IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED:30.06.2008 CORAM: THE HON'BLE MR.JUSTICE M.CHOCKALINGAM AND THE HON'BLE MR.JUSTICE S.PALANIVELU HCP.NOs.1750 and 1761 OF 2007 Subbulakshmi ...Petr., in HCP.No.1750/2007 Muthulakshmi ...Petr., in HCP.No.1761/2007 Vs. 1.The State of Tamil Nadu rep. by the Secretary to the Government, Public (SC) Dept., Fort St.George, Chennai. 2.The Union of India, rep. by its Secretary to the Government, Ministry of Finance, Department of Revenue,(Cofeposa Unit) New Delhi. 3.The Superintendent of Central Prison, Central Prison,Puzhal, Trichy. ...Respondents Petitions under Article 226 of the Constitution of India for the issuance of a writ of Habeas Corpus calling for the records relating to the detention orders in G.O.No.S.R.1/990-5/2007 and G.O.NO.1/990-7/2007 respectively dated 23.11.2007 passed by the first respondent and quash the same and direct the respondents to produce the body of the person of the detenu Venugopal, Son of Vellaichamy and C.Rathinam, S/o K.R.Chinniah now detained under Section 3(1) of the COFEPOSA ACT in Central Prison, Puzhal,Chennai and set them at liberty forthwith. For petitioners : Mr.B.Kumar Senior Counsel for Mr.S.Palani Kumar For Respondents : Mr.M.Babu Muthu Meeran Additional Public Prosecutor https://hcservices.ecourts.gov.in/hcservices/ O R D E R (Order of the Court was made by M.CHOCKALINGAM,J) Invoking the writ jurisdiction of this Court, the petitioner in HCP.No.1750 of 2007 who is the wife of the detenu Venugopal and the petitioner in HCP.No.1761 of 2007 who is the wife of Rathinam have challenged the order of the detention in G.O.NO.SR.I/990-5/2007 and G.O.NO.SR.I/990-7/2007 dated 23.112.2007 made by the first respondent and detained them under Section 3(1)(ii) of the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act 1974. 2. Perused the affidavit filed in support of the petition and counter affidavit . Heard the learned counsel for the petitioner as well as the learned counsel appearing for the respondents-State. 3. The short facts which led the first respondent to pass the orders under challenge can be stated thus: On 20.10.2007, the officers attached to the Air intelligence unit, Chennai customs to be present at the customs room situated in the departure hall of Anna International Airport, Chennai, on opening and examination of hand baggage's of the 11 passengers bound for Singapore by Indian Airlines flight IX 682/20.10.2007 and when the officers asked the passengers whether they are having currency or not, for which the passengers replied that they have possessed Indian currency Rs.1,00,000 each to meet the expenses at abroad. Further, the passengers gave the statements that they are going to Singapore for employment for which they have obtained visa from the proper authority. Thereafter, the officers examined the baggage's which containing Indian currency Rs.1,00,000/- each and the same were seized and total value of the Indian currencies is Rs.11,00,000/-. Further, the officers recorded the statement from those passengers that the seized monies were given by Venugopal and Rathinam, the detenus for arranging employment at Singapore. Since the detenu Venugopal was not in possession of any licence/permit to carry/export the Indian currency, he was arrested for violating the customs and Fema Act. 4. The detenu Venugopal gave a statement that he studied up to few classes in Tamil medium and he knows only Tamil and he is the Manager-Admn of M/s Exon consultants Private limited and he is running the said company for the past six months and his Managing Director one Ramachandran was residing at Singapore; that the company was engaged in recruiting personal for employment at Singapore and provide them training in electronic field before sending them for job to Singapore; that he on selecting the eleven persons for placement at Singapore and after getting work permit for them, they were sent https://hcservices.ecourts.gov.in/hcservices/ to Chennai Airport for flying to Singapore by Air India Express and he instructed his staff Rathinam, the co-detenu herein to hand over rupees one lakh each to eleven personal to carry it to Singapore. The money was given to eleven passengers with instruction to change it at the Chennai Airport into foreign currency; that the eleven passengers had failed to change the currency. Further the said incident had taken place on 20.10.2007, the officers arrested the detenus under Section 104(1) of the Customs Act 1962 on 21.10.2007 and the detenus were produced before the learned Additional Chief Metropolitan Magistrate E.O.I, Egmore, Chennai on 21.10.2007. Further the learned Magistrate remanded the detenus to Judicial custody till 5.11.2007. Further the said Court has granted bail to the detenus on 24.10.2007 on condition to appear before the Customs, Chennai until further orders. A representation was sent by the co-detenu Rathinam to the Commissioner of Customs (Air), Chennai. Further, the co-detenu gave a complaint to the Advisory Board on 23.01.2008. The eleven passengers sent a retraction letters to the Additional Chief Metropolitan Magistrate, E.O.I, Egmore, Chennai; that the detenu and co-detenu sent a retraction letter to the said Court. Both the detenu and co detenu sent a compounding application under Section 137(3) of the customs Act 1962 to compound their case. The Chief Commissioner of customs, Chennai has passed an order on 7.2.2008 and 20.2.2008 respectively. The detaining authority, on scrutiny of the materials, has passed the detention orders on 28.11.2007 and the same were executed and grounds of detention and booklets were served to the detenus on 29.11.2007. In the meeting of the Advisory Board, the detenus gave representations on 25.1.2008 and the same were also rejected on 15.2.2008. Confirmation has also been sent by the State Government. Under such circumstances, the above Habeas Corpus petitions have been brought forth before this Court. 5. Advancing his arguments on behalf of the petitioners, learned Senior counsel made the following submissions: In the instant case, the orders under challenge came to be passed on 28.11.2007 against the detenu Venugopal and co-detenu Rathinam. According to the learned Senior counsel, the orders of detention suffer by non-application of mind. Learned Senior counsel would rely upon two statements of the detention order. First statement in the detention order of the detenue Venugopal which is found in Ground V Page 3 which reads as follows: "You, V.Venugopal, Manager-Admn, of M/s Exon Consultants P.Ltd., in your statement dated 20.10.2007, inter alia stated that you were running the said company for the past six months, and that your Managing Director, Thiru Ramachandran was residing at Singapore, that the company was engaged in recruiting personnel for employment at Singapore and provide them training in electronic filed before sending them for job https://hcservices.ecourts.gov.in/hcservices/ to Singapore , that you on selecting the eleven persons for placement at Singapore and after getting work permit for them, sent them to Chennai Airport for flying to Singapore by Air India Express; that you instructed your staff Thiru Rathinam to hand over Rupees one lakh each to the eleven persons to carry it to Singapore; that Thiru Rathinam handed over the money to each of them outside the airport, that your company used to collect Rs.1,60,000/-from the individuals going to Singapore for job, out of which Rs.20,000/- was given to their sub agent, Rs. 20,000/- to the training centre, Rs./10,000/- for the Air Ticket and Rs.10,000/- for the company's expenses; that the balance Rs.One lakh used to be given to the Singapore office; that on two previous occasions, i.e. on 19.9.2007 and 27.9.2007 the company had sent 33 and 14 persons respectively to Singapore for job with USD1,200 endorsed in their passports through D.D.Travels, Royepattah, Chennai, that as the departure date of the particular eleven persons in the present case was advanced from 21.10.2007 to 19.10.2007 the Indian money of Rs.one lakh each was handed over to the passengers and they were instructed to change it at the Chennai Airport into foreign currency that the eleven persons had failed to change the currency that you know it was an offence to carry Indian currencies without declaring to customs, that you knowingly have committed this offence and requested for pardon". Ground (vi) which reads as follows: "(vi). In your further statement given on 20.10.2007, you reiterated the earlier statement given by you at your office immediately after the search was conducted and further stated that you had given the Indian currencies through Thiru Rathinam to be given to the eleven persons; that you had instructed Thiru Rathinam to tell the eleven persons to keep the currency in their checked-in-luggage; that you accepted that it was not possible to exchange currency in the airport once the money is kept in the checked-in-luggage; that you knew that the Indian currency was to be sent as it is, without converting it into foreign currency, You also stated that you had not acted on any third person's instruction." 6. Both the statements are alleged to have been given by the https://hcservices.ecourts.gov.in/hcservices/ passengers. From the said statements, it is quite clear that both the statements are inconsistent to each other and while these two statements are taken into consideration, if they are taken explicitly by the detaining authority to arrive at a subjective satisfaction, out of these two statements, which statement should be relied upon, was not made known. Therefore, the detenus were prevented not only from making their effective representation, but also could not able to put forth their defence at all. Therefore, it is clearly non- application of mind on the part of the authority who passed the detention orders. 7. Secondly, in the instant case, as could be seen from the orders, admittedly, from each of the eleven passengers, a sum of Rs.1 lakh of Indian currency was confiscated. Both the detention orders would clearly reveal that the currencies were confiscated under the provisions of Section 113(d) and 113(h)of the Customs Act and further the orders would reveal that pursuant to the act done or omission by the detenus which will render such goods are liable to be confiscated". Learned Senior counsel took the Court to Section 113(d) and 113(h) of the Customs Act, by pointing out that the passengers were liable to be confiscated as per the provisions, for the act done or omission that was actually done by the passengers. Learned Senior Counsel also took the Court to Section 77 of the Customs Act, wherein it is stated that the declaration must be given by the owner of baggage. Admittedly, in the instant case, passengers were found with check-in-baggage and if to be so, the passengers are duty bound to give a declaration as contemplated under Section 77 of the Customs Act, but they have not done so. Thus, a suppression of act or omission was done by the passengers and not by the detenus. Under such circumstances, at best, the detenus could be found to be as one abetted the offence, but not committed any act or omission. But, the orders would reveal that by committing an act or by making an omission,the goods are liable to be confiscated. Without making distinction in the order, the authority has given such a statement in its order, which was clearly non-application of mind on the part of the authority. Learned Senior counsel would further add that compounding applications were made by the detenu and co-detenu under Section 137(3) of the Act and the Chief Commissioner of Customs passed orders in the said compounding applications on 7.2.2008 and 20.2.2008 respectively. But, the applications and orders passed thereon were not at all placed before the Advisory Board or before the confirming authority. The Advisory Board could have an occasion to go through those materials and pass an order as to whether approval could be granted or not. If the advisory Board approved the case, the confirming authority can even revoke the said order. But, it was not placed before the confirming authority. Under such circumstances, the fact that the compound applications and the orders passed thereon were not placed either before the Advisory Board or before the confirming authority. All would go to show that the grounds raised in the detention orders are liable to be quashed and https://hcservices.ecourts.gov.in/hcservices/ hence the order of detention is liable to be set aside. 8. In support of his contention, learned Senior counsel for the petitioner relied on two decisions; 1.AIR 1983 SUPREME COURT 300 (Yumnam Mangibabu Singh Vs. State of Manipur and others . 2. 1990 L.W.(Crl.)169(Kutubudeen Ali Bhoy Vs. State of Tamil Nadu rep. by Secretary to Government, Public (S.C.) Department,St.George, Chennai) 9. The Court heard the Additional Public prosecutor on the above contentions and also the Court paid its anxious consideration to the submissions made. 10. It is not in controversy that the detenu Venugopal and co- detenu Rathinam were detained pursuant to the orders passed by the first respondent after recording a finding that their activities were got to be termed as smuggling activities and it is further to be considered necessary to detain them under Section 3(1) of the COFEPOSA Act in order to prevent them from abetting the smuggling of goods in future, the order under challenge is made before this Court. 11. After looking into the materials available on record, this Court is of the considered view that it is a case of non-application of mind on the part of the detaining authority is quite evident. Concededly, on 20.10.2007, when eleven passengers were about to aboard the flight for Singapore as referred to above, all the eleven passengers were examined and at the time they were found in possession of Rs.1 lakh Indian currency each. When they were questioned about the same, a statement was made to that effect that the seized monies were given by Venugopal and Rathinam for arranging employment at Singapore. Since the detenu Venugopal was not in possession of any licence/permit to carry/export the Indian currency, he was arrested and apart from this, currencies were also seized. The statements of detenus were also recorded and proceedings were initiated. Following the statement given by those passengers, the detenu and co-detenu were arrested under Section 104(1) of the Customs Act on 21.10.2007. They were remanded to judicial custody. Further they were granted bail and proceedings were initiated under the provisions of COFEPOSA Act and now they are detained. Now from the perusal of the orders, it would be quite clear that when the materials were placed before the detaining authority, two statements of the detenu Venugopal were placed and those statements are extracted in the order itself. The said statements are extracted here under. "You, V.Venugopal, Manager-Admn, of M/s Exon Consultants P.Ltd., in your statement dated 20.10.2007, inter alia stated that you were https://hcservices.ecourts.gov.in/hcservices/ running the said company for the past six months, and that your Managing Director, Thiru Ramachandran was residing at Singapore, that the company was engaged in recruiting personnel for employment at Singapore and provide them training in electronic filed before sending them for job to Singapore , that you on selecting the eleven persons for placement at Singapore and after getting work permit for them, sent them to Chennai Airport for flying to Singapore by Air India Express; that you instructed your staff Thiru Rathinam to hand over Rupees one lakh each to the eleven persons to carry it to Singapore; that Thiru Rathinam handed over the money to each of them outside the airport, that your company used to collect Rs.1,60,000/-from the individuals going to Singapore for job, out of which Rs.20,000/- was given to their sub agent, Rs. 20,000/- to the training centre, Rs./10,000/- for the Air Ticket and Rs.10,000/- for the company's expenses; that the balance Rs.One lakh used to be given to the Singapore office; that on two previous occasions, i.e. on 19.9.2007 and 27.9.2007 the company had sent 33 and 14 persons respectively to Singapore for job with USD1,200 endorsed in their passports through D.D.Tsravels, Royepattah, Chennai, that as the departure date of the particular eleven persons in the present case was advanced from 21.10.2007 to 19.10.2007 the Indian money of Rs.one lakh each was handed over to the passengers and they were instructed to change it at the Chennai Airport into foreign currency that the eleven persons had failed to change the currency that you know it was an offence to carry Indian currencies without declaring to customs, that you knowingly have committed this offence and requested for pardon". The statement in Ground (vi) which reads as follows: "(vi). In your further statement given on 20.10.2007, you reiterated the earlier statement given by you at your office immediately after the search was conducted and further stated that you had given the Indian currencies through Thiru Rathinam to be given to the eleven persons; that you had instructed Thiru Rathinam to tell the eleven persons to keep the currency in their checked-in-luggage; that you accepted that it was not possible to exchange currency in the airport https://hcservices.ecourts.gov.in/hcservices/ once the money is kept in the checked-in-luggage; that you knew that the Indian currency was to be sent as it is, without converting it into foreign currency, You also stated that you had not acted on any third person's instruction." From the very reading of these statements, it would be quite clear that the first statement was to the effect that the Indian amount of Rs.1 lakh each was handed over to eleven passengers and they were instructed to change it at the Chennai Airport into foreign currency; that the passengers failed to do so. Thus, it has resulted in initiation of proceedings. While the further statement would clearly reveal that once the money is kept in checked-in baggage, the detenu knew that the Indian Currency was to be sent as it is, without changing into foreign currency. According to the first statement given, the passengers were instructed to change it at the Chennai Airport into foreign currency and in so far as the second statement is concerned since the eleven persons were instructed to keep the currency in their checked-in-luggage, it was not possible to exchange currency in the airport once the money is kept in the checked-in- luggage and hence both the statements are thoroughly inconsistent to each other and thus in such circumstance, while these statements are inconsistent, it is not made clear based on which statement, the authority has passed its order. It causes confusion in the minds of the detenus that what could be their defence plea and therefore, as rightly pointed out by the learned Senior counsel for the petitioners, it is quite evident that it is non-application of mind. Further it is to be pointed out that mere statement of the detaining authority that he has taken into account only certain facts and materials placed before him and he has passed the orders after arriving at a subjective satisfaction; that which part of the statement was made best, must be made in the course of the order, but it has not been done so. Hence it can be termed as non-application of mind. 12. In so far as the second contention is concerned, this Court is able to see some force in the contention of the learned Senior Counsel for the petitioners. It is not in controversy that from eleven passengers who were about to aboard the flight, a sum of Rs.1 lakh each was actually seized from those passengers following the Mahazar prepared. Now, the order in respect of the seizure made from those passengers would read thus: "(x).Thiru V.Venugopal has attempted to smuggle Indian currency to Singapore through the unemployed youths who appear to be unaware of the rules and regulations governing the export of Indian currency. You, Thiru C.Rathinam, have abetted him in exporting the Indian currencies illicitly which is punishable under the Customs https://hcservices.ecourts.gov.in/hcservices/ Act 1962. Thereby, Thiru V.Venugopal and you have rendered Rs.11 lakhs of Indian currencies liable for confiscation under Section 113(d) and 113(h) of the Customs Act, 1962. According to Section 2 (39) of the Customs Act 1962 smuggling in relation to any goods means any act or omission which will render such goods liable to confiscation under Section 111 or 113 ibid." 13. From a reading of the said part of the order, it would be quite clear that the currencies were seized as if it was due to any act done or omission made by the detenu himself. Now, for the purpose of confiscation was made, as per Section 113(d) and 113(h) of the Customs Act, it is most proper and appropriate to extract the said Act. "113(d):any goods attempted to exported or brought within the limits of any customs area for the purpose of being exported, contrary to any prohibition imposed by or under this Act or any other law for the time being in force". "113(h) any goods which are not included or are in excess of those included in the entry made under this Act, or in the case of baggage in the declaration made under Section 77". 14. In the instant case, confiscation was made from the passengers while they kept the Indian currencies in the checked-in- baggage. If to be so, it is a case where the confiscation should have been made under Section 113 (h) of the Act. In the case of baggage, declaration has got to be made as contemplated under Section 77 of the Act. Section 77 reads as follows: "Declaration by owner of baggage- The owner of any baggage shall, for the purpose of clearing it, make a declaration of its contents to the proper officer." 15. In the instant case, declaration by owner of baggage shall for the purpose of clearing, it should make a declaration of its contents to the proper officer. From the reading of the detention order, a duty is cast upon the owner of the baggage to make such a declaration. In the instant case, at the time when the passengers were aboard the flight, each passenger was the owner of the respective baggage, a duty was cast upon them to make the declaration. Now, as could be seen from the part of the above order, confiscation was made under Section 113(d) and 113(h) of the Customs Act pursuant to the act done or omission made by the detenu himself. https://hcservices.ecourts.gov.in/hcservices/ If to be so, it is made clear that it should only be done by the passengers and pursuant to the same, confiscation was made and at best, the detenu has only abetted the offence. It is not made clear in the case on hand. Added further, in the instant case, as rightly pointed out by the learned counsel for the petitioners, in the case of this detenu, Venugopal, it has been stated that one Rathinam, the co-detenu has abetted this detenu for attempting smuggling Indian currency to Singapore, equally in the detention order of the said Rathinam, it is found that Venugopal has abetted Rathinam in attempting smuggling Indian currency to Singapore. In the case of either of the detenue, one has abetted in doing the smuggling activity the other. It is quite clear that at that time mere declaration should have been made by the passengers and not by the detenu himself. Thus, it is also indicative of the fact that the authority has not made distinction between the passengers who were in possession of the currency and the act of the detenus. Hence, it is nothing but non-application of mind on the part of the authority, which would be suffice to quash the orders of detention. Accordingly, the detention orders are quashed. 16. Accordingly, the Habeas Corpus Petitions are allowed, setting aside the detention orders passed by the first respondent in G.O..No.G.O.No.S.R.1/990-5/2007and G.O.NO.1/990-7/2007 dated 23.11.2007. The detenus, namely, Venugopal and Rathinam, who are now confined at Central Prison, Puzhal, Chennai are directed to be set at liberty forthwith unless their presence is required in connection with any other case. Sd/- Assistant Registrar /true copy/ Sub Assistant Registrar VJY To 1.The Secretary to the Government, Public (SC) Dept., Fort St.George, Chennai. 2.The Secretary to the Government, Ministry of Finance, Department of Revenue,(Cofeposa Unit) New Delhi. 3.The Superintendent of Central Prison, Central Prison,Puzhal, Trichy. https://hcservices.ecourts.gov.in/hcservices/ 4.The Public Prosecutor, High Court, Madras. 5.The Joint Secretary to Government of Tamil Nadu Public (Law & Order)