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2012 DIGILAW 370 (MAD)

K. Varadharaj v. The Intelligence Officer

2012-01-25

K.CHANDRU

body2012
Judgment :- 1. The petitioner in this writ petition seeks for the return of the Mahindra Scarpio car bearing registration No.TN 07-AJ 3838, 2006 model forthwith. The writ petition when it was filed, the Registry had raised an objection regarding maintainability of the writ petition stating that as against the order impugned in the writ petition, only a criminal revision will lie. The matter was posted for maintainability. On 7.10.2009, a learned Judge had overruled the above objection and directed the writ petition to be posted. 2. The writ petition was admitted on 09.10.2009. The application for the grant of interim custody was dismissed on 30.6.2010 on the ground that the relief in the main writ petition and in the miscellaneous petition is one and the same. On notice from this court, a counter affidavit has been filed by the sole respondent, i.e., the Intelligence Officer, Narcotic Control Bureau, South Zone Unit, Chennai, dated 23.12.2009, enclosing the order freezing the property dated 26.3.2009, which was served on the writ petitioner. The petitioner also filed an additional typed set. 3. Even before the writ petition was filed, the competent authority, i.e., the Intelligence Officer, NCB, South Zone, vide order dated 26.3.2009 served the freezing order freezing the properties of one M.Ashok Kumar, a Srilankan national. There were as many as 9 items involved which included the savings bank account, current account, term deposit, advance money given to third parties, Mahindra Scarpio vehicle covered by the writ petition as well as one motor cycle. As against the order of freezing, which was sent for confirmation by the competent authority constituted under Section 68F(2), the said authority by an order dated 22.4.2009 had confirmed the order of freezing. That order was served on the said Ashok Kumar, who was then lodged in the Central Prison, Puzhal. The order of freezing was also served on the petitioner in W.P.No.20517 of 2009. Initially, the order was sent to him by a speed post in the original residential address given by him, i.e., No.396/4, Mahatma Gandhi First Street, Palavakkam, Chennai and the same was returned undelivered on 16.4.2009. Thereafter, it was personally informed to the petitioner who came and gave a statement that the earlier address was erroneous. Therefore, the order was served on him with a return acknowledgment, dated 17.4.2009 enclosed along with the counter affidavit filed in the writ petition. Thereafter, it was personally informed to the petitioner who came and gave a statement that the earlier address was erroneous. Therefore, the order was served on him with a return acknowledgment, dated 17.4.2009 enclosed along with the counter affidavit filed in the writ petition. The said Ashok Kumar filed an appeal before the Appellate Tribunal for Forfeited property at New Delhi in terms of Section 68-O of the Narcotic Drugs and Psychotroic Substances Act, 1985 (for short NDPS Act). The appellate tribunal at its Camp Sitting at Chennai, after notice to the competent authority heard the matter, passed an order dated 28.8.2009, allowed the appeal and remanded the matter to the competent authority for fresh disposal after due opportunity to the said Ashok Kumar. The operative portion of the order passed by the appellate tribunal reads as follows: “The proceedings under Section 68H and 68-I are yet to be initiated by the Competent Authority. We are of the view that the appellants grievances can be redressed if the matter is sent back to the Competent Authority for passing appropriate order after affording reasonable opportunity of hearing to the appellant/counsel. We order accordingly. The appellant shall appear before the Competent Authority as per time and date fixed by the Competent Authority and the appellant shall be at liberty to place documents/material before the Competent Authority and make his submissions and raise all contentions that have been raised before us. The Competent Authority shall, after hearing the appellant, pass a speaking order.” 4. The competent authority, thereafter passed an order dated 15.3.2010. He confirmed that the said Ashok Kumar was convicted on 31.12.2008 to 11 years R.I. and he was also arrested on 23.1.2009. Therefore, he is the person within the meaning of Section 68-A(2)(cc) of the NDPS Act. His bank lockers were also broken open. It also found that the colour powder was tested positive for Heroin. Therefore, the Narcotic Psychotropic substance was also seized from him. He was further arrested on 4.3.2009. During the course of the investigation, the Intelligence Officer found that the assets listed out in the order including the Mahindra Scarpio Jeep owned by the said Ashok Kumar. Therefore, the order of freezing was earlier passed. Therefore, the Narcotic Psychotropic substance was also seized from him. He was further arrested on 4.3.2009. During the course of the investigation, the Intelligence Officer found that the assets listed out in the order including the Mahindra Scarpio Jeep owned by the said Ashok Kumar. Therefore, the order of freezing was earlier passed. Since the Tribunal had remanded the matter, it was once again considered after notice to other two persons who claimed to be the owners of Mahindra Scarpio jeep as well as motor cycle. But the competent authority had dealt with the claim separately and recorded as follows: “17.The assets numbered (viii) and (ix) in paragraph 2 above are: one Mahindra Scorpio bearing Registration No.TN 07AJ 3838 in the name of Shri K.Vardharajan purchased on 19.5.2006 and one TVS Apache motorcycle bearing Registration No.TN 07 AP 2504 in the name of Shri K.Punniyakotti purchased during April 2007. The Intelligence Office NCB has included the above two assets in the freezing order. It has been stated both before the Appellate Tribunal for Forfeited Property and before the Competent Authority now that these vehicles belong to Shri K.Varadharajan and Shri K.Punniyakotti and do not belong to Shri Ashok Kumar and therefore they should be released. 18. From the statement of Shri K.Varadarajan, son of Shri P.Krishnan given before NCB authorities on 30.01.2009, the Mahindra Scorpio bearing No.TN 07 AJ 3838 was purchased in the name of Shri K.Varadarajan by Shri M.Ashok Kumar on hire purchase basis for which he had borrowed a loan of Rs.1,50,000/- from Shri K.Varadarajan. He has also stated that the transaction is not evidenced by written document, but Shri M.Ashok Kumar had remitted Rs.13,668/- each month in his (that is, Varadharajans) bank account with Maharashtra Bank by cash. This was towards the monthly installment to be paid to the financing company, namely, Rs.13,668/-. Shri Varadharajan then used to issue cheque to the financing company towards the installment due.” 5. The competent authority had rejected the arguments of the petitioner in W.P.No.20517 of 2009 that the statement given by him was retracted and no reliance can be placed upon him. The competent authority also stated that the vendor Ashok Kumar was well known to Varadaraj, the petitioner in the other writ petition and his brother K.Punniyakoti as well as their family. He used to frequent to the restaurant run by them at No.70, ECR Road, Thiruvanmiyur, Chennai. The competent authority also stated that the vendor Ashok Kumar was well known to Varadaraj, the petitioner in the other writ petition and his brother K.Punniyakoti as well as their family. He used to frequent to the restaurant run by them at No.70, ECR Road, Thiruvanmiyur, Chennai. It is the said Varadaraj who had introduced Ashok Kumar to the Bank of Maharashtra, Valmiki Nagar Branch, Chennai. It was at his request the first floor property was rented out after taking the rental advance for the purpose of running the guest house in the name and style "Singing Fish Guest house". The said Varadaraj and Punniyakoti had many transactions with Ashok Kumar. In the statement which was retracted by a letter dated 21.9.2009 before the Chief Metropolitan Magistrate, Chennai also does not deny his acquaintance with Ashok Kumar. With reference to the bank account of Varadaraj, which was examined for payment of vehicle, it was seen that it was purchased by hire purchase through one GMAC Financial Services India Ltd. It was also seen that an amount of Rs.13,668/-every month was credited in his account from the bank account of Ashok Kumar. Therefore, the original statement given by him before the NCB was borne out by the bank statement and that the retraction was not valid. Hence the statement was rejected. Therefore, he held that the Mahindra Scorpio vehicle bearing registration No.TN 07/AJ 3838 is the property of Ashok Kumar holding on his behalf by the said Varadaraj. Hence the property was the illgally acquired property within the meaning of Section 68-B(g)(B) of the NDPS Act. Thus, he confirmed the freezing of accounts including vehicles. 6. As against the same, K.Varadaraj and his brother K.Punniyakotti filed an appeal under Section 68-O of the NDPS Act before the Appellate Tribunal for Forfeited property at New Delhi. The said Ashok Kumar also filed an independent appeal. Both appeals were grouped together. The Tribunal in its Camp Sitting at Bangalore heard the matter and passed an interim order dated 27.08.2010 releasing Mahindra Scorpio vehicle as well as the motor cycle. In the interim order, dated 27.08.2010, the Tribunal in paragraphs 7 to 9 had observed as follows: “7.In this connection, we also refer to section 68 M wherein it is stated that once an order under section 68-F(1) is passed, transfer of the property pending forfeiture proceeding is null and void. In the interim order, dated 27.08.2010, the Tribunal in paragraphs 7 to 9 had observed as follows: “7.In this connection, we also refer to section 68 M wherein it is stated that once an order under section 68-F(1) is passed, transfer of the property pending forfeiture proceeding is null and void. Orders u/s 68F are passed so that proceedings relating to the forfeiture of the property are not frustrated and properties are not transferred or destroyed. It will also prevent sale of the property to bonafide third party purchasers and benami transfers. AP-1 was also given freedom to approach the authority to deal with the property in case of necessity as indicated in the order itself. 8. Except for compelling reasons, this Tribunal will not interfere in such interim orders pending forfeiture proceedings though the order is appealable. In this connection, we also refer to section 68 J wherein burden is cast on the affected person to prove that the property is not illegally acquired. Appellants will get ample opportunity to prove the same after receipt of show cause notice under section 68H. They can raise all their contentions at that time. However, final order regarding forfeiture shall be passed only after complying with all statutory formalities and principles of natural justice untrammeled by the observations in the impugned order u/s 68F or in this order. 9. During the appellate proceedings, it was pointed out by the advocate of the appellants that the possession of two vehicles has been taken over by the authorities and these vehicles are likely to be wasted during the pendency of the proceedings which may take a long time before these are finalized. We also take note that Scorpio Jeep bearing registration No.TN 07 AJ 3838 was purchased in 2006 under HP agreement and monthly EMI is being paid. Further, the Apache motor cycle bearing registration No.TN 07 AP 2504 was purchased in 2007. In these circumstances, it will be appropriate if these two vehicles are released to AP-1 subject to following conditions. The appellant (AP-1) shall also file an affidavit to the satisfaction of the Competent Authority that : a. He will not transfer or alienate the vehicles and keep them in good condition till final proceedings are over. b. He shall also undertake in the affidavit that he will produce the vehicles before the Competent Authority as and when demanded. The appellant (AP-1) shall also file an affidavit to the satisfaction of the Competent Authority that : a. He will not transfer or alienate the vehicles and keep them in good condition till final proceedings are over. b. He shall also undertake in the affidavit that he will produce the vehicles before the Competent Authority as and when demanded. c. He shall produce no objection from respective registered owners. d. He shall furnish a bank guarantee to the satisfaction of the Competent Authority for Rs.100,000/- for the Scorpio Vehicle and Rs.10,000/- for the motor cycle. 10. In the light of the aforesaid position, we dismiss the appeal subject to above observations regarding interim release of two vehicles. In view of final disposal of appeal, all miscellaneous petitions are also disposed of accordingly.” 7. Pursuant to the order of the tribunal, K.Varadaraj had given a bank guarantee of Rs.1 lakh in respect of Mahindra Scorpio vehicle and in respect of the motor cycle, Rs.10,000/- bank guarantee was created. Both Varadaraj and Punniyakodi had also filed an affidavit as directed by the Tribunal. Challenging the interim order passed by the Tribunal, the competent authority and the Administrator, SAFEM (FOP) and NDPS Acts has filed the second writ petition in W.P.No.2940 of 2011. That writ petition was admitted on 8.2.2011. Pending the writ petition, an interim stay was granted for a period of four weeks. Subsequently, the order was extended from time to time. In that writ petition, K.Varadharaj was made as second respondent and his brother K.Punniyakoti as third respondent. In the meanwhile, Varadharaj took out an application in M.P.No.2 of 2011 seeking to implead the Investigation Officer, NCB, South Zonal unit, Chennai. That application was not ordered. A counter affidavit has been filed by K.Varadaraj and M.Ashok Kumar in the writ petition. In view of the interconnectivity between the two writ petitions, they were grouped together and a common order is passed. 8. In respect of W.P.No.20517 of 2009, the matter has become infructuous. Because in Crl.M.P.No.785 of 2009 in C.C.No.347 of 2002, the Principal Special Judge, Special Court under EC & NDPS Act, Chennai-104, had rejected the release of vehicle even at the stage of filing under Section 451 Cr.P.C. and even before the conclusion of the main criminal case where K.Varadaraj has been arraigned as an accused. Because in Crl.M.P.No.785 of 2009 in C.C.No.347 of 2002, the Principal Special Judge, Special Court under EC & NDPS Act, Chennai-104, had rejected the release of vehicle even at the stage of filing under Section 451 Cr.P.C. and even before the conclusion of the main criminal case where K.Varadaraj has been arraigned as an accused. Since subsequent to the impugned order, the main accused Ashok Kumar has moved the Tribunal against the confirmtion order and the Tribunal seazed of the matter and that by an interim order, the vehicle was directed to be released, W.P.No.20517 of 2009 is liable to be dismissed as infructuous. 9. In W.P.No.2940 of 2011, though in the counter affidavit, the impugned order of the Tribunal is sought to be justified, it is unnecessary to go into the larger issue as to whether the vehicle was involved in the offence and whether the present ownership of the vehicle claimed by K.Varadaraj and K.Punniyakoti in respect of two vehicles are not sustainable, which need not be gone into at this stage. The Tribunal has seized of the main appeal and pending appeal, the interim order came to be passed. 10. It must be noted that under Section 68-O, the appellate Tribunal has been created against any order passed under Section 68-F. Under Section 68-R, the power of the appellate tribunal has been prescribed. The Tribunal has been clothed with the power of the civil court in respect of several items set out in Section 68-R(a) to (e). Under Section 68-R(f), the Government of India has power to frame rules to prescribe power in respect of other matters. The Central Government had framed the Appellate Tribunal for Forfeited Property (Procedure) Rules, 1989. Under Rule 5(9), it provides for the aggrieved person filing an application for grant of an interim stay. Similarly under Rule 20, it is prescribed as follows: "20.Orders and directions in certain cases.-Notwithstanding anything contained in these rules, the Tribunal may make such orders or give such directions as may be necessary or expedient to give effect to its orders or to prevent abuse of its process or to secure the ends of justice." 11. Therefore, it is not the case that the tribunal is lacking any power to the grant an interim order. Therefore, it is not the case that the tribunal is lacking any power to the grant an interim order. On the other hand, the Tribunal had not dealt with the other properties such as freezing of bank accounts, but only dealt with the case of two vehicles that too on the ground that the vehicles are liable to be wasted during the pendency of the proceedings as the proceedings may likely to take a long time. The Mahindra Scarpio car was also purchased under the hire purchase agreement and that sufficient safeguards have been taken into account, i.e., furnishing bank guarantee of Rs.1 lakh in respect of Car and Rs.10,000/-in respect of the motor cycle with an affidavit of undertaking to produce the vehicles before the competent authority and with further condition not to transfer or alienate the vehicles. When this will safeguard the interest of the writ petitioner competent authority, it is unnecessary for the authority to have moved this court with the writ petition that too against the interim order instead of concentrating on the main appeal filed by the aggrieved person. 12. The Supreme Court vide its judgment in AslamMohammad Merchant v. Competent Authority reported in (2008) 14 SCC 186 had dealt with the scope of Section 68-R regarding the power of the competent authority. In paragraph 33, the Supreme Court had observed as follows: "33.The competent authority has a vast power as is provided under Section 68-R of the Act. He is not bound by any finding of any officer or authority under any other law as the same would not be conclusive for the purpose of any proceeding under the said Chapter." If for any reason, the competent authority had not exercised his power properly, the Tribunal can correct the error made by the competent authority. That was why an appeal has been provided to a Tribunal and Rule 20 clothes the Tribunal with necessary powers. 13. Since considering that the order was only an interim order and also that the appellate tribunal had safeguarded the interest of the department, this court sitting under Article 226 of the Constitution is not inclined to interfere with the interim order. The powr to issue writ in the nature of certiorari had come to be considered in more than one judgment of the Supreme Court. The powr to issue writ in the nature of certiorari had come to be considered in more than one judgment of the Supreme Court. It is necessary to refer to one or two decisions, which will have a bearing on the present case. 14. The Supreme Court in B.K. Muniraju v. State of Karnataka reported in (2008) 4 SCC 451 in paragraphs 22 and 23 had observed as follows: "22.It is settled law that a writ of certiorari can only be issued in exercise of extraordinary jurisdiction which is different from appellate jurisdiction. The writ jurisdiction extends only to cases where orders are passed by inferior courts or tribunals or authorities in excess of their jurisdiction or as a result of their refusal to exercise jurisdiction vested in them or they act illegally or improperly in the exercise of their jurisdiction causing grave miscarriage of justice. In regard to a finding of fact recorded by an inferior tribunal or authority, a writ of certiorari can be issued only if in recording such a finding, the tribunal/authority has acted on evidence which is legally inadmissible, or has refused to admit an admissible evidence, or if the finding is not supported by any evidence at all, because in such cases the error amounts to an error of law. It is needless to mention that a pure error of fact, however grave, cannot be corrected by a writ. 23.It is useful to refer to the decision of this Court in Surya Dev Rai v. Ram Chander Rai5 wherein, in para 38, it was held as under: (SCC p. 695) “38. (3) Certiorari, under Article 226 of the Constitution, is issued for correcting gross errors of jurisdiction i.e. when a subordinate court is found to have acted (i) without jurisdiction—by assuming jurisdiction where there exists none, or (ii) in excess of its jurisdiction—by overstepping or crossing the limits of jurisdiction, or (iii) acting in flagrant disregard of law or the rules of procedure or acting in violation of principles of natural justice where there is no procedure specified, and thereby occasioning failure of justice.” 15. Further, the Supreme Court in BowringsFine Art Auctioneers (P) Ltd. v. CBI reported in (2011) 11 SCC 491 in paragraph 16 had observed as follows: "16..... The jurisdiction of the High Court under Article 226 of the Constitution to issue appropriate writs is extraordinary, equitable and discretionary. Further, the Supreme Court in BowringsFine Art Auctioneers (P) Ltd. v. CBI reported in (2011) 11 SCC 491 in paragraph 16 had observed as follows: "16..... The jurisdiction of the High Court under Article 226 of the Constitution to issue appropriate writs is extraordinary, equitable and discretionary. Prerogative writs mentioned therein may be issued only for doing substantial justice. No person is entitled to claim relief under Article 226 of the Constitution as a matter of course." 16. The petitioners case do not come under the parameters pointed out by the Supreme Court. In view of the above, W.P.No.20517 of 2009 will stand dismissed as infructuous. W.P.No.2940 of 2011 will also stand dismissed for the reasons stated above. No costs. Consequently connected miscellaneous petitions stand closed.