JUDGMENT : G.B. Pattnaik, J. - The order of the Appellate Tribunal under the provisions of the Smugglers and Foreign Exchange Munipulators (Forfeiture of Property) Act, 1976 (hereinafter referred to as the 'Act") is challenged in this writ application, The said order of the Appellate Tribunal has been annexed as Annexure-2 to the writ application. 2. The brief facts of the case are that the Competent Authority under the Act served a notice on the petitioner requiring the petitioner to disclose his source of income and assets out of which the petitioner has acquired the properties mentioned in the Schedule to the notice The Competent Authority has served the notice in the purported exercise of his power u/s 6(1) of the Act. In the aforesaid notice, four items of property have been mentioned, namely, the house property situated on holding No. 120 in Ward No. 3 of Boudh Notified Area Council the assets of business carried on under the name and style of M/s. Bajrang Medical Stores situated at Boudhraj; the Life Insurance Policy No. 10628553 for Chouthmal Agarwalla of Boudh in the district of Phulbani. A copy of the notice has been annexed as Annexure-3 to the writ application. The petitioner filed his explanation to the said show cause notice indicating therein how he has acquired the aforesaid property and assets out of his own personal income and savings therefrom. The Competent Authority heard the matter and passed the final order directing forfeiture of all the proporties mentioned in the notice on a conclusion that the properties were illegally acquired. The said order of forfeiture was obviously in exercise of power u/s 7(1) of the Act. The petitioner assailed the order of the Competent Authority by filing an appeal before the Appellate Tribunal. The Appellate Tribunal by the impugned order came to the conclusion that the initial investment of Rs. 5,000/- in the business could not be said to be a property illegally set aside the order of forfeiture passed by the Competent Authority in respect of those two items of property. So far as the land and the building standing thereon as well as the investment of Rs. 5,000/- in the business could not be said to be a property illegally set aside the order of forfeiture passed by the Competent Authority in respect of those two items of property. So far as the land and the building standing thereon as well as the investment of Rs. 5,000/- which was given on loan to Chouthmal Agarwalla are concerned, the Appellate Tribunal came to hold that the petitioner had failed to establish that the sum was out of his own resources and accordingly confirmed the order of forfeiture passed by the Competent Authority in respect of those two items. It is this order of the Appellate Tribunal under Annexure-2 which is being assailed in this writ application. 3. Mr. Palit for the petitioner assailing the order of the Appellate Tribunal contends that the petitioner cannot be held to be a person to whom the Act applies and, therefore, the entire proceeding is null and void, He further contends that the property in question not having been found to be "illegally acquired property" within the meaning of Section 3(1)(c) of the Act, the Competent Authority had no jurisdiction to issue notice of forfeiture u/s 6 and cosequently, had no jurisdiction to pass an orler of forfeiture u/s 7 of the Act. The learned counsel then urges that the Competent Authority not having recorded the reasons in writing for entertaining a belief that the properties are illegally acquired properties, issuance of a notice u/s 6 of the Act is without jurisdiction and consecuently all subsequent proceedings are vitiated including the order of forfeiture Mr. Palit also urges that in the absence of any nexus between the properties of the petitioner and Shri Goplchand Agarwal who was detained under the provisions of the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974, the authorities under the Act had no jurisdiction to take recourse to the proceeding u/s 6 of the Act and pass an order u/s 7 and the Appellate Authority committed serious error in coming to a conclusion that in view of the Preamble to the Act, the question of nexus is irrelevant. Mr. Mr. Palit lastly urges that the Appellate Authority having been satisfied in respect of the two items of properties and having quashed the order of forfeiture in respect of those items failed to exercise his jurisdiction is not considering the question of giving an option to the person affected to pay fine in lieu of forfeiture as contained in Section 9 of the Act and thereby the impugned "appellate order is vitiated. The learned counsel also submits that the appellate order is vitiated on account of non-consideration of several material pieces of evidence. Each of these contentions requires a careful examination of the relevant provisions of the Act as well as the law on the subject. 4. Before examining the correctness of the submissions made by the learned counsel for the petitioner, it would be appropriate to notice the basic object with which the Act had been enacted. Thus it appears, the Parliament anacted the Act for effective prevention of smuggling activities and foreign exchange manipulations which have a deleterious effect on the national economy. It was intended that the persons engaged in such ativites and manipulations should be deprived of their ill-gotten gains. It was also found out that such persons engaged in. smuggling activities and been holding properties in the names of their relatives, associates and confidants. The Government thought of cleaning the social fabric and resuscitating the national economy and for this purpose by making legislation wanted ito assume necessary powers to deprive such persons of their illegally acquired properties so that the smuggling and clandestine activities could be effectively prevented.. 5. Coming to the first submission of Mr. Palit for the petitioner, Section 2(1) of the Act indicates that the provisions of the Act will apply only to the persons specified in Sub-section (2). Sub-section (2)(c) of Section 2 indicates that every person who is a relative of a person referred to in Clause a) or Clause (b) would be a person to whom the Act would apply. The expression "relative" has been defined in Explanation-2 to mean "spouse of the person". Since Gopichand Agarwal happens to be the brother of the petitioner's wife and since against said Gopichand Agarwal an order of detention had been made under the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974, the petitioner would be a person to whom the Act applies. Since Gopichand Agarwal happens to be the brother of the petitioner's wife and since against said Gopichand Agarwal an order of detention had been made under the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974, the petitioner would be a person to whom the Act applies. A combined reading of Section 2(1)(b), 2(1)(c) and Explaination-2 to the said Clause (c) makes It explicitly clear that the petitioner is a person to whom the Act applies. Therefore, the first submission of Mr. Palit is of no substance and is accordingly rejected. 6. So far as the second submission of Mr. Palit is concerned, Section 6 of the Act enables the Competent Authority to issue notice on the person concerned calling upon him to indicate the sources of his income, earnings and assets out of which or by means of which he has acquired the properties and the evidence on which he relies and other relevant informations and particulars to show cause why the properties in question should not be declared to be illegally acquired properties" and forfeited to the Central Government under the Act, if he has reasons to believe the all or any such properties are illegally acquired properties. The expression "illegally acquired property' has been defined in Section 3(1)(c) to mean, " ...'Illegally acquired property', in relation to any person to them this Act applies, means __ (i) any property acquired by such person, whether before or after the commencement of this Act, wholly or partly out of or by means of any income, earnings or assets derived or obtained from or autributable to any activity prohibited by or under any law for the time being in force relating to any matter in respect of which Parliament has power to make laws ; or (ii) any property acquired by such person, whether before or after the commencement of this Act. wholly or partly out of or by means of any income, earnings or assets in respect of which any such law has been contravened ; or (iii) any property acquired by such person, whether before or after the commencement of this Act, wholly or partly out of or by means of any income, earnings or assets the source of which cannot be proved and which cannot be shown to be attributable to any act or thing done in respect of any matter in relation to which Parliament has no power to make laws ; or (iv) any property acquired by such person, whether before or after the commencement of this Act, for a consideration, or by any means, wholly or partly traceable to any property referred to in Sub-clauses (i) to (iii) or the income or earnings from such property ; And includes : (A) any property held by such person' which would have been, in relation to any. previous holder thereof, illegally acquired property under this clause if such previous holder had not ceased to hold it, unless such person or any other person who held the property at any time after such previous holder or, where there are two or more such previous holders, the last of such previous holders is or was a transferee in good faith for adequate consideration ; (B) any property acquired by such person, whether before or after the commencement of this Act, for a consideration, or by any means, wholly or partly traceable to any property failing under item (A), or the income or earnings therefrom." Section 7 of the Act confers power of forfeiture on the Competent Authority who shall on considering the explanation received pursuant to the show cause notice and the materials available before him and after giving the person affected a reasonable opportunity of being heard, record a finding whether the properties are illegally acquired or not. In this context, the provision of Section 8 of the Act which provides for burden of proof is important and the burden of proving that any properties specified in the notice served u/s 6 are not illegally acquired shall be on the person affected. In this context, the provision of Section 8 of the Act which provides for burden of proof is important and the burden of proving that any properties specified in the notice served u/s 6 are not illegally acquired shall be on the person affected. The expression "has reason to believe" in Section 6(1) of the Act obviously means that the Competent Authority must have sufficient materials on the objective analysis of which the said authority can be said to have "reason to believe" and that belief must be recorded in writing. The notice u/s 6(1) of the Act has been annexed as Annexure-3. That notice is a mere borrowing of the language of Section 6(1) and does not indicate any date from which it can be said that the Competent Authority did entertain a belief on the materials that the properties acquired are illegally acquired properties. Issuance of a notice u/s 6 confers jurisdiction on the authority to tike final action of forfeiture u/s 7. Such issuance of notice u/s 6 indicates that the pre-condition for issuance of such notice is entertaining a reasonable belief by the Competent Authority that the properties acquired are illegally acquired proper- ties, If, therefore, the notice issused u/s 6 is without jurisdiction as the conditions precedent prescribed therein are not satisfied, then the final order pissed by the Competent Authority u/s 7 which emanates pursuant to such invalid notice must be held to be without jurisdiction In this view of the matter, the impugned order of forfeiture as well as the order of the Appellate Authority must be held to be null and void and on this ground alone, the writ application would succeed. 7. We also find ample force in Mr. Palit's contention that there must be some nexus between the properties sought to be forfeiture and the person who was detained under the provisions of the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act from which a reasonable belief could be entertained by the Competent Authority that the properties in question in fact were the properties acquired out of the smuggling activities. The definition of "illegally acquired property" in Section 3(1)(c) of the Act clearly stipulates that the property in question either wholly or partly must have been acquired by means of income, earning or assets derived or obtained from or attributable to any activity prohibited by or under law for the time being in force in respect of any matter in respect of which Parliament has power to make laws. All the clauses of of Section 3(1)(c) indicate that the property in question must have been acquired out of earnings of an activity which is prohibited under Saw. In other words, applying the same to the present case, it must be indicated that the property of the petitioner was acquired from out of the earnings of Gopichand who was in fact detained under the provisions of the Conservation of Foriegn Exchange and Prevention of Smuggling Activities Act, 1974. Thus some nexus must be there between the acquisition of the property in question and the illegal activity of either the owner of the property or some other person out of whose earnings the property was acquired. The materials on record are totally silent in this regard. There is not an iota of material to indicate that the petitioner had acquired the property out of any illegal activity prohibited under law nor is there any material to indicate that the property was in fact acquired out of the earnings of said Gopichand who was involved in smuggling. In that view of the matter, the impugned order of forfeiture is bid in law and cannot be sustained The contention of Mr. Palit on this score, therefore, must succeed. 8. In view of our conclusions as above, it is not necessary to consider the other two contentions raised by Mr. Palit for the petitioner. 9. In the net result, therefore, the order of the Appellate Authority confirming the forfeiture of the land together with the building standing thereon as well as the investment of Rs. 5,000/-which had been given on loan to one Chouthmal Agarwala stands quashed. The other part of the order of the Appellate Authority, however, is confirmed and the confiscation proceeding as well as the order of the Competent Authority under Annexure-1 is quashed in to. The writ application is allowed. There will, however, be no order as toto costs. S.K. Mohanty, J. I agree. Final Result : Allowed