AJN IN THE HIGH COURT OF JUDICATURE AT BOMBAY CRIMINAL APPELLATE JURISDICTION CRIMINAL WRIT PETITION NO.146 OF 2004 Suresh Kumar Jain ) Residing at Vasant Vihar Co-op. ) Housing Society, Behind Vasant ) Talkies, Mumbai, presently in ) the Mumbai Central Prison. ) ... Petitioner (Detenu) Versus 1. R.K. Gupta, ) Joint Secretary to the Government) of India, Ministry of Finance ) Department of Revenue, ) COFEPOSA Section. ) 2. The State of Maharashtra, ) through the Superintendent of ) Prison, the Mumbai Central ) Prison, Arthur Road, Mumbai. ) 3. Union of India,Aiyakar Bhavan) New Marine Lines, Mumbai. ) ... Respondents Mr. U.N. Tripathi for the petitioner. Mr. D.S. Mhaispurkar, A.P.P. for the State. Mr. R.M. Agarwal for respondents 1 and 3. CORAM: CORAM: CORAM: SMT. RANJANA DESAI & SMT. RANJANA DESAI & SMT. RANJANA DESAI & A.S. A.S. A.S. OKA, JJ. OKA, JJ. OKA, JJ. DATED: DATED: DATED: 1ST OCTOBER, 2004. 1ST OCTOBER, 2004. 1ST OCTOBER, 2004. ORAL JUDGMENT:- (Per Smt. Ranjana Desai, J.) 1. The petitioner (for convenience, "the detenu") has been detained by Mr. R.K. Gupta, Joint Secretary to the Government of India, under section 3(1) of the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 (for short, "the COFEPOSA Act") with a view to preventing him from acting in any : 2 : manner prejudicial to the augmentation of foreign exchange, in future. The order of detention, the grounds of detention and the material in support thereof were served on the detenu on 22/11/2003. 2. Before we go to the nature of the prejudicial activities in which the detenu is involved, we will note the points of attack on the order of detention. Mr. Tripathi, the learned counsel appearing for the petitioner-detenu firstly contended that the grounds of detention do not indicate that the detaining authority was aware about the bail position of the detenu. He submitted that the grounds do not indicate whether the detenu was ever arrested; whether he was released on bail and whether when the order of detention was passed, the detenu was in custody. This ground has not been raised by Mr. Tripathi in the petition. This petition was on our board on 10/9/2004. By consent of parties, it was adjourned to 13/9/2004. On 13/9/2004, Mr. Tripathi prayed for leave to amend the petition, which was granted to him. Mr. Agarwal, the learned counsel appearing for respondents 1 and 3 wanted more time. Mr. Tripathi, however, objected. We, therefore, directed Mr. Agarwal to file a local affidavit in reply to the amendment. Thereafter, Mr. Tripathi carried out the amendment. Even in the amended petition, this point was not raised. Considering the fact that we are dealing with a preventive detention petition, we asked Mr. Tripathi whether he is aware of the exact bail position of the : 3 : detenu. He submitted that he has no instructions. In such circumstances, we are not inclined to adjourn the petition more so because Mr. Agarwal, on instructions from officers who are present in court, has made a statement that the detenu was never arrested in connection with the prejudicial activities on the basis of which the present detention order is issued. In his affidavit, Mr. Anil Vasant Sardal, API, CB, CID, has stated that when he served the detention order on the detenu, the detenu was a free agent. In view of this, we need not dwell on this point. 3. Mr. Tripathi has assailed the order on several grounds such as the grounds of detention are vague; that there is inconsistency between paragraphs 29 and 42 of the grounds of detention; that the detenu had no antecedents and it was not necessary to detain him and this fact was not considered by the detaining authority; that there is delay in issuing the order of detention; that there is non-supply of vital documents; that there is supply of illegible documents and there is non supply of true and correct translations. Mr. Tripathi very heavily relied on the judgment of the Supreme Court in Kamaleshkumar Ishwardas Patel v. Union of India & Ors, JT 1995 (3) SC 639 where the Supreme Court has observed that the safeguards provided under Articles 22(4) and (5) of the Constitution of India are the minimum safeguards for the protection of persons sought to be preventively detained and, therefore, these safeguards are required to : 4 : be "jealously watched and enforced by the court". Their rigour cannot be modulated on the basis of the nature of the activities of a particular person". Mr. Tripathi, therefore, contended that his submissions may be considered in the light of the above observations of the Supreme Court and the nature of the activities in which the detenu is involved should not weigh with us while considering his submissions. 4. We are mindful of the observations made by the Supreme Court in Kamleshkumar’s case (supra). But, whether in a given case, there is really and truly infraction of Article 22(4) and (5) must be examined by the court. In our opinion, particularly in cases of smuggling and foreign exchange racketeering of great magnitude, the court has to adopt a cautious approach as possibility of false and untenable plea of infraction of Article 22(5) being made with ingenuity for the purpose of defeating the order, cannot be ruled out. 5. Grounds of detention reveal that reliable information was received by the Enforcement Directorate that a person using mobile phone No.9843021514 had been indulging in receiving and making compensatory payments under instructions of a person residing in UAE and that he had received payments of Rs.69 lakhs and Rs.65 lakhs on 7/2/2000 and 8/2/2000 respectively, from the said non-resident. Preliminary enquiries made by the Directorate revealed that the said mobile phone number belonged to C. Surendrakumar, who was residing at : 5 : No.1394, Trichy Road, Coimbatore and he had later vacated therefrom. Further investigations conducted by the Directorate had unearthed a hawala racket involving huge transfer of funds estimated over Rs.600 crores to India from UAE through unauthorised channel as per instructions of one Asarulla Rakka Khan, an Indian citizen, resident in Dubai; that his father K.P. Abdul Majeed of Kozhikode, Kerala, was managing the receipts and distribution of those funds by engaging various persons in Mumbai, Coimbatore in Tamil Nadu and northern parts of Kerala. The modus operandi, so far detected, was that funds in Indian Rupees were received in Mumbai from undisclosed sources, were credited into the bank accounts, maintained under fictitious names and addresses; that the persons had since been identified as employees or agents of K.P. Abdul Majeed. The funds, after deposited in those fictitious bank accounts in Mumbai, were transferred to bank accounts in Coimbatore and Kerala (maintained in the names of different persons with different banks) by means of Telegraphic Transfers; that therefrom the funds were withdrawn by cash. The source of funds and the end users or ultimate beneficiaries were not disclosed by the persons who were questioned so far, leaving it to the logical conclusion that there was a criminal conspiracy behind that hawala racket. 6. The residential premises of Surendrakumar was searched on 11/4/2000, which resulted in the seizure of : 6 : certain documents. During the course of investigation, evidence was gathered from various banks. It was also revealed that the deposits in C. Surendran’s account / M/s. Lord Krishna Bullion, Mumbai and other bank accounts in Mumbai referred to above were mainly by means of cash / transfers from other accounts of persons, who appeared to be C. Surendran’s associates, except in the case of M/s. Sweety International (P) Limited, Mumbai, in which the detenu was a Director, who had purchased pay orders for a sum of Rs.4.68 crores from their account no. 4380 with Indian Overseas Bank, Kalbadevi Branch, Mumbai, as detailed in Annexure - I [(C)(i)] which were found credited in the bank accounts in C. Surendran’s name and in the name of his firm viz. M/s. Lord Krishna Bullion maintained with Lord Krishna Bank, Fort, Mumbai; and that immediately after credit of those amounts, the same were transferred to C. Surendran’s various aforesaid bank accounts [Annexures I(a) and I (b)] maintained at Coimbatore in Tamil Nadu, and Calicut, Palakkad, Ernakulam and Trissur in Kerala. 7. After the detenu’s involvement came to light, his statements came to be recorded. His statement dated 2/9/2002 gives clear idea about the hawala transactions. He stated in that statement that - "(a) He knew Bhupendra through Laxman Akani and Laxman told him over phone that if he had to send amounts to Dubai, he : 7 : must handover the money to Bhupendra and he (Laxman) would receive the same. He was now working with Chaurasia and Bhupendra Thakkar and was doing cheque-discounting business. (b) He had an un-written agreement with Laxman that whatever drawback amounts were received by Sweety International against Imports made by Laxman, 80% would be Laxman’s share and balance 20% would be his share. (c) He has further explained his connection with Shri Bhupendra, who linked his role in transfer of funds to South India through Surendran and this role was known to Ashok and Dinesh also. Further, he has identified the photograph of Ashok F. Jain, Dineshkumar Chaurasia and Mahendra Dave and further confirmed the working of these persons for Bhupendra. 8. In his statement dated 19/9/2002, when questioned as regards Sl.No.5, cell phone bearing No.00971506590974 under the head Incoming in his mobile phone no.98201 80905, the detenu has stated that this is the cell phone : 8 : no. of Asarulla Raka Khan @ Altaf who stays in Dubai. He has further stated that Asarulla Raka Khan had given Laxman Bhai, the amounts that are to be transferred to Laxman Bhai by him and given to the employee of Bhupendra after confirming with him over his office phone or mobile phone. After his confirmation only, Asarulla Raka Khan pays the amount to Laxman Bhai. He has further described his independent connections with Asarula Raka Khan in transfer of funds even without the assistance of Bhupendra Thakkar and he has also explained a particular call on 9/7/2002 made by Shri Asarulla Raka Khan on his mobile phone to confirm the payment of Rs.5 lakhs. He has also stated that Shri Dinesh used to collect the amounts from him in lieu of amounts being delivered to Laxman by Altaf. 9. In his statement dated 26/2/2003, the detenu has confirmed his earlier statements and further stated that out of Rs.17.35 crores, 80% of the amount was sent to Laxman, who stayed in Dubai through Bhupendra Thakkar. These amounts were paid in instalments through various persons of Bhupendra Thakkar. 10. The statement of detenu’s brother Raj Kumar Jain was recorded on 6/5/2003. He has stated that on instructions of the detenu number of accounts were opened for Bhupendra Thakkar for doing hawala transactions on instructions of a person in Dubai. Raj Kumar Jain has further stated that he knew Bhupendra as a businessman in : 9 : the name of Pawan Jewelers and the name of his employees as Dinesh, Ashok F. Jain and Mahendra Dave. 11. These statements along with other statements and other subsidiary material was placed before the detaining authority. The detaining authority thereafter came to a conclusion that the detenu had been engaging himself in activities prejudicial to the augmentation and conservation of the foreign exchange resources of the country. The detaining authority came to a further conclusion that considering the nature and gravity of the offence, the detenu’s role therein, the planned manner in which the detenu had been indulging in such prejudicial activities, all of which reflect the detenu’s high potentiality and propensity to continue to engage in such prejudicial activities, in future, he was satisfied that unless detained, the detenu is likely to engage in the aforesaid prejudicial activities in future also and, therefore, it was necessary to detain the detenu under the COFEPOSA Act, 1974 with a view to preventing the detenu in future from acting in any manner prejudicial to the augmentation of country’s foreign exchange resources. 12. Having gone through the grounds of detention and having perused the material in support thereof, we have no hesitation in recording that the detaining authority’s satisfaction as regards the propensity and potentiality of the detenu to indulge in similar activities, in future, is well founded. : 10 : 13. Before we deal with Mr. Tripathi’s contention regarding supply of documents, which comprises non-supply of documents, supply of illegible documents and non-supply of true and correct translations, it is necessary to see the law laid down by the Supreme Court and by this court as regards supply of documents. It will have to be examined whether non-furnishing of any and every documents leads to infraction of Article 22(5) of the Constitution. In this connection, we may firstly refer to the judgment of the Supreme Court in Vakil Singh v. State of Jammu and Kashmir and Anr., AIR 1974 SC 2337. In that case, the detenu was told the name of the notorious agent and courier through whom he was supplying the information about the Indian Army and was further informed about the place in Pakistan which he was visiting. It was held that nothing more was required to be intimated to enable him to make an effective representation. The Supreme Court explained the word "grounds" as the material on which the order of detention was primarily based and emphasised that the grounds must contain the pith and substance of primary facts, but not subsidiary facts or evidential details. The relevant paragraph may be quoted: "Grounds within the contemplation of 5.8(1) of the Act means ‘materials’ on which the order of detention is primarily based. Apart from conclusions of facts, grounds : 11 : have a factual constituent also. They must contain the pith and substance of primary facts but not subsidiary facts or evidential details. This requirement as to the communication of all essential constituents of the grounds was complied with in the present case. The basic facts as distinguished from factual details, were incorporated in the material communicated to the detenu. He was told the name of the notorious PAK agent and courier (Mian Raham resident of Jumbian) through whom he was supplying the information about the Indian Army. He was informed about the places in Pakistan which he was visiting. He was further told that in lieu of the supply of this information, he has been receiving money from Pakistan. Nothing more was required to be intimated to enable him to make an effective representation. The facts which were not disclosed were not basic facts, and their non-disclosure did not affect the petitioner’s right of making a representation." 14. In Khudiram Das vs. The State of West Bengal, AIR 1975 SC 550, the history sheet was not supplied to the petitioner. Considering the relevant cases on the point the Supreme Court observed "..... material from the : 12 : history sheet which was not disclosed to the petitioner did not form part of the grounds of detention on which the order of detention was made by the District Magistrate and approved by the State Government, but merely constituted "other particulars" communicated by the District Magistrate to the State Government under section 3, sub-section (3). There was, therefore, no obligation on the District Magistrate or the State Government to disclose this material to the petitioner and the non-disclosure of it to the petitioner did not have the effect in invalidating the approval of the State Government to the order of detention." 15. In M.S. Umma Salema v. B.B. Gujral, AIR 1981 SC 1191, there was a failure to supply certain information regarding the trunk-calls made and petrol bills in respect of the petrol put in the jeep used for smuggling. The Supreme Court held that failure to furnish copies of documents to which a reference is made in the grounds of detention is not an into judgment of Article 22(5), fatal to the order of detention. It is only failure to furnish copies of such of the documents, as were relied upon by the detaining authority, making it difficult to the detenu to make a representation, that amounts to infringement of the fundamental right of the detenu under Article 22(5). The Supreme Court held that it was not necessary to furnish copies of the documents to which a casual or passing reference may be made in the course of the narration of facts and which were not relied upon by : 13 : the detaining authority in making the order of detention. 16. In Prakash Chandra Mehta v. Commissioner and Secretary, Government of Kerala & Ors., AIR 1986 SC 687, the Supreme Court considered the meaning of the expression "grounds" and held that the expression "grounds" for that matter includes not only conclusions of fact but also all the "basic facts", on which those conclusions were founded. They are different from subsidiary facts or further particulars of the basic facts". 17. In Meena Mahendra Vakharia v. K.L. Verma & Ors., decided by a bench of this court on 5th & 6/3/1997, this court had an occasion to consider the same issue. After taking a resume of the entire case law on the point, this court drew the following conclusions: "If a document is a basic document or a document which contains the pith and substance of primary facts which are the basis of the grounds of detention, such a document must be communicated to the detenu in order to comply with the constitutional obligation under Article 22(5) of the Constitution of India. This, however, does not mean that it is necessary for the detaining authority to furnish to the detenu each and every document, however, : 14 : insignificant or inconsequential it may be, and to which a mere reference is made in the grounds of detention and which can, therefore, be said to have been incorporated by reference in the grounds of detention. (2) In other words, if it transpires that a particular document is neither a basic document nor does it contain the pith and substance of primary facts but is only a subsidiary details of the grounds of detention or is an elaboration of the modus operandi adopted by the detenu, in our view, it is unnecessary for the detaining authority to furnish such a document to the detenu. If the facts which are not disclosed are not the basic facts, their non-disclosure does not affect the detenu’s right under Article 22(3) of the Constitution of India. (3) It would, therefore, follow that, all the basic facts on which the detaining authority has based its conclusions in taking the order of detention must be communicated to the detenu so as to comply with the plain requirement of the first safeguard of Article 22(5) of the : 15 : Constitution but this does not mean that "other particulars" apart from the material constituting the grounds of detention which other particulars do not form the basis of the making of the order of detention should also be disclosed to the detenu. (4 The documents or facts to which a mere casual or passing inference is made in the grounds of detention, but which do not constitute the basic material for recording the satisfaction in the grounds of detention need not be communicated to the detenu...." 18. The above judgments make it clear that the detenu must be supplied with the documents, which contain pith and substance of the primary facts which are the basis of the detention order. 19. Mr. Tripathi firstly contended that there is a reference to certain pay orders in paragraph 42 of the grounds of detention. It is stated that some amount was paid to Bhupendra Thakkar by means of pay orders in favour of Surendran and others. These pay orders, according to Mr. Tripathi, are vital documents and ought to have been supplied to the detenu. In the affidavit in reply, the detaining authority has stated that a : 16 : certificate issued by the concerned bank in respect of pay orders/bankers cheques has been included in the set of relied upon documents. It is an admitted position that a copy thereof has been supplied to the detenu. In our opinion, since the bank certificate is supplied, this submission of Mr. Tripathi must be rejected for the bank certificate would give the details of the pay orders. 20. Mr. Tripathi then urged that pages 529 to 567 of the compilation are illegible and Hindi translation thereof are also not supplied to the detenu. He contended that the detenu only knows Hindi. He does not understand English and, therefore, there is infraction of Article 22(5) of the Constitution. Mr. Tripathi also submitted that the detenu has studied only upto 5th Standard. 21. In this connection, our attention has been drawn by Mr. Agarwal, the learned counsel appearing for respondents 1 and 3 to certain documents from the compilation, which indicate that the claim made by the detenu that he does not know English is totally false. 22. At page No.579 of the compilation, there is an extract of the statement of the detenu recorded under section 37 of the Foreign Exchange Management Act, 1999. In that statement, which appears to have been written by the detenu himself, the detenu has given his educational qualification as 10th Standard. At page 582, against the : 17 : column "Languages known", the following is found. "A) READ : HINDI B) SPEAK : HINDI C) WRITE : HINDI/ENGLISH" 23. It appears that the detenu has written the statements in his own hand and many parts of the statements are in English. Therefore, the claim made by the detenu that he does not know English is false. In Prakash Chandra Mehta’s case (supra), the Supreme Court was considering a similar fact situation. In that case, the detenu’s claim was that he only knew Gujarati and he did not understand any other languages. The Supreme Court examined the facts and came to a conclusion that the claim made by the detenu was false. The Supreme Court observed that there is no rule of law that commonsense should be put in cold storage while considering constitutional provisions for safeguards against misuse of powers by authorities though these constitutional provisions should be strictly construed. The Supreme Court further observed that court is not the place where one can sell all tales. The Supreme Court noted that the detenu was merely feigning ignorance of English. These observations of the Supreme Court are clearly applicable to the present case. A total false plea is raised that the detenu does not understand English. The grievance about non-supply of translation, therefore, appears to us to be not genuine. Even then : 18 : since we are dealing with preventive detention we will deal with the point of translation assuming that the detenu does not know English. 24. According to Mr. Tripathi, on page 23 in paragraph 41 of the grounds, it is mentioned that Thakkar had engaged himself and the detenu had also made payments in cash and by bank pay orders to Thakkar or his employees as per the directions of Laxman Akhani of Dubai, who, in turn, had received foreign exchange from Asarulla Rakka Khan of Dubai. According to Mr. Tripathi, this portion is not translated. In reply to this, the detaining authority has, in his affidavit, stated that the detenu has been supplied with the free translation which gives the sum and substance of the order and that the detenu and others were engaged by Thakkar for transfer of funds and the mode of transfer was partly in cash and partly in bank pay orders from the account of M/s. Sweety International Private Limited in which the detenu has an interest, as Director. We are satisfied with this explanation. The prejudicial activity is intricate but its mode and pattern is very clear from the grounds of