Bhuramal Choraria v. Chief Enforcement Officer — 1977 DIGILAW 15 (CAL)

JUDGMENT The judgment of the Court was as follows :–– In this writ application the petitioner has challenged, inter alia, the validity of an order dated April 3, 1974 passed by the Chief Enforcement Officer, Respondent No. 1 whereby the petitioner has been arrested under Section 35 of the Foreign Exchange Regulation Act, 1973 hereinafter described as "the said Act" on the same day at the latter's office in Calcutta. He has also challenged the order of the Deputy Director of Enforcement, Calcutta dated June 3, 1975 imposing a penalty of Rs. 500/- on the petitioner under Section 50 of the Foreign Exchange Regulation Act, 1973. The facts of the case may, briefly be stated as follows : 2. On November 12, 1957, the petitioner left India for United Kingdom and permanently settled there with his family. The petitioner was a partner of a firm M/s. Bhuramal Manikchand in which the only other partner was the elder brother Punam Chand Choraria. On January 24, 1958, the said partnership firm was dissolved. His brother, however, continued the business of the said partnership firm in the firm name along with others. On January 21, 1960, the petitioner was granted British citizenship, on April 29, 1961 the respondents issued a notice to show-cause in connection with an offence punishable under the Foreign Exchange Regulation Act, 1947. The said notice was issued against the said firm and its partners. The petitioner, however, has denied the service of the said notice on him. On January 7, 1974, the petitioner came to Bombay and among other places he visited Calcutta and was staying at the residence of his said brother at 1, Minto Park, Calcutta. On February 15, 1974 search took place at the instance of the respondents at the said house. On the following day the petitioner left Calcutta for Rajasthan. On or about February 16 and 18, 1974, the Deputy Director of Enforcement issued summonses to the petitioner under Section 40 of the Foreign Exchange Regulation Act, 1973 directing him to appear before the Enforcement Directorate at 8, Lindsay Street, Calcutta together with evidence in connection with said search of his brother's house on February 15, 1974. As the petitioner was not available the said two summonses were served on his said brother. As the petitioner was not available the said two summonses were served on his said brother. It is alleged that copies of the said two summonses were affixed at the said premises No.1, Minto Park, Calcutta, being the last known address of the petitioner. On February 21, 1974, a show-cause notice was issued for alleged disobedience of the said two summonses but the said show-cause notice also could not be served on the petitioner personally. On March 31, 1974, the petitioner was returning to England when he was interrupted at Palam Airport, Delhi. His passport was seized along with two amounts of £ 280 and Rs, 62/-. There he was asked to attend the office of the Enforcement Directorate at 8, Lindsay Street, Calcutta. On April 2, 1974, the petitioner came to Calcutta and attended the said office. On the following day, he again came to the said office for replying to the interrogatories but he was arrested under the said impugned order on April 3, 1974. On April 4, 1974, the petitioner was produced before the Chief Metropolitan Magistrate, Calcutta and was released on bail. On April 6, 1974 another notice was issued alleging that the petitioner had not replied to the show-cause notice dated 21.2.74. On April 10, 1974, the petitioner filed an application before the Deputy Director, Enforcement Branch, praying for proper service of the show-cause notice dated 21.2.74 and for an opportunity to show-cause. His application was allowed and a notice was served on him. On April 27, 1974, the petitioner submitted to the Deputy Director of Enforcement a reply to the purported show-cause notice dated February 21, 1974. On June 3, 1975, the Deputy Director, Enforcement Directorate, Calcutta after hearing the petitioner held that the petitioner flouted the summons dated 16.2.74 issued under Section 40 of the said Act deliberately and imposed a penalty of Rs. 500/- on the petitioner under section 50. On June 15, 1974 a show-cause notice was issued by the Assistant Collector, Palam Airport, regarding the said two sums which had been seized at Palam Airport. On July 22, 1974 fresh summons was issued by the Chief Enforcement Office for the alleged non-compliance of the two summons dated 16.2.74 and 18.274 requiring the petitioner to give evidence in connection with some allegation against Punamchand Choraria. On July 22, 1974 fresh summons was issued by the Chief Enforcement Office for the alleged non-compliance of the two summons dated 16.2.74 and 18.274 requiring the petitioner to give evidence in connection with some allegation against Punamchand Choraria. On July 29, 1974 the petitioner appeared before the Chief Enforcement Office and replied to the questions put to him by the latter. On September 13, 1974 the petitioner replied to the above show-cause notice dated June 15, 1974 in connection with the seizure of the said two amount; at Palam Airport. On October 9, 1974, the petitioner was detained under the Maintenance of Internal Security Acts, 1971 and 1974 and thereafter on December 19, 1974 an order of detention under the Conservation of Foreign Exchange and Prevention of Smuggling Articles Act known as Cofeposa. On December 3, 1974, the Asstt. Collector of Customs (Palam Airport) confiscated the said two amounts and imposed a fine of Rs. 1500/-. On October 27, 1975, the petitioner made an application in the Court of the Chief Metropolitan Magistrate in connection with the impugned order of arrest dated 3.4.74, stating that no complaint was filed in connection with the proceeding in which he was arrested on April 3, 1974. 3. It may be stated here that an appeal was preferred by the petitioner against the said order of imposition of penalty dated June 3, 1975 before Foreign Exchange Regulation Appellate Board. On October 15, 1976, the Appellate Board decided in favour of the petitioner to the following effect: "The result is that the department has failed to establish that the appellant had knowledge of the order requiring him to comply with it. The imposition of a penalty under section 50, therefore, cannot be justified. The appeal is allowed and the impugned order set aside." 4. It appears from a document produced by the Counsel for the petitioner during the hearing of this matter that the Registrar, Foreign Exchange Regulation Appellate Board has communicated two copies of the Board's order to the Director of Enforcement and Deputy Legal Advisor at 402, Rohit House, 3, Tolstoy Marg, New Delhi. There is nothing to show that any appeal or revision has been preferred by the respondents against the said decision of the Board. 5. The matter again appeared before the Chief Metropolitan Magistrate. There is nothing to show that any appeal or revision has been preferred by the respondents against the said decision of the Board. 5. The matter again appeared before the Chief Metropolitan Magistrate. The learned Magistrate reserved his order till November 24, 1975 when he passed an order refusing to discharge the petitioner and again fixed the matter for hearing on December 26, 1975. On December 18, 1975, the petitioner moved this application challenging the validity of the said two impugned orders dated 3.4.74, 3.6.75 and November 24, 1975. 6. Mr. Deb and Mr. Ginwulla, Counsel for the petitioner have strenuously argued that the order dated 3.4.74 is an invalid order in the facts and circumstances of this case but has not laid stress on the invalidity of the order dated June 3, 1975 in view of the fact that the Foreign Exchange Regulation Appellate Board has set aside the said other dated 3.6.76. Similarly, they did not challenge the validity of order dated November 24, 1965, inasmuch as the Chief Metropolitan Magistrate who passed the said order has not been impleaded. 7. Mr. Deb has contended that the three grounds mentioned in the impugned order dated April 3, 1974 cannot be sustained in law on the face of the records. The relevant portions of the said impugned order read as follows: "Whereas I have reason to believe that you are guilty of an offence punishable under section 50 and section 56 of the Foreign Exchange Regulation Appellate Act, 1973, for non-compliance of two summons dated 16.2.74 and 18.2.74 issued under section 40 of the said Act. Whereas I have further reason to believe that you are guilty of an offence punishable under Foreign Exchange Regulation Act consequent on seizure from your person illegal foreign exchange and some Indian currency on 31.3.74 while you were attempting to leave the country. Whereas I have every reason to believe that you are guilty of an offence punishable under Foreign Exchange Regulation Act, 1947, vide show-cause notice No. 2(100)-E.N.F. III/57(IX) dated 29.4.61 to which you have not yet replied. Now, therefore, in exercise of the powers conferred on me under Section 35 of the Foreign Exchange Regulation Act, 1973, I hereby put you under arrest on this Third day of April 1974 at 5-45 p.m. from 8, Lindsay Street, Calcutta-16 (New Market). Sd. Now, therefore, in exercise of the powers conferred on me under Section 35 of the Foreign Exchange Regulation Act, 1973, I hereby put you under arrest on this Third day of April 1974 at 5-45 p.m. from 8, Lindsay Street, Calcutta-16 (New Market). Sd. S. C. Ghosh 3.4.74 Chief Enforcement Officer Enforcement Directorate, Cabinet Secretariat, Department of Personnel, Govt. of India, Calcutta". 8. Referring to the grounds set out in this said order, Mr. Deb has submitted that as the allegation of non-compliance of the said two summonses dated 16.2.74 and 18.2.74 has been rejected by the said Appellate Board the petitioner cannot be held guilty of an offence punishable under Sections 50 and 56 of the said Act. On the second ground it is urged that the possession of the said sums of £ 280 and Rs. 62/- seized from him at the Palam Airport is not an offence punishable under the said Act, inasmuch as Sections 50 and 56 of the said Act have expressly excluded the offences under section 13 of the said Act which alone prohibits any person to take out Indian or foreign currency out of India without the written permission of the Reserve Bank of India. With respect to the third ground he has contended that the petitioner cannot be punished under the Foreign Exchange Regulation Act, 1947 inasmuch as the show-cause notice sated 29.4.61 was not served upon the petitioner and that the said 1947 Act has been repealed on January 1, 1974. Relying upon (1) Dwarika Prasad Sahu v. The State of Bihar & Ors., AIR 1975 Supreme Court 134, he has submitted that if either of the said three grounds or some them are erroneous, the order must be struck down. 9. In my view, the arguments of Mr. Deb, though attractive, cannot be accepted. The petitioner has been arrested under Section 35 of said Act of 1973, relevant portions of which are as follows :–– "Power to arrest : (1) If any Officer of Enforcement authorized in this behalf by the Central Government, by general or special order, has reason to believe that any person in India or within Indian Customs water has been guilty of an offence punishable under this Act, he may arrest such person as soon as he informs him of the ground for such arrest. (2) Every person arrested under sub-section (1) shall without unnecessary delay be taken to a Magistrate................................." 10. In this section the words "any person" have been used and, therefore, the petitioner cannot get immunity because he holds British Passport. Secondly, under this Section the Enforcement Officer may arrest a person if "he has reason to believe that such person has been guilty of an offence punishable under this Act". The words "has reason to believe" have been used in various statutes, such as, the Customs Act and the Income Tax Act. The question, therefore, arises persuade a reasonable man to believe that he has been guilty of such an offence. The adequacy or sufficiency of those objective facts cannot be subject of judicial review of the stage of his arrest under section 35. The Court will have to find out if there are enough materials on the basis of which a reasonable man can believe that the arrested man has committed such offence. There is no question of holding such person guilty at the time when he is arrested. Immediately, after the arrest he may be released on bail, as has been done in this case. Section 35 is only an empowering section to arrest a person if such offence is reasonably believed to have been committed. Arrest under this section is not an arrest after conviction. Obviously, the arrest is made under this section for investigation or for enquiry as to the fact whether the grounds for his arrest are reasonable or not. Reliance may be placed upon the observation of the Supreme Court in (2) Ramesh Chandra Metha v. The State of West Bengal, AIR 1970 SC 940 , 950 para 26. In my view, the conditions that are required for an arrest under section 35 are as follows :–– (a) The Enforcement Officer is duly authorized by the Central Government; (b) The Officer has passed a general or special order; (c) The Officer has reason to believe that the arrested person has been guilty of an offence punishable under this Act. (d) Such person after arrest shall without delay be taken to a Magistrate. 11. The main contention of Mr. Deb is that the Enforcement Officer has not complied with the third condition. As stated above, according to him, the three grounds mentioned in the impugned order dated 3.4.1974 cannot be sustained. (d) Such person after arrest shall without delay be taken to a Magistrate. 11. The main contention of Mr. Deb is that the Enforcement Officer has not complied with the third condition. As stated above, according to him, the three grounds mentioned in the impugned order dated 3.4.1974 cannot be sustained. It is, therefore, necessary to examine these grounds. The case of the respondent is that the Enforcement Officer under Section 40 of the said Act summoned the petitioner whose attendance, he considered necessary to give evidence in connection with certain alleged contravention of the provisions of the said Act. Admittedly, the petitioner was in Calcutta at the residence of his brother Puran Mal Choraria at 1, Minto Park, Calcutta. A search took place on February 15, 1974 at the said premises. Immediately thereafter, two summonses were issued directing him to appear before the Enforcement Directorate at 8, Lindsay Street, Calcutta. The ease of the petitioner is that those summonses were never served on the petitioner and he left Calcutta on February 16, 1974. It is true that the said summons could not be served personally on the petitioner. A letter was delivered to the said Poonam Chand Choraria, the elder brother of the petitioner with whom the petitioner was staying at the said premises. The petitioner did not attend before the Chief Enforcement Officer on 18.2.74 as required under the said letter or summons. Another summons was issued directing the petitioner to appear before the Enforcement Officer on 19.2.74. The said summons was also handed over to his said brother. A copy of that said summons was affixed at the main entrance of the said premises. Another show-cause notice dated 21.2.74 though not mentioned in the impugned order was issued and served on the petitioner by affixation at the main entrance of the said house. The petitioner was detained at the Palam Airport on 31.3.74 when he was trying to leave India. The Enforcement Officer, therefore, had good reasons to believe that he was avoiding to receive the said summons. It was natural for his elder brother to inform the petitioner about the said two summonses. There is nothing to show that the petitioner left Calcutta on the 16.2.74 for Rajasthan. The Enforcement Officer, therefore, had good reasons to believe that he was avoiding to receive the said summons. It was natural for his elder brother to inform the petitioner about the said two summonses. There is nothing to show that the petitioner left Calcutta on the 16.2.74 for Rajasthan. It has been contended that the petitioner had no knowledge of such summons and as such, the petitioner could not be held liable for non-compliance with the provisions of section 40 of the said Act. Reference has been made to Rule 3 of the Foreign Exchange Regulation Rules, 1974. This Rule provides that the direction, order or notice shall be served firstly by delivering or tendering to that person or to his duly authorized agent. If it has not been possible to do the same then the service has to be done by sending the same by registered post with acknowledgment due at the last known place of residence. It is also stated in the Rule that if the person cannot be served in any of the manners as aforesaid the service can be effected by affixing such direction, order or notice on the outer door of the premises in which the person resides. It is submitted that as in this case no letter was sent to the petitioner by registered post, service by affixation hall not been validly made. The facts of this case show that the petitioner was in Calcutta on the 15th and he has been temporarily staying at his elder brother's residence in Calcutta. The Enforcement officers are concerned with a person who lives in England and has come to India for a short time. As his elder brother was not co-operating with the enforcement authorities in informing the petitioner about the summonses, it was futile for the enforcement authorities to serve formally the said notice by registered post. The whole object of serving a summons or notice is whether the petitioner had knowledge of such summonses or letters. The petitioner is suspected to be guilty of very serious anti-social activities. In fact, he was a partner of M/s. Bhuramal Manikchand prior to 1957, in which his said brother was also a partner. The whole object of serving a summons or notice is whether the petitioner had knowledge of such summonses or letters. The petitioner is suspected to be guilty of very serious anti-social activities. In fact, he was a partner of M/s. Bhuramal Manikchand prior to 1957, in which his said brother was also a partner. It is true that he could have been served by registered post but in the facts of this case serving the summons or notice by registered post would defeat the purpose and would be an empty formality. 12. It may be stated here that the Deputy Director of Enforcement passed an order imposing a penalty of Rs. 500/- on June 3, 1975, on the petitioner for not complying with the said two summonses. The petitioner preferred an appeal to the Appellate Board under section 52. On October 15, 1976 the imposition of the said penalty was set aside. It is, therefore, contended that as the Appellate Board held that the petitioner had no knowledge of the said two summonses the first ground set out in the impugned order is non-existent. The said ground was mentioned in the impugned notice dated April 3, 1974 and, therefore, the arrest was wrongly made on this ground as the Appellate Board decided in favour of the petitioner on October 15, 1976. 13. Mr. Chakraborty, Counsel for the respondents, has, however, submitted that the said decision of the Appellate Board is wrong and the respondents intend to prefer an appeal against the said decision of the Board. He has added that an appeal to the High Court against the said order has not been barred as yet. But be that as it may, the decision of the Appellate Board should not be ignored. It is not proper for the Court to ignore the findings of the statutory Appellate Board at this stage until such decision is challenged in accordance with law. Thus, strictly speaking, I agree with Mr. Deb that the first ground although a good ground on April 3, 1974 cannot be held to be so now. 14. On the second ground, it has been contended that in the facts of this case the petitioner cannot be held guilty of an offence under the Foreign Exchange Regulation Act, 1973. Thus, strictly speaking, I agree with Mr. Deb that the first ground although a good ground on April 3, 1974 cannot be held to be so now. 14. On the second ground, it has been contended that in the facts of this case the petitioner cannot be held guilty of an offence under the Foreign Exchange Regulation Act, 1973. It is stated that the foreign exchange seized from the petitioner at Palam Airport might be said to be a technical offence under Section 13(2) of the said Act but the penalty section of the said Act, i.e. Sections 50 and 56 have excluded the offences under section 13. It is, therefore, submitted that the second ground cannot be held to be a good ground for his arrest inasmuch as the petitioner has not committed any offence under the said Act. It is true that an arrest could only be made under section 35 if the petitioner "is guilty of an offence punishable under the said Act". It is, therefore, to be decided whether the enforcement authorities had reason to believe that the petitioner committed an offence under the said Act. It appears from the Preamble to the Act of 1973 that this Act was passed to consolidate the law relating to that transactions effecting foreign exchange export of currency for the conservation of foreign exchange reserve in the interest of its economic development. Section 13(2) specifically sets restrictions on a person to take out of India any foreign or Indian currency except with the permission of the Reserve Bank of India. Obviously any person taking out any such Indian or foreign currency without the permission of the Reserve Bank is committing an offence. Section 8 and section 9 of the said Act deals with restrictions on dealing in foreign exchange and restrictions on payments respectively. Sections 8 and 9 have not been excluded from the penalty provisions of sections 50 and 56. In any event, it cannot be said that the enforcement authorities had no reasonable ground to believe that the petitioner had been guilty of an offence under the said Act. Thus even assuming that the offence has been committed in this case under section 13(2) only, even then, in the facts of this case the enforcement authorities cannot be said to have believed unreasonably that he was guilty of offence under the said Act. Thus even assuming that the offence has been committed in this case under section 13(2) only, even then, in the facts of this case the enforcement authorities cannot be said to have believed unreasonably that he was guilty of offence under the said Act. In this connection, reference may be made to the various notifications that have been published under the said sections 8 and 9 whereby nobody was allowed to deal with foreign currency except with the permission of the Reserve Bank of India. 15. There is another reason why Mr. Deb's contention cannot be accepted. In view of the preamble, how is it possible that the legislators have excluded the provisions for penalty in respect of offences under section 13 from the ambit of sections 50 and 56. The answer to this question would be found in section 67 which reads as follows :–– "67. Application of Customs Act, 1962 : A restriction imposed by or under Section 13, clause (a) of sub-section (1) 18 and clause (a) of sub-section (1) of section 19 shall be deemed to have been imposed under section 11 of the Customs Act, 1962 (LII of 1962) and all the provisions of that Act shall have effect accordingly" It is clear from section 67 of the Act of 1973 that the restrictions or prohibitions in section 13 are to be construed as restrictions or prohibitions under section 11 of the Customs Act, 1962. This section also has expressly set out that all the provisions of the Customs Act shall be operative in such a case. Section 11 of the Customs Act set out restriction in respect of the prevention of smuggling, conservation of foreign exchange and safeguarding of balance of payment, and the import or export of goods of any specified description. The word "goods" in section 2(22) of the Customs Act includes currency. 16. Section 113 of the Customs Act, 1962 provides for confiscation of foreign currency attempted to be improperly exported. Section 114 of the Customs Act deals with imposition of fine for any prohibition in respect of such currency. The word "goods" in section 2(22) of the Customs Act includes currency. 16. Section 113 of the Customs Act, 1962 provides for confiscation of foreign currency attempted to be improperly exported. Section 114 of the Customs Act deals with imposition of fine for any prohibition in respect of such currency. Analogous to section 56 of the Foreign Exchange Regulation Act, 1973, section 135 of the Customs Act also provides that without prejudice to any action that may be taken under the Customs Act, such as, imposition of fine, the offender shall be also punishable in a Court of law where he might be sent for imprisonment after conviction. The scheme of the Foreign Exchange Act and the Customs Act is substantially same in respect of any restriction or prohibition to export foreign currency outside India. It is clear from the relevant sections of both the said two Acts that after service of the notice to show-cause the adjudication proceedings are initiated and the authorities or the officers concerned have got the power to arrest on offender under section 35 and section 104 of the Foreign Exchange regulation Act, 1973 and the Customs Act, 1962 respectively. It is clear that after the adjudication proceedings if the authorities or such officers are satisfied penalty or fine may be imposed on the offender under section 50 and section 114 of the said Foreign Exchange Regulation Act and Customs Act respectively. Similarly, in both the Acts a complaint may be filed in a criminal court if the authorities or officers concerned are satisfied that the offence committed is of a very serious nature. Section 61(2) of the Foreign Exchange Regulation Act, 1973, provides that no Court shall take cognizance of any offence punishable under section 56 or section 57 except upon complaint in writing by the Officer concerned provided that no such complaint shall be made unless the offender has been given an opportunity of showing that he had the permission to export such currency from the Reserve Bank of India. Under Section 137 of the Customs Act, however, the Court shall not take cognizance of any offence under section 133 or section 134 of the said Act except with the previous sanction of the Collector of Customs. Under Section 137 of the Customs Act, however, the Court shall not take cognizance of any offence under section 133 or section 134 of the said Act except with the previous sanction of the Collector of Customs. All these facts indicate that arrest under section 35 of the Foreign Exchange Regulation Act, or section 104 of the Customs Act, empowers the authorities to arrest a person for the purpose of investigating the facts and circumstances in relation to the offence. Thus, "Arrest" under section 35 of the Foreign Exchange Regulation Act is only made as a preliminary step for investigation or adjudication. At this stage, there is no question of filing a complaint in a criminal court. The contention that although a complaint has not been filed in a criminal court, the petitioner is being harassed by continuing the criminal proceedings cannot therefore be accepted. The only statutory obligation under S. 35(1) of the Foreign Exchange Regulation Act is that the person arrested under the said sub-section shall without unnecessary delay be taken to a Magistrate. In this case, the petitioner was duly placed before the Magistrate who subsequently granted him bail. It is, thus, clear that the words "offence punishable under this Act" is not limited to the provisions in Sections 50 and 56 of the said Act. The offence committed under Section 13(2) of the said Act, though excluded under sections 50 and 56, would be deemed to be an offence under section 67 of the Foreign Exchange Regulation Act. The result is that by legal fiction the words in section 35 of the said Act, "offence punishable under this Act" would also include the offence under the provisions of the Customs Act. 17. Mr. Deb has next contended that on December 3, 1974, by an order in respect of the show-cause notice dated 15th June, 1974, the Assistant Collector (Air Customs) New Delhi, confiscated the seized currency and imposed a penalty of Rs. 1,500/- on the petitioner. It is, therefore, argued that as the petitioner has already been penalized under the Customs Act criminal proceedings before the Magistrate should be quashed. This contention also has to be rejected. It may be stated here that the petitioner preferred an appeal against such order to the Collector of Customs who, on September, 6, 1975 dismissed the appeal. It is, therefore, argued that as the petitioner has already been penalized under the Customs Act criminal proceedings before the Magistrate should be quashed. This contention also has to be rejected. It may be stated here that the petitioner preferred an appeal against such order to the Collector of Customs who, on September, 6, 1975 dismissed the appeal. The petitioner, thereafter, challenged the said appellate order by way of revision petition under section 131 of the Customs Act, 1962 before the Central Government which is still pending. Thus, the dispute as to the imposition of fine has not yet finally settled. But, as the adjudication proceeding is not complete and investigation is going on, the enforcement authorities are also entitled to proceed against the petitioner under section 56 of the Foreign Exchange Act and under section 135 of the Customs Act also, if they are so satisfied inasmuch as those sections can be attracted, without prejudice to the award of penalty. 18. It is not correct to say that the petitioner has committed only a technical offence under section 13(2) of the Foreign Exchange Regulation Act, inasmuch as the petitioner without the written permission of the Reserve Bank of India attempted to take £ 280 out of foreign currency which he had brought from England. It is to specific section under which the petitioner is alleged to have committed an offence under the Foreign Exchange Regulation Act. The facts and circumstances, disclosed in paragraph 17 of the affidavit, affirmed by Bejoy Gopal Sen on 25.2.76 show that the petitioner was involved in the criminal conspiracy case No. 1/w/62 before the Judicial and Presidency Magistrate, Bombay, relating to Smuggling and dealings in foreign exchange. It also appears from paragraph 4 of the said affidavit that the petitioner came to the adverse notice of that British authorities in connection with diamond smuggling and illegal transfer of money to the Middle East from the London Banks. There is also allegation that the petitioner had the major control of illegal financing from India, foreign exchange racket, gold smuggling or drug smuggling. It is quite possible that all these allegations are frivolous and based on suspicion. But, in my opinion, these facts clearly show that the petitioner is not a stranger to the Indian authorities and has been previously involved in a serious economic offence. It is quite possible that all these allegations are frivolous and based on suspicion. But, in my opinion, these facts clearly show that the petitioner is not a stranger to the Indian authorities and has been previously involved in a serious economic offence. It is premature to say that the petitioner is guilty of any offence under the Foreign Exchange Regulation Acts 1947 and 1973. But in my opinion, the authorities had good reasons to arrest him for the purpose of investigating all relevant facts of such offence. 19. The last ground of arrest as set out in the impugned order is that the petitioner has committed an offence punishable under the Foreign Exchange Regulation Act, 1947 in relation to a show-cause notice dated 29.4.61 to which the petitioner is alleged to have not replied. I am satisfied that there is no substance in this connection. It has been alleged that the said show-cause notice dated 29.4.61 has not, been served at all as the petitioner was in London at that time. It is difficult to believe that the petitioner had no knowledge about the said notice when the impugned order was passed on April 3, 1974 the petitioner should have immediately replied by a letter complaining that no such letter or notice was served on him. In fact, the records show that the petitioner's lawyer wrote a letter to the Customs authorities on July 22, 1976 where he had admitted that the said notice was served on him. A copy of the said notice dated 29.4.61 has been examined by me. It appears that the said notice has been addressed to the partners of Bhuramal Manikchand of 4, Dohihatta Street, Calcutta, to which the petitioner amongst others has been described as a partner. The petitioner has annexed a document to his petition which show that the said partnership firm was dissolved on August 26, 1958. He has admitted that he was the partner of the said firm in 1957 when the said firm attempted to make payment of 3757 U.S. Dollars and 695 pounds to various persons residents outside India. The said notice and paragraph 17 of the affidavit of Bridhi Chand Surana also show that the petitioner has committed an offence under section 5(1)(c) and section 9 of the Foreign Exchange Regulation Act, 1947. The said notice and paragraph 17 of the affidavit of Bridhi Chand Surana also show that the petitioner has committed an offence under section 5(1)(c) and section 9 of the Foreign Exchange Regulation Act, 1947. It is true that the partnership firm was dissolved but the offence has been alleged to have been committed by the firm and its partners in 1957 when the petitioner was a partner. The fact is that the search of the offices of the said firm specifically denied in para (vii) and para (xv) of petitioner's reply dated 19th September, 1974, in reply to show-cause notices dated 21st August 1974 vide Annexure "A" to affidavit of the said Surana affirmed on 4th March, 1976. Further, the question whether such notice was served on him or not is a question of fact which cannot be decided in this Court. But there is no doubt that authorities had materials before them to show that the petitioner was guilty of an offence under the Foreign Exchange Regulation Act, 1947. 20. The contention that as the offence having been committed under the Act of 1947 which has been repealed by the Act of 1913, the third ground of arrest is invalid in law. This contention also must be rejected. Section 81 sub-clause (2) of the Foreign Exchange Regulation Act, 1973 clearly provides that notwithstanding the repeal of the Foreign Exchange Regulation Act of 1947 anything done or any action taken or purported to have been done or taken under the Act repealed, shall in so far as it is not in consistent with the provisions of 1973 Act, be deemed to have been done or taken under the corresponding provisions of the 1973 Act. Mr. Deb, however, has contended that this sub-section has only validated actions taken by the enforcement authorities and not acts committed by the petitioner, prior to the repeal. The reply to this contention is that the notice to show-cause was issued by the authorities as early as 1961 and, as such, the adjudication proceedings against the petitioner were duly initiated, according to the petitioner, he was in England at that time. But be that as it may, the adjudication proceedings against the petitioner was duly commenced by the authorities. But be that as it may, the adjudication proceedings against the petitioner was duly commenced by the authorities. But although other partners of the said firm were duly convicted the proceedings could not be continued against the petitioner as he was not available in this country. I am, therefore, of opinion that the third ground is a reasonable ground for the arrest of the petitioner. Relying upon Dwarika Prasad Saha (supra), Mr. Deb has contended that if one of the three grounds in the impugned order can be shown to be invalid in law the entire order should be struck down. In the Supreme Court case, person was detained under the Maintenance of Internal Security Act where the officer concerned was satisfied that the accused there was properly detained on several grounds. Bhagwati, J. has held that under the said Act the decision was subjective. It was difficult for the court to say which of the grounds have persuaded the authorities to detain him. Obviously, this case was decided on the language of the said Act where the decision of the authorities was based upon his mental assessment on all the grounds together. In the present case, however, the language used in Section 35 is that "has reasons to believe" which as stated above, have been used in the Income Tax Act and in the Customs Act. In my view the decision of arrest under section 35 of the Foreign Exchange Regulation Act, 1973 is based upon existence of reasonable believe in the grounds which have to be justified by objective facts. Existence of such belief is justiciable in a court of law and the Court has the jurisdiction to examine the grounds separately and find out if arrest is justified on any of the grounds. I am satisfied that there is a rational nexus between the belief of the enforcement officers and the second and third grounds mentioned in the impugned order. The decision of arrest of the petitioner is not a final decision unlike the facts in the Supreme Court case and any one of the grounds, if valid would justify his arrest. There is no question of the enforcement authorities making a final adjudication on the accused in respect of the allegation against the petitioner. Reliance may be placed on (3) S. Narayappa v. I.T. Commissioner, Bangalore, AIR 1967 SC 523 . There is no question of the enforcement authorities making a final adjudication on the accused in respect of the allegation against the petitioner. Reliance may be placed on (3) S. Narayappa v. I.T. Commissioner, Bangalore, AIR 1967 SC 523 . (4) Barium Chemicals Ltd v. Company Law Board, AIR 1967 SC 295 at p, 324, 325 and (5) Railway Board, New Delhi, & Anr. v. Niranjan Singh, AIR 1969 SC 966 . 21. For all the reasons stated above, the Rule is discharged. Parties will bear their own costs. I also direct that a copy of the said notice dated 19th April 1961 be filed with the records of this case.