Allowed

FPA-ND-48/DLI/2016 of Karam Chand @ Karam Dass v/s The Competent Authority, Delhi

ATFP16 Feb 2017FPA-ND-48/DLI/2016

Case brief

AI extract

What is this about?

The Tribunal allowed the appeal, ruling that property frozen under Section 68-F must be released under Section 68-Z upon acquittal in the specific FIR involved, rejecting the Competent Authority's reliance on conviction in unrelated cases.

What did the court decide?

The impugned order was set aside and the property frozen under FIR 383/2010 was released forthwith.

FPA-ND-48/DLI/2016 of Karam Chand @ Karam Dass v/s The Competent… — Narcotics (NDPS) | ATFP (2017)

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APPELLATE TRIBUNAL FOR FORFEITED PROPERTY NEW DELHI

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Date of Decision: 16.02.2017

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MP-ND-134/DLI/2016 FPA-ND-48/DLI/2016

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Karam Chand @ Karam Dass … Appellant/Applicant Versus The Competent Authority, Delhi … Respondent

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Advocates/Authorized Representatives who appeared

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For the appellant	: Shri Ayush Sharma, Advocate
For the respondent	: Shri Munish Kumar, Advocate
CORAM JUSTICE MANMOHAN SINGH SHRI B.K. BANSAL	: CHAIRMAN : MEMBER
JUDGEMENT JUSTICE MANMOHAN SINGH	: CHAIRMAN

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FPA-ND-48/DLI/2016

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By this order, we propose to decide the appeal filed by the appellant under section 68(O) against the order of the Competent Authority dated 20^th November, 2015 whereby the application by the appellant under section 68-Z to release the property frozen by the respondent was dismissed. The said impugned order was passed by the Competent Authority without the hearing of the appellant. The main reason given in the said ex-parte order was that since the appellant is

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covered under section 68A (2) (a) of the NDPS Act, 1985 the property cannot be released under section 68-Z of the Act.

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The brief facts of the matter is that the property in question was attached by the freezing order dated 18^th April, 2011 by the sub inspector passed by the Investigating Officer, Police Station Balh Distt. Mandi arisen out of FIR No. 383/2010. Admittedly the appellant was acquitted on 30^th October, 2011 in the matter arising out of FIR No. 383/2010. The main contention of the appellant is that once the appellant has been acquitted by virtue of the judgment which was not challenged by the respondent in the higher Court and the same had attained finality, under section 68-Z the property was liable to be released forthwith. However, for the reasons known to the respondent no. 1 the same was not released to the appellant despite of mandatory provision of section 68-Z. The same is read as under:-

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“ Release of property in certain cases:- (1) Where the detention order of a detenu is set aside or withdrawn, properties seized or frozen under this Chapter shall stand released.

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(2) Where any person referred to in clause (a) or clause (b) or clause (cc) of sub-section (2) of section 68A has been acquitted or discharged from the charges under this Act or any other corresponding law of any other country and the acquittal was not appealed against or when appealed against, the appeal was disposed of as a consequence of which such property could not be forfeited or warrant of arrest or authorization of arrest issued against such person has been withdrawn, then, property seized or frozen under this Chapter shall stand released.”

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The learned counsel for the respondent has not denied the facts that the freezing order was passed only in FIR no. 383/2010 dated 8^th December, 2010 under section 18/20 of the NDPS Act & registered at Police Station Balh Distt. Mandi. It is by virtue of the said freezing order that the property was frozen. The freezing order reads as under:-

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“POLICE STATION BALH

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DISTT. MANDI HP

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FRIEZING ORDER

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ORDER UNDER SECTION 68F (1) READ WITH SECTION 68-E OF THE NARCOTIC DRUGS AND PSYCHOTROPIC SUBSTANCES ACT 1985( AS AMENDED)

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Order u/s 68(f) of the N.D. & P.S. Act No. 61 of 1985 in the case of Sh. Karam Chand @ Karam Dass S/o Sh. Lobaria Ram Caste Labana (Nayak) r/o village and Post Office Dhaban Tehsil sadar Police Station Balh Distt. Mandi HP (presently lodged in sub jail Mandi) in case FIR No. 383/10 dated 8.12.2010 u/s 18/20-61-85 N.D. & P.S. Act registered at Police Station Balh Distt. Mandi order of freezing of properties in question.

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Whereas under singed has been vested with the powers of Investigation Officer of Police Station Balh Distt. Mandi HP. The jurisdiction of undersigned for investigation in relation of offences under ND&PS Act extended to the whole jurisdiction of this Police Station.

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That on date 19.9.2006 one kilogram charas was recovered from the possession of the accused Karam Chand @ Karam Dass and case FIR NO. 364/06 dated 19.9.2006 u/s 20-61-85 ND&PS Act Police Station Sundernagar Distt. Mandi had been registered and on date 24.12.2007 500 grams charas was recovered from the possession of the accused Karam Chand @ Karam Dass and case FIR No. 244/07 dated 24.12.2007 u/s 20,29-61-85 N.D.&P.S. Act Police Station Barmana Distt. Bilaspur HP had registered and on dated 8.12.2010, 200 grams charas and 160 grams opium recovered from the possession of the accused Karam Chand @ Karam Dass and case FIR No. 383/10 dated 8.12.2010 U/S 19/20-61-85 N.D.&P.S. Act has also been registered.

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Whereas undersigned investigated the cast FIR NO. 383/10. All three cases are under trail in the courts. During the course of investigation undersigned has traced and identified the illegally acquired properties of this person u/s 68 (1) of ND & PS Act who have committed the offences under this act.

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During the course of investigation it is revealed that the accused has running a tea stall stop in his house which is not running properly and maximum time remained closed. Earning income from the shop is not sufficient for his lively hood but the accused Karam Chand @ Karam Dass have well immovable property and money in various accounts. Details of the properties identified to be owned by the accused are appended below.

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Sr. No.	Description of Properties	Name of _Owner _	Year of acquition	Value of assets
1.	First storey of House in which one room, one Kitchen and bath room	Karam Chand @ Karam Dass	2006-07	2,02708=00
2.	Punjab National Bank Branch Baggi Distt.	Do	2009	63,452=00

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	Mandi A/C No. 1206000101072288
3.	RCS FREE GIFT. COM WZ-1A, T/F MAIN NAGAFGARH ROAD GANESH NAGAR,	Do	2009	60,000=00
	Tilak Nagar ,New
	Delhi 110018 ID No _RCSP99880087 _

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Karam Chand @ Karam Dass does not have any source of income to make investment in the bank, RCs FREE GIFT.COM and built upper storey of house. All the above said properties are of recent origin and do not commensurate with the sources of income of accused.

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This is a reasonable belief that the accused has acquired these properties through the illicit selling/trafficking of the Charas and Opium.

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Therefore in exercise of the power conferred upon me Under Section 68-E read with section 68-F of the ND & PS Act 1985, I hereby friezed the properties mentioned in the above annexure to this order and direct the above mentioned person that shall not part with, transfer, mortgage or otherwise deal with the properties as shown in the annexure without prior permission of the undersigned or the Competent Authority & Administrator NDPS Act 9^th Floor Lok Nayak Bhavan, Khan Market, New Delhi-110003.

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This order is issued without prejudice to any other action that may be initiated in future under this Act or any other Act for time being in force in India.

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Ranjit Sngh Sub. Inspr. Investigation Officer. Police Station Balh Distt. Mandi.”

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It is apparent from the freezing order that the property is in question in FIR no. 383/2010, though in sub para (3) of the said order it is also mentioned that the other FIR No. 244/2007 and 364/2006 are also pending against the appellant for reference purposes. It is also not in dispute that the other remaining FIRs the properties in question were not freezed by the respondent nor any freezing order were passed. It is apparent that Section 68-Z is a mandatory and deeming provisions. No different meaning can be given nor any exception is permissible as it stipulates that in case the detention order of the detenu is set aside the

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freezing property shall stand released. No other option is left with the Competent Authority to take shelter of any ground unless the said order is challenged by the Competent Authority.

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In the present case no appeal was filed against the acquittal order by the Competent Authority. The first submission of the learned counsel for the respondent is that the appellant earlier filed the appeal under section 68-O of the NDPS Act, 1985 challenging the confirmation order. As by that time he was acquitted, he had taken one of the grounds about the acquittal order under section 68-Z of the Act. Admittedly, the said appeal FPA-ND-26/DLI/2013 was dismissed by this Tribunal by order dated 10^th October, 2014. Even the said order was challenged before the Hon‟ble High Court, Delhi WPC No. 846/2015 but the same was withdrawn on dated 24^th August, 2015, therefore the present appeal is not maintainable.

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Having gone through the order dated 10^th October, 2014 passed by this Tribunal we find no force in the submission of the learned counsel for the respondent as the said appeal was dismissed by this Tribunal only the ground of delay. In the said impugned order dated 3.5.2011 under section 68-F of the NDPS Act the attachment was confirmed which was initially frozen by order dated 18^th April, 2011. Whereas appeal was filed after a long time in April, 2012. It appears from the said order that the appeal was dismissed merely on the ground of delay in para no. 29 & 30 of the said order which reads as under:

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“29. The plea of the appellant regarding alleged defect in notice and consequently the impugned order being without jurisdiction cannot be accepted nor the appellant is entitled for condonation of delay in filing the appeal on the alleged ground of notice being without jurisdiction.

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30. Consequently, the delay in filing appeal after 60^th day cannot be condoned in the facts and circumstances of the present appeal and the application for condonation of delay is liable to be dismissed. The application is therefore dismissed.”

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Therefore, no re-judicata would be applicable against the appellant. Had the order been passed on merits; including the dealing of the ground taken of acquittal, the present appeal would not have been maintainable. Thus argument of the respondent is wholly misconceived.

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The next objections raised by the respondent is that the impugned dated 20^th November, 2015 is not appealable, as it does not get covered within the meaning of 68-O of the NDPS Act.

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It appears from the records that after the acquittal and dismissal of the appeal on account of delay, the appellant filed the application before the Competent Authority requesting for de-freezing order under section 68-Z of the Act. However, the Competent Authority dismissed the application filed by the appellant and the main ground for dismissal of the application was that though the appellant has been acquitted in two FIRs no. 364 and 383, but he has been convicted in the third FIR 244 and the properties frozen in the present circumstances are not liable to be released at this stage as the appellant is covered under section 68A (2) (a) of the NDPS Act, 1985.

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The impugned order dated 20^th November, 2015 is reproduced here below:-

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“GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE OFFICE OF THE COMPETENT AUTHORITY SMUGGLERS & FOREIGN EXCHANGE MANIPULATORS (FORFEITURE OF PROPERTY) ACT, 1976 AND NDPS ACT, 1985

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9^TH FLOOR, LOK NAYAK BHAVAN, KHAN MARKET NEW DELHI-110003

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F.No. CA/DL(HP)/NDPS/38/11-12/1192 Dated: 20.11.2015

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Shri Karam Chand @ Karam Dass S/o Shri Lobaria Ram, R/o Village and Post Office: Dhaban, Tehsil: Sadar, PS: Balh Distt. Mandi, HP

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Sub: Application under section 68Z to release the property freezed by the respondent vide order dated 18.04.2011regarding.

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Sir,

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Please refer your letter/application dated NIL received in this office on 03.09.2015 on the subject cited above.

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In this regard, it is stated that out of the three FIRs, the AP has been acquitted in two FIRs i.e. (i) 364/06 dated 19.06.2006 and (ii) 383/10 dated 08.12.2010. With regard to the third FIR i.e. FIR No. 244/07 dated 24.12.2007, it is submitted that the AP was sentenced to undergo rigorous imprisonment for two years each with fine of Rs. 2,00,000/- by the Ld. Session Judge, Bilaspur. But, after an appeal made by accused before the Hon’ble High Court of Himachal Pradesh, the punishment awarded by the Ld. Trial was modified to imprisonment for one year and fine was increased from Rs. 2,00,000/- to Rs. 5,00,000/- each. Hence, the AP has not been acquitted in the offence punishable under NDPS Act, 1985 with imprisonment for a term of 10 years or more. Therefore the AP is covered under section 68A(2)(a) of the NDPS Act, 1985.

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Under the circumstances, the properties which were seized/frozen in this case are not liable to be released at this stage.

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Yours faithfully,

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(S.P. Lohmorh) Inspecting Officer

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Copy to:Shri Ayush Sharma, Advocate, 723/2007, Chamber No. 846, Saket Court Complex, Saket, Delhi-110017.

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(S.P. Lohmorh) Inspecting Officer”

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The said submission of the respondent is also of no avail as the

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freezing order speaks for itself:

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“Order u/s 68(F) of the NDPS Act NO. 61 of 1985 in the case of Shri Karam Chand @ Karam Dass S/o Shri Lobaraia Ram Caste Labana (Nayak) r/o village and Post Office Dhaban Tehsil sadar Police Station Balh Distt. Mandi HP (presently lodged in sub Jail Mandi) in case FIR NO. 383/10 dated 8.12.2010 under section 18/20-61-85 N.D. & P.S. Act registered at Police Station Balh Distt. Mandi order of freezing of properties in question.”

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It is admitted on behalf of the respondent that property was not freezed in other two FIR nor any steps were taken by the Competent Authority. Section 68A (2) (a) has no application in the facts of the present case as the subject matter of the dispute of freezing order wherein the property in question were freezed is FIR 383/2010. The said provisions does not help the case of the respondent as it is clear from the said provision that the term every persons who have been convicted in the said chapter (V) (A), is in relation to forfeiture or illegally acquired property. In the said provision, it is stipulated that every person who has been convicted of an offence punishable under this Act with imprisonment for a term of ten years or more shall attract the provisions of chapter (V) (A). In the present case he has been acquitted in the matter in the FIR no. 383/2010 whereby the property of the appellant were attached/freezed as per the freezing order. Once he has been acquitted in the said FIR, the section 68-Z would come into operation. Both the provision of section 68A (2)(a) and section 68-Z are to be read together. As the respondent has not freezed the said property in question in another FIR, the respondent cannot take the shelter of section 68A(2)(a).

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Pertaining to the last objection that the appeal filed by the appellant is not maintainable as the impugned order does not get covered FPA-ND-48/DLI/2016 Page 8 of 13

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u/s 68-(O), it is appropriate to refer to section 68-O, which reads as under:-

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“ 68-O. Appeals - (1) [Any officer referred to in sub-section (1) of section 68E or any person aggrieved by an order of the competent authority] made under section 68F, section 68-I of section 68K or section L, may within forty-five days from the date on which the order is served on him, prefer an appeal to the Appellate Tribunal:

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Provided that the Appellate Tribunal may entertain an appeal after the said period of forty-five days, but not after sixty days, from the date aforesaid if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal in time.

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(2) On receipt of an appeal under sub-section (1), the Appellant Tribunal may, after giving an opportunity to the appellant to be heard, if he so desires, and after making such further inquiry as it deems fit, confirm or set aside the order appealed against.

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(3) The powers and functions of the Appellate Tribunal may be exercised and discharged by Benches consisting of three members and constituted by the Chairman of the Appellate Tribunal.

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(4) Notwithstanding anything contained in sub-section (3), where the Chairman considers it necessary so too do for the expeditious disposal of appeals under this section, he may constitute a Bench of two members and a Bench so constituted may exercise and discharge the powers and functions of the Appellate Tribunal;

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Provided that if the members of a Bench so constituted differ on any point or points, they shall state the point or points on which they differ and refer the same to a third member( to be specified by the Chairman) for hearing of such point or points and such point or points shall be decided according to the opinion of that member:

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[ Provided further that if the office of the Chairman is vacant by reason of his death, resignation or otherwise, or if the Chairman is unable to discharge his duties owing to absence, illness or any other cause, the Central Government may, by order nominate any member to act as the Chairman until a new chairman is appointed and assumes charge or, as the case may be, resumes his duties.]

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(5) The Appellate Tribunal may regulate its own procedure.

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(6) On application to the Appellate Tribunal and on payment of the prescribed fee, the Tribunal may allow a party to any appeal or any person authorized in this behalf by such party to inspect at any time

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during office hours, any relevant records and registers of the Tribunal and obtain a certified copy of any part thereof.”

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In case the chapter (V) (A) and the Act is examined it is clear that in the present case the freezing order were passed by the respondent under section 68-F of the Act. Once the appellant is acquitted, unless the appeal is filed, the section 68-Z applies. In the present case the acquittal order was passed in 2011 and no appeal filed by the respondent even as of today. The said order has attained finality. Section 68-Z clearly mandates that the freezing order under this chapter shall stand released. It is a deeming provision.

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The present appeal has been filed against the order in which despite of the mandatory provision of section 68(Z) of the Act, the Competent Authority has declined to released the properties in question, which were freezed u/s 68-F which reads as under:-

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“ 68F. Seizure or freezing of illegally acquired property .—(1) Where any officer conducting an inquiry or investigation under section 68E has reason to believe that any property in relation to which such inquiry or investigation is being conducted is an illegally acquired property and such property is likely to be concealed, transferred or dealt with in any manner which will result in frustrating any proceeding relating to forfeiture of such property under this Chapter, he may make an order for seizing such property and where it is not practicable to seize such property, he may make an order that such property shall not be transferred or otherwise dealt with, except with the prior permission of the officer making such order, or of the competent authority and a copy of such order shall be served on the person concerned:

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Provided that the competent authority shall be duly informed of any order made under this sub-section and a copy of such an order shall be sent to the competent authority within forty-eight hours of its being made.

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2. Any order made under sub-section (1) shall have no effect unless the said order is confirmed by an order of the competent authority within a period of thirty days of its being made.

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Explanation.—For the purposes of this section, “transfer of property” means any disposition, conveyance, assignment, settlement, delivery, payment or other alienation of property and, without limiting the generality of the foregoing includes—

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a. the creation of a trust in property;

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b. the grant or creation of any lease, mortgage, charge, easement, licence, power, partnership or interest in property;

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c. the exercise of a power of appointment of property vested in any person, not the owner of the property, to determine its disposition in favour of any person other than the donee of the power; and

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d. any transaction entered into by any person with intent thereby to diminish directly or indirectly the value of his own property and to increase the value of the property of any other person .”

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As a matter of fact, the appellant had filed the application informing the Competent Authority that despite of acquittal, the properties were not being released which were attached under the compliance of section 68-F of the Act.

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It is admitted position that in the earlier appeal the appellant challenged the confirmation order when the property were initially freezed and the said appeal was dismissed only on the ground of delay. No doubt at that time the appellant was already acquitted and one of the ground was also taken but nothing was decided at that time on merits.

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It is a settled law that if a question expressly raised which was excluded from the decision in a matter cannot be treated as res-judicata. In order to support the plea of former decision must have been on the merit of the question in subsequent suit. See AIR 1970 Supreme Court

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898 at 906 and AIR 1996 Supreme Court page 1332 at page no. 1336. Thus it is clear that if the issue involved in the matter is already decided in the earlier judgment, the same cannot be raised in the subsequent proceedings and it would be amount to res-judicata. However, on the other hand if in the earlier order the said issue is not decided and order has not been passed on merits, subsequent arising the same issue cannot be held to be barred by the principle of res-judicata. Even otherwise if the former suit is dismissed without any adjudication on the matter of issue merely on technical ground that cannot operates as resjudicata at AIR 1996 SC 2367.

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Being an expert body who are aware of the consequence of acquittal order, and the properties were freezed under section 68-F regularly, still on flimsy grounds, no compliance was being done. The Authority was aware that the property in question were not freezed in the other two FIRs. In case of property which was freezed under section 68-F in the specific FIR, even no written request is required being the deeming provision and it has to be released without any further notice unless the acquittal is challenged by the Authority.

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Despite of that the appellant have filed the application in the present case to release the properties under section 68-Z of the Act. However, the Competent Authority has passed the impugned order which is contrary to the scheme of provisions of the Act.

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As a matter of fact, the filing of the appeal is an extension of the provision of section 68-F which covers under 68-O in the provision of the appeal as the property were freezed/attached by the respondent in the

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said provision. If the section 68-F is not complied by the Competent Authority as requested by the detenu after acquittal, the attachment was invoked under section 68-F, the appellant has right to file the appeal by stating that now the attachment of property by the Competent Authority was illegal. Section 68-Z and 68-F under these circumstances are to be read together. As there is no compliance, the appellant was left with no option but to challenge the order passed though the application filed by the appellant was not required. In fact the operation was filed on account of failure on the part of the Competent Authority who is duty bound to comply with the provisions of NDPS Act without giving different meaning and twisting the mandatory provision which is not permissible in law.

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