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The Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976

An enactment namely, ‘The Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976’ (Act no. 13 of 1976) being Act of Parliament was enacted for making provisions as to forfeiting properties of smugglers and foreign exchange manipulators which has been acquired illegally. It was found that there was deleterious effect on national economy of the these activities, also it was seen that there was breach of laws including wealth and Income tax laws for obtaining such properties. Initially many steps were taken by the Government dealing with such activities including making legislation on this issue. Earlier there was an ordinance, namely, Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Ordinance, 1975 and the same was thereafter replaced with this Act. The Act was assented by the President of India on 25th January, 1976. Moreover, the Act was brought into force on 5th November, 1975 as provided under section 1 of the Act itself. The same is required to have extension over the whole of India, however, the State of Jammu and Kashmir is exempted from applicability of its provisions. The same Act was amended several times, including by the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Amendment Act, 1980 (Act no. 55 of 1980) and The Narcotic Drugs and Psychotropic Substances (Amendment) Act, 1988 (Act no. 2 of 1989).

Section 2 being very important provided for applicability of the provisions of this Act to the persons being offenders under the Sea Customer Act, 1878 or the Customs Act, 1962 relating to the goods of value in excess to 1 lakh rupees; being convicts under the Foreign Exchange Regulation Act, 1947 or the Foreign Exchange Regulation Act, 1973, relating to amount or value involved in excess to 1 lakh; being subsequent convicts under the Act of 1878, Act of 1962, Act of 1947 or Act of 1973; or persons against whom detention order has been made under the provisions the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974. However, the provisions of the Act sought not to have applicability in respect of the offences provided under Chapter VA of the Narcotic Drugs and Psychotropic Substances Act, 1985

So far as the main purpose of this Act is concerned, the provisions of section 4 is important as it is provided with the view to prohibit the persons holding any property either by himself or on his behalf through others being illegal and all such properties should be liable to be forfeited to the Central Government. There is a provision for appointment of competent authority by the Central Government to perform the functions directed by it. When such authority is satisfies that there is an illegally acquired property held by any person, then the said Authority is required to serve a notice to such person requiring him to appear before such authority within the specified period to show the source of such property. On such process if the authority concludes that, the same property is being illegally acquired properties then the same to be declared as forfeited to the Central Government free from all encumbrances. The Authority is also empowered to make an order giving option to the offender that, he can pay fine in lieu of forfeiture, in certain circumstances.

Further, provisions have also been made for avoiding transfers of such properties against which the notice under previsions provision issued by the authority. And if such transfer is made, then such transfer to be taken as void one. Moreover, in case any person feels aggrieved by the orders of Authority, then the Act makes provisions as to appeal before the Appellate Tribunal. Such Appellate Tribunal to be constituted by the Central Government as ‘Appellate Tribunal for Forfeited Property’. However, there should be no right to filed appeal against the orders of Appellate Tribunal made under this Act. Even any Civil Court should not have jurisdiction in respect of the issues for which the authority is vested with the Appellate Tribunal or such Authority. However, certain powers of Civil Courts are given to the Authority and also to the Appellate Tribunal in respect of matters given under section 15 of the Act. There are certain provisions where the competent authority is empowered as to certain matters like, requiring any officers of either departments as has been given, to exercise certain powers. Further, an immunity is given to the Central Government and other officers thereof against the legal actions for anything done in good faith by them or even under the provisions of this Act or rules under this Act. It is specified that though there will be any law containing provisions contrary to the provisions of this Act, but only the effect of provisions of this Act survive. Section 26 of the Act makes provisions to empower the Central Government for making of rules under this Act and especially on the matters enlisted under this provision.

 by Faim Khalilkhan Pathan.