Detention; Shafeeq P.K. Vs. State of Kerala [Kerala High Court, 22-03-2016]

Conservation of Foreign Exchange and Prevention of Smuggling Activities Act (COFEPOSA Act) – Section 3(1)(i) and 3(1)(ii) – Order of detention – Non mention in the grounds of detention about the show cause notice would not be a sufficient ground to quash the order of detention at its pre-execution stage.

# Detention


IN THE HIGH COURT OF KERALA AT ERNAKULAM

K.T.SANKARAN & K.P. JYOTHINDRANATH, JJ.

W.P.(C) No.34051 of 2014

Dated this the 22nd day of March, 2016

PETITIONER

SHAFEEQ P.K.

BY ADVS.SRI.M.K.DAMODARAN (SR.) SRI.O.V.MANIPRASAD SRI.GILBERT GEORGE CORREYA

RESPONDENTS

1. STATE OF KERALA REP. BY THE ADDITIONAL CHIEF SECRETARY TO GOVERNMENT, HOME DEPARTMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM.

2. THE PRINCIPAL SECRETARY TO GOVERNMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM.

3. THE DIRECTORATE OF REVENUE INTELLIGENCE REGIONAL UNIT, VILAKUNNEL, KAITHOTH ROAD, PALARIVATTOM, KOCHI- 682025, REPRESENTED BY THE DEPUTY DIRECTOR.

R1 & R2 BY DIRECTOR GENERAL OF PROSECUTION SRI.ASAF ALI R3 BY STANDING COUNSEL SRI.C.P.UDAYABHANU

JUDGMENT

K.T.Sankaran, J.

The reliefs prayed for by the petitioner in the Writ Petition are the following:

“i. Call for the entire records leading to the detention order No.7018/SSA4/2013/Home dated 06.05.2013 issued by the 2nd respondent against the petitioner and issue a writ of certiorari or any other appropriate writ quashing the same.

ii. Issue a direction to the 2nd respondent to provide a copy of the detention order No.7018/SSA4/2013/Home dated 06.05.2013 issued by the 2nd respondent against the petitioner and the grounds of detention to the petitioner.

iii. To declare that the detention order No.7018/SSA4/2013/Home dated 06.05.2013 issued by the 2nd respondent against the petitioner is illegal and the petitioner is not liable to be detained as per the said order. iv. Such other relief this Hon’ble Court deems fit and proper to grant in the facts and circumstances of the case.”

2. The order issued by the second respondent against the petitioner, which is sought to be quashed, is an order issued under

# Section 3(1)(i) and 3(1)(ii) of the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act

(hereinafter referred to as ‘the COFEPOSA Act). The order of detention was not served on the petitioner and he was not arrested as, even according to the petitioner, he was all throughout in Dubai, UAE, in connection with his employment.

3. The petitioner submits that Ext.P2 grounds of detention was issued to Antony Morris, who is involved in the same incident in which the petitioner is allegedly involved. The petitioner also relies on the facts stated in Ext.P2 grounds of detention issued in the case of Antony Morris. The petitioner relies on Ext.P3 statement given by Antony Morris under Section 108 of the Customs Act to show that there was no real complicity by the petitioner in the incident. It is submitted that even Antony Morris has retracted his statement under Section 108 of the Customs Act.

4. The learned State Prosecutor submitted that the allegations in Ext.P2 grounds of detention issued to Antony Morris and the grounds which are available against the petitioner are similar. Since both parties rely on Ext.P2 grounds of detention, we are of the view that the facts stated in Ext.P2 can be taken into account for the purpose of disposing of this Writ Petition and in dealing with the contentions raised by the petitioner.

5. Ext.P2 shows that on 28.10.2011 and 16.11.2012 large quantity of red sanders was seized from the containers made ready for transshipment at Vallarpadom transshipment terminal. The red sanders were concealed in dehusked coconuts and coir pith under the pretext that what was being exported was dehusked coconuts and coir pith. It is also alleged that a total number of seven containers were transshipped on different dates, out of which four containers containing red sanders. It is also alleged that even subsequently, three containers were transshipped allegedly at the instance of the petitioner, in which two containers contained only coconut husks and the third container attempted to be transshipped on 16.11.2012 contained 7.75 metric tonnes of red sanders valued at ₹77.50 lakhs, which was seized on 17.11.2012. 6. The statement of Antony Morris and others were recorded under Section 108 of the Customs Act. With respect to the incident dated 28.10.2011, show cause notice dated 20.4.2012 was issued to the petitioner. The proceedings in respect of the same culminated in Ext.P8 order dated 30.4.2013 passed by the Commissioner of Customs. At paragraph 94 of Ext.P8 order, it was held thus:

“94. I also find that though S/Shri Hameed and Sadique were mentioned as noticee to the SCN at Sl.No.12 and 13 respectively, the SCN was not served as the whereabouts are not known. Shri Anil Kumar has stated that smuggling of red sanders was arranged by Hameed and Shafique, residents of Dubai. Apart from the above mention, the investigation has failed to locate the above persons or to bring out the role played them. As such the proposal for imposition of penalty on them is not considered.”

It is submitted by the learned counsel for the petitioner that the name Sadique mentioned in paragraph 94 of Ext.P8 is none other than the petitioner (Shafique) and the name was wrongly shown as Sadique in Ext.P8 order. It is also submitted that Sadique was also a party to Ext.P8 proceedings and fine was imposed on him as is seen from Ext.P8 order. It is therefore submitted that paragraph 94 of Ext.P8 order really refers to Shafique, the petitioner, and not Sadique. Learned State Prosecutor submitted that it may be a mistake with respect to the name as mentioned in paragraph 94 of Ext.P8 order.

7. With respect to the incident dated 16.11.2012 on which date a quantity of 7.75 metric tonnes of red sanders was attempted to be transshipped illegally, Ext.P7 show cause notice dated 2.5.2013 was issued to the petitioner under Section 124 of the Customs Act. In that proceeding, order dated 23.10.2014 was passed by the Commissioner of Customs and a penalty of Rupees ten lakhs was imposed on the petitioner. The petitioner challenged the order dated 23.10.2014 in appeal before the Customs, Excise & Service Tax Appellate Tribunal, South Zonal Bench, Bangalore. The Appellate Authority allowed the appeal filed by the petitioner as per Ext.P9 order dated 8.9.2015 and the order issued by the Commissioner of Customs was set aside. The Commissioner of Customs filed Customs Appeal No.1 of 2016 before this Court challenging Ext.P9 order of the Appellate Authority. The Customs Appeal was admitted on 19.1.2016 and as per the order in I.A.No.146 of 2016, a Division Bench of this Court said that the decision of the Appellate Authority, setting aside the order of imposition of penalty, will be subject to the final decision of the appeal. 8. At the time when the Writ Petition was filed, Ext.P9 order was not passed. Later, on 8.9.2015, Ext.P9 order was passed and it was produced by the petitioner as an additional document. The petitioner raised a contention that in similar circumstances where the order imposing penalty was set aside by the Appellate Authority, the Supreme Court in Ext.P10 order in W.P.(Crl) No.88 of 2010 directed the detaining authority to consider the representation of the party concerned and to take note of the subsequent events. Thereafter, Ext.P11 order was passed by the Supreme Court recording the order passed by the Government of Maharashtra revoking the order of detention against the petitioner in W.P.(Crl) No.88 of 2010. It was submitted at the time when Exts.P10 and P11 orders were produced in the present Writ Petition that the Writ Petition filed by the petitioner also could be disposed of directing the detaining authority to take into account the subsequent event, namely, passing of Ext.P9 order by the Appellate Authority exonerating the petitioner from liability. At that juncture, the learned State Prosecutor submitted that an appeal was proposed to be filed challenging Ext.P9 order. Subsequently, the Commissioner of Customs filed Customs Appeal No.1 of 2016 before the High Court of Kerala challenging Ext.P9 order. In these circumstances, the submission made by the learned counsel for the petitioner that a direction could be issued to the detaining authority to take note of the subsequent event has lost its significance, since Ext.P9 order is subject to the result of the Customs Appeal pending before the High Court. 9. In the statement given by Antony Morris under Section 108 of the Customs Act, he stated as follows:

“About 10 months back I met one Shri Kannan of Chennai for the first time in Willingdon Island. Shri Kannan contacted me over phone and then met me at Cochin and informed that he is engaged in the business of smuggling Red sanders to Dubai and that my details were given by one Moideen of Hong Kong, who in turn got my details from one Shafique of Thalassery. I know Shafique for the last 6 years, but do not know his exact address. He is presently doing business in Dubai. I also know that his brother has a Tile shop in Ernakulam. However, he knows that I am engaged in the clearing and forwarding business. Kannan came to Cochin and we had discussions about logistics support and clearing facilities for his smuggling of Red sanders to Dubai. I agreed to arrange the container and trailer and also help in clearing the export consignment containing red sanders. For that purpose, I introduced one Mr.Jayan who does CHA work, to Kannan and Shri Jayan agreed to help in the clearance of the export consignment of red sanders. An amount of Rs.10,00,00/- per consignment was fixed as my fee for providing this service. Shri Prakash @ Senthil, an aide of Kannan used to co- ordinate the arrangements with Jayan. I also arrange accommodation for Kannan whenever he visits Ernakulam. Kannan lastly visited Ernakulam on 05.11.2012, for which I booked room for him from 05.11.2012 to 08.11.2012 at Hotel Fort Queen, Fort Kochi. Around February 2012, Kannan informed me that one Mustafa and Ashraf having IEC in the name of M/s.Silver Star International are ready to lend their IEC for the smuggling of red sander logs. I arranged logistics support and clearing facilities for the clearance of seven consignments in the name M/s.Silver Star International from Cochin Port from February 2012 to July 2012. Out of the said seven consignments, four consignments contained red sanders weighing approximately 7.5 MT to 8.5 MT per consignment which were smuggled by concealment under the export cargo of dehusked coconuts. The said seven consignments belonging to Kannan were exported to Dubai. Jayan looked after the clearing work for all these exports. After the export, Jayan handed me the documents and Bill of lading, which I used to send to Shafique in Dubai and a copy to Kannan. After these 7 consignments, we decided to change the IEC holder. Subsequently, around August 2012, Kannan said that one Yousaf Moideen is prepared to take an IEC in name of M/s.Suweihan Exporting and is willing to lend it for sending red sander logs to Dubai. In August and September 2012, 2 containers were exported containing coconuts & coir pith respectively as test export.”

10. In Ext.P7 show cause notice issued to the petitioner, the statement given by Antony Morris was relied upon. Further, in Ext.P7 it was stated thus:

“25. Further enquiries regarding mobile numbers i.e. 9962427203, 9444002222 and 9940269868 used by Shri Kannan, mobile No.9846216450 used by Shri Antony Morris and mobile No.9895280000 used by Shri Shaheed P.K., brother of Shri Shafeeq, as deposed in the respective statements, were conducted. The call data of 9895280000 used by Shri Shaheed P.K. shows that he used to call 00971505530838 which he had stated as the mobile no. of his brother Shri Shafeeq at Dubai. The call data records of 9962427203 ie. Shri Kannan’s mobile number and 9846216450 i.e. Shri Antony Morris’s mobile number during the period from February 2012 to November 2012 shows that Shri Kannan and Shri Antony Morris had contacted 00971505530838 constantly and vice versa. From the above call records and from statement of Shri Antony Morris, it is evident that Shri Shafeeq P.K. is the main operator of the red sander smuggling and coordinates smuggling activities.”

11. Thus the case put forward against the petitioner is that he is the main operator of the red sander smuggling and he coordinated the smuggling activities. It is also alleged that the consignments were sent to Dubai. The petitioner was in Dubai and the export documents and bill of lading were sent to the petitioner at Dubai.

12. Learned senior counsel appearing for the petitioner submitted that when the present order of detention was passed, Ext.P8 order dropping the proceedings against the petitioner was in existence. But, it is not mentioned in the grounds of detention as to what final order was passed in the said proceedings. The grounds of detention only mentions about the notice issued to the petitioner, but it does not state as to what order was passed by the authority. It is submitted that there was non-application of mind on this aspect and the order of detention is vitiated. It is also submitted that Ext.P7 show cause notice dated 2.5.2013 was issued to the petitioner in respect of the incident which took place on 16.11.2012. But in the grounds of detention, there is no reference to the said show cause notice. That also shows that there was non-application of mind. Ext.P8 order shows that the investigation has failed to bring out the role played by the petitioner. That finding was also not taken note of by the detaining authority. The learned counsel referred to the decisions of the Supreme Court in

# Additional Secretary to the Government of India and others v. Smt.Alka Subhash Gadia and another (1992 Supp (1) SCC 496

# Subhash Popatlal Dave v. Union of India and another ((2012) 7 SCC 533

and

# Subhash Popatlal Dave v. Union of India and another ((2014) 1 SCC 280

The learned counsel submitted that the grounds for interference at the pre-execution stage as laid down in Alka Subhash Gadia’s case were expanded in Subhash Popatlal Dave’s case. However, the petitioner is relying on ground (iv) at paragraph 30 of the decision in Alka Subhash Gadia’s case, namely, that the order of detention is passed on vague, extraneous and irrelevant grounds. The learned counsel relied on the decisions of the Supreme Court in

# Pooja Batra v. Union of India and others ((2009) 5 SCC 296

and

# Pebam Ningol Mikoi Devi v. State of Manipur and others ((2010) 9 SCC 618).

It is submitted that the petitioner was exonerated in Ext.P8 proceedings and no appeal having been filed by the Commissioner of Customs against that order at the relevant time, the detaining authority should have taken note of that order and having not done so, the order of detention should be considered to have been issued on vague, extraneous and irrelevant grounds. The further submission is that Ext.P7 proceedings under Section 124 of the Customs Act have not attained finality and use of incomplete material which is either pending or inconclusive cannot be a basis for the detention.

13. In

# Additional Secretary to the Government of India and others v. Smt.Alka Subhash Gadia and another (1992 Supp (1) SCC 496

the Supreme Court, after considering the powers under Articles 226 and 32 of the Constitution, held thus:

“30. …….. We have while discussing the relevant authorities earlier dealt in detail with the circumstances under which these extraordinary powers are used and are declined to be used by the courts. To accept Shri Jain’s present contention would mean that the courts should disregard all these time-honoured and well- tested judicial self-restraints and norms and exercise their said powers, in every case before the detention order is executed. Secondly, as has been rightly pointed out by Shri Sibal for the appellants, as far as detention orders are concerned if in every case a detenu is permitted to challenge and seek the stay of the operation of the order before it is executed, the very purpose of the order and of the law under which it is made will be frustrated since such orders are in operation only for a limited period. Thirdly, and this is more important, it is not correct to say that the courts have no power to entertain grievances against any detention order prior to its execution. The courts have the necessary power and they have used it in proper cases as has been pointed out above, although such cases have been few and the grounds on which the courts have interfered with them at the pre-execution stage are necessarily very limited in scope and number, viz., where the courts are prima facie satisfied (i) that the impugned order is not passed under the Act under which it is purported to have been passed, (ii) that it is sought to be executed against a wrong person, (iii) that it is passed for a wrong purpose, (iv) that it is passed on vague, extraneous and irrelevant grounds or (v) that the authority which passed it had no authority to do so. The refusal by the courts to use their extraordinary powers of judicial review to interfere with the detention orders prior to their execution on any other ground does not amount to the abandonment of the said power or to their denial to the proposed detenu, but prevents their abuse and the perversion of the law in question.”

14. As stated earlier, the learned counsel for the petitioner is relying on ground (iv) in paragraph 30 of the decision in Alka Subhash Gadia’s case that the order of detention is passed on vague, extraneous and irrelevant grounds. We have gone through the statement of Antony Morris, the order dated 23.10.2014 [Exhibit R3(2)] passed by the Commissioner of Customs in Ext.P7 proceedings, Ext.P9 appellate order and the grounds taken in Ext.P7 show cause notice. We have also perused Ext.P2 grounds of detention and Ext.P8 order passed by the Commissioner of Customs in the proceedings under Section 124 of the Customs Act against the petitioner and others in respect of the incident dated 28.10.2011.

15. In Ext.P8 order, the proceedings against the petitioner were dropped on the ground that notice was not served on the petitioner and his whereabouts were not known. It is true that in Ext.P8 order, mention is made that the investigation has failed to locate the petitioner and to bring out the role played by him. When notice was not served on the petitioner and no adjudication had taken place with respect to the case against the petitioner on the merits, we do not think that Ext.P8 order can be used by the petitioner in his favour to show that no case is made against him. In Ext.P7 show cause notice, allegations have been made in clear terms. The statement of Antony Morris indicates that the petitioner is the main operator of the smuggling activities. The export documents and the bill of lading were sent to the petitioner at Dubai after the goods were transshipped from Vallarpadom Container Terminal. These allegations make out a sufficient ground for the detaining authority to arrive at a subjective satisfaction that the petitioner was involved in the smuggling activities and in order to prevent him from indulging in such activities in future, an order of detention under the COFEPOSAAct is required to be issued.

16. We do not think that non-mention of Ext.P7 notice in the grounds of detention would lead to the conclusion that the subjective satisfaction is vitiated. Ext.P7 show cause notice was issued on 2.5.2013 and the order thereon [Ext.R3(2)] was issued by the Commissioner of Customs on 23.10.2014. Before passing the order dated 23.10.2014, the order of detention was issued on 6.5.2013. Therefore, there was no occasion for the detaining authority to refer to in the grounds of detention the result of the proceedings in Ext.P7. Even if the fact of issue of notice on 2.5.2013 is not referred to in the grounds of detention, that by itself is not a sufficient ground to interfere with the order of detention at its pre-execution stage.

17. The decision in

# Pooja Batra v. Union of India and others ((2009) 5 SCC 296

was a case where the order of detention was challenged after its execution. In Pooja Batra’s case, notice to reopen the question of levy of customs duty was issued and immediately an order of detention was also issued. The question of duty was finalised earlier and in that context, the Supreme Court held in Pooja Batra’s case that use of incomplete material which is either pending or inconclusive cannot be a basis for detention order. Paragraph 31 of the decision in Pooja Batra’s case would make the distinguishing aspect. Paragraph 31 reads as follows:

“31. If we consider the case on hand on the above principles, though the detaining authority has relied on the import of eight consignments, the fact remains that the goods were cleared after passing appropriate orders by the authorities and in any event on the date of passing of the detention order it was at the stage of notice calling for reopening the issue, hence the same cannot be a valid material for passing an order of detention against the detenu. In fact, while determining the subjective satisfaction the detaining authority had said that enquiries are pending on all those documents placed on record and relied upon by them.”

18. In

# Pebam Ningol Mikoi Devi v. State of Manipur and others ((2010) 9 SCC 618

a two Judge Bench of the Supreme Court held at paragraph 26 thus:

“26. What emerges from these rulings is that, there must be a reasonable basis for the detention order, and there must be material to support the same. The Court is entitled to scrutinise the material relied upon by the authority in coming to its conclusion, and accordingly determine if there is an objective basis for the subjective satisfaction. The subjective satisfaction must be twofold. The detaining authority must be satisfied that the person to be detained is likely to act in any manner prejudicial to the security of the State or from acting in any manner prejudicial to the maintenance of the public order and the authority must be further satisfied that it is necessary to detain the said person in order to prevent from so acting.”

19. A six Judge Bench of the Supreme Court in

# State of Bombay v. Atma Ram Shridhar Vaidya, AIR 1951 SC 157

held thus:

“5. …….. The satisfaction of the Government, however, must be based on some grounds. There can be no satisfaction if there are no grounds for the same. There may be a divergence of opinion as to whether certain grounds are sufficient to bring about the satisfaction required by the section. One person may think one way, another the other way. If, therefore, the grounds on which it is stated that the Central Government or the State Government was satisfied are such as a rational human being can consider connected in some manner with the objects which were to be prevented from being attained, the question of satisfaction except on the ground of mala fides cannot be challenged in a Court. Whether in a particular case the grounds are sufficient or not, according to the opinion of any person or body other than the Central Government or the State Government, is ruled out by the wording of the section. It is not for the Court to sit in the place of the Central Government or the State Government and try to determine if it would have come to the same conclusion as the Central or the State Government. As has been generally observed, this is a matter for the subjective decision of the Government and that cannot be substituted by an objective test in a Court of law. Such detention orders are passed on information and materials which may not be strictly admissible as evidence under the Evidence Act in a Court, but which the law, taking into consideration the needs and exigencies of administration, has allowed to be considered sufficient for the subjective decision of the Government.”

20. In Ext.P7 proceedings which culminated in the order dated 23.10.2014 and the appellate order dated 8.9.2015, the petitioner was heard and he was fully aware of the allegations levelled against him and the proceedings with respect to the smuggling activity alleged to have taken place. It is thus clear that there was no suppression of any material fact and the petitioner was quite aware of the allegations against him and he has appropriately taken his defence as well. Therefore, non-mention in the grounds of detention about the show cause notice dated 2.5.2013, would not be a sufficient ground to quash the order of detention at its pre-execution stage. It is also to be noted that the show cause notice is dated 2.5.2013 while the order of detention is dated 6.5.2013, four days after the date of issue of Ext.P7 show cause notice.

21. Antony Morris was arrested and he was detained in execution of the order of detention issued against him. Ext.P2 grounds of detention was issued in the case of Antony Morris. Licil Antony, the wife of Antony Morris filed a Writ Petition challenging the order of detention and the continued detention and that Writ Petition was dismissed by the Kerala High Court as per the decision in

# Licil Antony v. State of Kerala and another, 2014 Crl.L.J. 2062

The Supreme Court in Crl.A.No.872 of 2014 confirmed the order passed by the High Court and dismissed the Criminal Appeal filed by the wife of Antony Morris. (See Licil Antony v. State of Kerala and another (2014 KHC 4256)). The grounds of detention, even according to the petitioner, are common to Antony Morris as well as the petitioner. Even after the detention order was issued, this Court did not find any ground to interfere with the order of detention. The subjective satisfaction arrived at by the detaining authority was upheld by this Court in Licil Antony’s case on the same set of facts as in the case of the petitioner. Non-interference by the High Court as well as the Supreme Court in the order of detention against Antony Morris on the same set of facts would have great significance while considering the question whether the order of detention issued against the petitioner is liable to be interfered with at its pre- execution stage. When the subjective satisfaction was found to be properly arrived at by the detaining authority on the same set of facts in Licil Antony’s case (Antony Morris’s case), it will not be proper for us to arrive at a conclusion quite contrary to that on the same set of facts in the case of the petitioner and that too at the pre-execution stage.

22. In the facts and circumstances, we do not find force in the submission of the petitioner that clause (iv) of paragraph 30 of the decision in Alka Subhash Gadia’s case will apply and that the order of detention was passed on vague, extraneous or irrelevant grounds. According to the petitioner, he is still in Dubai. He wants to get rid off the execution of the order of detention against him on grounds which he could raise only after the order of detention is executed. Grounds which could be raised challenging the order of detention after its execution cannot always be made a ground for challenging the order of detention at its pre-execution stage. Certain contentions are to be decided on the basis of the averments in the affidavit, counter affidavit as well as the records. An analysis of facts and contentions which could be undertaken in a Writ Petition challenging the order of detention after its execution, cannot be undertaken in a Writ Petition challenging the order of detention at its pre-execution stage. We do not find any ground to exercise the jurisdiction under Article 226 of the Constitution to grant the reliefs prayed for in this Writ Petition. Relief (ii) is not maintainable in the light of the decision of the Supreme Court in

# Subhash Popatlal Dave v. Union of India and another, (2014) 1 SCC 280

23. We make it clear that we have considered only the grounds raised by the learned senior counsel for the petitioner confining his submission to the challenge against the order of detention at its pre-execution stage and findings herein above would not preclude the petitioner from raising all his contentions in a Writ Petition challenging the order after it is executed.

For the aforesaid reasons, the Writ Petition is dismissed.

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