Properties of criminals can't be confiscated: SC



New Delhi: The Supreme Court on Monday ruled government does not have the powers to seize or attach the properties of criminals who commit offences within the territory of India.

A bench of Justices V S Sirpurkar and S S Nijjar held in a judgement that the forefiture of such ill-gotten property can be done only in cases where the same has been accumulated in crimes having international ramifications.

Such a seizure can be done provided there is a treaty between India and the contracting country, the apex court said.

The apex court passed the judgement while dismissing the appeal filed by Madhya Pradesh government which had confisciated the properties of Balram Mihani, an alleged criminal who reportedly accumulated huge assets through his criminal dealing purportedly in the State.

The state had chosen to confiscate the property by invoking Chapter VII-A of the Code of Criminal Procedure, 1973 which authorised the government to confisicate properites of criminals under exceptional circumstances.

The trial court had earlier allowed the authorites to seize the properties Mihani on an application moved by the Inspector of Itarsi police station who alleged the properties were earned by criminal activities.

According to the state, the accused was involved in the criminal activities since long and had accumulated huge wealth derived directly or indirectly by or such criminal activities. It was alleged that some of these properties were in the name of his relatives, which were clearly traceable to the accused.

The trial court permitted the confisciation on the plea made by the state under CrPC.

The Madhya Pradesh High Court quashed the confisciation, after the state appealed in the apex court.

Upholding the high court's verdict, the apex court said that in the Statement of Objects and Reasons to the Amending Act 40 of 1993 (CrPC) there is a clear reference that the government of India had signed an agreement with the Government of United Kingdom of Great Britain and Northern Ireland for extending assistance in investigation and prosecution of crime and the tracing, restraint and confiscation of the proceeds of crime (including crimes involving currency transfer) and terrorist funds with a view to checking terrorist activities in India and the UK, besides other countries with which such treaties are signed.

"When we see the applications as also the order passed by the trial court, it is clear that it is only and only in respect of the local offences like gambling and the offences under IPC which are local. Even the properties are not shown to be connected with crimes mentioned in the acts and reasons of the amended Act. In fact, no connection is established also between crimes mentioned and the properties," the apex court said.

The apex court said such properties are clearly not included in Section 105-C.

"Though the language of Section 105-C (1) is extremely general, its being placed in Chapter VII-A cannot be lost sight of. Again, there is a clear cut reference in Sub-section (2) thereof to the contracting state, the definition of which is to be found in Section 105-A (a).

"It is, therefore, clear that the property envisaged in Section 105-C (1) cannot be an ordinary property earned out of ordinary offences committed in India," the apex court said.

According to the apex court, if the state's contention is to be acccepted, it would mean that even for the offences which are local in nature and committed within the state, the property connected with those offences shall be forfeited by the central government.

"That would obviously be an absurd result. Lastly, we cannot ignore the likely misuse of the provisions in Chapter VIIA if the whole Chapter is made applicable to the local offences generally. Such does not appear to be the intendment of the Legislature in introducing Chapter VII A. In view of the above, we approve the judgment of Madhya Pradesh High Court and confirm the same. The appeals are dismissed," the apex court said in its judgement.

PTI