Naresh Kumar Jain vs Union Of India Through
2010 Latest Caselaw 2710 Del

*               IN THE HIGH COURT OF DELHI AT NEW DELHI

                            WP (CRL.) NO. 485 OF 2010


%                                               Reserved on: 27th April, 2010
                                               Date of Decision: May 21,2010


NARESH KUMAR JAIN                                 . . . PETITIONER

                             Through :         Mr. B. Kumar, Sr. Advocate with
                                               Mr. Naveen Malhotra, Adv.

                                  VERSUS

UNION OF INDIA THROUGH
NCB & ORS.                                            . . .RESPONDENTS

                             Through:          Mr. A.S. Chandhiok, ASG with
                                               Mr. V.B. Niren, CGSC,
                                               Mr. Rajesh Manchanda &
                                               Ms. Akriti Gandotra Advs.

CORAM :-

        HON'BLE MR. JUSTICE A.K. SIKRI
        HON'BLE MR. JUSTICE AJIT BHARIHOKE

        1.      Whether Reporters of Local newspapers may be allowed to
                see the Judgment?
        2.      To be referred to the Reporter or not?
        3.      Whether the Judgment should be reported in the Digest?


A.K. SIKRI, J.

1. On 24th September, 2009 a search operation was launched in the residential

premises of the petitioner by the officials of the Directorate of Enforcement under

the supervision of its Deputy Director. During this search, Indian currency in the

sum of Rs.12,50,000/-and some foreign currency was recovered from the

petitioner. The petitioner was also taken to the office of Directorate of

Enforcement where he was interrogated about the seized money and his

statements were also recorded under Section 67 of the Narcotic Drugs and

Psychotropic Substances Act 1985(hereinafter referred to as `NDPS Act') on 5 th

December 2009 and 6th December 2009.

2. It is the allegation of the petitioner in this writ petition that since officials

of the Directorate of Enforcement could not find any incriminating material

against him, they felt defeated and, therefore, started searching a trap to

implicate the petitioner or to bring him within the provisions of Prevention of

Money Laundering Act, 2002 (hereinafter referred to as `PML Act'). The

premises of the petitioner was thereafter again searched on 5th December, 2009 by

the officers of the Narcotic Control Bureau of India (NCB for short) alongwith the

officers of Directorate of Enforcement.

3. The petitioner was arrested on 6th December, 2009 by invoking the

provisions of Section 24 and 27A of the NDPS Act. He was produced before the

Duty Magistrate when the NCB officials sought custodial remand of the petitioner

for three days. In the remand application, the respondent-NCB, inter alia, stated

that the petitioner was involved in financing directly and indirectly to various

peoples all over the world for sale, purchase, transportation of narcotic drugs,

import into India, export from India or transshipment of the said narcotic drugs

and psychotropic substances etc. and was in fact indulging in such activities. It

was further alleged that the involvement of the petitioner in such activities was

apparent from the facts disclosed by the petitioner in his statements recorded on

5th December 2009 and 6th December 2009 under Section 67 of the NDPS Act and

also from the inputs provided from the enforcement agencies from abroad.

4. Though the petitioner opposed this application through his lawyer, the

learned Duty Magistrate was pleased to grant three days police remand of the

petitioner i.e. till 9th December, 2009. On 9th December, 2009, the petitioner was

once again produced before the learned Special Judge, NDPS, New Delhi This

time, the respondent moved an application seeking judicial remand of the

petitioner for a period of fourteen days on the same averments which were

narrated in their first application. At the same time, the petitioner also moved an

application alleging that he had been falsely implicated in the case; during the

police remand he was interrogated by the Directorate of Enforcement, DEA (USA)

and other agencies in the office of NCB and was tortured; his signatures were

forcibly obtained on blank papers; he was forced to write a statement which was

dictated by NCB officials and officials of other agencies; no recovery of any drug

was effected from the petitioner or money seized either. He also denied any

transaction of the nature alleged by the respondents having been made by the

petitioner either in India or in any other country. He reiterated his statement

made before the NCB. The Petitioner was remanded to judicial custody by the

learned Special Judge.

5. On the basis of search which was earlier carried out by the office of the

Directorate of Enforcement on 24th September, 2009, the said Directorate also

registered a case against the petitioner and arrested him on 11th December, 2009

under the provisions of Section 3 & 4 of the PML Act. By another application

dated 15th December, 2009 the respondents again sought judicial remand of the

petitioner for a further period of fourteen days stating therein that the

investigation was likely to take some time. The learned Special Judge remanded

the petitioner to judicial custody vide orders dated 15th December, 2009. The

learned Special Judge rejected the contention of the petitioner contained in the

application dated 15th December 2009 which he had also moved opposing his

custody and remand, wherein he had, inter alia, stated that there was no material

against him and in any case provisions of Section 24 and 27A of the NDPS Act

could not be invoked.

6. On 23rd December, 2009 the learned Special Judge extended the remand till

6th January, 2010. On 6th January, 2010, the petitioner moved another application

stating that he was a Non-Resident Indian and residing in Dubai for the last

fourteen years and has been engaged in a business. He further alleged that his

arrest was effected by the respondents only at the instance of Enforcement

Directorate as they wanted to bring the case under the schedule of the PML Act.

The petitioner also produced a certificate issued by Ministry of Justice, Milan,

Italy, and Ministry of Justice, Modena to the effect that no criminal record

pertaining to the petitioner was available either in Milan and Modena, as alleged

by the respondents. The learned Special Judge did not accede to his request and

rather, allowed the prayer of the respondents, sending him in judicial custody till

13th January, 2010. This custody has been extended from time to time by the

learned Special Judge. The last application filed by the petitioner opposing the

judicial remand on 25th February, 2010 was also dismissed by the learned Special

Judge vide orders dated 18th March, 2010.

7. At this stage, the petitioner approached this Court by filing the present

petition for habeas corpus and other reliefs invoking the provisions of Article 226

of the Constitution of India with the following prayers:-

(a) issue of Writ of Habeas Corpus for release of the petitioner from the illegal custody .

(b) further issue a writ of Mandamus/Certiorari or any other Writ order or direction for quashing of the proceedings./ arrest memo dated 06.12.2009 u/S 24 and 27A of the Narcotics Control and Psychotropic Substances Act, 1985, pending in the court of Shri Sanjeev Jain, ASJ (Special Judge NDPS Act Cases) New Delhi against the Petitioner which are without jurisdiction as well as resulting in gross abuse of the process of the court against the petitioner, after calling the record in case file no. VIII/37/DZU/2009.

(c) Release the petitioner forthwith from the custody of the respondents.

(d) Call for the records of the cases pending before the learned Special Judge NDPS cases, New Delhi and after perusing the same quash the same.

(e) Initiate appropriate proceedings against the respondents for falsely implicating the petitioner in an NDPS case and punish them suitably.

        (f)     Pass any other or such further order or orders as this
                Hon'ble Court       may deem fit in the facts and

circumstances of the case in the interest of justice.

8. When this writ petition came up for preliminary hearing/admission on

April 6, 2010, learned counsel for the petitioner dropped the prayer of Habeas

Corpus submitting that he would confine his writ petition limited to challenging

the arrest memo dated 6th December, 2009 under Section 24 & 27A of the NDPS

Act on the ground that entire proceedings against the petitioner are without

jurisdiction. This being a jurisdictional issue touching upon the jurisdiction of

Special Judge, NDPS Cases, to deal with the matter, we fixed the matter for

hearing on this issue on 12th April, 2010. Matter was heard on that day and on

subsequent dates. Since arguments are heard limited to the question of

jurisdiction, we are called upon to decide that issue in the present writ petition.

9. The submissions of learned Senior Counsel appearing for the petitioner was

that the petitioner is a Non Resident Indian who has been residing in Dubai for

the last fourteen years. As such, no case can be foisted upon him by the

authorities in India invoking the provisions of Section 24 & 27A of the NDPS Act.

Drawing our attention to these provisions, learned Senior Counsel argued that

Section 24 of the Act deals with the engagement in or controlling any trade in

Narcotic Drug or Psychotropic Substance. Likewise, Section 27A of the Act

imposes punishment for financing illicit traffic and harbouring offenders. His

submission was that it was not the case of the respondents that petitioner deals

with the narcotic drugs. Even if the prosecution case was to be believed, as per

the allegations of the respondents, the petitioner comes into picture only after the

drug is sold, as allegations against him are for dealing with money which he

received from others after the drug operation/activity was over. It was the

submission of the learned Senior Counsel that even if it was tainted money in his

hands, Section 24 & 27A of the Act would not be applicable. For this purpose, he

also referred to Section 12 of the said Act as per which it had no territorial

operations. He referred to the provisions of Section 8A and Section 32 of the Act

as well as some other provisions and submitted that even if a case is treated to

have been made out under the aforesaid provisions (though no such case was

registered against the petitioner under these provisions), those were bailable

offences and on this ground also, the petitioner could not have been arrested and

kept in continued incarceration.

10. Learned counsel for the respondents, on the other hand, challenged the

maintainability of the writ petition on the ground that in the present case, the

petitioner was kept in judicial custody pursuant to the orders passed by the

competent court of law namely the Special Judge, NDPS and if the petitioner was

aggrieved by those orders, his remedy was to challenge those orders by filing

appropriate proceedings and not by way of present writ petition. On merits,

learned counsel for the respondents submitted that considering the complex

nature of operation involved, the authorities probing into the matter on the basis

of material collected thus far were justified in arresting the petitioner. His further

detention was thereafter authorized by the learned Special Judge, NDPS by

passing a valid order giving detailed reasons. The judicial remand of the

petitioner thereafter has been extended from time to time. In support of this

contention, learned counsel for the respondents relied upon the orders passed by

learned Special Judge giving reasons for the remand. Learned counsel also

submitted that a prima facie case is made out for booking the petitioner under

Section 24 and 27A of the NDPS Act. The submission in this behalf was that the

petitioner was admittedly an Indian citizen and, therefore, as per the provisions of

Section 188 of the Code of Criminal Procedure, he could be tried by a court of law

in India as well, even if the offence is committed outside India. Mr. Manchanda,

learned counsel appearing for the Narcotic Department also produced the record

containing the material/information received from the authorities in Dubai, Italy

and Modena.

11. We have considered the submissions made by counsel of either side and

also gone through the records produced by the respondents. Before adverting to

the discussion on the respective arguments, it would be apposite to take note of

some relevant provisions.

12. Section 2 of the NDPS Act: Definitions:- In this Act, unless the contest

otherwise requires:-

(viiia) "illicit traffic", in relation to narcotic drugs and psychotropic

substances, means-

(i) Cultivating any coca plant or gathering any portion of coca plant;

(ii) Cultivating the opium poppy or any cannabis plant;

(iii) Engaging in the production, manufacture, possession, sale purchase, transportation, warehousing, concealment, use or consumption, import inter-State, export inter-State, import into India, export from India or transshipment, of narcotic drugs or psychotropic substances;

(iv) Dealing in any activities in narcotic drugs or psychotropic substances other than those referred to in sub-clauses (i) to (iii); or

(v) Handling or letting out any premises for the carrying on of any of the activities referred to in sub-clauses (i) to (iv).

Other than those permitted under this Act, or any rule or order made, or

any condition of any licence, term or authorization issued, thereunder, and

includes-

         (1)     Financing, directly or indirectly,         any   of   the
                 aforementioned activities;

(2) Abetting or conspiring in the furtherance of or in support of doing any of the aforementioned activities;

             and


         (3)     Harbouring persons engaged            in   any   of   the
                 aforementioned activities.

Section 24:- Punishment for external dealings in narcotic drugs and psychotropic substances in contravention of Section 12-

Whoever engages in or controls any trade whereby a narcotic drug or a

psychotropic substance is obtained outside India and supplied to any person

outside India without the previous authorization of the Central Government or

otherwise than the accordance with the conditions (if any) of such authorization

granted under Section 12, shall be punishable with rigorous imprisonment for a

term which shall not be less than ten years but which may extend to twenty years

and shall also liable to fine which shall not be less than one lakh rupees but may

extend to two lakh rupees:

Provided that in the Court may, for reasons to be recorded in the judgment,

impose a fine exceeding two lakh rupees.

Section 27A- Punishment for financing illicit traffic and harbouring offenders:-

Whoever indulges in financing, directly or indirectly, any of the activities

specified in sub-clauses (i) to (v) of clauses (viiia) of section 2 or harbours any

person engaged in any of the aforementioned activities, shall be punishable with

rigorous imprisonment for a term which shall not be less than ten years but which

may extend to twenty years and shall also be liable to fine which shall not be less

than one lakh rupees but which may extend to two lakh rupees:

Provided that the Court may, for reasons to be recorded in the judgment,

impose a fine exceeding two lakh rupees.

Section 36A- Offences triable by Special Courts:-

(1) Notwithstanding anything contained in the Code of Criminal

Procedure, 1973 (2 of 1974),-

(a) All offences under this Act which are punishable with

imprisonment for a term of more than three years shall be

triable only by the Special Court constituted for the area in

which the offence has been committed or where there are more

Special Courts than one for such area, by such one of them as

may be specified in this behalf by the Government.

13. A conjoint reading of the aforesaid provisions would clearly disclose that

the definition of "illicit traffic" is very wide and even those handling or letting out

any premises for carrying on any of the activities referred to in Sub-Clauses (i) to

(v) of the definition are covered by the said definition. Not only that, whosoever

finances these activities is also treated as indulging in "illicit traffic". Section 24A

of the Act provides for punishment to those who indulge in financing, directly or

indirectly, any of the activities specified in sub-Clauses (i) to (v) of clause (viiia) of

Section 2 which provides the definition of "illicit traffic". We had examined the

record keeping in view the aforesaid legal position in mind.

14. Since the matter is still at investigation stage and charge-sheet is yet to be

filed, it would not be appropriate for us to comment upon the material collected by

the investigating officer against the petitioner during the investigation. We would

only observe at this stage that the material collected so far does indicate the

possibility of launded money received by the petitioner and hawala money which

is being rooted again to facilitate illegal traffic where the possibility of role of the

petitioner in financing the said illicit traffic, directly or indirectly, cannot be ruled

out. Therefore, it cannot be said that there is no jurisdiction with the Special

Judge to deal with this matter. The submission of the learned counsel for the

petitioner that even on the basis of admitted facts no case of illicit trafficking is

made out, cannot be accepted at this stage.

15. From the record, it is clear that the petitioner was arrested on the basis of

the investigations carried out so far. He was produced before the concerned Court

and his judicial custody remand was authorized by the Court from time-to-time.

While passing said remand orders, the concerned Special Judge considered the

allegations in the applications made by the prosecution and at the same time

rejected the prayer of the petitioner for rejecting the remand application. The

learned Special Judge has given his reasons by passing detailed speaking orders.

The petitioner has not challenged those remand orders by preferring any appeal

or other proceedings in the High Court. Instead, present writ petition is filed, that

too, at a time when the investigation is at a nascent stage. Since statutory remedy

to challenge these remand orders is provided under law, which has not been

availed of as yet by the petitioner, it would not be appropriate for us to comment

on the merits of those orders. Stating at the cost of repetition that the scope of

this writ petition is very limited and as we do not find that the proceedings

pending before the learned Special Judge are ex-facie without jurisdiction, we have

no option but to dismiss this writ petition giving liberty to the petitioner to

challenge the orders of the Special Court in accordance with law, if he so desires.

16. In the circumstances of this case, there shall be no orders as to costs.

(A.K. SIKRI ) JUDGE

(AJIT BHARIHOKE) JUDGE May 21 , 2010 skb/ks