2005 (98) ECC 36 (ATFFE)

APPELLATE TRIBUNAL FOR FOREIGN EXCHANGE

New Delhi

Shri O.P. Nahar, Acting Chairperson

Shri Ghisulal Narsaji Jain

Versus

Director of Enforcement

Appeal No. 393 of 1997

[Appeal Against Adjudication Order No. ADJ/123/AD/RK/B/97 dated 28.5.1997 passed by Asstt. Director of Enforcement, Mumbai]

Order dated 23.8.2004, certified on 9.9.2004

Interpretation

Sections 25 & 26 of the Evidence Act -- Merely because confessional statement is made under custody before Enforcement Directorate it cannot be ousted from consideration because it is not hit by Sections 25 & 26 of the Evidence Act. The Enforcement Directorate cannot be taken equal to police officers before whom confessional statement becomes inadmissible under the provisions of Sections 25 and 26 of the Evidence Act.

Foreign Exchange Regulation Act, 1973

Section 63 r/w 8(1) and 8(2) -- Confiscation and Penalty -- Foreign exchange recovered from the appellant and he was unable to explain the same which could be taken as corroboration. Similarly Indian currency of high value was recovered during the search which the appellant had tried to explain as it belongs to his brothers who filed affidavits but the same could not be accepted without any contemporary evidence -- The confiscation of the foreign exchange and Indian currency under Section 63 was sustained.

Appeal dismissed

PRESENT :

Shri P. Ojha, Advocate for the appellant.

Shri T.K. Godoo, DLA for the respondent.

Cases Cited :

1. K.I. Pavunny v. Asstt. Collector (HQ) Central Excise Collectorate, Cochin 1997 Supreme Court Cases (Cri.) 444

2. K.T.M.S Mohd. v. UOI, 1992 (40) ECC 352 (SC)

3. Muthswami v. State of Madras, AIR 1954 SC 4

4. Pyare Lal Bhargav v. State of Rajasthan, AIR 1963 SC 1094

5. Roshan Beevi v. Joint Secretary to the Government of Tamil Nadu, 1984 (15) ELT 289 (Mad.)

6. Shanti Prasad Jain v. Director of Enforcement, AIR 1962 SC 162

ORDER

This order of the Appellate Tribunal for Foreign Exchange is delivered by O.P. Nahar, Acting Chairperson.

2. Pursuant to this appeal the appellant has challenged the Adjudication Order No. ADJ/123/AD/RK/B/97 dated 28.5.1997 passed by Asstt. Director, Enforcement Directorate imposing a penalty of Rs. 20,000 and confiscation of seized and recovered Indian currency of Rs. 4,45,000 and foreign currency of Saudi Riyals 3764, UAE Dirhams 805, Qatar Riyals 150 and US $ 51 for the reasons that the appellant without any general or special permission of the RBI acquired foreign exchange from different persons for selling the same to unauthorized person in contravention of section 8(1) and 8(2) of FERA, 1973. The appellant made pre-deposit of Rs. 20,000 as directed by order dated 27.12.02 passed by this Tribunal. Presently this case is taken up for hearing on merits.

3. According to the learned counsel Shri P. Ojha for the appellant's written submissions have already been filed in this appeal whereafter he pleaded that the appeal may be disposed of in accordance with the written submissions. According to Shri T.K. Gadoo, DLA he does not intend to file submissions. He addressed this Tribunal by oral arguments.

4. As per the facts, search was conducted in the shop premises of the appellant during which foreign currency Saudi Riyals 3764, UAE Dirhams 805, Qatar Riyals 150, US $ 51 and Indian currency of Rs. 4,45,000 is recovered and seized. The appellant made confessional statement stating that he acquired foreign exchange by purchasing the same from unauthorized persons without any permission of RBI and the Indian currency recovered from is the sale proceeds of further transferring acquired foreign exchange to different persons. The confessional statement was recorded on 18.4.96 but the same was retracted in 20.4.96. The main thrust of the argument is that confessional statement cannot be made as basis of arriving at a guilt against the appellant and confessional statement needs corroboration without which it cannot be acted upon. The judgment of Madras High Court in Roshan Beevi v. Joint Secretary to the Government of Tamil Nadu, 1984(15) ELT 289 (Mad.) and other judgments of Supreme Court viz. (1) Muthswami v. State of Madras, AIR 1954 SC 4; (2) Pyare Lal Bhargav v. State of Rajasthan, AIR 1963 SC 1094 and (3) Shanti Prasad Jain v. Director of Enforcement, AIR 1962 SC 162 are cited in support of aforesaid arguments. It is repeatedly argued that confessional statement before acting should be accepted as voluntary without which it cannot be acted upon and more particularly when it is retracted within a short time.

5. There is no doubt that appellant made confessional statement. According to him said confession was made under custody. However, merely because confessional statement is made under custody before Enforcement Directorate it cannot be ousted from consideration because it is not hit by Sections 25 & 26 of the Evidence Act. The Enforcement Directorate cannot be taken equal to police officers before whom confessional statement becomes inadmissible under the provisions of Sections 25 and 26 of the Evidence Act. The confessional statement before officials of Enforcement Directorate is otherwise admissible.

6. The confession has been retracted after three days but retraction alone cannot take it out from consideration. There is not a slightest proof not record that coercion and threat is practised upon the appellant. Such plea is required to be supported by some little evidence without which bald statement cannot be accepted and burden cannot be shifted to respondent. It this regard judgment of the Supreme Court in K.T.M.S Mohd. v. UOI, 1992 (40) ECC 352 (SC) : (1992) 3 SCC 178 can be safely referred where Hon'ble Supreme Court has observed as follows:

"We think it is not necessary to recapitulate and recite all the decisions on this legal aspect. But suffice to say that the core of all the decisions of this Court is to the effect that the voluntary nature of any statement made either before the Customs authorities or the officers of Enforcement under the relevant provisions of the respective Acts is a sine qua non to act on it for any purpose and if the statement appears to have been obtained by any inducement, threat, coercion or by any improper means that statement must be rejected brevi manu. At the same time, it cannot be recorded as involuntary or unlawfully obtained. It is only for the maker of the statement who alleges inducement, threat, promise, etc. to establish that such improper means has been adopted. However, even if the maker of the statement fails to establish his allegations of inducement, threat etc. against the officer who recorded the statement, the authority while acting on the inculpatory statement of the maker is not completely relieved of his obligations in at least subjectively applying its mind to the subsequent retraction to hold that the inculpatory statement was not extorted. It thus boils down that the authority or any court intending to act upon the inculpatory statement as voluntary one only. On this principle of law, this Court in several decisions has ruled that even in passing a detention order on the basis of an inculpatory statement of a detenu who has violated the provisions of the FERA or the retraction and record its opinion before accepting the inculpatory statement lest the order will be vitiated."

7. The appellant states that his confessional statement was recorded under custody and during night but there is nothing on record which can justify or an interference can be drawn with regard to practising of coercion and threat upon him. The admission whether in the night or day can hardly make any substantial difference. The bald statement is required to be rejected. The retracted confessional can also be acted upon as observed by the Supreme Court in K.I. Pavunny v. Asstt. Collector (HQ) Central Excise Collectorate, Cochin, 1997 Supreme Court Cases (Cri.), 444. The citations advanced by the counsel for the appellant do not make out any other case. Moreover, these judgments cannot be interpreted like statute. These are the expressions made in the course of delivery of judgment when particular facts were available.

8. The foreign exchange is recovered from the appellant and he is unable to explain the same which can be taken as corroboration. Similarly Indian currency of high value is recovered during the search which the appellant has tried to explain as it belongs to his brothers who filed affidavits but the same cannot be accepted without any contemporary evidence. The confiscation of the Indian currency as well as foreign currency cannot be faulted in this background.

9. For the reasons stated hereinabove the impugned order is liable to be sustained and maintained. An order is passed accordingly. The confiscation of the foreign exchange and Indian currency under section 63 is correct and cannot be disturbed. The pre-deposit of Rs. 20,000 made by the appellant may be appropriated towards the penalty. This appeal is dismissed having no merits.

………………………..