http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 13  

PETITIONER: CENTRAL BUREAU OF INVESTIGATION

       Vs.

RESPONDENT: STATE OF RAJASTHAN AND ORS.

DATE OF JUDGMENT:       08/07/1996

BENCH: RAY, G.N. (J) BENCH: RAY, G.N. (J) HANSARIA B.L. (J)

CITATION:  JT 1996 (6)   313        1996 SCALE  (5)203

ACT:

HEADNOTE:

JUDGMENT:                             WITH             WRIT PETITION (CIVIL) NO. 33 OF 1996 Arvind Singh Mewar V. Union of India & Anr.                       J U D G M E N T G.N. RAY, J.      leave granted. Heard learned counsel for the parties.      This appeal  is directed  against the order of the High Court of  Rajasthan (Jaipur  Bench) dated July 6, 1993 in SB Crl. Misc.  Petition No. 81 of 1992 under Section 482 of the code  of  criminal  procedure,  affirming  the  order  dated October 22,  1991  passed  by  the  learned  Chief  Judicial Magistrate (Economic  Offices) Jaipur,  arising out  of  CBI case No. RC 8(s)/91/SIU (IX), New Delhi.      Shri  Om  Prakash,  Deputy  Superintendent  of  Police, CBI/SIU (IX),  New Delhi,  made an application under Section 155 (2)  of the Code of criminal procedure, before the Chief Judicial magistrate (Economic Offences), jaipur for grant of permission to the said Deputy Superintendent of police, CBI, to investigate case No. RC 8/91/STU/(IX)/CBI/New Delhi under Section 25(1)  read with  Section 56 of the Foreign exchange (regulating )  Act, 1973  (hereinafter referred  to as FERA) against respondent  No.3 Shri Arvind Singh Mewar of Udaipur, Rajasthan. It  was inter alia stated in the said application under Section 155 (2) of the code of Criminal Procedure that the aforesaid  case was registered against Shri Arvind Singh Mewar on  the allegation that shri Mewar, an Indian National and a  resident in  India, had purchased three properties in united Kingdom and god them repaired and renovated involving total  expenditure   of  Rs.   228  lakhs   (782790   ponds) approximately. The said Arvind Singh had also incurred heavy expenditure on  the  education  of  his  daughter  in  U.K., journey expenditure  to and  fro United  Kingdom and  on the purchase of  Rolls Royace  Car etc. All such expenditure was incurred by  Shri Mewar  without any permission from Reserve

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 13  

Bank of  India or Government of India. Accordingly, the said shri Mewar had committed an offence under Section 25(2) read with Section  56 of  FERA. It was further stated in the said application that  as per  Section 62  of FERA,  the offences punishable under  Section 56  of  FERA  were  non-cognizable within the  meaning of Code of Criminal procedure and it was submitted that  in order  to investigate  the  no-cognizable offence, the aforesaid application for permission was filed,      By the order dated October 22, 1991, the Chief judicial Magistrate (Economic  Offences) Jaipur,  dismissed  he  said application, inter alia, on the finding that under Section 5 of FERA,  the State  Government may  by order and subject to such conditions  and limitations as it thinks fit to impose, authorise any  officer of Customs of any Central Excise such of the  powers and  discharge such  of  the  duties  of  the Director Enforcement or any other officer of the Enforcement under FERA  as  may  be  specified  in  the  order;  but  no notification could be produced before the said learned Chief Judicial Magistrate which had empowered CBI under Sections 4 and 5  of FERA  to cause  investigation in  respect  of  the offence under  FERA. The  learned Chief  Judicial Magistrate also noted that the Fir had been registered by the CBI under Section 154  (1) of  the Code of the Criminal Procedure. The learned Chief Judicial Magistrate indicated that the offence alleged Against respondent NO. 3 was non- cognizable offence under Section  62 FERA  and FIR under Section 154 (1) of the Code  of   Criminal  Procedure   could  be   registered  for cognizable offences  and not for non-cognizable offence. The learned Judicial  Magistrate further  observed that   in the FIR under  Section 154 (1) of the Code of Criminal Procedure could be registered for cognizable offences and not for non- cognizable offences. The learned Judicial Magistrate further observed that  in the  FIR it was alleged that the violation of the  provisions of  FERA had  been committed in a foreign country. For  investigation of offences foreign country. For investigation of offences committed in foreign countries, it was necessary  to take permission of the Government of India Under Section  188 of  the Code  of Criminal  Procedure, but permission from  Central  Government  had  not  been  taken, Accordingly, the  learned Judicial  Magistrate held that the permission to  investigate the offences alleged against Shri Arvind Singh  Mewar by  the CBI  could not  be given and the said application was dismissed.       Being  aggrieved by  the said  order  of  the  learned Judicial Magistrate, the appellant made an application under Section 482  of the Code of Criminal Procedure being SB Crl. Misc. Petition  No 81  of 1991.  The Learned Single Bench of Rajasthan High  Court (Jaipur  Bench) by order dated July 6, 1993 dismissed  observing that  the reasonings  given by the learned Chief  Judicial Magistrate  in  the  Impugned  Order being justified, there was no occasion to interfere with the same.      Mr.  Jayaram,   learned  Additional  Solicitor  General appearing for  the appellant, has submitted that the learned Chief Judicial  Magistrate and  the  High  Court  filled  to appreciated that  SECTION 5  of FERA  clearly  empowers  the Central Government  to entrust  the functions of Director or other officer  of Enforcement  or any  police Officer or any other officer  of the  General Government  or  of a State to exercise such  powers and  discharge such of the duties. Mr. Jayaram has  further submitted that any officer who has been entrusted with the duties and function of the Directorate of Enforcement would  be bound  by the law which empowered them to be  deemed as  "Officers of Enforcement". Mr. Jayaram has also submitted  that the  contention that  the provisions of

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 13  

the Code  of Criminal Procedure cannot apply to the offences under FERA is without any basis. By Section  62 of FERA, the contention that  the provisions  of  the  Code  of  Criminal Procedure cannot apply to the offences under FERA is without any basis.  By Section  62 of  FERa, the offences punishable under Section  56 of  FERA  have  been  made  non-cognizable within the meaning of that Code. He has submitted that there cannot be any authority other than authority mentioned under Section 155  of the  Code of Criminal Procedure to deal with the cases  under  FERA  being  not-cognizable  offence.  Mr. Jayaram has  also submitted  that where the operation of the Code has been kept in abeyance that has been specifically se out in  FERA. By  way of  illustration he  has  referred  to Section 56(6)  of FERA  wherein  it  has  been  specifically stated that  "nothing in the first proviso to Section 188 of the Code of Criminal Procedure, 1898 (5 of 1898) shall apply to any offence punishable under this Section."      Mr. Jayaram  has further  submitted that  the  offences under  FERA  were  notified  for  investigation  by  CBI  in exercise of  the powers  conferred on the Central Government vide Sections  3 and  5 read  with Section  6 of  the  Delhi Special Police Establishment Act, 1946 (hereinafter referred to as DSPE Act). The Government of Rajasthan vide letter No. G.10(1) Home/XIV/74 dated November 10, 1975 addressed to the Government of India had conveyed its consent under Section 6 of the  DSPE exercising  power and jurisdiction in the whole of  State   of  Rajasthan   for  investigation  of  offences punishable   under   FERA   and   attempt,   abetments   and conspiracies in  relation to  or in connection with the said offences. Mr.  Jayaram has  further submitted  that the CBI, Special Police  Establishment, is  specialised Investigation Agency constituted  under the DSPE Act for the Investigation of special class of crimes having interest and international ramifications irrespective  of the  fact that  the  offences therein are  covered by  a special  legislation. It has been contended by Mr. Jayaram that entrustment of an offence of a special  nature   to  any   of  the   reputed  agencies  for investigation is  purely a  "State subject"  and the same is within the inherent powers of a State Government. Therefore, the consent  given by  the Government of Rajasthan is within the inherent powers and jurisdiction of the State Government and such  exercise of  power and jurisdiction are out of the scope of judicial interference.      Mr. Jayaram has contended that the State Government has the prime  responsibility over  the  crime,  law  and  order situation within  its territory.  It has also been contended by Mr.  Jayaram that  in view  of the  consent given  by the Government  of   Rajasthan,  Department   of  Personnel  and Administrative Reforms  of the Central Government vide Order No228/2/74-AVD/II dated October 26, 1977, in Exercise of the powers Conferred  under section 5 the DSPE Act, notified the offences under  FERA for  investigation by  DSPE in  various States including  the State  of Rajasthan.  Mr. Jayaram  has submitted   that   a   consolidated   notification   bearing No.228/8/89-AVD/II dated  September 7, 1989 was issued under Section 3  of the  DSPE Act  in respect  of the offences for which consent  by all  the State  Governments has been given for the  pursue of investigation by the CBI and the offences under FERA  are at  SL. No.  19 of  the list of Central Acts notified investigation   by the members of DSPE. Mr. Jayaram Magistrate and  the High  Court  failed  to  appreciate  the implication of  the Special legislation which deals with all types of  offences either to be departmentally dealt with in adjudication proceedings  as well   conviction by a court of law if  so warranted. Mr. Jayaram has submitted that Section

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 13  

5 of  undoubtedly confers authority on Central Government to Enforcement or  his subordinates to a Police Officer. Hence, the  notification   issued  under  Section  3  pf  DSPE  Act authorising the  officers of  DSPE to  investigate into  the offences under  FERA must  be held to be a due authorisation under Section 5 of FERA.      Mr. Jayaram  has contended  that the  CBI having  legal authority took  up the  case for  investigation and made the application under  Section   155(2) Cr.P.C. before the Chief Judicial Magistrate  for permission  to investigate  a  non- cognizable offence.  Due to  refusal of  permission  by  the Chief Judicial  Magistrate, no  enquiry could be held by the CBI. It  has been  submitted by Mr. Jayaram that the primary requirement of  law of the country should not be jeopardised by refusing  to accord  permission on untenable grounds. Mr. Jayaram has  submitted that  it was  preeminently a fit case where permission  should have  been granted  to the  CBI  to cause investigation in respect of the allegations of serious breach under FERA.      Mr.  Jayaram  has  also  submitted  that  the  CBI  has initiated the  case by  registration of  Fir No. RC 8(S)/91- SIU.IX/CBI/New Delhi  on September  17, 1991  which is  much before any  action taken  by the  Director of Enforcement. A copy of  the FIR  has also  been sent  to  the  Director  of Enforcement, The  Directorate  of  Enforcement  is  free  to investigate the  lapses under  FERA other  than the offences under Section  25(1) read  with Section  56  of  FERA.  Such investigation  of  the  CBI  does  not  amount  to  parallel investigation, In any event, there is not question of double jeopardy unless the accused has been prosecuted for the same offence by  tow authorities.  Mr. Jayaram has submitted that it is  not necessary  to give specific authority to officers of the  CBI individually  to cause investigation relating to the offences  under FARA. A general notification authorising the officers  of the DSPE to investigate the  offences under FERA must  be held  to be  proper authorisation  to all  the members of  the CBI  to cause  investigation. In  support of this Court  in Major  E.G. Barsay  Vs. State  of Bombay (Air 1961  SC   1762).  Our  attention  has  been  drawn  to  the observation of  this Court  at page  1778 which  is  to  the following effect:-      "It was  contended before  the High      Court and it was repeated before us      that the  consend should  have been      given to every individual member of      the  Special  Police  Establishment      and that  a general  consent  would      not be  a good  consent. We  do not      see any  force  in  this  argument.      Under  Section   6  of   the  Delhi      Special Police  Establishment  Act,      no member of the said Establishment      can     exercise     powers     and      jurisdiction in any area in a State      without   the    consent   of   the      Government  of   the  State.   That      section  does  not  lay  down  that      every   member    of    the    said      Establishment       should       be      specifically authorised to exercise      jurisdiction in  that area,  though      the State  Government  can  do  so.      When   a   State   Government   can      authorise a  single single  officer      to exercise  the said jurisdiction,

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 13  

    we do  not see  any legal objection      why  it  could  not  authorise  the      entire force operating in that area      belonging to  that Establishment to      make such  investigation.  to  make      such       investigation.       The      authorisation filed  in  this  case      sufficiently  complies   with   the      provisions  of  Section  6  of  the      Delhi Special  Police Establishment      Act, 1946,  and there are no merits      in this contention."      Mr. Jayaram   has  also submitted that Section 3 of the DSPE Act  empowers the  Central Government  to  specify  the offences to  be investigated  by the  members of  DSPE.  The offences under  FERA have been mentioned in the notification empowering the  members of  the DSPE. The superintendence of DSPE vests  in the  Central Government and section 5 of DSPE Act empowers the Central Government to extend to any area in a State,  not in  a Union  Territory,  the  powers  and  the jurisdiction  of   the  members  of  the  Establishment  for investigation  of   any  offences  or  classes  of  offences specified under  Section 3.  Subject to  the orders  of  the Central  Government,   the  members  of  such  establishment exercising such  extended powers  and jurisdiction are to be deemed to  be the  members of  the Police Force of that area for  the   purpose  of  powers,  functions,  privileges  and liabilities; but  the powers and jurisdiction of a member of DSPE in  such State is to be Exercised only with the consent of the  Government of  the State  concerned. Mr. Jayaram has submitted that  the scheme  of  DSPE  Act  does  not  either expressly or  by necessary  implication  divest  the  police authorities of their jurisdiction and powers under any other competent law. Mr. Jayaram  has also submitted that DSPE Act is only  permissive and empowers the members of DSPE also to investigate all  the offences  specified under  Section 3 of DSPE Act.  In support  of this  contention, Mr.  Jayaram has relied on the observation at paragraph 12 in the decision of this Court  in A.C. Sharma V. Delhi Administration (AIR 1973 so 913).  Mr. Jayaram  has submitted that by authorising the members of  the CBI  to cause investigations relating to the offences under  FERA, the power conferred or the officers of the  enforcement   under  FERA  has  not  been  taken  away.      Mr. Jayaram  has also  contended that  as  the  offence under FERA  can be investigated by the members of the CBI in view of  the specific  notification issued  by  the  Central Government under  DSPE Act  and as  the jurisdiction of such Officers of  CBI view of the specific notification issued by the  Central   Government  under   DSPE  Act   and  as   the jurisdiction of  such Officers of CBI to cause investigation has been extended in the State of Rajasthan with due consent of Government  of Rajasthan,  there cannot be any impediment of the Officer of the CBI to cause investigation relating to the offences  alleged to  have been committed by Shri Arvind Singh Mewar.  In the aforesaid circumstances, the permission sought for  by the  Dy. Superintendent  of Police of the CBI before the learned Chief Judicial Magistrate, Jaipur, Should have been  granted and  the High  Court erred in not setting aside the  order of  rejection of  such permission sought by the CBI.      Mr. Jayaram  has submitted  that despite  very  serious allegations of  violations of  FERA  by  Shri  Arvind  Singh Mewar,  investigation   cannot  be  taken  up  for  want  of permission by  the learned  Judicial Magistrate.  He  has  , therefore, submitted  that in  the facts  of the  case,  the

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 6 of 13  

impugned order  of the  learned Chief Judicial Magistrate in refusing the  permission sought  for  by  the  CBI  to  make investigation relation  to the  allegations contained in the FIR, since upheld by the High Court, should be set aside and the  permission   should  be  given  to  the  CBI  to  cause investigation in respect of the offences alleged in the FIR.      Mr. Ashok Sen, learned Senior counsel appearing for the respondent no.  3, namely,  Shri  Arvind  Singh  Mewar,  has contended that  it will  be quite apparent from the combined reading of  Sections 4,5  and 26  of the  code  of  Criminal procedure that  if there  is  special  law  prescribing  the special procedure  for investigation  of the  cases  falling under that  law, the  provisions of  the  Code  of  Criminal Procedure are  not applicable,  It is only in the absence of any provision regulating investigation, inquiry and trial of non-IPC  offence   i.e.  offence   under  any   other   law, investigation, inquiry  or trial,  shall be  as per the Code Criminal Procedure, Under FERA Specific provisions have been made  for   the  investigation,  inquiry  and  recording  of statement of  witnesses and  also of trial of offences under FERA. Therefore,  the Provisions  of the  Code  of  Criminal Procedure do not govern the investigation etc. in respect of the offences  under FERA. Mr. Sen has submitted that Section 33 (2)  of the  FERA empowers  the Central Government or the Reserve Bank or any other Officer of Enforcement Directorate not below  the rank of Chief Enforcement Officer to call for information, Section  34 of  FERA powers  any officer of the Enforcement Directorate  so authorised by Central Government to search  a suspected person and to seize document. Section 35 authorises  an officer  or Enforcement to arrest a person against whom  the officer  has reason  to believe  that  any person in India or within the Indian customs waters has been quietly of  an offence  punishable under  FERA.  Section  30 authorises the officer of Enforcement to stop and search the conveyances. Section  37 confers  power to  search premises. Section 38 authorises the officers of Enforcement authorised by the  Central Government  to examine  persons. Section  40 authorises the  Gazetted Officer  of Enforcement  to  summon persons to  give evidence  and produce documents. Section 41 authorises an officer of Enforcement to take into custody of the  document,   Section  42   authorises  such  officer  to investigate  the  drafts,  cheques  and  other  instruments. Section 43  authorises the officer of Enforcement to inspect books of  accounts and  other documents. Other provisions of the Act provide various course of actions for implementation of  the  Act.  the  said  contravention  of  Section  25  is punishable under Section 56. Section 62 of the Act makes the offence under  FERA as  no-cognizable. Mr. Sen has submitted that the aforesaid scheme of FERA clearly shows that FERA is a  self   contained  code   which  is   fully  comprehensive specifying the  various offences,  prescribing the procedure for  investigation   or  trial  of  such  offences  and  the punishment to be awarded for such offences. These provisions of the  Code are  not applicable  in respect of such matters governed by the special law i.e. FERA.      Mr. Sen  has  further  submitted  that  the  effect  of Section 5  of code  of Criminal  Procedure is  to render the provision of  the Code  inapplicable in  respect of  matters convert by  special law,  This Section  clearly excludes the applicability of code in respect of investigation etc. under any special or local law. Therefore, only those officers who have been  empowered to  investigate under  the special  law i.e.FERA can  do so  and that  to  in  accordance  with  the special  law.   Mr.  Sen   has  submitted  that  the  police therefore, does  out of  picture. Section 155 of the Code of

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 7 of 13  

Criminal Procedure  also cannot  be invoked as on account of specific provisions  in the  special law, general provisions contained in the Code do not apply.      "Section 5  Criminal Procedure Code      Provides that  all  offences  under      any law other than the Indian penal      Code   shall    be    investigated,      Inquired into,  Tried and otherwise      dealt   with   according   to   the      provisions contained in the Code or      Criminal Procedure  but subject  to      any enactment for the time being in      force  regulating   the  manner  or      place of  investigation,  inquiring      into, trying  or otherwise  dealing      with  such  offences.  The  Foreign      Exchange  Regulation   Act   is   a      Special Act  and it  Provides Under      Section  19A   for  the   necessary      investigation  into   the   alleged      suspected commission  of an offence      under the  Act, by  the Director of      Enforcement. The  provisions of the      Code    of    Criminal    Procedure      therefore will  not apply  to  such      investigation by him."      Mr. Sen  has also  referred to  the decision  of madras High Court  in L.E.  Mohammad Hussain vs. Dy. superintendent of Customs  (AIR 197  Madras 464)  has been  observed in the said decision:-      "When  there   is   a   prohibition      against taking  cognizance  by  the      Magistrate without  a complaint  by      concerned   authority    and   when      procedure is  laid down  under  the      Foreign  Exchange   Regulation  Act      which is  a special  Act, the power      of the  police to  investigate  can      only be  confined to that conferred      to them  under Section 19--j (2) of      the Act.  So for  as offence in the      Special   enactments    area   made      Cognizable, the  police. under  the      general  power, may investigate. In      the  Foreign   Exchange  Regulation      Act. the  only offence that is made      cognizable is  the contravention of      sub-section (1) of      Section 4,  and the  police  cannot      investigate other  offences  except      on the  complaint  of  the  officer      concerned and with the order of the      Magistrate.  In   investigating   a      cognizable offence  with  they  are      entitled to, it may be that certain      facts  which   may  amount   to  an      offence under  special Act may also      be disclosed.  But that  would  not      deprive the  police of  their poser      to investigate a cognizable offence      not  falling   under  the   special      Statute."      Mr. Sen has submitted that Section 62 of FERA makes all offences punishable under Section 56 non-cognizable, thereby excluding the  jurisdiction of police officer to investigate

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 8 of 13  

such offences.  The provisions of Chapter XIV of the Code of Criminal Procedure, therefore, cannot apply to investigation of such  offences. Mr  Sen has also submitted that violation of Section 25 (restriction on purchase of properties abroad) is punishable  under Section 56 of FERA. Section 62 has been enacted notwithstanding  anything contained  in the Criminal Procedure Code.  the said  Section 62  has been  enacted  to prevent police  from initiating  action in  case of  alleged FERA violations.  The jurisdiction  of  police  is  normally excluded from  several economic  offences  as  they  can  be properly investigated  by specialized agencies only. Mr. Sen has submitted  that Section 45 of FARA is the only excepting where powers  have been  conferred upon  police  in  case  a person is  guilty of  illegally purchasing or buying foreign exchange in  public place  (Section 8(1)  FARA). This is the only limited role of police under FARA.      Mr. Sen  has also  submitted that  a member of DSPE has only  jurisdiction  to  investigate  the  offence  committed outside the  country does not fall within the purview of the provisions of  DSPE Act.  He has  submitted that  even under Section  188   of  the   Code  of  Criminal  Procedure,  The Permission  of  the  Central  Government  is  necessary  for investigation  for   an  offence  punishable  out  said  the country. Therefore,  in any  event, investigation in respect of the  offences alleged  to  have  been  committed  by  the respondent no.  3 outside  India in violation of FARA cannot be done by any member of CBI.      Mr. Sen has also submitted that Sections 3 and 5 of the DSPE Act  cannot be applicable for the offences said to have been  committed  outside  the  country.  Mr.  Sen  has  also submitted that  Section 25  of FARA  provides that no person resident in  India shall. except with the general or special permission of  the Reserve  Bank of India Acquire or hold or transfer or  dispose of  by  sale,  mortgage,  lease,  gift, settlement  or  otherwise  any  immovable  property  situate outside India.  The  offence  under  Section  25  cannot  be committed  in   India.  Therefore,   the   powers   by   the Notification issued  under DSPE  Act purporting to authorise the officers  of the  DSPE to  investigate in respect of the offences committed  outside India  under FARA  is beyond the provisions of the DSPE act and such Notification is ex facie illegal. Mr  Sen has , therefore, submitted that the learned Chief  Judicial   Magistrate  has   rightly   rejected   the application made  under Section  155 of the code of Criminal Procedure and  the  High  Court  has  rightly  rejected  the application under  Section  482  of  the  Code  of  Criminal Procedure and  the  High  Court  has  rightly  rejected  the application under  Section  482  of  the  Code  of  Criminal Procedure to  challenge the  said decision  of  the  learned Chief Judicial  Magistrate. He has therefore, submitted that the appeal should be dismissed.      On  a   careful  consideration   of   the   facts   and circumstances of  the  case  and  submissions  made  by  the learned counsel for the parties, it appear to use that under Section 3  of DSPE  Act,  the  Central  Government  May,  by notification,  specify   the  offences   which  are   to  be investigated by the members of DSPE. It is not disputed that notification under  Section 3 of DSPE Act has been issued by the central Government specifying the offences under FARA to be investigated  by the  members of  DSPE. It is also not in dispute the  a notification  dated October  26, 1977  by the Government of India. Ministry of Home Affairs, Department of Personal and  Administrative Reforms,  has  been  issued  in exercise of  the powers  conferred  by  sub-section  (1)  of Section 5  read with  Section 6  of DSPE  act. By  the  said

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 9 of 13  

notification the  Central Government. with , with consent of the various  State Governments  as  mentioned  in  the  said notification including  the State  Government of  Rajasthan, has extended  the powers  and jurisdiction of the members of DSPE,  inter  alia,  to  the  state  of  Rajasthan  for  the investigation of  the offences  specified  in  the  Schedule under clause  (a), offences  punishable under FARA and under clause (b)  attempts, abetments and conspiracies in relation to or in connection with any offence mentioned in clause (a) and any  other offence  committed in  the course of the same transaction  arising   out  of  the  same  facts  have  been mentioned.      It is,  however, to  be noted  that under  Section 7 of DSPE act,  the Central  Government  has  been  empowered  to constitute a  special police force to be called the DSPE for the  investigation   in  any  union  Territory  of  offences notified under  Section 3.  Under Section  5 (1) of DSPE Act the   Central Government  may by  order extend  to any  area including  Railway   areas  in  a  State,  not  being  Union Territory, the Powers and jurisdiction of the members of the DSPE for  the investigation of any of the offence or classes of offences  specified in  a notification  under Section  3. Under Section 5 (2), when by an order under sub-section (1), the powers  and jurisdiction  of the  members  of  the  said police establishment are extended to any such area, a member thereof  may,   subject  to  any  order  which  the  Central Government may  make in  this behalf discharge the functions of a  police officer  in  that  area  and  shall,  while  so discharging such  functions, be  deemed to  be a member of a police force  of that  area and  be vasted  with the powers, functions  as   and  privileges   and  be   subject  to  the liabilities of  a police  officer belonging  to that  police force.      It is quite evident that members of DSPE are members of special police force constituted under Section 2 of DSPE Act by the  Central Government.  The question  that  arises  for decision in  this case  is whether  or not a member of DSPE, Which is  also a  member of special police force constituted by the  Central Government, even if authorised under Section 3 and  Section 5  of DSPE  Act to  investigate in respect of offences under  FERA in  a particular  state other  than the Union Territory,  with the consent of such State Government, can investigate  the offences   for  violation of FERA, more so, when  the offence  is alleged  to  have  been  committed outside Indian  Territory. It will be apposite at this stage to refer to the provisions of Section 3, 4 and 5 of FERA:      Section 3:  Classes of  Officers of      Enforcement-      There  shall   be   the   following      classes of officers of Enforcement,      namely:      (a) Directors of Enforcement;      (b)   Additional    Directors    of      Enforcement;      (c)     Deputy     Directors     of      Enforcement;      (d)    Assistant    Directors    of      Enforcement:      (e) such other class of officers of      Enforcement as may be appointed for      the purposes of this Act.      Section 4-  Appointment and  powers      of officers of enforcement:-      (1)  The   Central  Government  may      appoint such  persons as  it thinks

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 10 of 13  

    fit to be officers of enforcement.      (2)  Without   prejudice   to   the      provisions of  sub-section (1), the      Central Government  may authorise a      Director  of  Enforcement    or  an      Additional Director  of Enforcement      or a Deputy Director of Enforcement      or  an   Assistants   Director   of      Enforcement to  appointed  officers      of Enforcement below the rank of an      Assistant Director of Enforcement.      (3) Subject  to such conditions and      limitations    as    the    Central      Government may  impose, and officer      of      impose,   an   officer   of      Enforcement may exercise the powers      and discharge  the duties conferred      or imposed on him under this Act.      Section 5- Entrustment of functions      of Director  or  other  officer  of      Enforcement:           The Central Government may, by      order   and    subject   to    such      conditions  and  limitation  as  it      thinks fit to impose, authorise any      officer of  customs or  any Central      Excise  Officer   or   any   police      officer or any other officer or the      Central  Government   or  a   State      Government to  Exercise such of the      powers and  discharge such  of  the      duties   of    the   Director    of      Enforcement or any other officer of      Enforcement under  this Act  as may      be specified in the order.      The  aforesaid  Sections  of  FERA  indicate  that  for implementing enforcement of the provisions of FERA different classes of  officers of Enforcement have been constituted in Section  3.   Under  Section   4(1)  of  FERA,  the  Central Government may authorise some of the senior officials of the Directorate of Enforcement, as mentioned in that sub-section (3) of Section 4 authorises the Central Government to impose conditions and  limitations in  the exercise  of powers  and discharge of duties under Fera by an officer of Enforcement. Section 5  authorises the  Central Government to entrust the functions of  Director or other officers of the Enforcement, with such  conditions and  limitations as  it thinks fit, to any officer  of the customs or any Central Excise Officer or any police  officer or  any other  officer  of  the  Central Government or  a State  Government to  exercise such  of the powers and  discharge such  of the duties of the Director of Enforcement of  any other  officer of  the Enforcement under FERA as  may be  specified in  the order to be issued by the Central Government.      In our  view, a combined reading of Sections 3, 4 and 5 of FERA makes it quite evident that primarily the officer of Enforcement Directorate as mentioned in Section 3 and 4 have been empowered  to exercise  the powers  and  discharge  the duties  conferred   or  imposed  on  such  officers  of  the Enforcement Directorate  under FERA.  As it may be expedient in some  cases to  confer powers  and duties  under FERA  to persons outside the Enforcement Directorate, the Legislature in its  wisdom has given authority to the Central Government under Section  5 of  FARA to  authorise any  officer or  any officer  of   Central  Government  or  State  Government  to

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 11 of 13  

exercise such of the powers and discharge such of the duties of the  Director of  Enforcement or  any  other  officer  of Enforcement under  FERA as  may be specified subject to such conditions and  limitations as  deeded fit  by  the  Central Government.      The  member  of  DSPE  is  a  member  of  police  force constituted under  DSPE Act by the Central Government. Under DSPE Act,  a member  of  DSPE  can  Exercise  the  power  of investigation in  the offence  or offences  as specified  in Section 3  DSPE act  within Union  Territory. For exercising power of  investigation outside  Union  Territory,  even  in respect of offences specified under Section 3 of DSPE Act, a notification extending  jurisdiction in  the State or States outside Union  Territory is  required to  be issued  by  the Central Government wit the consent of such state  Government or Governments.  Unless such notification under Section 5 of DSPE Act  is issued, a member of DSPE cannot investigate and exercise jurisdiction  under DSPE  act in respect of offence or offences  specified in  Section 3 in a State outside  the Union  Territory.   It  has   already  been  indicated  that notifications under  Section 3 and 5 have been issued by the Central  Government   authorising   members   of   DSPE   to investigate various  offences including  offences under FERA in number  of States  outside Union  Territory including the State of Rajasthan.      In our  view, such  notifications under Section 3 and 5 of DSPE  of Act  are necessary for the purpose of exercising powers by a member of DSPE in respect of offence or offences and in  respect of areas outside the Union Territory. It may however be  noted  here  that  by  a  general  notification, members of  DSPE may  be  authorise  to  exercise  power  of investigation in respect of offence or offences and in areas as specified  in the notification under Sections 3 and 5. as As  already  indicated,  although  officers  of  Enforcement Directorate are  clothed  with  the  powers  and  duties  to enforce implementation   of  the  provisions  or  FERA,  the Central Government  has been  authorised to  impose on other officers including a police officer, powers and authority to discharge such  of  the  duties  and  functions  as  may  be specified by  it. It  is nobody’s case that any notification has been  issued under  FERA authorising the member of  dspe to  discharge  the  duties  and  functions  and  officer  of Enforcement Directorate. In our view, in the absence of such notification under  FERA, a  member of  DSPE,  the  foresaid notifications under  Sections 3 and 5 of DSPE Act, cannot be held to  be an  officer under  FERA  and  therefore  is  not competent to investigate into the offences under FERA.      FERA is a special legislation relating to regulation of foreign exchange. FERA is also a central legislation enacted at a later point of time than the DSPE Act which was enacted in 1946.  In our  view, Section  4 and  5  of  the  code  or Criminal Procedure will not come in aid of the investigation of the  Officer  of  DSPE  in  accordance  of  the  Criminal Procedure Code.  Section 4  and 5  of the  Code of  Criminal Procedure provide  that in  the absence  of  any  provisions regulating   investigation ,  inquiry or trial of non-I.P.C. offences  i.e.   offences   under   any   other   law,   the investigation, inquiry and trial shall be in accordance with the Code  of Criminal Producer. But FERA is a self contained code containing  comprehensive provisions of  investigation, inquiry and  trial for  the offences  under  that  Act.  The provisions under  FERA gives  power to  the officers  of the Directorate of Enforcement or other officers duly authorised by the  Central Government under FERA to search, conspirate, recover, arrest,  record statements of witnesses, etc., FARA

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 12 of 13  

contains provisions for trail of the offences under FARA and imposition of  punishment for  such offences.  FARA, being a special  law,   containing  provisions   for  investigation, enquiry, search, Seizure, trial and imposition of punishment for offences  under FARA,  Section 5 of the Code of Criminal Procedure is  not applicable  in respect  of offences  under FARA. In  the decision  of Nil  Ratan Sircar’s case (supra), this Court  has considered  the import  of the provisions of FARA and has held:-      "It  was   also   urged   for   the      appellant that  the  provisions  of      Section 5(2)  of the  code apply to      the present  case in  matters which      are not  provided by  the Act. This      contention  too   has   no   basis.      Section   5   provides   that   all      offences under  any law  other than      the  Indian  Penal  code  shall  be      investigated, inquired  into, tried      and otherwise  dealt with according      to the  provisions contained in the      Code  of  Criminal  Procedure,  but      subject to  any enactment  for  the      time being  in force regulating the      manner or  place of  investigating,      inquiring    into,     trying    or      otherwise  dealing   with      such      offences, The  Act is a special Act      and it  provides under Section 19-A      for  the   necessary  investigation      into    the    alleged    suspected      commission of  an offence under the      Act,    by    the    Director    of      Enforcement. The  provisions of the      Code    of    Criminal    Procedure      therefore will  not apply  to  such      investigation by him, assuming that      the   expression    ’investigation’      includes  the   retaining  of   the      documents for  the purposes  of the      investigation."      The position is same under the FERA of 1973 as it would appear  from   its  various   provisions  noted  above.  the aforesaid case  was concerned  with   FERA of  1947. similar view has  been expressed by this Court in Ajmer Singh’s case (supra) by  indicating that  the Army  Act, Navy Act and Air Force  Act   embody  a   completely   self   contained   and comprehensive Code and therefore constitute a special law in force providing for special jurisdiction and powers on court material and  prescribing a  special form  of procedure  for trial of the  offences under the said Acts. Hence, Section 5 of the Code of Criminal Procedure was not applicable.      It may also be noted that the allegations in the FIR in question, Indicate commission of offences under FERA outside India. DSPE  Act has  been enacted  "to make  provision  for constitution  of  special  police  fore  in  Delhi  for  the investigation of  certain offences  in the  Union Territory, for the superintendence and administration of the said force and for extension to other of the powers and jurisdiction of the members of the said force in regard to the investigation of the  said offences".  Under Section  1 and 2 of DSPE Act, the authority  under the  said Act  is  to  investigate  the offences committed  in the  Union Territory or in such other States where  the Jurisdiction   of  the member  of DSPE has been extended  under Section  5 of  the Act.  The member  of

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 13 of 13  

DSPE, therefore,  is  not  clothed  with  the  authority  to investigate offences  committed outside  India.  Even  under Section 188  of Code of Criminal Procedure, investigation of an offence  committed outside  Indian territory  may be made only with  permission of  the Central Government. Of Course, if permission  is granted,  offences committed outside India can also be investigated.      In the  aforesaid facts,  we do  not find any person to interfere  with  the  impugned  order  and  the  appeal  is, therefore, dismissed. WRIT PETITION (CIVIL) NO. 33 OF 1996      This Writ  Petition has  been filed  for quashing Order No.228/2/74-AVD-II dated  October 26,  1977  issued  by  the government of  India under  Section 5 read with Section 6 of DSPE Act  and  letter/Circular  dated  July  passed  in  the appeal, indicating  the scope  and  effect  of  notification issued on October 26, 1977 under Section 5 and 6 of the DSPE Act, no  further order  need be passed on this Writ Petition and the same Stands disposed of.