Mohendra Chandra Roy and Another vs Union Territory of Mizoram

B.L. Hansaria, J.—The Criminal Law Amendment Ordinance, (hereinafter the ordinance) was promulgated to provide for preventing the disposal or concealment of money or other property procured by means of certain offences specified in the schedule of the Act. Offences relating to misappropriation finds place in the schedule. The allegation against Appellant No. 1 being misappropriation of a sum of Rs. 1 (one) lakh 17 (seventeen) thousand odd between the period from 11.3.63 to 19.4.69. a petition under Sections 3, 4 read with Section 6 of the Ordinance was filed before the learned District Judge, Cachar at Silchar praying for attachment of the properties described in schedules A and B of the application. It may be mentioned that Schedule-A property was said to be the property of Appellant No. 1 himself, whereas Schedule-B property was said to be of his wife alleging that she was a benamidar of Appellant No. 1. Some amendments were made in (he schedule and ultimately by the impugned judgment the properties have been finally attached after hearing the Appellants. As to the properties in the name of Appellant No. 1, it has been stated that any property standing in the name of the offender may be attached u/s 3 So far as the property of the wife is concerned, the same has been held to really belong to Appellant No. 1 - the wife being an ostensible owner. The first point which needs determination is as to whether the property which could be attached under the Ordinance has to be one which is believed to have been procured by means of the offence. Shri Sen appearing for the Appellants, is at points to contend that the long title and the preamble of the Ordinance would clearly show that the property which could be attached has to be one which was procured by means of scheduled offences. This is apparent from the preamble which reads:

Whereas emergency has arisen which makes it necessary to provide for preventing the disposal or concealment of money or other property procured by means of certain offences punishable under the Indian Penal Code.

The long title "An Ordinance to prevent the disposal or concealment of property procured by means of certain offences" would also supports the same, though it is watch noting that in the long title no mention has been made of "money". Aid of the preamble is, however, taken only when there is a doubt as to the meaning of a provision. To put it differently, if the language of the enactment is capable of more than one meaning, then the one which comes nearest to the purpose and scope of the preamble, has to be preferred. In other words, preamble may assist in ascertaining the meaning but does not affect clear words in a statute See Tribhuban Parkash Nayyar Vs. The Union of India (UOI), The decision was cited with approval by His Holiness Kesavananda Bharati Sripadagalvaru Vs. State of Kerala, . This position in law is not in dispute. In Caries on Statute Law, it has been stated at page 202 of the 7th Edition that if the enactment is clear and unequivocal without the preamble, the preamble can have no effect Whatever. This apart, as has been pointed out in Secretary of State v. Maharajah of Bobbili AIR 1919 PC 52, the legislature may well intend that the enacting part do extend beyond the apparent ambit of the preamble. It is also stated in Attorney General v. HRH Prince Ernest 1957 AC 436 by the House of Lords that the enactment may go beyond, or it may fall short of the indication that may be gathered from the preamble.

We have, therefore, to see the main provision first. Section 3(1) of the ordinance deals with application for attachment of the property and the relevant portion of the same reads:

Whereas the State Government has reason to believe that any person has committed...any scheduled offence, the State Government may...authorize the making of an application to the District Judge...for the attachment...of the money or other property which the State Government believes the said person to have procured by means of the offence, or if such money or property cannot for any reason be attached, of other property of the said person of value as nearly as may be equivalent to that of the aforesaid money or other property.

(Emphasis added).

This provision leaves no manner of doubt that what could be applied for attachment is not confined to the property procured by means of the offence, as the Sub-section clearly says that if the property procured by means of the offence cannot for any reason be attached, other property of the equivalent value could be so done. Other property is available if property procured by tainted money cannot "for any reason" be attached. We cannot give a limited and narrow meaning to the expression "for any reason" as that would frustrate the object. To fall back on other property, it is not necessary that the tainted property must exist but is not available for attachment for some reason or the other, Shri Sen has, however, advanced this argument because of the following finding place in Section 4(1) of the ordinance,

Ad-interim attachment- (1) Upon receipt of an application u/s 3, the District Judge shall, unless for reasons to be recorded in writ ting he is of the opinion that there exists no prima facie grounds for believing that the person in respect of whom the application is made has committed any scheduled offences or that he has procured thereby any money of other property, pass without delay an ad-interim order attaching the money or other property alleged to have been so procured, or if it transpires that such money or other property is not available for attachment, such other property of the said person of equivalent value as the District Judge may think fit.

(Emphasis supplied)

Though Section 4(1) has spoken about the nonavailability of the tainted property before other property could be attached, the non-availabity could, be for any reason, one of which may be the non-existence of any property procured by means of the offence. If both Sections 3(1) and 4(1) are read together, as they have to be being a part of the composite scheme, no doubt can be entertained that attachment of other property except the tainted one is also permissible even where to the knowledge of the State Government, there may not be any property (as distinguished from money) procured by means of the offence.

In this view of the matter, the power of attachment cannot be confined to the property procured by means of the offence as mentioned in the preamble, or the long title of the Ordinance. Any other view would make that part of Section 3(1), and for that matter of Section 4(1) redundant, which has authorized attachment of property other than the one procured by means of the offence. Shri Sen. however, refers to G.L. Salwan Vs. The Union of India and Another, in paragraph 11 of which it has been stated that the object of the ordinance is to freeze money or property improperly obtained by the Government servant in an official capacity, or money or property belonging to the Government regarding which an offence is alleged to have been committed. These observations made while dealing with the validity of the ordinance on the touchstone of Articles 14 and 20(3) of the Constitution, cannot be regarded as the ratio of that decision. Though some assistance is also sought to be derived by Shri Sen from the State of West Bengal Vs. S.K. Ghosh, that decision has indeed slated categorically in its para 9 that u/s 3, two kinds of property may be attached, namely (1) the property which has been procured by the commission of the offence, whether it be in the form of money or in the movable or immovable property and (2) properties other than the above. No rider has been added that the other property must be one which has been procured with the tainted money. Indeed, in para 1 it was stated that if for some reason the tainted money or property could not be attached, the Government was given power to apply for the attachment of other property as well, even though no offence has been committed with respect to that other property.

If we refer to some other provisions of the Ordinance, this conclusion would be reinforced. Section 5 which deals with investigation of objection to attachment mandates in its proviso (b) that the District Judge shall not withdraw the order of attachment unless he is satisfied that the concerned person has not by means of the said offence procured any money or other property. This proviso does not permit withdrawal of attachment of other property simply for the reason that the property bad not been procured by means of the offence or from the money procured in the offence, it is worth stating that Section 4 of the Ordinance having permitted attachment of other properties Section 5 makes it abundantly clear that no objection in this regard would be sustainable only on the ground that property from tainted money was not in existence, as this cannot he a ground to withdraw the order of attachment in view of what has been stated in proviso (b). Section 6 permits attachment of property in the hands of mala fide transferees where the assets available for attachment of the concerned person are found to be less than the amount or value which he is believed to have procured by means of the offence. The availability of the assets bad not been confined in this section to the property procured by means of the offence, but it speaks of all assets of the concerned person.

From what has been stated above, no doubt can be entertained that the main provisions of the Ordinance permit attachment of other properties also, The restrictive language used in the preamble, cannot, therefore, cut down the ambit of the provisions. It has to be accepted that in this case the legislature did intend the enacting part to extend beyond the Zone of the preamble. No illegality can, therefore, be read in ordering attachment of other properties belonging to Appellant No. 1.

Coming to the property of Appellant No. 2, Sri Sen contends that except the bold allegation of benami, there was no material to come to this conclusion. My attention is invited to the evidence of the only witness examined in the case for the prosecution who merely stated that he found some property of Appellant No. 1 in the name of his wife. Except for this one line statement, there is nothing in the evidence of P.W. 1 to show how and why was the wife a benamidar of Appellant No. 1. A perusal of the impugned order. however, shows that incoming to the conclusion of ostensible ownership, the learned Judge has disbelieved the evidence off the wife who was examined AS D.W. 1 and had stated that she had purchase the property from the money she had received from her brother. Even if the explanation offered by D.W. 1 be not convincing, it is well established that it is for the person who makes than allegation to prove the same beyond reasonable doubt, as pointed out in Maung Po Kin v. Maung Poh Shein AIR 1926 PC 77 . This view has been accepted by the highest Court of this land in innumerable decisions dealing with benami transactions. Reference may be made to Thakur Bhim Singh (Dead) by Lrs and Another Vs. Thakur Kan Singh, . This apart, the Courts have to bear in mind a number of factors in deciding the question of benami acquisition, In Jaydayal Poddar (Deceased) through L.Rs. and Another Vs. Mst. Bibi Hazra and Others, the Court had listed six such circumstances. These being:

(1) The source from which the purchase money came.

(2) the nature and possession of the property ;

(2) motive, if any, for giving the transaction a benami colour;

(4) the position of the parties and the relationship, if any, between the claimant and the alleged benamidar:

(5) The custody of the title-deeds after the sale; and

(6) the conduct of the parties concerned in dealing with the property after the sale.

In the present case, we do not find any discussion relating to Schedule-B properties on the touch-stone of the above circumstances, except saying that the money did not come from the source disclosed by the wife. This, however, cannot be decisive. Similarly, from the mere fact that the property was acquired after 11.3.63, an irresistible conclusion does not follow-as is the view of the learned District Judge, that the properties were acquired with the tainted money. As such the impugned order relating to the properties of the wife cannot be accepted.

The result is that the appeal is dismissed qua the properties of Appellant No. 1, but is upheld as regards the properties of Appellant No. 2. Despite this decision, it would be open to the Respondent to pray for attachment of the properties of the wife by satisfying the Court that the wife was really a benamidar; and on any such approach being made, the Court would decide this question in the light of the circumstances mentioned above, of course, by bearing in mind that the question whether a particular transaction is benami or not, is largely one of fact for determining which no absolute formulae or acid test uniform ally applicable in all situations be laid down, enough in weighing the probabilities and for gathering the relevant indicia the above circumstances be taken as guidelines.