{"id":229035,"date":"1997-11-19T00:00:00","date_gmt":"1997-11-18T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/amenabai-tayebaly-ors-vs-competent-authorityunder-safema-on-19-november-1997"},"modified":"2015-10-06T19:21:16","modified_gmt":"2015-10-06T13:51:16","slug":"amenabai-tayebaly-ors-vs-competent-authorityunder-safema-on-19-november-1997","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/amenabai-tayebaly-ors-vs-competent-authorityunder-safema-on-19-november-1997","title":{"rendered":"Amenabai Tayebaly & Ors vs Competent Authorityunder Safema … on 19 November, 1997"},"content":{"rendered":"
Supreme Court of India<\/div>\n
Amenabai Tayebaly & Ors vs Competent Authorityunder Safema … on 19 November, 1997<\/div>\n
Author: S Majmudar<\/div>\n
Bench: S.B. Majmudar, M. Jagannadha Rao<\/div>\n
           PETITIONER:\nAMENABAI TAYEBALY & ORS.\n\n\tVs.\n\nRESPONDENT:\nCOMPETENT AUTHORITYUNDER SAFEMA & ORS.\n\nDATE OF JUDGMENT:\t19\/11\/1997\n\nBENCH:\nS.B. MAJMUDAR, M. JAGANNADHA RAO\n\n\n\n\nACT:\n\n\n\nHEADNOTE:\n\n\n\nJUDGMENT:\n<\/pre>\n
\t       THE 19TH DAY OF NOVEMBER, 1997
\nPresent
\n\t     Hon’ble Mr. Justice S.B. Majmudar
\n\t     Hon’ble Mr. Justice M. Jagannadha Rao
\nR.F. Nariman,  Sr. Adv.,  Mrs. M. Karanjawala, Adv. with him
\nfor the appellants
\nK.N. Shukla,  Sr.Adv.,\tT.C.Sharma,  S.Rajappa,\t S.N.Terdol,
\nA.P. Mayee  and A.M.  Khanwilkar, Advs.\t with  him  for\t the
\nRespondents
\n\t\tJ U D G M E N T\/ O R D E R S
\n     The following Judgment of the Court was delivered:
\nS.B. Majmudar J.\n<\/p>\n
     This  appeal   by\tspecial\t leave\tseeks  to  challenge
\njudgment and  order rendered  by a  Division  Bench  of\t the
\nBombay High  Court in Writ Petition No.2841 of 1982.  By the
\nimpugned  judgment  the\t order\tof  respondent\t–  competent
\nauthority forfeiting  the property  in\tquestion  under\t the
\nSmugglers and  Foreign Exchange\t Manipulators (Forfeiture of
\nProperty) Act,\t1976 (hereinafter  referred to\tas ‘SAFEMA’)
\ncame to be confirmed.\n<\/p>\n
     In Order  to appreciate the grievance of the appellants
\nit is necessary to note a few introductory facts.\n<\/p>\n
     Introductory Facts.\n<\/p>\n
     One Talab\tHaji Hussein  Sumbhania was detained Foreign
\nExchange and  Prevention of  Smuggling Activities  Act, 1974
\n(hereinafter referred to as ‘COFEPOSA’) by the Government of
\nGujarat by  order dated\t 02nd April  1976.   Before the said
\norder of  detention, the  second wife  of  said\t Talab\tHaji
\nHussein, Tahira\t Sultana, purchased  a flat being Flat No.25
\nin  Dharam   Jyoti  Premises  Cooperative  Housing  Society,
\nBandra, Bombay\tin February  1979 for a consideration of Rs.
\n88,562\/-.   On 15th  February 1977  the competent  authority
\nissued a  notice under\tSection 6(1)  of SAFEMA\t to the said
\nTahira Sultana\tcalling upon  her to show cause why the said
\nflat purchased\tupon her  to show  cause why  the said\tflat
\npurchased in  her name\tshould not be forfeited as illegally
\nacquired property  of the  COFEPOSA detenu, her husband, the
\naforesaid Talab\t Haji Hussein.\t After\thearing said  Tahira
\nSultana the competent authority passed an order Section 7 of
\nthe SAFEMA  on 12th  October  1977  holding  that  the\tsaid
\nproperty was  illegally acquired property and, therefore, it
\nstood forfeited\t to the\t Central Government  free  from\t all
\nencumbrances as\t laid down  under Section  7(3)\t of  SAFEMA.
\nSaid  Tahira  Sultana  challenged  the\taforesaid  order  of
\nforfeiture by  filing a\t Misc.\t Petition No.1680 of 1977 on
\nthe Original  Side of  the Bombay  High court.\t In the writ
\npetition she  challenged both  the order of detention of her
\nhusband as  well as  the order\tof forfeiture  of  the\tsaid
\nproperty standing  in her  name.  The said writ petition was
\nmoved in  December 1977.   The\tHigh Court of her husband as
\nwell as\t the  order  of\t forfeiture  of\t the  said  property
\nstanding in  her name.\t The said writ petition was moved in
\nDecember 1977.\t The  High Court of Bombay admitted the said
\nwrit petition  of Tahira  Sultana on  03rd  March  1978\t and
\nstayed the  order of  forfeiture of  the said property on an
\nundertaking by her that she would not dispose of or alienate
\nor encumber  or part  with the\tright, title and interest in
\nthe said  flat\tpending\t the  final  disposal  of  the\twrit
\npetition.\n<\/p>\n
     Simultaneously she\t moved the  Appellate Tribunal under
\nthe SAFEMA  challenging\t the  order  of\t forfeiture  of\t her
\nproperty.   The Appellate Authority dismissed her appeal and
\nconfirmed the  order of\t forfeiture by\tits order dated 25th
\nJuly 1978.   By\t amendment to  her writ\t petition  she\talso
\nchallenged the\tlatter order.\tIn  the\t meantime  the\twrit
\npetition filed\tby her before the Bombay High Court remained
\npending.   On 20th  November 1980 COFEPOSA detenu Talab Haji
\nHussein expired.\n<\/p>\n
     Now comes the crucial date when the present appellants’
\npredecessor came in picture.  By a Sale Deed dated 30th July
\n1981 Tahira  Sultana  sold  the\t said  flat  to\t Tayab\tAli,
\npredecessor-in-interest of  the\t present  appellants  for  a
\nconsideration of Rs. 3,60,000\/-.  We will refer to Tayab Ali
\nas the\tpurchaser of  this flat. It is obvious that the said
\nsale was  in breach  of the  undertaking given by the vendor
\nTahira Sultana\tto the\tBombay High Court and it was pending
\nthe disposal  of the  writ petition  challenging  the  order
\nforfeiting the very same property as passed by the competent
\nauthority years\t back on  12th October 1977 and as confirmed
\nby the Appellate Tribunal on 25th July 1978.  It is the case
\nof the purchaser that he had purchased the said flat in good
\nfaith for  valuable consideration  since he was not aware of
\nthe order  of the  competent authority\tor his vendor Tahira
\nSultana’s undertaking  to  the\tHigh  Court.\tSaid  Tahira
\nSultana out  of the consideration money received by her from
\nthe purchaser  in the aforesaid transaction amounting to Rs.
\n3,60,000\/- is said to have purchased a flat a Shivasthan Co-
\noperative Society,  Bandra, Bombay, for Rs. 1,86,000\/-.\t The
\ncase of\t the appellants\t is that  towards the  said purchase
\nconsideration Rs.1,60,000\/- were utilised by the said Tahira
\nSultana from  the sale\tproceeds which she received from the
\npurchaser of  Dharam Jyoti  flat,  namely,  the\t appellants’
\npredecessor-in-interest.     The  on   05th  November  1982,
\naccording to  the appellants,  the purchaser  for the  first
\ntime got  information from the Society in whose building the
\nflat was situated, about the order of forfeiture of the said
\nflat and  the undertaking  given by  the purchaser’s  vendor
\nTahira Sultana\tbefore the Bombay High Court.  That resulted
\nin a  Writ Petition  No. 2841 of 1982 filed by the purchaser
\nTayab Ali  on 13th  December 1982  in the Bombay High Court.
\nthe said writ petition was admitted on 16th December 1982 by
\nthe High  Court\t and  interim  relief  was  granted  to\t the
\npurchaser.   When it was brought to the notice of the Bombay
\nHigh  Court  that  purchaser’s\tvendor\tTahira\tSultana\t had
\ncommitted breach  of the  undertaking given  by her  in\t her
\npending writ  petition against\tthe forfeiture\torder of the
\nflat in\t Dharam Jyoti  Building, the  High  Court  initiated
\ncontempt  of  court  proceedings  against  the\tsaid  Tahira
\nSultana and  by an  order dated\t 21st February 1983 held her
\nguilty\tof   contempt  and   imposed  punishment  of  simple
\nimprisonment for  four weeks  and a  fine of  Rs. 2,000\/- on
\nsaid Tahira  Sultana.\tShe  underwent\tthe  said  sentence.
\nTahira Sultana\ton her\tpart filed  Writ Petition  No.100 of
\n1984 on\t the Criminal Side of Bombay High Court in 184 again
\nchallenging the\t detention order  and order of forfeiture of
\nproperty,  while   the\tappellants’  predecessor-in-interest
\nTayab Ali,  the purchaser of the flat in question, moved the
\nHigh Court  of Gujarat\ton 12th\t August 1985 challenging the
\ndetention order\t of the\t COFEPOSA detenu  Talab Haji Hussein
\nwhich gave  rise to  the proceedings under SAFEMA as sell as
\nconsequential  order   under  SAFEMA   since  the  order  of
\ndetention was  issued by the State of Gujarat.\tThe Division
\nBench of  the High  Court of  Gujarat by  its judgment dated
\n17th July 1986 held that the order of forfeiture of property
\nwas passed  by the  competent authority\t without hearing the
\npurchaser of  the property  and hence  the proceedings\twere
\nrequired to be decided afresh after giving an opportunity of
\nhearing\t to  the  said\tpurchaser.    Pending  the  remanded
\nproceedings the purchaser Tayab Ali expired on 24th December
\n1986 leaving  present appellants  as  his  heirs  and  legal
\nrepresentatives.  Pursuant to the order of the High Court of
\nGujarat the  competent authority functioning under SAFEMA by
\norder dated  17th March\t 1987 after  hearing the purchaser’s
\nheirs, namely, the present appellants re-confirmed the order
\nof forfeiture  of the  flat purchased  by their predecessor,
\nunder  SAFEMA.\t   Independent\t of  these  proceedings\t the
\ncompetent authority  also passed  an order on 18th June 1987
\nunder Section  7(2) of SAFEMA, after hearing Tahira Sultana,
\nforfeiting the second flat purchased by her being Flat No.1,
\nGround Floor,  shivasthan Co-operative Housing Society Ltd.,
\nBandra, Bombay.\t  It  was held by the competent authority in
\nthe  said   proceedings\t that\tFlat  No.1,   Ground  Floor,
\nShivasthan  Co-operative  Housing  Society  Ltd.,  had\tbeen
\nacquired by  said Tahira  Sultana partly  out  of  the\tsale
\nproceeds of  Flat No.25,  Dharam Jyoti\tBuilding, Pali Hill,
\nBandra, Bombay,\t which was held to be illegally acquired and
\nwas forfeited  to the  central Government by an order passed
\non 12th\t October 1977.\t As  a consequence  of this order of
\n18th June  1987 it  was directed  by the competent authority
\nunder  section\t 19(1)\tof   SAFEMA  that  said\t Flat  No.1,
\nShivasthan Society, was illegally acquired by Tahira Sultana
\nand directed  her  to  deliver\tpossession  thereof  to\t the
\ncentral Government authorities.\t Tahira Sultana filed appeal
\nagainst the said order in connection with forfeiture of Flat
\nNo.1,  Shivasthan   Society,  which  was  dismissed  by\t the
\nAppellate Tribunal  on 02nd  November 1987.   Tahira Sultana
\nunsuccessfully challenged  the said order in proceedings for
\nsetting aside  the  ex\tparte  order  before  the  Appellate
\nTribunal.    The  said\tapplication  was  dismissed  by\t the
\nTribunal.   She filed  Writ Petition No. 1527 of 1995 before
\nthe Bombay  High Court\tchallenging the\t order of  Appellate
\nTribunal  passed   on  18th   April  1995   dismissing\t her
\napplication for\t setting aside\tthe ex\tparte order  of\t the
\nAppellate Tribunal.   Her writ petition was dismissed by the
\nBombay High Court on 21st August 1995.\tThe authorities took
\npossession of  Flat No.1,  Shivasthan Society,\tfrom  Tahira
\nSultana on  13th September  1995.   She filed  Special Leave
\nPetition before\t this Court  challenging the  order  of\t the
\nBombay\tHigh  Court  pertaining\t to  Flat  No.1,  Shivasthan
\nSociety, Bombay.  It was  dismissed by\tthis Court  on\t24th
\nNovember 1995.\t Therefore  the\t forfeiture  of\t Flat  No.1,
\nShivasthan Society,  became final  upto\t this  Court.\t The
\nappellants, who were brought on record as heirs of purchaser
\nin the\tlatter’s Writ  Petition\t No,  2841  of\t1982,  which
\nchallenged the\tforfeiture of  the said\t Flat No.25,  Dharam
\nJyoti Building,\t and the  direction to\tthem  to  hand\tover
\npossession ultimately  came to\tbe dismissed  by a  Division
\nBench of  the High  Court of  Bombay by\t an order dated 29th
\nJune 1995  and that  is how  the appellants  are  before  us
\nTahira\tSultana’s  Misc.    Petition  No.1680  of  1977\t was
\nwithdrawn by her before the Bombay High Court with a view to
\nchallenging the\t appellate order  confirming  the  order  of
\nforfeiture.   She accordingly filed subsequent Writ Petition
\nNo.1527 of  1995 which was rejected by the Bombay High Court
\non 21st\t August 1995.\tThe  said  decision  was  challenged
\nbefore this  Court in S.L.P. (C) No. 25358 of 1995 which was
\ndismissed by this Court on 24th November 1995.\n<\/p>\n
     It is in the background of the aforesaid facts that the
\nmain contentions canvassed in support of this appeal have to
\nbe examined.\n<\/p>\n
     Learned senior  counsel, Shri  R.F.  Nariman,  for\t the
\nappellants firstly  contended that  SAFEMA  itself  did\t not
\napply to  the purchase\tmade by\t the purchaser as he was not
\none of\tthe persons  mentioned in  Section  2(2)  of  SAFEMA
\nespecially Section  2(2)(e) thereof  and, therefore,  entire
\nproceedings  against  him  were\t null  and  void.    It\t was
\nalternatively contended\t that in  any view of the matter the
\noriginal purchaser  Tayab Ali  was a bona fide purchaser for
\nvalue without  notice and he was, therefore, not responsible
\nfor the\t acts of commission on the part of his vendor Tahira
\nSultana.   That even  if she  might have committed breach of
\nthe undertaking\t given to the High Court of Bombay for which
\nshe was\t adequately punished the purchaser cannot be visited
\nwith any adverse consequences thereof  It was next contended
\nthat Section  11 of  SAFEMA would  not apply to the facts of
\nthe present  case as the appellants’ predecessor-in-interest
\nhad not\t purchased the flat in Dharam Jyoti Building between
\ntwo terminal  dates, namely,  15th February 1977 when notice
\nunder Section  6(1) of\tSAFEMA was  issued to Tahira Sultana
\nand 12th  October 1977\twhen  the  order  of  the  competent
\nauthority under\t section 7  of SAFEMA  was passed.   On\t the
\nother had  he had  purchased the property on 30th July 1981.
\nTherefore on  the express  language of\tsection\t 11  of\t the
\nSAFEMA the said transaction could not be said to be null and
\nvoid.\tIt was\tnext contended\tthat even  proceeding on the
\nbasis  that   Dharam  Jyoti  Building  flat  was  originally
\npurchased by  Tahira Sultana  for  a  consideration  of\t Rs.
\n88,562\/- by  utilising the  tainted money  of  her  husband,
\nTalab Haji Hussein, who was a COFEPOSA detenu, once she sold
\nthe said  property to the purchaser by taking Rs. 3,60,000\/-
\nspent Rs.1,60,000\/-  for purchasing Shivasthan Society flat,
\nthe tainted  money which  were converted into flat in Dharam
\nJyoti were  again re-converted\tinto cash  and were utilised
\nfor purchasing\tanother immovable  property.  Therefore, the
\ntainted money  could be\t traced out  to the said property in
\nShivasthan Society  and could  be said\tto  have  ultimately
\nresulted in  purchase of  Shivasthan  Society  property\t and
\nwhich now  is likely  to fetch\tRs. 65 lac, as seen from the
\nauction notice\tdated 24th July 1996.  Hence the purchaser’s
\ntransaction may\t not be\t treated to be a void transaction as
\nit  wold   amount  to  double  forfeiture  of  the  original
\nsmuggler’s property.   It  was lastly  contended that in any
\ncase looking  to  the  equities\t of  the  case\tand  as\t the
\npurchaser was a bona fide purchaser for value without notice
\nhe may\tnot be\tvisited with  the evil\tconsequences of\t the
\ntransaction wherein  only the  vendor Tahira  Sultana was at
\nfault and  consequently on  an analogy\tof Section  9 of the
\nSAFEMA this  Court may\timpose appropriate  fine in  lieu of
\nforfeiture.\n<\/p>\n
     Learned senior  counsel for  the respondents, Shri K.N.
\nShukla, on  the\t  hand, supported  the decision\t of the High
\nCourt.\n<\/p>\n
     In view  of the aforesaid contentions of learned senior
\ncounsel\t Shri\tNariman,  the  following  points  arise\t for
\ndetermination ;\n<\/p>\n
1.   Whether the  provisions of\t SAFEMA apply  to  the\tsale
\n     transaction entered  into between\tthe widow  of  Talab
\n     Haji   Hussein,\tCOFEPOSA   detenu   and\t  purchaser,
\n     predecessor-in-interest of the appellants.\n<\/p>\n
2.   Whether the  purchaser was\t a bona\t fide purchaser\t for
\n     value without notice.\n<\/p>\n
3.   Whether the  forfeiture of\t purchaser’s Flat  in Dharam
\n     Jyoti Building  by the  authorities can  be treated  as
\n     double forfeiture\ton the\tbasis of  the  same  tainted
\n     money  of\t the  COFEPOSA\t convict  only\tbecause\t the
\n     subsequent property purchased by the purchaser’s vendor
\n     in\t Shivasthan   Co-operative  Society  has  also\tbeen
\n     forfeited to the Government under SAFEMA.\n<\/p>\n
4.   Whether the  transaction in  favour  of  the  purchaser
\n     could be  cleared on  principles analogous to Section 9
\n     of the SAFEMA by imposing fine in lieu of forfeiture on
\n     the peculiar facts of this case.\n<\/p>\n
     We shall  deal  with  these  points  for  consideration
\nseriatim.\n<\/p>\n
     Point Nos.1 and 2<\/span><\/p>\n
     It is  true that the SAFEMA has been enacted to provide
\nfor the\t forfeiture  of\t illegally  acquired  properties  of
\nsmugglers and  foreign exchange manipulators and for matters
\nconnected therewith  or incidental thereto,  It is also true
\nthat Section  2 sub-section (1) of the SAFEMA lays down that
\n‘the provisions\t of this act shall apply only to the persons
\nspecified in  sub-section (2)’.\t When we turn to sub-section
\n(2) of\tSection 2  we find list of persons mentioned therein
\nat clauses  (a) to  (e).   In section 2 sub-section 2(a) and
\n(b() are mentioned persons who are themselves detenues under
\nthe Act.   Clause  (c) refers  to  every  person  who  is  a
\nrelative of  a person  referred to  in clause  (a) or clause\n<\/p>\n
(b); Clause  (d) refers\t to  every  associate  of  a  person
\nreferred to  in clause\t(a) or\tclause (b); while clause (e)
\nrefers to  any holder  of any property which was at any time
\npreviously held\t by a  person referred\tto in  clause (a) or
\nclause (b) unless the present holder or, as the case may be,
\nany one\t who held such property after such person and before
\nthe present holder, is or was a transferee in good faith for
\nadequate consideration.\t  It  is  obvious  that\t purchaser’s
\nvendor (2)(c)  as she  was the\twife of\t the COFEPOSA detenu
\nTalab  Haji   Hussein.\t  Property  standing  in  her  name,
\ntherefore, could  be processed\tunder the  provisions of the
\nSAFEMA.\t  It is\t true that a purchase from a relative of the
\nCOFEPOSA detenu\t would not  be covered\tby  Section  2\tsub-
\nsection (e).   Accordingly the purchaser Tayab Ali cannot be
\ncovered by Section 2(2)(e) of SAFEMA.  However difficulty in
\nhis case arises independently of the provisions of Section 2
\nsub-section  (2)(e)  as\t well  will  presently\tshow.\t The
\nproperty in  question at the relevant time stood in the name
\nof purchaser’s\tvendor Tahira  Sultana.\t   As  she  was\t the
\nrelative of  the COFEPOSA detenu, her husband, the competent
\nauthority issued  a notice  to her  under  Section  6(1)  of
\nSAFEMA in  connection with  Dharam Jyoti  Building flat, the
\ndispute property  herein.   After hearing her, the competent
\nauthority  passed   an\torder  under  Section  7  of  SAFEMA
\nforfeiting the\tsaid property  on 12th\tOctober 1977.  Of is
\nthis order  which was  challenged by  her in the Bombay High
\nCourt.\tShe had undertaken not to alienate the said property
\nand still  in flagrant\tbreach thereof she sold the property
\nin 1981\t to purchaser  Tayab Ali.   Apart from the fact that
\nthe said  transaction had  exposed purchaser’s vendor Tahira
\nSultana to  contempt proceedings  and she  was punished, the
\nquestion survives  whether the\tpurchaser  Tayab  Ali  could
\nderive any  benefit out of the said tainted transaction.  It
\nis, of course, true that pending the writ petition there was
\nalready a  stay order  of the  High Court of Bombay by which
\nthe order  of forfeiture  of the  said property had remained
\nstayed.\t  But  it  was\tnot  an\t absolute  order.    It\t was
\nconditional on\tthe purchaser’s\t vendor Tahira\tSultana, the
\nwrit petitioner,  not transferring  or alienating  the\tsaid
\nproperty pending  the proceedings.   The  said injunction of
\nthe High  Court\t reflected  by\tthe  undertaking  of  Tahira
\nSultana made  the said property inalienable pending the writ
\npetition proceedings  moved by purchaser’s vendor before the
\nHigh Court.   Under  these circumstances even though Section
\n52 of  the Transfer  of Property Act, strictly speaking, may
\nnot apply  as the  lis\twas  not  registered  in  Bombay  as
\ninformed to  us, the  prohibition against alienation of this
\nproperty,  by\tway  of\t  undertaking  of   purchaser’s\t own
\npredecessor-in-title before the High Court had its full sway
\nand operation.\t Therefore,  if ultimately the writ petition
\nwas dismissed  the transfer  effected by the writ petitioner
\nin breach  of the  prohibition and the undertaking would not
\ngive any benefit to the purchaser.  It would be too much for
\nhim to\tcontend that  he was a bona fide purchaser for value
\nwithout notice.\t The High Court in the impugned judgment has
\nnoted that the said plea does not appear to be probable.  It
\nis true,  as pointed  out by  learned  senior  counsel\tShri
\nNariman for  the appellants, that for coming to this finding
\nthe High  Court has wrongly assumed that the purchaser Tayab
\nAli had\t immediately filed  a writ petition after purchasing
\nthe property  as he had filed his writ petition only on 13th
\nDecember 1982  when he\thad  received  information  on\t05th
\nNovember  1982\t that  the  flat  in  question\twas  already
\nforfeited by  Government.   That may  be  so,  However,\t the
\nultimate finding of the High Court in this connection cannot
\nbe faulted  on the  touchstone of  probabilities.  Reason is
\nobvious.   The COFEPOSA\t detenu Talab  Haji  Hussein  was  a
\nsmuggler.   When  the  purchaser  purchased  the  said\tflat
\nstanding in  the name  of the  wife of the said smuggler, in
\nusual course  of conduct  the said  purchaser must have been
\nput on\tenquiry as  to how  COFEPOSA  detenu’s\twife  Tahira
\nSultana became\tthe owner  of this  property  and  what\t had
\nhappened to  this property  in the  proceedings under SAFEMA
\nand whether  title of  the said\t flat was  clear or not.  No
\nsuch enquiry  seems to have been made and it is not the case
\nof the\tpurchaser that\tany such  enquiry was made by him at
\nthe relevant  time when he entered into the said transaction
\npending the writ petition in the Bombay High Court.  Thus on
\nbroad probabilities  of\t the  case  it\tmust  be  held\tthat
\npurchaser willingly  and with open eyes played with fire and
\npurchased litigation  and it is too tall a claim on his part
\nto submit  that he  was a  bona\t fide  purchaser  for  value
\nwithout notice.\t  Such\tstand does into bear scrutiny on the
\ntouchstone of  probabilities.\tBut even that apart once the
\nwrit petition filed by Tahira Sultana challenging forfeiture
\norder of  12th October 1977 got dismissed by the Bombay High
\nCourt and once that order became final the original order of
\nforfeiture of this property dated 12th October 1977 operated
\nin full\t swing and the result was that as per Section 7 sub-
\nsection (3)  of SAFEMA\tthe said property stood forfeited to
\nthe  Central   Government  free\t  from\t all   encumbrances.
\nTherefore, it  must be\theld that  by 12th  October 1977 the
\nproperty in  dispute had  ceased to  belong  to\t purchaser’s
\nvendor\tTahira\t Sultana  and  had  vested  in\tthe  Central
\nGovernment.   Consequently when\t she purported\tto sell this
\nproperty on  30th July\t1981 to\t the purchaser Tayab Ali she
\ncan be\tsaid to\t have sold  the property  which had  already
\nceased to  belong to  her and  she could  not pass any valid
\ntitle in  favour of  Tayab Ali\tin connection  with the said
\nproperty which no longer belonged to her since 1977.  It is,
\nof course,  true that  when she\t sold the  said property the
\norder of  forfeiture had  been stayed by the High Court but,
\nas seen\t earlier, it  was a  limited  stay  subject  to\t the
\ncondition  of  inalienability  of  the\tproperty  by  Tahira
\nSultana\t and   breach  of  such\t undertaking,  which  was  a
\nsubstitute for\tan injunction,\twould make  that transaction
\nvoidable and its efficacy had to be seen in the light of the
\nfinal result  of the writ petition and once the final result
\nwas against Tahira Sultana, whatever she did in the meantime
\nbecame an  exercise in\tfutility.  In this connection we may
\nusefully refer to section 11 of SAFEMA which reads as under:\n<\/p>\n
     “11. Certain  transfers to\t be null
\n     and voild.-Where after the issue of
\n     a notice  under section  6 or under
\n     section 10,  any property\treferred
\n     to\t  in\tthe   said   notice   is
\n     transferred by  any mode whatsoever
\n     such  transfer   shall,   for   the
\n     purposes of  the proceedings  under
\n     this Act,\tbe ignored  and if  such
\n     property is  subsequently forfeited
\n     to\t the  central  Government  under
\n     Section 7,\t then  the  transfer  of
\n     such property shall be deemed to be
\n     null and avoid.”<\/p><\/blockquote>\n
     It is no doubt true that on the express language of the
\nsaid  Section\ttransfer  of   any  property   pending\t the
\nproceedings under  Section 6 or 10 of the said act and prior
\nto the\torder of  forfeiture shall be treated to be null and
\nvoid.\tThe purchaser  transaction is  after  the  order  of
\nforfeiture of  the said\t property,  Still the consequence of
\nthe said  transaction being  null  and\tvoid  could  not  be
\navoided by  the purchaser  on the plea that this transaction
\nwas subsequent\tto the\toriginal order\tof forfeiture,\t The
\noriginal order\tof forfeiture  was stayed  at  time  of\t the
\npurchase.   It\tgot  confirmed\tby  the\t Bombay\t High  Court
\nultimately when\t the Misc.   Petition No. 1680 of 1977 moved
\nby Tahira  Sultana was\tdisposed of  and the subsequent Writ
\nPetition No.  1527 of  1995 was\t dismissed by the High Court
\nand the\t S.L.P was  filed by  her in  this  Court  was\talso
\ndismissed.   We many  also note\t that as the Misc.  Petition
\nNo.1680\t of  1977  was\twithdrawn  on  19th  June  1995\t and
\nultimately the\tforfeiture order came to be confirmed in the
\nsubsequent Writ\t Petition No.1527  of 1995  on\t21st  August
\n1995, the  transaction of  transfer in\tfavour of  Tayab Ali
\nwould be  said to  have been effected after the notice under
\nsection 6, issued to Tahira Sultana, and before the order of
\nforfeiture ultimately got confirmed by the High Court and by
\nthis Court  and which had back affect of confirming the same
\nfrom 1977.  It must, therefore, be held that the transaction
\nof purchase  by the  appellants’ predecessor  Tayab Ali\t was
\nalso hit by Section 11 of SAFEMA.  Consequently in 1981 when
\nthe purchaser  purchased this  property from  Tahira Sultana
\nshe had\t no interest in the said flat which she could convey
\nto the appellants’ predecessor.\t In substance it amounted to
\nselling of Central Government’s property by a total stranger
\nin favour  of the  purchaser.\tNo title,  therefore, in the
\nsaid  property\t passed\t to   the  appellants’\tpredecessor.
\nAppellants’ predecessor,  therefore, had  no  legal  defence
\nagainst the  claim of  the authorities\tin calling  upon the
\nappellants as  heirs of the original purchaser to vacate and
\nhand over  the possession  of the  property to\tthe  Central
\nGovernment as  full owner  thereof.   Both  the\t points\t for
\ndetermination,\t therefore,   are   answered   against\t the
\nappellants and in favour of the respondents.\n<\/p>\n
     Point No.3
\n     So far as this point is concerned we fail to appreciate
\nhow it\tis a  case of  double  forfeiture  of  the  property
\npurchased from\tthe very  same tainted money.  It is easy to
\nvisualise that\ttainted money  earned  by  smuggler  who  is
\nconvicted under\t COFEPOSA may result in purchasing number of
\nproperties.   It  cannot,  therefore,  be  said\t that  these
\nproperties when confiscated after following due procedure of
\nSAFEMA would  amount to\t multiple forfeiture.  So far as the
\nfacts of the present case are concerned it has to be kept in
\nview that  for\tRs.  88,562\/-  the  original  vendor  Tahira
\nSultana purchased  the disputed\t flat in February 1975.\t She
\nsold this  very flat  to the  purchaser for  Rs. 3,60,000\/-.
\nTherefore, money  earned out  of the  said consideration Rs.
\n88,562\/- remained  tainted money.   Utilising a part of this
\nmoney she  purchased Shivasthan\t Society  flat\tfor  Rs.  1,
\n86,000\/- out  of which\tit is  said that Rs. 1,60,000\/- were
\nutilised from  the sale\t proceeds of  Dharam Jyoti  Building
\nflat.\tTo this\t original tainted  money of  Rs.  988,562\/-,
\ntherefore,  she\t  must\thave   added  some  more  money\t for
\npurchasing Shivasthan  Society flat.  Even assuming that for
\nthe purchase  of the  said flat\t she utilised Rs. 1,60,000\/-
\nout of\tRs. 3,60,000\/- obtained by her from the purchaser as
\nconsideration for the sale of the Dharam Jyoti Building flat
\nto him\tit cannot  be said  that the  original forfeiture of
\nDharam Jyoti  Building flat  on 12th October 1977 was in any
\nway  affected\tby  the\t subsequent  forfeiture\t of  another
\nimmovable  property  purchased\tby  the\t widow\tof  original
\nCOFEPOSA smuggler  when she  purchased the second flat.\t The
\nsaid  transaction  was\tquite  independent  of\tthe  earlier
\ntransaction which  had already resulted in forfeiture of the
\ndisputed property.   It\t is not\t as  if\t that  Dharam  Jyoti
\nBuilding flat  is being\t forfeited twice,   Consequently the
\nforfeiture of  the Dharam Jyoti flat on 12th October 1977 by
\nthe competent  authority must  be treated  to  be  quite  an
\nindependent transaction\t as compared  to the latter order of
\nforfeiture of Shivasthan Flat on 18th June 1987.  The latter
\norder of forfeiture of entirely different immovable property
\ncannot\tretrospectively\t invalidate  the  earlier  order  of
\nforfeiture of  12th October  1977 pertaining to Dharam Jyoti
\nBuilding flat.\t At  the time when the earlier order of 12th
\nOctober 1977  was passed  the said disputed property clearly
\nreflected the  utilisation of tainted money of Rs. 88,562\/-.
\nIf subsequent  dealing with the said property is found to be
\nunauthorised and  inoperative in  law and if such subsequent
\ntransaction qua\t the said  property remains a still-born one
\nno life\t can be\t infused in  it on account of the subsequent
\nforfeiture of  some other  property of\tthe original  vendor
\nwhen a\tsubsequent forfeiture  has stood  on its own and has
\nbecome final.  The third point for determination, therefore,
\nalso is\t held against  the appellants  and in  favour of the
\nrespondents.\n<\/p>\n
     Point No.4
\n     So far  as this  contention is  concerned Section\t9 of
\nSAFEMa on  its express\tlanguage cannot apply.\tIt lays down
\nas under:\n<\/p>\n
     “9. Fine  in lieu\tof forfeiture. –
\n     (1) Where\tthe competent  authority
\n     makes  a\tdeclaration   that   any
\n     property stands  forfeited\t to  the
\n     central Government\t under section 7
\n     and it  is a  case where the source
\n     of only  a part,  being  less  than
\n     one-half, of  the income,\tearnings
\n     of assets\twith which such property
\n     was acquired has not been proved to
\n     the satisfaction  of the  competent
\n     authority it  shall make  an  order
\n     giving  an\t option\t to  the  person
\n     affected  to   pay,  in   lieu   of
\n     forfeiture, a fine equal to one and
\n     one-fifth times  the value\t of such
\n     part.\n<\/p><\/blockquote>\n
     Explanation- For  the  purposes  of
\n     this sub-section,\tthe value of any
\n     part of income, earnings or assets,
\n     with which\t any property  has  been
\n     acquired, shall be.-\n<\/p><\/blockquote>\n
     (a) in  the case  of  any\tpart  of
\n     income of\tearnings, the amounts of
\n     such part of income earnings;\n<\/p><\/blockquote>\n
     (b) In  the case  of  any\tpart  of
\n     assets, the  proportionate part  of
\n     the full value of the consideration
\n     for   the\t acquisition   of   such
\n     assets.”<\/p><\/blockquote>\n
     This is not a case in which the purchase of Flat No.25,
\nDharam Jyoti  Building, Bandra, Bombay, by Tahira Sultana in
\nFebruary 1975  could be\t said to  be a result of only a part
\nutilisation of\tthe tainted  money and\tany part of the said
\nsale consideration of Rs.88,562\/- could be said to have come
\nout of\ta source  which was not tainted.  Such is not a case
\nof anyone,  Shri Nariman,  learned senior  counsel  for\t the
\nappellants, also  therefore, rightly  contended that he only
\ndraws an  analogy from Section 9 and submits in the peculiar
\nfacts of  this case that the appellants may not be disturbed
\nafter so many years especially when from the other forfeited
\nproperty the  central Government  is likely  to get  Rs., 65
\nlacs as\t seen from  the auction\t notice and that appropriate
\nfine may be imposed on the appellants in lieu of forfeiture.
\nIt is  difficult to  agree.   The  appellants’\tpredecessor,
\npurchaser Tayab\t Ali played  with fire.\t  He  purchased\t the
\nproperty  despite   there  being   an  injunction   and\t  an
\nundertaking by\this vendor  Tahira Sultana  in\tthe  pending
\nproceedings  in\t  the  writ   petition.\t   His\ttransaction,
\ntherefore, was liable to be voided in the light of the final
\nresult of  the writ  petition which  confirmed the  order of
\nforfeiture of  this very  property purchased  by him.\tEven
\nthat apart,  as a  result  of  the  dismissal  of  the\twrit
\npetition of  Tayab Ali’s vendor by the Bombay High Court the
\npurchased property  stood forfeited  to the Government prior
\nto the\tdate of\t purchase by  the purchaser  as the order of
\nforfeiture, as\tseen above, operated from 1977 once the stay
\ngranted by  the Bombay\tHigh Court stood lifted on the final
\ndismissal of  the writ\tpetition of  writ petitioner  Tahira
\nSultana, Therefore, the transaction of purchase by Tayab Ali
\nwas an\texercise in futility.  Such a still-born transaction
\ncannot be resurrected by passing an order of fine in lieu of
\nforfeiture.   The  forfeiture  of  this\t very  property\t had
\nalready taken place on 12th October 1977 and which order got
\nultimately confirmed  by the  Bombay High Court.  Therefore,
\nit is too late in the day for the appellants to contend that
\nthe clock should be put back and the 12th October 1977 order
\nmay be\tconverted into fine in lieu of forfeiture especially
\nwhen Tahira  Sultana against  whom that\t order has operated,
\nhas finally  lost in  her challenge to the said order.\t The
\nfourth point  for determination,  therefore, has  also to be
\nrejected and stands decided against the appellants.\n<\/p>\n
     As a  result of  the aforesaid  findings of ours on all
\nthese points  the inevitable result is that the appeal fails
\nand is dismissed.  Interim order of stay granted pending the
\nappeal will  stand vacated.   On the facts and circumstances
\nof the case there will be no order as to costs.<\/p>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India Amenabai Tayebaly & Ors vs Competent Authorityunder Safema … on 19 November, 1997 Author: S Majmudar Bench: S.B. Majmudar, M. Jagannadha Rao PETITIONER: AMENABAI TAYEBALY & ORS. Vs. RESPONDENT: COMPETENT AUTHORITYUNDER SAFEMA & ORS. DATE OF JUDGMENT: 19\/11\/1997 BENCH: S.B. MAJMUDAR, M. JAGANNADHA RAO ACT: HEADNOTE: JUDGMENT: THE 19TH DAY OF […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-229035","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nAmenabai Tayebaly & Ors vs Competent Authorityunder Safema ... on 19 November, 1997 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/amenabai-tayebaly-ors-vs-competent-authorityunder-safema-on-19-november-1997\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Amenabai Tayebaly & Ors vs Competent Authorityunder Safema ... on 19 November, 1997 - 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