Letters Patent Appeal No. 2 of 1997, Letters Patent Appeal No. 25 of 1997 in Civil Writ Jurisdiction Case No. 2059 of 78 and Letters Patent Appeal No. 27 of 1997 in Civil Writ Jurisdiction Case No. 2191 of 78. Case: Kamla Devi and Ors. Vs The Union of India and Ors.. High Court of Patna (India)
| Case Number | Letters Patent Appeal No. 2 of 1997, Letters Patent Appeal No. 25 of 1997 in Civil Writ Jurisdiction Case No. 2059 of 78 and Letters Patent Appeal No. 27 of 1997 in Civil Writ Jurisdiction Case No. 2191 of 78 |
| Counsel | For Appellant: Sandeep Kumar and Alok Kumar, Advocates and For Respondents: Sanjay Kumar, A.S.G. and Anjani Kumar Sharan, C.G.C. |
| Judges | N. P. Singh and Nilu Agrawal, JJ. |
| Issue | Income Tax Act, 1961 - Section 147; Smugglers and Foreign Exchange Manipulators Forfeiture of Property) Act, 1976 - Sections 18, 6 |
| Judgement Date | August 13, 2015 |
| Court | High Court of Patna (India) |
Judgment:
N. P. Singh, J.
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All these three cases are inter-linked and they arise out of a proceeding for forfeiture of property under the provisions of the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 (hereinafter referred to as the "SAFEMA").
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We have heard at length the parties. The facts are within a narrow compass. Late Mewalal was a businessman at Patna, had four sons namely, Ram, Lakshman, Bharat Prasad and Shyam Babu. After the death of Mewalal, the four brothers continued the business as a H.U.F. Firm. In 1962, there was a family partition. Bharat Prasad and Shyambabu then carried on businesses under the name and style of Stainless Steel House and other Shyam Steel House, one in Bakarganj, Patna and other in Muradpur. The business was exclusively of Steel utensils.
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Till 1968, there was no restrictions of import of steel or steel utensils from Nepal under Indo-Nepal Treaty, whereas, there was no qualitative or quantitative excessive imports of steel utensils affecting the local market in India to utensils produced in India. In 19th May, 1969, Government of India issued a circular under the Customs Act, restricting import of stainless steel utensils from Nepal. Various customs formalities had to be complied with apart from payment of duty. On 03.06.1974 to 06.06.1974, the Customs Officers allegedly raided the Stainless Steel premises of the two brothers and reported that they were unable to produce document in relation to purchase of some stocks of stainless steel utensils which had been imported from Nepal, from M/s. Devi Dayal Manufacturer of Bombay. No penal confiscation/forfeiture orders were taken up under the Customs Act, nor any proceeding for evasion of duty or illegal import was taken, under the Customs Act.
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Admittedly, the Customs Authorities then informed the Income Tax Authorities of the unexplained stocks of steel utensils. Income Tax Authorities reopened the issues under Section 147 of the Income Tax Act. Apparently, upon assessment being made, this information was then given to the Customs Authorities, by the two brothers Bharat Prasad and Shyam Babu, who had been detained under the Maintenance of Internal Security Act. An internal emergency having been imposed, they were then both detained, put under the preventive detention under the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 (hereinafter referred to as "COFEPOSA").
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They challenged...
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