YOGENDRA KUMAR JAISWAL ETC. versus STATE OF BIHAR & ORS.
[2015] 14 S.C.R. 1037, Supreme Court of India, 2015
Outcome: Disposed off
Segment: Ratio
YOGENDRAKUMAR JAISWAL ETC. v. STATE OF BIHAR 1141 
[DIPAK MISRA, J.] 
has its own significance in the context of the range of offences A 
provided under the 1988 Act. Section 13( 1 )( e) covers a period 
which is called check period. It pertains to amassing of 
disproportionate assets. The condition precedent is that 
accused is prima facie found in possession of disproportionate 
properties or possessing resources not known to his sources B 
of income. It is obligatory on the part of the accused in that 
case to explain his sources, which has been the basis for 
accumulating the assets which are alleged to be 
I is proportionate. The offences (!nder Section 13(1) (a) to (d) . 
1n a broad way can be called incident specific or situation C 
specific whereas the offence under Section 13(1 )(e) is period 
specific and it is not incident specific. There can be different 
check periods. A person holding high public office or political 
office has opportunities to accumulate disproportionate assets 
other than his known sources of income. It has been submitted D 
by the learned counsel for the appellants that disproportionate 
assets can be accumulated by the persons working in the lesser 
rank or not holding such high offices. This submission is noted 
only to be rejected, forthe holders of high post or high public 
office do definitely enjoy a distinguished position in contrast E 
to other categories of officers or post holders. They form a 
separate class. The legislature,
regard being had to the 
position the public servant holds, has put them in a different 
class. There is a manifest 'reason that sustains the said 
classification. The contention of the learned counsel for the 
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appellants is that the provision suffers because of under-
inclusive classification but the same does not impress us as 
in the instant case we are disposed to think that there is a 
perceptible differentia in such exclusion. The court cannot 
adopt an attitude to scrutinize a provision with mathematical G 
exactitude. A pedantic approach in this regard cannot be 
visualized. Learned counsel for the State of Odisha would 
submit that the distinction is writ large and the legislature in its 
wisdom has carved out the offence of Section 13(1 )(e) to be 
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A tried by Special Courts in a speedy manner. It is urged by him 
that the onus is on the accused to prove that the asset is not 
disproportionate and within the known sources of his income. 
He has drawn inspiration from P. Na/Jamal v. Inspector of 
Police", wherein it has been held that the words "known 
B sources of income" have to be understood as "any lawful 
source". That apart, the explanation to Section 13( 1 )( e) further 
enjoins that receipt of such income should have been intimated 
by the public servant in accordance with the provisions of any 
law applicable to such public servant at the relevant time. Such 
C a public servant cannot escape from Section 13(1 )(e) of the 
1988 Act by showing other legally forbidden sources, albeit 
such sources are outside the purview of clauses (a) to (d) of 
the sub-section. 
115. Having so stated, we proceed to dwell upon the . 
D concept of classification as envisaged under Article 14 of the 
Constitution. In this regard, we may usefully refer to the authority 
in Ram Krishna Dalmia v. Shri Justice S.R. Tendolkar and 
others" wherein this Court while dwelling upon the concept of 
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permissible classification opined thus:-
"lt is now well established that while Article 14 
forbids class regislation, it does not forbid 
reasonable classification for the purposes of 
legislation. In order, however, to pass the test of 
permissible classification two conditions must be
fulfilled namely, (i) that the classification must be 
founded on an intelligible differentia which 
distinguishes persons or things that are grouped 
together from others left out of the group, and (ii) 
that that differentia must have a rational relation to 
the object sought to be achieved by the statute in 
question. The classification may be founded on 
different bases, namely, geographical, or according 
to objects or occupations or the like. What is
YOGENDRA KUMAR JAISWAL ETC. v. STATE OF BIHAR 1143 
[DIPAK MISRA, J.] 
necessary is that there must be a nexus between 
A 
the basis of classification and the object of the Act 
under consideration. It is also well established by 
the decisions of this Court thatArticle 14 condemns 
discrimination not only by a substantive law but also 
by a law of procedure." 
B 
116. Recently, in Satyawati Sharma (Dead) by LRs v. 
Union of India and Another", the Court, after reproducing 
the principles stated in Shri Ram Krishna Dalmai (supra), 
has referred to the various principles that have been enunciated 
in that case by Chief Justice S.R. Das. We may profitably C 
reproduce the same:-
. "(a) that a law may be constitutional even though it . 
relates to a single individual if, on account of some 
special circumstances or reasons applicable to him 
0 
. and not applicable to others, that single individual 
may be treated as a class by himself; 
(b)'that there is always a presumption in favour of the 
constitutionality of an enactment and the burden is upon 
him who attacks it to sh9w that there has been a clear E 
transgression of the constitutional principles; 
(c) that it must be presumed that the legislature 
understands and correctly appreciates the need of its 
own people, that its laws are directed to problems made 
manifest by experience and that its discriminations are 
F 
based on adequate gr-0unds; 
(d) that the legislature is free to recognise degrees of 
harm and may
confine its restrictions to those cases· 
where the need is deemed to be the clearest; 
(e) that in order to sustain the presumption of 
constitutionality the court may take into consideration 
matters of common knowledge, matters of common 
02 (2008) 5 sec 287 
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report, the history of the times and may assume every 
state of facts which can be conceived existing at the time 
of legislation; and 
(f) that while good faith and knowledge of the existing 
conditions on the part of a legislature are to be presumed, 
if there is nothing on .the face of the law or the surrounding 
circumstances brought to the notice of the court on which 
the classification may reasonably be regarded as based, 
the presumption of constitutionality cannot be carried to 
the extent of always holding that there must be some 
undisclosed and unknown reasons for subjecting certain 
individuals or corporations to hostile or discriminating 
legislation." 
117. Having noted the aforesaid authorities, it is 
0 
instructive to refer to the authority in Rehman Shagoo v. State 
of Jammu and Kashmir", which dealt with a single offence 
legislation and treated it to be valid by observing thus:-
"The offence created by Section 3 of the Ordinance 
is not found as such in the Penal Code but is a new 
E 
offence of an aggravated kind which may in the· 
circumstances prevailing in the State mentioned 
above be treated as different from the ordinary 
offences and may well be dealt with by a drastic 
procedure without encountering the charge of 
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violation of the equal protection clause. We are, 
therefore, of opinion that on the principles laid down 
by this Court in the large number of cases 
summarised in the Da/mia
case the Ordinance 
can!lot be said to be discriminatory and, therefore, 
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violative of Article 14 of the Constitution." 
,. 
118. In C./. Emden v. State of Uttar Pradesh , the 
Constitution Bench, while considering the presumption raised 
: AIR 1960 SC 1 
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AIR 1960 SC 548
YOGENDRAKUMAR JAISWAL ETC. v. STATE OF BIHAR 1145 
[DIPAK MISRA, J.] 
under Section 4( 1) of the Prevention of Corruption Act, 194 7 A 
has ruled that:-
" Legislature presumably realised that experience 
in courts showed how difficult it i~ to bring home to 
the accused persons the charge of bribery; 
evidence which is and can be generally adduced 
in such cases in support of the charge is apt to be 
treated as tainted, and so it is not very easy to 
establish the charge of bribery beyond a reasonable 
doubt. Legislature felt that the evil of corruption 
amongst public servants posed a serious problem 
and had to be effectively rooted out in the interest 
of clean and efficient administration. That is why 
the legislature decided to enact Section 4(1) with 
a view to require the raising of the statutory 
presumption as soon as the condition 'precedent 
prescribed by it in that behalf is satisfied. The object 
which the legislature thus wanted to achieve is the 
eradication of corruption from amongst public 
servants, and between the said object and the 
intelligible differentia on which the classification is 
based there is a rational and direct relation. We 
have, therefore, no hesitation in holding that the 
challenge to the viresof Section 4(1) on the ground 
that it violates Article 14 of the Constitution must 
fail." 
119 .. While dealing with this facet, it would not be 
inappropriate to advert to certain passages from !he concurring 
opinion ofV.R. Krishna Iyer, J. in
the Special Courts Bill, 1978 
(supra) which reads as under:-
. "105. Rightatthe beginning, an exordial enunciation 
of my socio-legal perspective which has a 
constitutional bearing may be set out. I lend 
judicious assent to the broader policy of social 
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[2015] 14 S.C.R. 
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justice behind this Bill. As I read it, this measure is 
the embryonic expression of a necessitous 
legislative project, which, if full-fledged, will work a 
relentless break-through towards catching, through 
the compulsive criminal process, the higher 
B 
inhabitants of Indian public and political decks, who 
have, in practice, remained "untouchable" and 
"unapproachable" to the rule of law. "Operation 
Clean-Up" is a "consummation devoutly to be 
wished", although naive optimism cannot obfuscate 
C 
the obnoxious experience that laws made in 
terrorem against those who belong to the top power 
bloc prove in action to be paper tigers. The 
pathology of our public law, with its class slant, is 
that an unmincing ombudsman or sentinel on the 
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qui vive, with power to act against those in power, 
now or before, and offering legal access to the 
informed citizen to complain with immunity does not 
exist, despite all the bruited umbrage of political 
performers against peculations and perversions by 
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higher echelons. Law is what law does, not what 
law says and the moral gap between word and deed 
menaces peopled faith in life and law. And then, 
the tragedy-democracy becomes a casualty. 111. 
No erudite pedantrv can stand in the way of 
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pragmatic grouping of high-placed office-holders 
separately, for purposes of high-speed criminal 
action invested with early conclusiveness and 
inguired into by high-level courts.
This differentia of 
the Bill rings irresistibly sound. And failure to press 
G 
forward such clean-up undertaking may be a blow 
to the rule of law and the Rule of life and may deepen 
the crisis of democracy among the millions -
the 
men who make our nation -. who today are 
largely disenchanted. So it is time. if peaceful 
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YOGENDRA KUMAR JAISWAL ETC. v. STATE OF BIHAR 1147 
. [DIPAK MISRA, J.] 
transformation is the constitutional scheme. to 
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begin by pre-emptive steps of quick and conclusive 
exposure and conviction of criminals in towers of 
power-. a special class of economic offenders 
with abettors from the Bureaucracy and Big 
Business. as recent Commission Reports trendily 
B 
portray and portent. Such is the simple. sociological 
substance of the classificatory discrimen which 
satisfies the egalitarian conscience of Article 14." 
[emphasis supplied] 
120. From the abovestated ratiocination, it is quite 
evincible that there is a difference, a demonstrable one, 
between the offence under Section 13(1)(e) and the rest of 
c 
the offences enumerated in Section 13. Section 13(1 )(e) 
targets the persons who have disproportionate assets to their D 
known sources of income. This conceptually is a period 
offence, for it is not incident specific as such. It does not require 
proof of corruption in specific acts, but has reference to asi;ets 
accumulated and known sources of income in a particular 
. period. The test applicable and proof required is different. 
E 
That apart, in the context of the present Orissa Act it is 
associated with high public office or with political office which 
are occupied by people who control the essential dynamics of 
power which can be a useful weapon to amass wealth adopting 
illegal means. In such a situation, the argument that they being 
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put in a
different class and tried in a separate special court 
solely because the alleged offence, if nothing else, is a self-
defeating one. The submission that there is a sub-classification 
does not remotely touch- the boundaries of Article 14; and 
certainly does not encroach thereon to invite its wrath of the G 
equality clause. 
121. The controversy can be looked from another angle. 
The special courts have been established on the basis of the 
law enacted by the State Legislature after obtaining the 
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presidential assent. The legislature has spelt out a policy for 
the purpose of establishing the Special Courts. It relates to an 
offence of special kind. In this regard, reference to a 
Constitution Bench decision in Kedar Nath Bajoria v. The 
State of West Bengal' may be usefully referred to. Speaking 
B forthe majority, Patanjali Sastri C.J. distinguished the decision 
in State of West Bengal v. Anwar Ali Sarkar". The Court 
referred to the Act which was brought into existence to provide 
for the more speedy trial and more effective punishment of 
certain offences. The Court while dealing with the equal 
C protection of law guaranteed by Article 14 of the Constitution 
observed that there is a system which is brought into by 
introducing Special Courts dealing with special types of 
offences under a shortened and simplified procedure. The 
legislation is based on perfect intelligible principles of 
D differentia having a clear and reasonable relation with the object 
sought to be achieved. The Court further observed that whether 
an enactment providing for a special procedure for trial of 
certain offences is or is not discriminatory and violative of 
Article 14 must be determined in each case as it arises, for, 
E no general rule applicable to all cases can safely be laid down. 
It has been further ruled that practical assessment of operation 
of the law in the particular circumstances is necessary. We 
may state that
the Court took note of the fact that in Kathi 
Raning Rawat v. The State of Saurashtra" the decision in 
F Anwar Ali Sarkar (supra) was distinguished and it was held 
that the provisions are not obnoxious to Article 14 as it has 
provided a special procedure regard being had to the gravity 
of the particular crime, the advantage to be derived by the State 
by recoupment of its loss, and oth'er like considerations may 
G have to be weighed before allotting a case to the special court 
which is required to impose a compensatory sentence of fine 
on every offence tried and convicted by it. 
H : li~~~i ig~ ~i:
YOGENDRA KUMAR JAISWAL ETC . .v. STATE OF BIHAR 1149 
[DIPAK MISRA, J.] 
122. In J. Jaya Lalitha v. Union oftndia" the validity of A 
Section 3 of the 1988 Act insofar as it empowers the State 
Government "to appoint as many special judges as may be 
necessary for such or group of cases" as may be specified in 
the notification and the consequential exercise of power in 
appointing special judges to try exclusively on day to day basis B 
the criminal cases filed against the writ petitioner therein, was 
called in question. Dealing with the said facet, the two-Judge 
Bench opined that the said provision is not arbitrary inasmuch 
as the provisions sufficiently indicated the intention of the 
legislature and also the object of the Act that the cases of C 
corruption are required to be tried speedily and completed 
as early as possible. Be it stated, the Court referred to the 
authorities in the Special Courts Bill, 1978 (supra), Kathi 
Raning Rawat (supra) and Jyoti Pershad v. Administrator 
for_ the Union Territory of Delhi to arrive at the said D 
conclusion. 
123. Thus, the submission which has been put forth 
forcefully by the learned counsel for the appellants pales into 
insignificance, ·and 
the irresistible conclusion is that the 
legislative policy behind establishment of Special Courts for E 
trial of accused involved in the offence under Section 13( 1 )( e) 
' . ; 
of the 1988 Act in respect of certain categories of accused is 
absolutely impeccable and it is saved
from the vice of Article 
14 of the Constitution. 
124. The next submission advanced by the learned 
counsel for the appellants pertains to the issue that the 
corruption is an all India phenomenon and persons in other 
States are prosecuted under the 1988 Act, whereas in the State 
F 
of Odisha,. they are tried in a more rigorous manner. It is G 
submitted that the same brings in inequality which causes 
discomforttoArticle 14 of the Constitution. We have already 
held that as the assent of the President under Article 254(2) of 
: (1999) s sec 13s 
AIR 1961SC1602 
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the Constitution has been obtained and the assent is valid in 
law, the State law will operate. Article 14 comes into play where 
equals are treated as unequals. The persons holding high 
public or political office in the State of Odis ha are governed 
by the OrissaAct. The State legislature has passed the Orissa 
B Act having regard to the obtaining situation in the State as the 
objects and reasons of the said Act do reflect. The legislature 
in its wisdom has enacted the law. The persons who are 
functioning in certain other States may be required to face trial 
under the 1988 Act, but on that score there can be no violation 
C of Article 14 of the Constitution. The scale suggested, cannot 
be the scale to judge. A legislation passed by one State 
legislature cannot be equated with the legislation passed by 
another State legislature. Nor can its validity be tested on that 
foundation. The Constitution bench judgment in The State of 
" 
D Madhya Pradesh v. G.C. Mandawar long back had 
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succinctly clarified the position in this regard laying down thus:-
"The power of the Court to declare a law void under 
Article 13 has to be exercised with reference to the 
specific legislation which is impugned. It is 
conceivable that when the same legislature enacts 
two different laws but in substance they form one 
legislation, it might be open to the Court to 
disregard the form and treat them as one law and 
strike it down,
if in their conjunction they result in 
discrimination. But such a course is not open where, 
as here, the two laws sought to be read in 
conjunction are by different Governments and by 
different legislatures. Article 14 does not authorise 
the striking down of .a law of one State on the ground 
that in contrast with a law of another State on the 
same subject its provisions are discriminatory. Nor 
does it contemplate a law of the Centre or of the 
State dealing with similar subjects being held to be 
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60 AIR 1954 SC 493
YOGENDRA KUMAR JAISWAL ETC. v. STATE OF BIHAR 1151 
[DIPAK MISRA, J.] 
unconstitutional by a process of comparative study 
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of the provisions of the two enactments. The 
sources of authority for the two statutes being 
different, Article 14 can have no application''. 
125. Similar view was reiterated in Prabhakaran Nair 
v. State of Tami/ Nadu & Others". Therefore, the question of 8 
bringing in the concept of equality qua persons who function in 
the other ·states is an unacceptable proponement and it is 
impossible to accept the same. 
126. Now, we shall advert to the challenge relating to the c 
grievance which is fundamentally twin in nature. First, the 
appellants who were facing the trial before the Special Judge 
under the 1988 Act, their cases being transferred, are being 
compelled to be tried under the Orissa Act as a consequence 
of which they are constrained to face rigourism of confiscation 0 
as an interim punishment which was not in existence and 
second, the provisions pertaining to confiscation cause double 
jeopardy. It is urged that the provisions violate Article 14, 20(2) 
and 21 of the Constitution. Having regard to the submissions 
made, we think it necessary to produce the relevant provisions 
E 
of the Act. The said provisions are Sections 13, 14, 15 and 
16 of the OrissaAct. They occur in Chapter Ill of the OrissaAct 
that deals with confiscation of property. We have outlined the 
said provisions earlier. To appreciate the controversy in proper
perspective, we reproduce the said provisions:-
61 
"Section 13. Application for confiscation. - (1) 
Where the State Government, on the basis of prima 
facie evidence, have reasons to believe that any 
person, who held high public or political office has 
committed the offence, the State Government may, 
whether or not the Special Court has taken 
cognizance of the offence, authorise the Public 
Prosecutor for making an application to the 
authorised officer for confiscation under this Act of 
AIR 1987 SC 2117 
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the money and other property, which the State 
Government believe the said person to have 
procured by means of the offence. 
2.An application under sub-section (1 )-
(a) shall be accompanied by one or more 
affidavits, stating the grounds on which the belief, 
that the said person has committed the offence, 
is founded and the amount of money and 
estimated value of other property believed to 
have been procured by means of the offence; 
and 
(b) shall also contain any information available 
as to the location for the time being of any such 
money and other property, and shall, if necessary, 
give other particulars considered relevant to the 
context. 
Section 14. Notice for confiscation. - ,(1) Upon 
receipt of an application made under Section 13 of this 
Act, the authorised officer shall serve a notice upon the 
person in respect of whom the application is made 
(hereafter referred to as the person affected) calling upon 
him within such time as may be-specified in the notice, 
which shall not be ordinarily less than thirty days, to 
indicate the source of his income, earnings or assets, 
out of which or by means of which he has acquired such 
money or property, the evidence on which he relies and 
other relevant information and particulars, and to show 
cause as to why all or any of such money or property or 
both, should not be declared to have been acquired by 
means of the offence and be
confiscated to the State 
Government. 
(2) Where a notice under sub-section (1) to any person 
specifies any money or property or both as, being held 
on behalf of such person by any other person, a copy of 
the notice shall also be served upon such other person.
YOGENDRA KUMAR JAISWAL ETC. v. STATE OF BIHAR 1153 
[DIPAK MISRA, J.] 
(3) Notwithstanding anything contained in sub-section ( 1 ), 
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the evidence, information and particulars brought on 
record before the authorised officer, by the person 
affected, shall not be used against him in the trial before 
the Special Court. 
Section 15. Confiscation of property in certain 
B 
cases-
(1) The authorised officer may, after considering 
the explanation, if any, to the show cause 
notice issued under section 14 and the 
c 
materials available before it, and after giving 
to the person affected (and in case where the 
person affected holds any money or property 
specified in the notice through any other 
person, to such other person also) a 
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reasonable opportunity of being heard, by 
order, record a finding whether all or any other 
money or properties in question have been 
acquired illegally. 
(2) Where the authorised officer specifies that 
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some of the money or property or both 
referred to in the show cause notice are 
acquired by means of the offence, but is not 
able to identify specifically such money or 
property, then it shall be lawful for the 
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authorised officer to specify the money or 
property or both which, to the best of his 
judgment, have been acquired by means of 
the offence and record a finding, accord_ingly, 
under sub-section (1 ). 
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(3) Where the authorised officer records a finding 
under this section to the effect that any money 
or property or
both have been acquired· by 
means of the offence, he shall declare that 
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such money or property or both shall, subject 
to the provisions of this Act, stand confiscated 
to the State Government free from all 
encumbrances. 
Provided that if the market price of the 
property confiscated is deposited with the 
authorised officer, the property shall not be 
confiscated. 
(4) 
Where any share in a Company stands 
confiscated to the State Government under 
this Act, then, the Company shall, 
notwithstanding anything contained in the 
Companies Act, 1956 (1 of 1956) or the 
Articles of Association of the Company, 
forthwith register the State Government as 
the transferee of such share. 
(5) 
Every proceeding for confiscation of money 
or property or both under thfs Chapter shall 
be disposed of within a period of six months 
from the date of service of the notice under 
sub-section (1) of section 14. 
(6) The order of confiscation passed under this 
section shall, subject to the order passed in 
appeal, if any, under section 17, be final and 
shall not be called in question in any Court of 
law. 
Section 16. Transfer to be null and void. -
Where, after the issue of a notice under section 14 
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any money or property or both referred to in the 
said notice are transferred by any m·ode 
whatsoever, such transfer shall, for the purposes of 
the proceedings under this Act, be void and if such 
money or property or both are subsequently 
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confiscated to the State Government under section
YOGENDRA KUMAR JAISWAL ETC. v. STATE OF BIHAR 1155 
[DIPAK MISRA, J.] 
15, then, the transfer of such money or property or 
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both shall be deemed to be null and void." 
127. The said provisions, as has been stated earlier, have 
been attacked from two angles. The first cine, these provisions 
violate Articles 14, 20(2), 20(3) and 21 of the Constitution. The B 
second limb of submission is with regard to the accused 
persons who had been facing trial under the 1988 Act prior to 
coming into force of the Orissa Act as a result of the transfer 
of case, are compelled to face harsher penalty than what was 
provided at the time of commission of the alleged offence. 
Structuring the first submission, it is contended that C 
reasonableness of pre-trial confiscation of a person's property 
before he has been found guilty makes the provision unjust, 
unfair and arbitrary. That apart, it being a punish~ent, the 
accused cannot be allowed to face doubl<;! jeopardy. 
Additionally, it is contended that Section 13 confers the power D 
on the State Government to authorise the Public Prosecutor 
for making the application to the authorised officer for 
confiscation of money and other property under the Orissa Act, 
if the State Government believes that the said person to have 
been procured by means of the offence. The criticism E 
advanced as regards the said provision is that unbridled and 
unrestricted power is conferred on the State Government to 
form an opinion. We have expressed
our opinion with regard 
to formation of opinion as regards the prima facie case in the 
context of Section 5 of the Act. The said principles are F 
applicable to Section 13. What is required to be scrutinized 
by the State Government that the offence exists under Section 
13( 1 )( e) of the Orissa Act and thereafter it has to authorise the 
Public Prosecutor to make an application. The submission of 
the learned counsel for the appellants that the Public Prosecutor G 
has no role. We are not adverting to the role of the Public 
Prosecutor that has been conferred on him under the Code of 
Criminal Procedure nor is it necessary to dwell upon, how this 
Court has time and again dwelt upon the role of the Public 
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Prosecutor. It is because the application that is required to be 
filed in sub-section (1) of Section 13 itself postulates the 
guidelines. The application has to be accompanied by an 
affidavit stating the grounds on which the belief as regards the 
commission of the offence and the amount of money and many 
B other aspects. An application has to be filed by the Public 
Prosecutor. The Public Prosecutor before he files an 
application under sub-section (1) of Section 13, is required to 
be first satisfied with regard to the aspects enumerated in sub-
section (2). Sub-section (2) obliges the Public Prosecutor that 
C requirements are satisfied for filing the application. In view of 
the said position, it cannot be said that there is lack of guidance. 
It is not that the authority has the discretion to get an application 
filed through the Public Prosecutor or not. It is not that a mere 
discretion Is left to the Public Prosecutor. The authority has 
D only been authorised to scrutinize the offence and authorise 
the Public Prosecutor and thereafter the Public Prosecutor has 
been conferred the responsibility which is manifestly detailed, 
and definitely guided, to file the application. Thus scrutinized, 
the said provision does not offend Article 14 of the Constitution. 
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128. Having said about the guidance, we would like to 
make it clear that the word "may" used in Section 13 has to be 
understood in its context. It does
not really relate to authorization-
of filing. To clarify that the authority does not have the 
F 
discretionary power to authorise for filing against some and 
refrain from authorizing in respect of the other, it has to be 
construed that the said word relates to the purpose, that is, 
the application to be filed for the purpose of confiscation. This 
is in consonance with the legislative policy, the scheme of the 
Act and also the objects and reasons of the Act. The legislative 
G policy, as declared, clearly indicates thatthere should not be 
any kind of discretion with the Government in these kinds of 
matters. The fulcrum of the policy, as is discernible, is that 
delinquent officers having disproportionate assets coming 
H within the purview of Section 13(1 )(e) have to face the
YOGENDRA KUMAR JAISWAL ETC. v. STATE OF BIHAR 1157 
[DIPAK MISRA, J.) · 
confiscation proceedings subject to judicial scrutiny as the rest A 
of the provisio"ns do unveil. Learned counsel for the appellants 
would contend that the legislature has delegated such power 
on the authority which can act in an indiscriminate manner. 
The said submission in the context of this Act, is sans 
substance as we have already opined that there is no 
B 
discretion to pick and choose but to see the minimum 
requirement, that is, the offence and the status. Nothing beyond 
that. 
129. Sections 14 and 15 have been criticized on the 
ground that they introduce concept of pre-trial confiscation. As C 
indicated earlier, the submission is pyramided on the principle 
that the provisions are violative of Articles 14, 20(2) and 21 of 
the Constitution of India. Apart from this, the· other assail is 
that they have been made retrospectively applicable because 
the cases of accused persons pending before the Special _? 
Courts under the 1988 Act are transferred and they are 
compelled to face the confiscation proceedings and further 
consequence thereof, which is not permissible in the 
constitutional scheme. 
130. First we .shall deal with the first attack. Section 14 
requires the person in respect of whom the application is made 
to indicate his source of income, earnings or assets out of 
which he has acquired such money or property. He is entitled 
E 
to adduce evidence on which he wants to
place reliance and 
F 
is also entitled to furnish other relevant information. Section 
. ·15 confers jurisdiction on the Authorised Officer to consider 
the explanation and the material available before it and 
proceed to record a finding whether all or any other money or 
properties in question have been acquired illegally. He is G 
statutorily required to afford reasonable opportunity of being 
heard to the affected person. He is obliged under the law to 
declare that such money or property or both shall stand 
confiscated free from all encumbrances. Sub-section 5 of 
Section 15 stipulates that the proceeding for confiscation shall 
H
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SUPREME COURT REPORTS 
[2015] 14 S.C.R. 
A 
be disposed of within a period of six months from the date of 
notice issued under sub-section (1)of Section 14. The order 
of confiscation as envisaged under Section 15(6) is subject to 
appeal. Mr. R.K. Dash, learned senior counsel appearing for 
some of the appellants would contend that it is a draconian 
B law taking the society back to the dark days. The provisions 
are criticized that once a confiscation takes place free from 
all encumbrances, the right, title and interest to the property or 
the money gets extinguished. It is urged that same cannot be 
done without a proper trial. Learned counsel for the State would 
c lay emphasis on the ill-gotten wealth. He has referred to an 
extract of the 16olh Law Commission Report. We have been 
commended to certain judgments of this Court that spoke of 
corruption at high places. The issue that has really emanated 
for consideration is whether there can be an interim 
D confiscation when 
the trial is pending. It is argued with 
vehemence by the learned counsel for the appellants that it is 
"forfeiture" of property and it cannot be imposed without a trial. 
In this context, reference has been made to Section 53 of the 
Indian Penal Code which provides forfeiture of property as a 
E punishment. It is also canvassed that the nomenclature would 
not make. any difference when the impact tantamounts to a 
punishment. Emphasis is laid on the words "vest free from all
encumbrances" to highlight that in its normal connotation, it 
would only mean that it shall stand transferred to the State. 
F 
131. Regard being had to the aforesaid submissions, it 
is absolutely essential to understand the concept of 
confiscation. In Maqboo/ Hussain v. State of Bombay" the · 
Constitution Bench was dealing with the issue whether the 
confiscation by the customs authorities is a punishment. 
G Dealing with the said issue, the larger Bench ruled:-
"17. We are of the opinion that the Sea Customs 
authorities are not a judicial tribunal and the 
adjudging of confiscation, increased rate.of duty or 
H 
62 AIR 1953 SC 325
YOGENDRAKUMAR JAISWAL ETC. v. STATE OF BIHAR 1159 
[DIPAK MISRA, J.] 
penalty under the provisions of the Sea Customs 
Act do not constitute a judgment or order of a court 
or judicial tribunal necessary for the purpose of 
supporting a plea of double jeopardy. 
18. It therefore follows that when the Customs 
authorities confiscated the gold in question neither 
the proceedings taken before the Sea Customs 
authorities constituted a prosecution of the 
appellant nor did the order of confiscation constitute 
a punishment inflicted by a court or judicial tribunal 
on the appellant. The appellant could not be said 
by reason of these proceedings before the S'ea 
Customs authorities to have been "prosecuted and 
punished" for the same offence with which he was 
charged before the Chief Presidency Magistrate, 
Bombay, in the complaint which was filed against 
him under Section 23 of the Foreign Exchange 
Regulation Act." 
A 
B 
c 
D 
132. Learned counsel for the State has drawn our 
attention to another Constitution Bench decision in the State E 
of West Bengal v. S.K. Ghosh". The factual matrix in the 
said case was that the respondent therein was appointed as 
the Chief Refugee Administrator of Burma Refugee 
Organisation and he was believed to have embezzled large 
sums of money belonging to Government which were at his 
F 
disposal. The prosecution was initiated under Sections 120-B 
and 409 of the Indian Penal Code before coming into force . 
the Second Special Tribunal
constituted under the Criminal 
Law Amendment Ordinance, No. 29 of 1943. During the 
pendencyofthe case, the Criminal Law Amendment Ordinance G 
30 of 1944 was passed. The Court took note of the fact that 
the object of the Ordinance was to prevent disposal or 
concealment of money or other property procured by means 
of certain scheduled offences punishable under the IPC and 
63 AIR 1963 SC 255; 1963 (2) SCR 111 
H
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[2015] 14 S.C.R. 
A 
one of the offences to which the Ordinance applied was 409 
IPC apart from other offences. The respondent was convicted 
by the Special Tribunal on August 31, 1949 by which Criminal 
Law (1943)Amendment amending Ordinance No. 12of1945 
had come into force. Relying on the said Ordinance, the Special 
B Tribunal apart from imposing a substantial sentence of rigorous 
imprisonment for five years, directed a fine of Rs. 45 lakhs to 
be paid on the charge of conspiracy. The respondent preferred 
an appeal before \he High Court assailing his conviction and 
the High Court upheld the conviction and sentence of fine. 
C 
However, the High Court opined that the Special Tribunal could 
have imposed the fine under the ordinary law but not under 
Section 10 of the 1943 Ordinance as amended in 1945 
prescribing minimum limit of fine. The respondent had 
approached this Court in appeal which was dismissed on the 
D ground that it was clear that Rs. 30 lakhs have been 
misappropriated by the respondent as a result of the 
conspiracy. On January 9, 1957, an application was made to 
the District Judge under Section 13 of the 1944 Ordinance for 
confiscation of the property. The property stood attached under 
E Section 3 of the 1944 Ordinance. The learned District Judge 
held on a construction of Section 12 and Section 13(3) of the 
1944 Ordinance that the amount of Rs. 30 lakhs together with 
the cost of attachment had first to be forfeited
to the Union of 
India from the properties attached and thereafter the fine of 
F 
Rs. 45 lakhs was to be recovered from the residue of the said 
attached property. However, as it was not possible to forfeit 
the properties to the value of Rs. 30 lakhs without valuation, 
the District Judge directed the receiver to report as to the cost 
of attachment including the cost of management of the property 
G attached. He also directed the parties to submit their estimates 
as to the value of the property attached. The said order was 
assailed by the respondent in appeal and one of the Judges 
of the High Court opined that the fine amount was recoverable 
and no proceeding under Section 13 could be taken for 
H
YOGENDRA KUMAR JAISWAL ETC. v. STATE OF BIHAR 1161 
[DIPAK MISRA, J.] 
forfeiture of Rs. 30 lakhs, the embezzled amount inasmuch as A 
no action could be taken under the Ordinance. The other 
learned Judge opined that the District Judge had jurisdiction 
to forfeit properties worth Rs. 30 lakhs under Section 13 but 
he was of the opinion that Section 53 of the IPC referred to 
forfeiture as punishment is distinct from fine and as the 
B 
· punishment of forfeiture as contemplated by the 1944 
Ordinance had yet to take place, Article 20(1) of the 
Constitution would apply. The reason for coming to such a 
conclusion was that 1944 Ordinance had come into force on 
August 23, 1944, while the real and effective period during C 
which the offence was committed ended with July, 1944 and 
thereafter forfeiture was not prescribed as a punishment before 
the 1944 Ordinance. This Court referred to Section 13 of the 
1944 Ordinance which deals with the disposal of attached 
property upon termination of criminal proceeding. The court D 
referred to Section 5 that provides for investigation of objection 
to attachment and the authority of the District Judge under sub-
section 3 of Section 5 to pass an order making the attachment 
absolute or varying it by releasing a portion of the property 
from attachment or withdrawing the order. In the said case, the E 
District Judge had made the order absolute and the properties 
had continued under attachment. The Court referred to Section 
3 to
opine that there are two kinds of properties which are to 
be attached. The first property which has been procured by 
· the commission of the offence, whether it be in the form of F 
money or in the form of movable or immovable property, and 
second properties are other than the above. The respondent 
in the said case had been .charged with embezzlement of 
money and that was why an application for attachment under 
Section 3 was made that he had used the money procured by G 
commission of offence in purchasing certain properties. The 
Court referred to Section 13 and ruled that the District Judge 
has jurisdiction to deal with the property attached under Section 
38 for the purpose of forfeiture provided Section 12 has been 
H
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SUPREME COURT REPORTS 
[2015] 14 S.C.R. 
A complied with. Thereafter, the larger Bench adverted to Section 
B 
c 
D 
E 
F 
G 
H 
12(1) and in that context held that:-
" .... The sub-section lays down that before the 
judgment is pronounced by the court trying the 
offender and it is represented to the court that an 
order of attachment of property had been passed 
under Section 3 in connection with such offence, 
the court shall, if it is convicting the accused, record 
a finding as to the amount of money or value of 
other property procured by the accused by means 
of the offence. Clearly all that Section 12(1) requires 
is that the court trying the offender should be asked 
to record a finding as to the amount of money or 
value of other property procured by the accused 
before it by means of the offence for which he is 
being tried. There is no procedure provided for 
making the representation to the court to record a 
finding as to the amount of money or value of other 
property procured by the offence. In our view, all 
that Section 12(1) requires is that at the request of 
the prosecution the court should give a finding as 
to the amount of money or value of other property 
procured by the accused. Representation may be 
by application or even oral and so long as the court 
gives a finding as to the amount of money or value 
of other property procured by the offence that would 
in our opinion be sufficient compliance with Section 
12(1 ). It is not necessary that
the court when it gives 
a finding as to the amount of money or value of other 
property procured by means of the offence should 
say in so many words in passing the order that it is 
making that finding on a representation under 
Section 12(1 ). It is true that under Section 10 of the 
1943 Ordinance as amended in 1945 the court 
when imposing a fine has to give a finding as to the
YOGENDRAKUMAR JAISWAL ETC. v. STATE OF BIHAR 1163 
[DIPAK MISRA, J.] 
• 
amount of money or value of other property found 
A 
to have been procured by the offender by means of 
the offence in order that it may comply with the 
provisions of Section 10 as to the minimum fine to 
be imposed. We see no reason however why a 
finding given for the purpose of Section 10 
B 
determining the amount of money or the value of 
other property found to have been procured by the 
offender by means of the offence should not also 
be taken as a finding under Section 12(1) of the 
1944 Ordinance. The result of the two findings in 
C. 
our opinion is exactly the same, the only difference 
being that under Section 10 of the 1943 Ordinance, 
as amended in 1945, the court may do this suo moto 
while under Section 12(1) of the 1944 Ordinance it 
has to be done on the representation made by the 
D 
prosecution." 
133. Thereafter the Court noted the reasoning of the other 
learned Judge and opined that it was not necessary in the said 
appeal to decide whether the case would come within the ambit 
of Articles 20(1 ). This opinion was expressed principally on 
E 
the ground that the forfeiture provided under Section 13(3) is 
not a penalty at all wit~in the meaning of Article 20(1 ). In that 
context, the Court analyzed the provisions of the 1944 
Ordinance and came to hold that:-
" .... The forfeiture by the District Judge under Section 
13(3) cannot in our opinion be equated to forfeiture 
of
property which is provided in Section 53 of the · 
Indian Penal Code. The forfeiture provided in 
F 
Section 53 is undoubtedly a penalty or punishment 
G 
within the meaning of Article 20( 1 ); but that order of 
forfeiture has to be passed by the court trying the 
offence. where there is a provision for forfeiture in 
the section concerned in the Indian Penal Code. 
H
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SUPREME COURT REPORTS 
[2015] 14S.C.R. 
A 
There is nothing however in the 1944 Ordinance to 
show that it provides for any kind of punishment for 
any offence. Further it is clear that the Court of 
District Judge which is a Principal Court of Civil 
Jurisdiction can have no jurisdiction to try an 
B 
offence under the Indian Penal Code. The order of 
forfeiture therefore by the District Judge under 
Section 13(3) cannot be equated to the infliction of 
a penalty within the meaning of Article 20(1 ).Article 
20(1) deals with conviction of persons for offences 
C 
and for subjection of them to penalties. It provides. 
firstly that "no person shall be convicted of any 
offence except for violation of a law in force at the 
time of the commission of the act charged as an 
offence". Secondly, it provides that no person shall 
D 
be "subjected to a penalty greater than that which 
might have been inflicted under the law in force at 
the time of the commission of the offence". Clearly, 
therefore Article 20 is dealing with punishment for 
offences and provides two safeguards, namely, (1) 
E 
that no one shall be punished for an act which was 
not an offence under the law in force when it was 
committed, and (ii) that no one shall be subjected 
to a greater penalty for an offence than what was 
provided under the law in force when the offence 
F 
was committed. The provision for forfeiture under 
Section 13(3) has nothing to do with the infliction of 
any penalty on any
person for an offence. If the 
forfeiture provided in Section 13(3) were really a 
penalty on a convicted person for commission of 
G 
an offence we should h'ave found it provided in the 
1943 Ordinance and that penalty offorfeiture would 
have been inflicted by the criminal court trying the 
offender." 
[emphasis is added] 
H
YOGENDRAKUMAR JAISWAL ETC. v. STATE OF BIHAR 1165 
[DIPAK MISRA, J.] 
134. In this context reference to authority in Divisional A 
Forest Officer and another v. G. II. Sudhakar Rao and 
others
04 would be apt. In the said case, the confiscation under 
the Andhra Pradesh Forest Act arose for consideration. The 
question that was posed by the Court was whether where a 
Forest Officer makes a report of seizure of any timber of forest B 
produce and produces the seized property along with a report 
under Section 44(2) that he has reason to believe that a forest 
offence has been committed in respect of such timber or the 
forest produce seized, could there be simultaneous 
proceedings for confiscation to the Government of such timber C 
or forest produce and the implements, etc., if the Authorized 
Officer under Section 44(2A) of the Act is satisfied that a forest 
offence has been committed, along with a criminal case 
instituted on a complaint by the Forest Officer before a 
Magistrate of the commission of a forest offence under Section D 
20 of the Act. Answering the said issue, the Court scrutinized 
the amended provisions that were brought into force by Act of 
1976 and came to hold that:-
"The conferral of power of confiscation of seized 
timber or forest produce and the implements, etc., 
on the Authorized Officer under sub-section (2A) of 
Section 44 of the Act on his being satisfied that a 
forest offence had been committed in respect 
thereof, is not dependent upon
whether a criminal 
prosecution for commission of a forest offence has 
been launched against the offender or not. It is a 
separate and distinct proceeding from that of a 
trial before the Court for commission of an offence. 
Under sub-section (2A) of Section 44 of the Act, 
where a Forest Officer makes report of seizure of 
any timber or forest produce and produces the 
seized timber before the Authorized Officer along 
with a report under Section 44(2), the Authorized 
" (1985) 4 sec 573 
E 
F 
G 
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SUPREME COURT REPORTS 
[2015] 14 S.C.R. 
A 
Officer can direct confiscation to Government of 
such timber or forest produce and the implements, 
etc., if he is satisfied that a forest offence has been 
committed, irrespective of the fact whether the 
accused is facing a trial before a Magistrate for 
B 
the commission of a forest offence under Section 
20 or 29 of the Act." 
135. In Director of Enforcement v. M.C. T.M. 
Corporation Pvt. Ltd and Others" a two-Judge Bench was 
addressing the issue with regard to mens rea or criminal intent 
C for establish contravention of Section 10 punishable under 
section 23 of Foreign Exchange Regulation Act, 194 7. The 
other issue that arose for consideration was whether Section 
10(1) of FERA, 1947 was an independent provision making 
its contravention by itself punishable under Section 23(1 )(a) 
D of FERA, 1947 or whether its contravention could arise only if 
there is a breach of some directions issued by the Reserve 
Bank of India under Section 10(2) of FERA, 194 7. In the said 
case, the High Court had opined that Section 23 was a penal 
provision and the proceedings under Section 23(1 )(a) were 
E quasi criminal in nature and therefore existence of mens rea 
was a necessary ingredient for the commission of an offence 
under Section 10 of the Act. Dealing with the said facet the 
Court expressed:-
F 
"The proceedings under Section 23(1 )(a) of FERA, 
194 7 are 'adjudicatory' in nature and character are 
not "criminal
proceedings". The officers of the 
Enforcement Directorate and other administrative 
authorities are expressly empowered by the Act to 
G 
'adjudicate' only. Indeed they have to act 'judicially' 
and follow the rules of natural justice to the extent 
applicable but, they are not 'Judges' of the 'Criminal 
Courts' trying an 'accused' for commission of an 
offence, as understood in the general context. They 
H "(1996) 2 sec 471
YOGENDRA KUMAR JAISWAL ETC. v. STATE OF BIHAR 1167 
[DIPAK MISRA, J.] 
perform quasi ~judicial functions and do not act 
A 
as 'courts' by only as 'administrators' and 
'adjudicators'. In the proceedings before them, they 
do not try 'an accused' for commission of "any 
crime" (not merely an offence) but determine the 
liability of the contravener for the breach of his 
B 
'obligations' imposed under the Act. They impose 
'penalty' for the breach of the "civil obligations" laid 
down under the Act and not impose any 'sentence' 
forthe commission of an offence. The expression 
'penalty' is a word of wide significance. 
C 
Sometimes, it means recovery of an amount as a 
penal measure even in civil proceedings. An 
exaction which is not compensatory in character is 
also termed as a 'penalty'. When penalty is 
imposed by an adjudicating officer, it is done so 
D 
in "adjudicatory proceedings" and not by way of fin~ 
as a result of 'prosecution' of an 'accused' for 
commission of an 'offence' in a criminal court. 
Therefore, merely because 'penalty' clause exists 
in Section 23(1 )(a), the nature of the proceedings 
E 
under that section is not changed from 'adjudicatory' 
to 'criminal' prosecution. An order made by an 
adjudicating authority under the Act is not that of 
conviction but of determination of the breach of the 
civil obligation by the offender". 
F 
136. In this regard, reference to a recent two-Judge 
Bench decision in Biswanath Bhattacharya v. Union of 
India &
others 
00 would be apt. In the said case the Court was 
dealing with forfeiture under the Smugglers and Foreign 
Exchange Manipulators (Forfeiture of Property) Act, 1976. A G 
contention was advanced by the appellant therein that forfeiture 
is ;i penalty and, therefore, it could not be taken recourse to 
without a conviction. The stand of the Union of India was that 
00 (2014) 4 sec 392 
H
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SUPREME COURT REPORTS 
[2015] 14 S.C.R. 
A 
the forfeiture contemplated under the said Act was not a penalty 
within the meaning of that expression occurring in Article 20, 
but only a deprivation of property to a legislatively identified 
class of persons - in the event of their inability to explain to the 
satisfaction of the State that they had legitimate sources of 
B funds forthe acquisition of such property. The two-Judge Bench, 
while explaining the stand of the Union of India, took note of 
the fact that the Act is made applicable to five classes of 
persons specified under Section 2 of the said Act. It also 
observed that the conviction or the preventive detention 
C contemplated under the Act is not the basis or cause of 
confiscation, butthefactual basis for a rebuttable presumption 
to enable the State to initiate proceedings to examine whether 
the properties held by such persons are illegally acquired 
properties. In the ultimate eventuate, the Court ruled that the 
D forfeiture provided in the said enactment was not violative of 
E 
F 
Article 20 of the Constitution. It also proceeded to state:-
"lf a subject acquires property by means which are 
not legally approved, the sovereign would be 
perfectly justified to deprive such persons of the 
enjoyment of such ill-gotten wealth. There is a public. 
interest in ensuring that persons who cannot 
establish that they have legitimate sources to 
acquire the assets held by them do not enjoy such 
wealth. Such
a deprivation, in our opinion, would 
certainly be consistent with the requirement of 
Articles 300-A and 14 of the Constitution which 
prevent the State from arbitrarily depriving a subject 
of his property." 
G 
137. In the case at hand, the entire proceeding is meant 
to arrive at the conclusion whether on the basis of the 
application preferred by the Public Prosecutor and the material 
brought on record, the whole or any other money or some of 
the property in question have been acquired illegally and further 
H any money or property or both have been acquired by the
YOGENDRA KUMAR JAISWAL ETC. v. STATE OF BIHAR. 1169 
[DIPAK MISRA, J.] 
means of the offence. After arriving at the said conclusion, the A 
order of confiscation is passed. The order of confiscation is 
subject to appeal under Section 17 of the Orissa Act. That 
apart, it is provided under Section 19 where an order of 
confiscation made under Section 15 is modified or annulled 
by the High Court in appeal or the where the person affected 
B 
is acquitted by the special court, the money or property or both 
shall be returned to the person affected. Thus, it is basicaliy a 
confiscation which is interim in nature. Therefore, it is not a 
punishment as envisaged in law and hence, it is difficult to 
accept the submission that it is a pre-trial punishment and, 
C 
accordingly, we repel the said submission. 
~ 38. 
The next facet of the said submission pertains 
to retrospective applicability. The submission has been put 
forth on the ground that by transfer of cases to the Special 
Courts under the Orissa Act in respect of the accused persons D 
who are arrayed as accused under the 1988 Act, have been 
compelled to face harsher punishment which is constitutionally 
not permissible. It is contended that there was no interim 
confiscation under the 1988 Act but under the OrissaActthey 
have to face confiscation. We have already opined that E 
confiscation is not a punishment and, therefore, Article 20(1) 
is not attracted. Thus, the real grievance pertains to going 
through the
process of confiscation and suffering the same 
after the ultimate adjudication of the said proceeding which is 
subject to appeal. In this context we are required to see the 
F 
earlier provision. The 1988 Act provides for applicability of· 
Criminal Law Amendment Ordinance, 1944. Section 2 refers 
to "interpretation" and in sub-section (1) it is stipulated that 
"Schedule offence" in the Ordinance means an offence 
specified in the Schedule to the Ordinance; Section 3 deals G 
with the application for attachment of property; Section 4 
provides for ad interim attachment; Section 5 deals with 
investigation of objections to attachment; Section 6 provides 
for attachment of property of ma/a fide transferees; Section 7 
H
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SUPREME COURT REPORTS 
[2015] 14 S.C.R. 
A 
stipulates how execution of orders of attachment shall take 
place; Section 8 provides for security in lieu of attachment and 
Section 9 deals with administration of attached property. 
Section 1 O deals with duration of attachment and Section 11 
provides for appeals. Section 13 deals with disposal o~ 
B attached property upon termination of criminal proceedings. 
c 
D 
E 
F 
G 
Section 13(3) reads as f?llows:-
"(3) Where the final judgment or order of the 
Criminal Courts is one of conviction, the District 
Judge shall order that from the property of the 
convicted person attached under this Ordinance or 
out of the security given in lieu of such attachment, 
there shall be forfeited to Government such amount 
or value as isfound in the final judgment or order of 
the Criminal Courts in pursuance of Section 12 to 
have been procured by the convicted person by 
means of the offence, together with the costs of 
attachment as determined by the District Judge and 
where the final judgment or order of the Criminal 
Courts in pursuance of Section 12 to have been 
procured by the convicted person by means of the 
offence, together with the costs of attachment as 
determined by the District Judge and where the 
final judgment or order of the Criminal Courts has 
imposed or upheld a sentence of fine on the said 
person (whether alone or in conjunction with any 
other punishment), the District Judge may order, 
without prejudice to
any other mode of recovery, 
that the said fine shall be recovered from the residue 
of the said attached property or of the security given 
in lieu of attachment." 
139. Learned counsel for the appellants would submit 
that under the 1988 Act the accused were liable to face 
attachment during trial and forfeiture after conviction but by 
H virtue of the Orissa Act they are compelled to face confiscation
YOGENDRA KUMAR JAISWAL ETC. v. STATE OF BIHAR 1171 
[DIPAK MISRA, J.] 
as a consequence of which they are deprived of the possession A 
and the property goes to the State Government. Learned 
counsel for the State would submit that the forfeiture is provided 
after the conviction as the property has to be forfeited and 
embezzled a_mount requires to be realized but it does not debar 
the legislature to provide confiscation of property as an interim 
B 
measure by providing an adequate adjudicatory process. It is 
also submitted that the offence under Section 13(1 )(e) h·as its 
gravity and, therefore, the stringent interim measure is the 
requisite. Alternatively, it is argued that when forfeiture was 
prescribed, and attachment of property was provided as an 
C 
interim measure, different arrangement, may be a stringent 
one, can always be provided by the legislature. 
140. We have already held that confiscation is not a 
punishment and hence, Article 20(1) is not violated. Learned 0 
counsel for the State would lay stress on the decision in State 
·p7 
of Andhra Pradesh and Others v. CH. Gandhi . In that case, 
the issue that arose for consideration when the disciplinary 
proceeding was initiated, one type of punishment was 
imposable and when the punishment was imposed due to 
E 
amendment of rule, a different punishment, which was a . 
greater one, was imposed. The High Court opined that the 
punishment imposed under the amended rule amounted to 
imposition of two major
penalties which was not there in the 
old rule. Dealing with the issue the Court referred to the rule 
F 
that dealt with major penalties and the rule making power. 
Reference was made to the decision in Pyare Lal Sharma v. 
Managing Director and others." wherein it has been stated 
that no one can be penalised on the ground of a conduct which 
was not penal on the date it was committed. Thereafter, the 
two-Judge Bench referred to the authority K. Satwant Singh G 
v. State of Punjab" wherein it has been held thus:-
:: (2013) 5 sec 111 
"(1989) 3 sec 448 
AIR 1960 SC 266 
,_ 
H
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SUPREME COURT REPORTS 
{2015] 14 S.C.R. 
A 
" ... In the present case a sentence of imprisonment 
was, in fact, imposed and the total offines imposed, 
whether described as 'ordinary' or 'compulsory', 
was not less than the amount of money procured 
by the appellant by means of his offence. _Under 
B 
Section 420 of the Penal Code an unlimited amount 
of fine could be imposed. Article 20(1) of the 
Constitution is" in two parts. The first part prohibits 
a conviction of any person for any offence except 
for violation of law in force at the time of the 
C 
commission of the act charged as an offence. The 
latter part of the article prohibited the imposing of 
a penalty greater than that which might have been 
inflicted under the law in force at the time of the 
commission of the offence. The offence with which 
D 
the appellant had been charged was cheating 
punishable under Section 420 of the Penal Code 
which was certainly a law in force at the time of the 
commission of the offence. The sentence of 
imprisonment which was imposed upon the 
E 
appellant was certainly not greater than that 
permitted by Section 420. The sentence of fine also 
was not greater than that which might have been 
inflicted under the law which had been in force at 
the time of the commission of the offence, as a fine 
F 
unlimited in extent could be imposed under the 
section." 
G 
141 . Thereafter, the Court referred to Maya Rani Punj 
v. crf
0
, K. Satwant Singh (supra) and Tiwari
Kanhaiyala/ 
v. err' and eventually held:-
" ... The order of compulsory retirement is a lesser 
punishment than dismissal or removal as the 
pension of a compulsorily retired employee, if 
10 (1969) 1 sec 445 
H 
71 (1975) 4 sec 101
YOGENDRA KUMAR JAISWAL ETC. v. STATE OF BIHAR 1173 
[DIPAK MISRA, J.] 
eligible to get pension under the Pension Rules, is 
A 
not affected. Rule 9(vii) was only dealing with 
reduction or reversion but issuance of any other 
direction was not a part of it. It has come by way of 
amendment. The same being a lesser punishment 
than the maximum, in our considered opinion, is 
B 
imposable and the disciplinary authority has not 
committed any error by imposing the said 
punishment, regard being had to the nature of 
charges. It can be looked from another angle. The 
rule-making authority has split Rule 9(vii) into two 
C 
parts- one is harsher than the other, but, both are 
less severe than the other punishments, namely, 
compulsory retirement, removal from service or 
dismissal. The reason behind it, as we perceive, is 
not to let off one with simple reduction but to give a 
D 
direction about the condition of pay on restoration 
and also not to impose a harsher punishment which 
may not be proportionate. In our view, the same 
really does not affect any vested or accrued right. It 
also does not violate any constitutional protection." 
E 
142. We are absolutely conscious that the said judgment 
was delivered in a different context. What is prohibited under 
Article 20(1) is imposition of greater punishment that might 
have been imposed and prohibition of a conviction of any 
person for violation of law at the time of commission of the act. 
F 
We repeat at the cost of
repetition that confiscation being not 
a punishment does not come in either of the categories. Thus 
viewed, the property of an accused facing trial under the 1988 
Act could be attached and there can be administration by third 
party of the said property and eventual forfeiture after G 
conviction. The term "attachment" has been understood by this 
Court in Kera/a State Financial Enterprises Ltd. v. Official 
Liquidator, High CourtofKerata" in the following manner:-
" (2006) 1 o sec 709· 
H
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SUPREME COURT REPORTS 
[2015] 14 S.C.R. 
A 
'The word "attachmenf' would only mean 'faking into 
the custody of the law the person or property of one 
already before the court, or of one whom it is sought 
to bring before it". It is used for two purposes: (1) to 
compel the appearance of a defendant; and (it) to 
B 
seize and hold his property for the payment of the 
debt. It may also mean prohibition of transfer, 
conversion, disposition or movement of property 
by an order issued by the court." 
143. The legislature has thought it proper to change the 
C nature and character of the interim measure. The property 
obtained by ill-gotten gains, if prima facie found to be such by 
the authorised officer, is to be confiscated. An accused has 
no vested right as regards the interim measure. He is not 
protected by any constitutional right to advance the plea that 
D he cannot be made liable to face confiscation proceedings of 
the property which has been accumulated by illegal means. 
That being the litmus test, the filament of reasoning has to 
rest in favour of confiscation and not against it. Therefore, we 
are of the considered view that the provision does not violate 
E 
any constitutional assurance. 
144. The next aspect we shall address to whether the 
procedure for confiscation as envisaged under Section 13 to 
Section 15 suffers from any lack of guidance. We have already 
F 
opined that the State Government is only required to scrutinize 
the "offence" and
authorises the Public Prosecutor for the 
purpose of filing an application for confiscation. The Public 
Prosecutor, as mandated under Section 13(2) is required to 
file an application indicating the reasons on the basis of which 
G the State Government believes that the delinquent officer has 
procured the property by means of the offence. Thus, reasons 
have to be stated in the application and it has to be clearly 
averred that the property has been acquired by means of the 
offence as defined under the Orissa Act. The authorised officer 
H is a judicial officer and is required to afford reasonable
YOGENDRA KUMAR JAISWAL ETC. v. STATE OF BIHAR 1175 
[DIPAK MISRA, J.] 
opportunity of hearing to the accused or any other person 
A 
operating the property on his behalf. Discretion is also 
conferred on the authorised officer to record a finding whether 
all or any other money or property in question have been 
acquired illegally. The said authority can drop the proceedings 
or direct confiscation of all or some properties. Affording of a 
B 
reasonable opportunity of hearing is not confined only to file 
affidavits. We are inclined to think that when the delinquent is 
entitled to furnish an explanation and also put forth his stand, 
he certainly can bring on record such material to sustain his 
explanation. Confiscation proceeding as provided under sub-
C 
section (3) of Section 15 is subject to appeal. In view of the 
scheme of the Orissa Act, there can be no shadow of doubt 
that there is ample guidance in the procedure for confiscation. 
It is not a proceeding where on the basis of launching of 
prosecution, the properties are confiscated. Therefore, the D 
proceedings relating to confiscation cannot be regarded as 
violative of article 14 because conferment of unchecked power 
or lack of guidance. 
145. Learned counsel for the appellants have laid 
emphasis on the phraseology used in Section 15(3) of the 
E 
Orissa Act. The said provision stipulates that where the 
authorised officer records a finding under the Section that any 
money or property or both have been
acquired, by means of 
the offence, he shall make a declaration subject to the 
provisions of the Act, then they stand confiscated to the State 
F 
Government "free frbm all encumbrances". It is submitted that 
once the property stands confiscated to the State Government 
free from all encumbrances, the right, title and interest of the 
person concerned is extinguished. Tl;le said submission, in 
our consideration, is on a very broad canvass. As the scheme G 
of the Orissa Act would show, the confiscation is interim in 
nature. It does not assume the character of finality. Same is 
the position in Bihar Act. The accused is entitled to get return 
of the property or money in case he succeeds in appeal before 
H
1176 
SUPREME COURT REPORTS 
[2015] 14 S.C.R. 
A the High Court against the order passed by the authorised 
officer or in the ultimate eventuality when the order of acquittal 
is recorded. The words "free from all encumbrances'', in the 
context, are to be given restricted meaning. It is to repel third 
party claims and negate attempts to undo and invalidate the 
B temporary or interim confiscation till the final decision. It cahnot 
be equated with the provisions in other statutes where by 
operation of law the property vests with the State Government 
free from all encumbrances where the rights of the person 
c 
D 
E 
F 
G 
concerned get obliterated. 
146. While dealing with the word "encumbrance", this 
Court in State of Himachal Pradesh v. Tarsem Singh and 
others" has opined that:-
" ... means a burden or charge upon property or 
claim or lien upon an estate or on the land. 
"Encumber" means burden of legal liability on 
properly, and, therefore, when there is 
encumbrance on a land, it constitutes a burden on 
the title which diminishes the value of the land ... 
147. In Su/ochana Chandrakant Galande v. Pune 
Municipal Transport and others" dealing with the word 
"encumbrance", the Court has expressed thus:-
"Encumbrance" actually means the burden caused 
by an act or omission of man and not that created 
by nature. It means a burden or charge upon 
property or a claim or lien on the land. It means a 
legal liability on property. Thus, it constitutes a 
burden on the
title which diminishes the value of 
the land. It may;t>e a mortgage or a deed of trust or 
a lien of an easement. An encumbrance, thus, must 
be a charge on the property. It must run with the 
property. (Vide Collector of Bombay v. 
:: AIR 2001 SC 3431 
H 
(2010) a sec 467
YOGENDRA KUMAR JAISWAL ETC. v. STATE OF BIHAR 1177 
[DIPAK MISRA, J.] 
Nusserwanji Rattanji Mistr/', H.P. SEB v. Shiv K. 
A 
Sharma" and Al Champdany Industries Ltd. v. 
Official Liquidator')." 
In view of the aforesaid enunciation of law, the words "free 
from all encumbrances" in the provision under assail has to be 
conferred constricted meaning, for it is interim confiscation 
B 
and definitely it is not equivalent to vesting. Hence, the 
contention on the said score founders. 
148. The next plank of submission relates to creation of 
a dent in the basic concept of fair trial, which is an integral c 
part of Article 21 of the Constitution. In Dayal Singh v. State 
of Uttaranchai' the Court, while dealing with the concept of 
fair trial, expressed the view that where our criminal justice 
system provides safeguards of fair trial and innocent till proven 
guilty to an accused, there it also contemplates that a criminal 0 
trial is meant for doing justice to all, the accused, the society 
and a fair chance to prove to the prosecution; and then alone 
can law and order be maintained. 
149. In Rattiram v. State ofM.P." it has been held:-
"39 .... Fundamentally, a fair and impartial trial has 
a sacrosanct purpose. It has a demonstrable object 
that the accused should not be prejudiced. A fair 
trial is required to be conducted in such a manner 
which would totally ostracise injustice, prejudice, 
dishonesty and favouritism. 
x 
x 
x 
x 
x 
62 .... Decidedly, there has to be a
fair trial and no 
miscarriage of justice and under no circumstances, 
E 
F 
prejudice should be caused to the accused but, a 
G 
;: AIR 1955 SC 298 
(2005) 2 sec 164 
77 (2009) 4 sec 486 
76 . 
,, (2012) 8 sec 263 
(2012) 4 sec 516 
H
1178 
SUPREME COURT REPORTS 
[2015] 14 S.C.R. 
A 
pregnant one, every procedural lapse or every 
interdict that has been acceded to and not objected 
at the appropriate stage would not get the trial 
dented or make it unfair. Treating it to be unfair 
would amount to an undesirable state of pink of 
B 
perfection in procedure. An absolute apple-pie 
order in carrying out the adjective law, would only 
be sound and fury signifying nothing." 
150. In the instant case .. it is urged that when the 
concerned person/accused discloses his stand before the 
C authorised officer serious prejudice is likely to be caused to 
him during trial. The principal grievance is that he is compelled 
to disclose his defence before trial though he is entitled in law 
not to do so. This submission is founded on the protection 
given under Article 20(3) of the Constitution. 
D 
151. There can be no cavil over the proposition that an 
accused has the right to maintain silence and not to disclose 
his defence before trial. It is worth noting here that the Authorised 
Officer is a judicial officer and he is required to deal with 
E material for the limited purpose of confiscation. That apart, 
there is a statutory protection that the material produced before 
the Authorised Officer shall not be used during trial. If we 
understand the said provision appositely, it is graphically clear 
that the materials produced before the authorised officer are 
F 
not to be looked into during trial, and the trial
is to proceed in 
accordance with the Code of Criminal Procedure and subject 
to the provisions of the 1988 act as long as there is no 
inconsistency. The trial Judge is a senior judicial officer and 
has a trained judicial mind. If something is not to be looked 
G into, it shall by no means be looked into. The constitutional 
protection under Article 20(3) .is in no way affected. That apart, 
Article 20(3) of the Constitution speaks about the guarantee 
against "testimonial compulsion". In the case of M.P. Sharma 
v. Satish Chandra"' the court has observed thus:-
H 
80 AIR 1954 SC 300
YOGENDRAKUMAR JAISWAL ETC. v. STATE OF BIHAR 1179 
[DIPAK MISRA, J.] 
"Broadly stated the guarantee in Article 20(3) is 
A 
against "testimonial compulsion". It is suggested 
that this is confined to the oral evidence of a person 
standing his trial for an offence when called to the 
witness-stand. We can see no reason to confine 
the content of the constitutional guarantee to this 
B 
barely literal import. So to limit it would be to rob 
the guarantee of its substantial purpose and to miss 
the substance for the sound as stated in certain 
American decisions. The phrase used in Article 
20(3) is "to be a witness". A person can "be a 
C 
witness" not merely by giving oral evidence but also 
by producing documents or making intelligible 
gestures as in the case of a dumb witness (See 
Section 119 of the Evidence Act) or the like. "To be 
a witness" is nothing more than "to furnish evidence" 
D 
and such evidence can be furnished through the 
lips or by production of a thing or of a document or 
in other modes. 
• •• 
The phrase used in Article 20(3) is "to be a witness" 
and not to "appear as a witness". It follows that the 
protection afforde.d to an accused in so far as it is 
related, to the phrase "to be a witness" is not merely 
in respect of testimonial compulsion in the court 
room but may well extend to compelled testimony 
previously obtained from him. It is available 
therefore to a person against whom a formal 
accusation relating to the commission of an offence
has been levelled which in the normal course may 
result in prosecution. Whether it is available to other 
persons in other situations does not call for 
decision in this case". 
E 
F 
G 
H
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SUPREME COURT REPORTS 
[2015] 14 S.C.R. 
A 
152. Tested on the aforesaid enunciation of law, it can 
be stated with certitude that the right conferred on an accused 
under Article 20(3) is not violated. We reiterate that whatever 
is produced before the authorised officer is not to be looked 
into by the trial court and neither the prosecution nor the 
B defence can refer to the same. That is the statutory command. 
Therefore, the submission astutely canvassed by the learned 
counsel for the appellants is sans substance. 
153. The next aspect which needs to be addressed is 
C the v,alidity of Section 17 of the Orissa Act which deals with 
appeal. The said provision reads as follows:-
"Section 17. Appeal:-(1)Any person. aggrieved 
by any order of the authorised officer under this 
Chapter may appeal to the High Court within thirty 
D 
days from the date on which the order appealed 
against was passed. 
(2) Upon any appeal preferred under this section 
the High Court may, after giving such parties, as it 
thinks proper, an opportunity of being heard, pass 
E 
such order as it thinks fit. 
(3)An appeal preferred under sub-section (1) shall 
be disposed of within a period of three months from 
the date it is preferred, and stay order, if any, passed 
F 
in an appeal shall not remain in force beyond the 
prescribed period of disposal of appeal." 
[underlining is ours] 
154. Learned counsel for the appellants have seriously 
G criticised Section 17(3) on the ground that the
said provision 
interferes with the judicial proceeding by laying down that the 
said order shall not remain in force beyond the prescribed 
period of disposal of appeal. It appears that such a contention 
was not raised before the High Court, for the High Court has 
not dealt with the same. However, Mr. S.K. Padhi, learned 
H
YOGENDRA KUMAR JAISWAL ETC. v. STATE OF BIHAR 1181 
[DIPAK MISRA, J.] 
senior counsel for the respondent-State, would submit that in A 
the Orissa Special Courts Act, 1990 (Orissa Act 22 of 1992) 
contained a similar provision .and the Division Bench in 
Kishore Chandra Patel (supra) construed the said provision 
by opining that the provision in Section 18(3) limiting the 
operation of stay order, if any, passed in appeal for a period of B 
three months does not prohibit passing of a fresh stay order 
beyond that period, if a case for the same were to be made 
out to the satisfaction of the Court. At this stage, we may note 
with profit that the High Court of Patna has dealt with Section 
17(3) of the BiharAct which provides that an appeal shall be C 
disposed of preferably within a period of six months from the 
date it is preferred, and stay order, if any, passed in an appeal 
shall not remain in force beyond the prescribed. period of 
disposal of appeal. It has been held therein that it would not be 
proper to construe that the prescribed period of disposal of D 
appeal is only six months but it is only desirable that the appeal 
should be disposed of within six months and the stipulation 
that the order of stay is not to remain in force beyond the period 
of disposal of appeal would not mean that the order of stay will 
lose its force during the pendencyofthe appeal. The High Court E 
has laid emphasis on the word "preferably'' to interpret that the 
intention of the
legislature is that the appeal should be 
disposed of within six months but it does not mean that the 
appeal has to be disposed of within six months. The High Court 
has further observed that it would not be proper to construe F 
that the prescribed period of disposal of appeal is only six 
months and, therefore, the stay order passed by the High Court 
will lose its force automatically on expiry of any particular period. 
It has placed the said interpretation to save the constitutionality 
of the provision. We have referred to the Bihar Act at this G 
juncture as the provisions are similar to the OrissaAct except 
the word "preferably" used in Section 17(3) of the Bihar Act. 
There can be no doubt that no statutory provision can postulate 
that an order of stay shall not remain in force beyond the period 
H
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SUPREME COURT REPORTS 
(2015] 14 S.C.R. 
A meant for disposal of the appeal. The High Court of Patna has 
construed the provision by laying down stress on the word 
"preferably''. We are disposed to think that the interpretation 
placed on the similar provision of the Orissa Act in Kishore 
Chandra Patel (supra) is correct and, therefore, we are 
B disposed to hold that the order of stay if passed in an appeal 
would not debar or prohibit the High Court to pass a fresh stay 
order beyond that period, if a case is made out to the 
satisfaction of the court. We would like to add that the 
legislative intent is that an appeal has to be tried absolutely 
C expeditiously regard being had to the scheme of the Orissa 
Act as well as the Bihar Act and the person grieved by the 
order passed by the authorities should not enjoy an order of 
stay beyond that period. Proper construction that has to be 
placed would be that the High Court while exercising the power 
D of appeal can extend the period of stay subject to its 
satisfaction unless there is justifiable reason for vacating the 
say. This provision, needless to say, has to be read in this 
manner to save it from the vice of unconstitutionality. However, 
we may clearly state that the High Court being a superior court 
E having the power of judicial review shall see to it that the real 
purpose of the legislation is not defeated. It will be advisable 
and that the Chief Justice should demarcate a Bench for one 
day to hear
these appeals. And accordingly, we so request. 
Needless to say, the learned Judge will endeavour to dispose 
F of the appeal within the time frame. 
G 
H 
155. Learned counsel forthe appellants have seriously 
criticized the proviso appended to Section 18(1) of the Orissa 
Act. To appreciate the assail, Section 18(1) is reproduced in 
entirety:-
" Section 18(1). Where any money or property or 
both have been confiscated to the State 
Government under this Act, the concerned 
authorised officer shall order the person affected, 
as well as any other person, who may be in
YOGENDRA KUMAR JAISWAL ETC. v. STATE OF BIHAR 1183 
[DIPAK MISRA, J.] 
possession of the money or property or both to 
surrender or de!iver possession thereof to the 
concerned authorised officer or to any person duly 
authorised by him in this behalf, within thirty days 
of the service of the order: 
Provided that the authorised officer, on an 
application made in that behalf and being satisfied 
that the person affected is residing in the property 
in question, may instead of dispossessing him 
immediately from the same, permit such person to 
occupy it for a limited period to be specified on 
payment of market rent to the State Government 
and thereafter, such person shall deliver the vacant 
possession of the property." 
A 
B 
c 
Criticizing the said provision, it is urged by them that by 
0 
virtue of the provision pertaining to confiscation the delinquent 
officer/accuse.d is compelled to face a situation where he will 
be disposed from his dwelling house, the so called protection 
given under the proviso is an illusory one. It is argued that 
when the money is confiscated, it is well- nigh impossible on 
E 
his part to deposit the market rent to occupy even for a limited 
period. The argument, if we permit ourselves to say so, suffers 
from a fundamental fallacy. Under the scheme of the Orissa 
Act, the confiscation does not take place immediately on 
lodging of an FIR. A detailed procedure has been stipulated 
F 
which is contain adequate safeguards and thereafter
the order 
is given effect to. The proviso appended to Section 18( 1) of 
the Orissa Act is an exception to give protection to the 
concerned officer to remain in possession of the house where 
he resides fora certain period. The person concerned is given 
G 
protection subject to certain terms. It is to be borne in mind 
that the confiscation is associated with the property 
accumulated from the ill-gotten gain. It is urged that though 
proviso gives protection, it actually mocks at Article 21 of the 
Constitutions. We do not think so. The property is confiscated 
H
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SUPREME COURT REPORTS 
(2015] 14 S.C.R. 
A 
by way of an interim measure by taking recourse to law which 
we have held to be constitutionally valid. The submission that 
the man will be in the streets is an argument in frustration but 
not founded on reason. Be that as it may, when by determination 
of the authorised officer for the purpose of confiscation, the 
B 
plea that he will be ousted from the dwelling house which would 
play foul of Article 21 of the Constitution, really does not 
commend acceptance. A person cannot be allowed to indulge 
in corruption and conceive of protection to his dwelling house 
after a finding is recorded in the proceeding for confiscation 
C that it is constructed or purchased by way of corrupt means. 
The person concerned can satisfy the authorised officer or in 
appeal that the dwelling house where he is residing is acquired 
from his known sources of income. In such a situation, we are 
afraid that we cannot accept the submission advanced by 
D the learned counsel for the appellants and, accordingly, the 
same stands rejected. 
156. The next provision which is challenged is Section 
19 of the Orissa Act that deals with refund of confiscated money 
or property in the event of the order of confiscation being 
E 
modified or annulled by the High Court in appeal. The said 
F 
G 
H 
provision is necessary to be reproduced:- · 
"19. Refund of confiscated money or property.-
Where an order of confiscation made under section 
15 is modified
or annulled by the High Court in 
appeal or where the person affected is acquitted 
by the Special Court, the money or property or both 
shall be returned to the person affected and in 
case it is not possible for any reason to return the 
propertv. such person shall be paid the price thereof 
including the money so confiscated with the interest 
at the rate of five per cent per annum thereon 
calculated from the date of confiscation." 
(underlining is ours)
YOGENDRAKUMARJAISWAL ETC. v. STATE OF BIHAR 1185 
[DIPAK MISRA, J.] 
157. The challenge of the appellants pertains t<:> the part A 
we have underlined. It is submitted that the said provision is 
confiscatory in nature and is violative of Article 300A of the 
Constitution. It is urged that the said provision enables the State 
Government to appropriate the property of a person who 
eventually succeeds in appeal or ultimately is acquitted. 
B 
Learned counsel for the State would submit that when there is 
no possibility of being returned for a reason which is beyond 
the control of the State Government, then the said provision 
will come into play. The High Court of Patna while dealing with 
the similar provision contained in Section 19 of the Bihar Act C 
in order to save its constitutionality has held that in case the 
confiscated property is not returned by showing good reasons 
that it is not possible to do so, the interest payable must be at 
the .usual bank rate prevailing during the relevant period for a 
loan to purchase or acquire similar property. It has further D 
observed that said direction is necessary in order to save the 
vires of Section 19 of the Bihar Act and otherwise the relevant 
provision would fall foul of provisions of the Constitution. The 
view expressed by the High Court of Patna is not correct. The 
provision has to be construed in a seemly manner. The 
E 
language used is "in case it is not possible for any reason to 
return the property". Mr.
Ranjit Kumar, learned senior counsel 
appearing for the State of Bihar would submit that in case this 
Court read down the said provision, and, if it is not inclined to 
do so, it may apply doctrine of severability. Mr. A. Saran, 
F 
learned senior counsel for the appellants, per contra, would 
contend that it is the obligation of the State Government to 
return the money as it is and there cannot be a stipulation to 
return the value with five per cent interest, for it is absolutely 
obnoxious. 
G 
158. The language employed in Sedion 19 of the Orissa 
Act has to be appreciated regard being had to the scheme of 
the said Act. The legislative intent is to curb corruption at high 
places and requires the accused persons to face trial in the 
Special Court constituted under the Orissa Act in a speedier H
1186 
SUPREME COURT REPORTS 
(2015] 14 S.C.R. 
A 
manner and also to see that the beneficiaries of ill-gotten 
property or money do not enjoy the property or money during 
trial. That apart, the intention is also clear that the Government 
should not appropriate the money or the property to itself in 
any manner. Confiscation, we have already opined, is done 
B as an interim measure. The words "free from all encumbrances" 
have been given a restricted meaning by us as it follows from 
the language used in the OrissaAct. Section 19 clearly lays 
down return of the confiscated money or property or both. It 
conceives of three situations, namely, modification of the order 
C of confiscation, or annulment of confiscation, or the eventual 
acquittal. In these conditions, the money or property or both 
are required to be returned. The words, which we have 
underlined in Section 19, seem to us, cannot be conferred a 
wide meaning. They cannot be allowed to convey that the State 
D will not return the property. The key words are "in case it is not 
possible" and "for any reason". It will be an assumption to think 
that "for any reason" would mean any kind of subjective reason. 
In certain statutes or enactments the words "for any reason" 
can be attributed a wide meaning to subserve the legislative 
E purpose. The term "possible", in our considered opinion, may 
not be given the stature or status of "impossible", which is 
absolute in its connotation, but the word "possible", as we
perceive, in itself contains certain concept of reason. The 
reason ascribed by the State has to withstand scrutiny in the 
F 
strict sense. As indicated before, it may not be conceived in 
absolute terms like the word "impossible", for law does not 
countenance an impossible thing to be done. Therefore, the 
construetion that is required to be placed on this provision is 
that the State must clearly demonstrate that it has a real and 
G acceptable reason and hence, it is not possible not to return 
the money or property or both. Such an interpretation shall 
save the provision from the vice of unconstitutionality. We think 
so as there may be situations where it may not be possible on 
the part of the State to return the property. No illustration need 
H be given because it would depend upon facts of each case.
YOGENDRAKUMAR JAISWAL ETC. v. STATE OF BIHAR 1187 
[DIPAK MISRA, J.) 
The argument by the appellants is that in such a situation the 
A 
payment of value determined and the rate of interest provided 
in the provision is absolutely irrational and the State can 
appropriate the property. The aforesaid submission, though 
on a first blush, may look quite attractive, but on a deeper 
scrutiny, is bound to melt into insignificance. It is to be 
B 
remembered that the proceeding is initiated for confiscation 
in respect of the property acquired by the offence as described 
under the Act. It is done on the basis of certain material brought 
on record. Ultimately the proceedings may not be successful 
but if it is not possible to return the property the State cannot c 
be asked to compensate more than what the legislature has 
thought to be appropriate. It cannot be equated with 
acquisition. The entire proceeding is initiated regard being· 
had to the ·rampant corruption at high places in the present 
day society. Therefore, to think that submission that there has D 
to be adequate compensation would be against the larger 
public interest. Thus understood, the challenge to the provision 
on the backdrop of Article 300A has .to be treated as 
unacceptable and we do so. We may hasten to add that any 
order passed under this provision is always subject to judicial 
E 
review by the superior courts. 
159. We have at the beginning had mentioned that both 
the Orissa Act and the Bihar
Act are almost similar and, 
wherever required we have adverted to the same while dealing 
with the Orissa Act. Barring the same, we do not find there is . F 
any distinction between the two enactments and, therefore, 
analysis made by us as regards the Orissa Act will apply to 
the Bihar Act. 
160. It is significant to note here that before the High G 
Court of Patna the validity of a Rule was assailed but the 
application was not pressed and the High Court has made 
certain observations. We intend to put the controversy to rest. 
Rule 12 of the 2010 Rules provides for Special Courts to follow 
summary procedure. Rule 12(a) and (f) read as under:-
H
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SUPREME COURT REPORTS 
[2015] 14S.C.R. 
A 
"(a) On institution of a case or transfer of pending 
proceeding to the Special Courts, trial shall be held 
in summary manner. 
(f) The delinquent public servant shall be put on trial 
and shall be afforded opportunity to lead evidence 
B 
in support of his defence. If the special court, on 
the evidence of delinquent public servant is, prima 
facie, satisfied that he has been able to discharge 
his onus, the prosecution shall be called upon to 
lead its evidence to prove the charges against the 
C 
delinquent public servant." 
161. When the Bihar Act provides to follow the warrant 
procedure prescribed by the Code for trial of cases before a 
Magistrate, the 2010 Rules could not have prescribed for 
summary procedure. The rules have to be in accord with the 
D Act. The rules can supplement the provisions of the Act but 
decidedly they cannot supplant the same. Therefore, we 
declare that part of Rule 12 which lays down that the learned 
Special Judge shall follow summary procedure, is ultra vires 
E 
F 
G 
the Bihar Act. 
162. In view of the foregoing analysis, we proceed to 
summarise our conclu~ions:-
(i) The Orissa Act is not hit by Article 199 of the 
Constitution. 
(ii) The establishment of Special Courts under the Orissa 
Act as well as the Bihar Act is not violative of Article 247 
of the Constitution. 
(iii) The provisions pertaining to declaration and effect 
of declaration as contained in Section 5 and 6 of the
Orissa Act and the Bihar Act are constitutionally valid as 
they do not suffer from any unreasonableness or 
vagueness. 
(iv) The Chapter Ill of the both the Acts providing for 
H 
confiscation of property or money or both neither violates
YOGENDRA KUMAR JAISWAL ETC. v. STATE OF BIHAR 1189 
[DIPAK MISRA, J.] 
Article 14 nor Article 20(1) nor Article 21 of the A 
Constitution. 
(v) The procedure provided for confiscation and the 
proceedings before the Authorised Officer do not cause 
any discomfort either to Article 14 or to Article 20(3) of B 
the Constitution . 
. (vi) The provision relating to appeal in both the Acts is 
treated as constitutional on the basis of reasoning that 
the power subsists with the High Court to extend the order 
of stay on being satisfied. 
c 
(vii) The proviso to Section 18(1) of the Orissa Act does 
not fall foul of Article 21 of the Constftution. 
(viii) The provisions contained in Section 19 pertaining 
to refund of confiscated money or property does not o 
suffer from any kind of unconstitutionality. 
(ix) Sub-rules (a) and (f) Rule 12 of the 2010 Rules being 
violative of the language employed in the Bihar Act are 
ultra \/ires or anything contained therein pertaining to the 
summary procedure is also declared as ultra vires the E 
BiharAct. 
163. Consequently, the appeals arising out of the 
judgment and order passed by the High Court of Orissa are 
dismissed and the appeals which have called in question the 
legal validity of the judgments and order passed by the High 
F 
Court of Patna are allowed to the extent indicated hereinbefore. 
Regard being had to the facts and circumstances of the case, 
we refrain from imposing any costs in the civil appeals. 
Bibhuti Bhushan Bose
Appeals disposed of.