therein as well as his dubious conduct as brought out in the statements in
the grounds, all of which reflect his high potentiality and propensity to
indulge in such prejudicial activities in future, the authority was fully satisfied
that there was need to prevent the detenu from indulging in such prejudicial
activities in future by a detention order under the COFEPOSA Act, 1974.
main thrust of the arguments advanced by Shri V..A. Mohta, learned senior
counsel appearing for the appellant was that the order of detention was
vitiated by non- consideration of relevant materials by the detaining authority
and non-application of mind and the High Court erred in confirming such illegal
and invalid order of detention.
his contention the learned senior counsel submitted that the detaining
authority has not verified the copies of the shipping bills submitted to
different authorities in course of the transactions of export to ascertain
whether the allegations of forgery and manipulation of the shipping bills levelled
against the detenu were true or not. It was the further submission of Shri V.A.
Mohta that since the detaining authority has referred to 90 shipping bills
relating to exports from the Port at Mumbai and Nhava Sheva Port in Gujarat
sending a few samples to the forensic experts and arriving at a subjective
satisfaction that the signatures of the Asst.Commissioner of the Customs
Department and other officers borne on the shipping bills were forged suffers
from non-application of mind to the matter.
contra, Shri Mukul Rohtagi, learned Additional Solicitor General appearing for
the respondents contended that in the grounds of detention communicated to the detenu
the detaining authority has described in great detail the nature of organised
activities in which the detenu and his associates were involved; and the manner
in which they have reaped the benefit by avoiding customs duty to the tune of lakhs
of rupees by using the forged and manipulated shipping bills. In such a case it
is not necessary for the detaining authority to send each and every shipping
bill to the forensic expert for examination for arriving at a subjective
satisfaction whether the detenu should be detained under the provisions of
COFEPOSA Act. The further contention raised by Shri Mukul Rohtagi is that the
detaining authority has taken into consideration all the relevant materials
placed before him including the statements made by the detenu and his
associates; has considered all the relevant materials and has arrived at a
subjective satisfaction about the necessity of detaining the detenu under the
COFEPOSA Act in a fair and proper manner. It is the contention of Sri Mukul Rohtagi
that the order of detention warrants no interference by this Court.
case of A.Sowkath Ali vs. Union of India & Ors., (2000) 7 SCC 148, this
Court considered the contention raised on behalf of the detenu that the
detention order was vitiated as sponsoring authority placed the confessional
statements of P & I before the detaining authority but did not place their
retractions from the said confession. This Court held :
sponsoring authority should place all the relevant documents before the
detaining authority. It should not withhold any such document based on its own
opinion. All documents, which are relevant, which have bearing on the issue,
which are likely to affect the mind of the detaining authority should be placed
before it. Of course a document which has no link with the issue cannot be
construed as relevant.
the facts and circumstances of the case, this Court held :
confessional statement and the retraction, both constituting a composite
relevant fact should have been placed.
one of the two documents alone is placed without the other, it would affect the
subjective satisfaction of the detaining authority. Therefore, non- placement
of the retraction affects the subjective satisfaction of the detaining
(2000) 7 SCC 601, this Court, taking an exception to the approach of the High
Court in deciding the writ petition filed on behalf of the detenu under Section
3 of the COFEPOSA Act, 1974 held :
High Court has virtually decided the matter as if it was sitting in appeal on
the order passed by the detaining authority. The action by way of preventive
detention is largely based on suspicion and the court is not an appropriate
forum to investigate the question whether the circumstances of suspicion exist
warranting the restraint on a person. The language of Section 3 clearly indicates
that the responsibility for making a detention order rests upon the detaining
authority which alone is entrusted with the duty in that regard and it will be
a serious derogation from that responsibility if the court substitutes its
judgment for the satisfaction of that authority on an investigation undertaken
regarding sufficiency of the materials on which such satisfaction was grounded.
court can only examine the grounds disclosed by the Government in order to see
whether they are relevant to the object which the legislation in view, that is,
to prevent the detenu from engaging in smuggling activity. The said
satisfaction is subjective in nature and such a satisfaction, if based on
relevant grounds, cannot be stated to be invalid.
authorities concerned have to take note of the various facts including the fact
that this was a solitary incident in the case of the detenu and that he had
been granted bail earlier in respect of which the application for cancellation
of the same was made but was rejected by the Court. In this case, there has
been due application of mind by the authority concerned to that aspect of the
matter as we have indicated in the course of narration of facts. Therefore, the
view taken by the High Court in the circumstances of the case cannot be
supplied) In the case of Ahmed Nassar vs. State of Tamil Nadu & Ors.,
(1999) 8 SCC 473, this Court, taking a similar view, held :
conceivable material which is relevant and vital which may have a bearing on
the issue should be placed before the detaining authority. The sponsoring
authority should not keep it back, based on his interpretation that it would
not be of any help to a prospective detenu. The decision is not to be made by
the sponsoring authority.
law on this subject is well settled; a detention order vitiates if any relevant
document is not placed before the detaining authority which reasonably could
affect his decision.
supplied) In the case of Sanjay Kumar Aggarwal vs. Union of India & Ors.,
(1990) 3 SCC 309, this Court, referring to the grounds of detention, held:
therefore be seen that the detaining authority has considered the allegations
that the detenu was manhandled etc. At any rate, the detaining authority has
clearly noted that the detenu has retracted from the alleged statement,
therefore it cannot be said that there is non-application of mind in this
regard, namely, in considering the representation This Court repelled the
contention of non-application of mind by the detaining authority. Relying on
the averments made in the counter affidavit, this Court observed :
next submission of the learned counsel is that the detaining authority has not
applied his mind properly in rejecting the representation made by the detenu.
xxx It can therefore be seen that the detaining authority has considered the
allegations that the detenu was manhandled etc. At any rate, the detaining
authority has clearly noted that the detenu has retracted from the alleged
statement, therefore it cannot be said that there is non-application of mind in
this regard, namely, in considering the representation. The same principles
applies to the Advisory Board also.
to the submissions of the learned counsel, these documents were not placed
before the Advisory Board in its meeting on September 18, 1989.
statement was made by the petitioners on June 22, 1989 prior to the detention
and the grounds clearly disclose that there was retraction. It must also be
noted in this context that in the grounds in paragraph 10 also it is mentioned
that a telegram was received on June 9, 1989 alleging about the wrongful arrest
and extraction of the statements and the detaining authority has also taken
note of the allegations made against the DRI officers which were found to be
false and baseless.
same material was there before the Advisory Board. Therefore there is no force
in this submission.
case of Ashadevi wife of Gopal Ghermal Mehta (Detenu) v. K.Shivraj, Addl. Chief
Secretary to the Govt. of Gujarat & Anr., (1979) 1 SCC 222, this Court held
principle that could be clearly deduced from the above observations is that If
material or vital facts which would influence the mind of the detaining
authority one way or the other on the question whether or not to make the
detention order are not placed before or are not considered by the detaining
authority, it would vitiate its subjective satisfaction rendering the detention
order illegal. After all the detaining authority must exercise due care and
caution and act fairly and justly in exercising the power of detention and if
taking into account matters extraneous to the scope and purpose of the statute
vitiates the subjective satisfaction and renders the detention order invalid
then failure to take into consideration the most material or vital facts likely
to influence the mind of the authority one way or the other would equally
vitiate the subjective satisfaction and invalidate the detention order.
case of Ayya alias Ayub v. State of U.P. & Anr., (1989) 1 SCC 374, this
Court held :
weight the contents and assertions in the telegram should carry is an
altogether a different matter. It is not disputed that the telegram was not
placed before and considered by the detaining authority. There would be
vitiation of the detention on grounds of non-application of mind if a piece of
evidence, which was relevant though not binding, had not been considered at
all. If a piece of evidence which might reasonably have affected the decision
whether or not to pass an order of detention is excluded from consideration,
there would be a failure of application of mind which, in turn, vitiates the
detention. The detaining authority might very well have come to the same
conclusion after considering this material; but in the facts of the case the
omission to consider the material assumes materiality.
supplied) Testing the case at hand on the touchstone of the principles laid
down in the decisions noted above, we find that the subjective satisfaction
arrived at by the Detaining Authority in the case is based on consideration of
all the relevant materials placed before it by the sponsoring authority. It is
not the case of the appellant that the sponsoring authority did not place
before the detaining authority any material in its possession which is relevant
and material for the purpose and such material, if considered by the detaining
authority, might have resulted in taking a different view in the matter. All
that is contended on behalf of the detenu is that the detaining authority
should have taken further steps before being satisfied that a case for
detention under the COFEPOSA Act has been made out against the detenu. Whether
the detention order suffers from non- application of mind by the detaining
authority is not a matter to be examined according to any straight-jacket
formula or set principles. It depends on the facts and circumstances of the
case, the nature of the activities alleged against the detenu, the materials
collected in support of such allegations, the propensity and potentiality of
the detenu in indulging in such activities, etc. The Act does not lay down any
set parameters for arriving at the subjective satisfaction by the detaining
authority. Keeping in view the purpose for which the enactment is made and the
purpose it is intended to achieve, the Parliament in its wisdom, has not laid
down any set standards for the detaining authority to decide whether an order
of detention should be passed against a person. The matter is left to the
subjective satisfaction of the competent authority.
senior counsel Sri V.A.Mohta raised another contention that the detenu had
annexed to his representation certain document written in Urdu language; the
detaining authority did not take any step for translation of the said document
into English, and therefore, the said material could not be considered by the
authority concerned while disposing of the representation. The contention
raised by Sri Mohta can not be accepted. The judgment of the High Court does
not show that such a contention was raised before the Court when the case was
argued. Further, our attention has not been drawn to any material to show that
the document in question was not translated into English, or whether the
authority concerned had not perused the contents of the document. There is also
no material to show that the detenu had sought the help of the authorities to
get the document in question translated into English since that was a piece of
material which was relied upon by him in support of the representation.
facts and circumstances of the case, it is our considered view that the
contention raised on behalf of the detenu that the order of detention was
vitiated due to non- application of mind of the detaining authority, cannot be
accepted. The High Court committed no error in declining to interfere with the
detention order and in dismissing the writ petition.
the appeal, being devoid of merit, is dismissed.