The Central Bureau of Investigation (CBI) recently registered four separate cases on allegations that huge losses to the exchequer were caused by leasing out prime-value land under the Custodian of Enemy Property for India on forged documents.


What is ‘enemy property’?

  • In the wake of the India-Pakistan wars of 1965 and 1971, there was migration of people from India to Pakistan.
  • Under the Defence of India Rules (framed under the Defence of India Act, 1962), the Government of India took over the properties and companies of those who took Pakistani nationality.
  • These “enemy properties” were vested by the central government in the Custodian of Enemy Property for India.
  • The same was done for property left behind by those who went to China after the 1962 Sino-Indian war.
  • The Tashkent Declaration (1966) included a provision stating that India and Pakistan would discuss the return of property and assets taken over by either side during the conflict. However, the Pakistani government disposed of all such properties in their country in 1971.


How does India manage enemy property?

  • The Enemy Property Act, 1968, amended from time to time (latest in 2017), governs the vesting, preservation, management, control, sale, transfer of rights, disposal and other forms of usage of Enemy Property.
  • As per the amended act, enemy property refers to any property belonging to, held, or managed on behalf of an enemy, an enemy subject, or an enemy firm.
  • The Act provided for the continuous vesting of enemy property (including the rights, title, interest and benefits arising out of such property) in the Custodian of Enemy Property for India (CEPI).
  • The Office of the CEPI is a statutory authority under the provisions of the Enemy Property Act, 1968 (as amended in 2017) and a subordinate office under the Ministry of Home Affairs, Government of India.
  • The Custodian is a quasi-judicial authority under the Act and a Civil Court under the Civil Procedure Court,1908.
  • The central government (through the Custodian), is in possession of enemy properties spread across many states in the country.
  • Under this Act, some movable properties are also classified as enemy properties.


Issues with the Enemy Property Act, 1968

  • Various court judgments have been issued that have harmed the powers of the Custodian and the Government of India under the Enemy Property Act, 1968.
  • For example — A court decision granted legal heirs’ ownership of enemy property. The verdict opened the way for further petitions in courts across the country in which genuine or alleged relatives of people who had migrated to Pakistan claimed ownership over enemy properties.


Amending the 1968 Act

  • In 2017, the Parliament of India passed the Enemy Property (Amendment and Validation) Bill, 2016, which amended the 1968 Act and the Public Premises (Eviction of Unauthorised Occupants) Act, 1971.
  • The amendments were intended to protect against claims of succession or transfer of property left by people who migrated to Pakistan and China after the wars.


Salient provisions of the Enemy Property (Amendment and Validation) Act, 2016

  • It expanded the definition of the term “enemy subject” and “enemy firm.”
  • The expanded definition to include the legal heir and successor of an enemy, whether an Indian citizen or a citizen of a country that is not an enemy and the succeeding firm of an enemy firm, regardless of the nationality of its members or partners.
  • It stated that enemy property shall continue to vest in the Custodian even if the enemy (subject/firm) ceases to be an enemy due to death, extinction, business winding up or change of nationality or if the legal heir or successor is an Indian citizen or a citizen of a non-enemy country.
  • The Custodian may dispose of enemy properties vested in him, with prior approval from the central government and the government may issue directions to the Custodian for this purpose.