Gujarat High Court
The Principal Commissioner Of Customs vs Kishan Manjibhai Gadhesariya on 14 February, 2022
Author: J. B. Pardiwala
Bench: J.B.Pardiwala
C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/TAX APPEAL NO. 254 of 2021
With
CIVIL APPLICATION (FOR STAY) NO. 1 of 2021
In R/TAX APPEAL NO. 254 of 2021
With
R/TAX APPEAL NO. 255 of 2021
With
CIVIL APPLICATION (FOR STAY) NO. 1 of 2021
In R/TAX APPEAL NO. 255 of 2021
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE J.B.PARDIWALA Sd/-
and
HONOURABLE MS. JUSTICE NISHA M. THAKORE Sd/-
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1 Whether Reporters of Local Papers may be allowed YES
to see the judgment ?
2 To be referred to the Reporter or not ? YES
3 Whether their Lordships wish to see the fair copy NO
of the judgment ?
4 Whether this case involves a substantial question NO
of law as to the interpretation of the Constitution
of India or any order made thereunder ?
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THE PRINCIPAL COMMISSIONER OF CUSTOMS
Versus
KISHAN MANJIBHAI GADHESARIYA
================================================================
Appearance:
MR DHAVAL D VYAS, STANDING COUNSEL for the Appellant(s) No. 1
MR D.K. TRIVEDI, ADVOCATE for the Opponent(s) No. 1
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CORAM:HONOURABLE MR. JUSTICE J.B.PARDIWALA
and
HONOURABLE MS. JUSTICE NISHA M. THAKORE
Date : 14/02/2022
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C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022
COMMON ORAL JUDGMENT
(PER : HONOURABLE MR. JUSTICE J.B.PARDIWALA)
1. Since the question of law involved in both the captioned Tax Appeals is common, those were taken up for hearing analogously and are being disposed of by this common judgment and order.
2. For the sake of convenience, the Tax Appeal No.254 of 2021 is treated as the lead matter.
3. This Appeal under Section 130 of the Customs Act, 1962 (for short, the 'Act 1962') is at the instance of the Revenue and is directed against the order passed by the Customs, Excise and Service Tax Appellate Tribunal, West Zone Bench, Ahmedabad (for short, the 'CESTAT') dated 1 st October 2019 in the Customs (Appeal) No.267 of 2011 arising out of the Order in Original dated 30th March 2011 passed by the Commissioner of Customs, Ahmedabad.
4. This Appeal came to be admitted on the following substantial question of law :
"Whether the CESTAT erred in interpreting and applying the provision of Section 108 as well as Section 114(i) of the Customs Act, 1962 to the case of the respondent ?"
5. The facts giving rise to this Appeal may be summarised as under:
Page 2 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 (1) An intelligence was received by the Directorate of Revenue Intelligence (DRI), Regional Unit, Surat, that M/s.
Perfect Chemicals, Aurangabad, a bogus and fictitious firm, had consigned a parcel containing a psychotropic substance which was most likely 'Alprazolam' and that the said parcel was consigned to M/s. Bhatia Chemicals, Vapi, under the Lorry Receipt No.22987 dated 03.03.2009 and was to be unloaded at M/s. Choudhary Roadways, Parcel Office, Vapi, on 05.03.2009.
(2) In view of the above intelligence, a surveillance was kept on 05.03.2009 at the given address of M/s. Choudhary Roadways at Vapi. The DRI noticed that the goods transported from Aurangabad were received and stored in the godown of M/s. Choudhary Roadways, at Vapi, in the early morning of 05.03.2009. Several discreet inquiries confirmed that the parcel covered under the Lorry Receipt No.22987 dated 03.03.2009 had been received in the said godown. The surveillance was continued on 06.03.2009. During the surveillance on 05.03.2009 and 06.03.2009 respectively till the afternoon, no one came forward to receive the said packet/parcel. Therefore, the officials of the DRI entered into the godown premises to locate and verify the said packet/parcel. One Nandkishore Choudhary, the Proprietor of M/s. Choudhary Roadways, was available in the said premises and he confirmed the receipt of consignment covered under the Lorry Receipt No.22987 dated 03.03.2009 from Aurangabad and produced the documents related to the said parcel, i.e. LR Page 3 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 No.22987 and bill No.124 dated 03.03.2009 of M/s. Perfect Chemicals, declaring the said goods as 'Benzahydrol Powder'. The consignment covered under the said Lorry Receipt was found to be one woven sack bag weighing 25 kgs. net with the LR No.22987 written on it. As no one came forward to claim the parcel, the parcel was opened and three representative samples of 25 gms. each were drawn. The said parcel was taken over for further verification under the panchnama dated 06.03.09 (RUD-1) with instruction to the claimants to approach the DRI office for claiming the consignment.
(3) After leaving the godown, a tip off was received that someone had proceeded to M/s. Choudhary Roadways office to collect the parcel between 16:00 hours and 17:00 hours on 06.03.09. The suspect claimant approached the transport company and enquired about the consignment covered under the LR No.22987 dated 03.03.2009 and produced the consignor copy of the Lorry Receipt. On interrogation by the officers of the DRI, Surat, the said claimant gave his name as Jayeshbhai Chunibhai Vadaliya and admitted that he had gone to the transporters godown, i.e. M/s. Choudhary Roadways at Vapi, to receive the consignment of LR No.22987 dated 06.03.2009.
(4) The statement of Shri Jayeshbhai Chunibhai Vadaliya was recorded under Section 108 of the Customs Act, 1962, on 06.03.2009 (RUD-14) wherein he, inter alia, stated that:
Page 4 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 "He was staying in Surat for the last 4-5 years; that initially, he used to do the job relating to diamond cutting and thereafter for the last one and a half years, he had been working with a looms factory situated at Plot No. D-1/9, Hojiwala Estate, Sachin, Surat, whose owner is one Shri Kishanbhai Manjibhai Gadhesariya who is his relative; that he was getting a salary of Rs.8000/- per month.
On being asked further, he stated that on 6.3.2009, he received a phone call from Shri Sanjaybhai, a younger brother of Shri Kishanbhai, at around 10 a.m. and he was told to go to Vapi to take delivery of the goods; that the full name of Sanjaybhai is Shri Sanjaybhai Manjibhai Gadhesariya and he stays at Bhojalram Society, behind Kranti Maidan, Ashwani Kumar Road, Varachha, Surat;
As per the telephonic talk with Shri Sanjaybhai, he, along with one employee, Shri Shivabhai, reached Palsana Chokdi at around 12.30 p.m. where he met one person of Shri Sanjaybhai whose name he did not know; that as per the telephonic discussions, he had with Shri Sanjaybhai, he handed over to him one Bilty No.22987, dated 3.3.2009 of M/s.Choudhary Roadways, one Invoice No. JBE/BC001 dtd. 6.3.2009 of M/s. J.B. Enterprise, A-212, Simit Shopping Centre, GIDC Char Rasta, Vapi and one letter dated 5.3.2009 Page 5 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 issued by M/s. Bhatia Chemicals, Plot No. 2219, GIDC Estate, Ankleshwar, addressed to the Manager, Choudhary Roadways, Vapi; that in this letter, the authority is given to one Shri Anuj Shah for taking delivery of the parcel received at Choudhary Roadways, Vapi under L/R No. 22987, dated 3.3.2009; that Shri Sanjay told him over telephone not to disclose his real name and to get the delivery of the parcel from the transport company disclosing his name as Shri Anuj Shah, therefore he had signed in the letter of authority as Anuj Shah.
Shri Sanjaybhai also told him that the names and addresses shown in the said documents were bogus.
He submitted both the above letters and the Bilty. He further stated that Shri Sanjaybhai also directed him to rebook the same parcel in Surat-Ahmedabad Transport Co., GIDC, Vapi after taking delivery from M/s. Choudhary Roadways, Phase-I, Opp: GEB Office, GIDC, Vapi and to hand over the Invoice of M/s. J.B. Enterprise to the transport company (i.e. Surat- Ahmedabad transport); that he was not told what the parcel contained and hence he was unaware of its contents; that the above Authority Letter and Invoice were signed by Shri Sanjaybhai.
He further stated that he, along with Shri Shivabhai left Surat via Palsana on his bike and reached M/s.
Page 6 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 Choudhary Roadways, Vapi, at about 16:15 hours. He produced the above Bilty (L/R) in the said transport company to the person available there for taking delivery of the goods; that he had received a phone call from Shri Sanjaybha and he informed him that he had already reached Vapi;
When he was taking delivery of the goods from M/s. Choudhary Roadways, Vapi. he was intercepted by officers of DRI; that when he was asked to reveal his name, he disclosed his name as Shri Anuj Shah; that when asked for his Driving Licence, he handed over his licence and informed the officers that his real name is Jayeshbhai, that since he was told by Shri Sanjaybhai to give his identity as Shri Anuj Shah, he did not disclose his real name initially to the officers;
On being asked further, he stated that in the month of January, 2009, he had taken delivery of similar parcel of Shri Sanjaybhai which had arrived from Aurangabad through M/s. Choudhary Roadways, Vapi as per the instructions of Shri Sanjaybhai and the same was again booked in Surat-Ahmedabad Transport, Vapi; that the L/R of said parcel was given to him by Shri Sanjaybhai in his office at 306, Opera House, Varachha, Surat; that at that time also Shri Sanjaybhai had given to him one similar bogus letter, but he had given his identity as Jayeshbhai and also put his real signature.
Page 7 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 He was further shown one Bilty No. 22715, dated 19.1.2009 of M/s. Choudhary Roadways; that after seeing the same, he stated that the delivery of the goods of the said L/R was also taken by him from the said Choudhary Roadways, Vapi at the directions of Shri Sanjaybhai and the goods were re-booked again in Surat-Ahmedabad Transport; that he did not know who had taken delivery of the goods at Surat; that he had not taken delivery of the goods at Surat; that he was not told about the quantity and the type of goods contained in the parcel; that he did Sanjaybhai's work only because of relationship; that he did not know whether the goods were prohibited in nature or otherwise.
He was further shown the Panchnama dtd. 06.03.09 under which the parcel received from Aurangabad under L/R No. 22987, dated 3.3.2009 had been detained under the provisions of the Customs Act; that the Panchnama was written in English, but he had been explained the contents in Gujarati; that he had put his dated signature on the last page of the Panchnama.
On being asked further, he stated that Shri Sanjaybhai was a Chemical Engineer and he had an office at 306, Opera House, Varachha; that he had visited this office many times; that he came to know from their (Sanjaybhai's) conversation that they were exporting the goods which they bring from Page 8 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 Aurangabad out of the country. But he did not know whether they were exporting in the same form or were exporting in some other form manufactured out of it; that he was not getting any extra money for this work of taking delivery of goods from Vapi nor did he demand anything extra from them; that he did not know what else Shri Sanjaybhai was doing; that he did not know to which country they export the goods; that the detained goods did not belong to him: that Shri Sanjaybhai had only one office at Opera House."
(5) The further statement of Shri Jayeshbhai Chunibhai Vadaliya was recorded under Section 108 of the Customs Act, 1962, on 07.03.2009 (RUD-15) wherein, inter alia, he reiterated that he was sent by Sanjaybhai to Vapi on 6.3.2009 for taking the delivery of the parcel from M/s. Choudhary Roadways, Vapi, and to re-book the same in the Surat-Ahmedabad transport; that Sanjaybhai had not told him what the parcel contained; that he had disclosed his name as Anuj Shah before the said Choudhary Roadways as per the instructions of Sanjaybhai.
(6) Jayeshbhai Chunibhai Vadaliya, in his above statements, disclosed the role of Sanjaybhai and Kishanbhai. Accordingly, the residential premises of Sanjaybhai and Kishanbhai were visited on 07.03.2009. The residential house of Sanjaybhai situated at 36, Bhojalram Society, A.K. Road, Varachha, Surat, was found closed. The residential house of Kishanbhai situated at 22, Page 9 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 Shyam Sunder Society, A.K. Road, Varachha, Surat, was searched under the panchnama dated 07.03.09 (RUD-2), however, no incriminating documents/goods were found during the search. Kishanbhai was also not available during the search. The office premise of Sanjaybhai at 306, Opera House, was also visited. The said premise was also found closed, and after breaking the lock, the premise was searched and some documents regarding their companies were seized and collected under the panchnama dated 07.03.09 (RUD-3) for further investigation. Further, the residential premise of Jayeshbhai Chunibhai Vadaliya situated at Sachin, Surat, was also searched under the panchnama dated 07.03.09 (RUD-4), however, no incriminating documents/goods were found during the search.
6. It is the case of the Revenue that the consignment seized by the DRI was sent by one M/s. Perfect Chemicals, Aurangabad, and was consigned to M/s. Bhatia Chemicals, Vapi. The inquiry further revealed that M/s. Bhatia Chemicals and M/s. J.B.Enterprises were fictitious and non-existing companies. The inquiry further revealed that even M/s. Bhatia Chemicals stationed at Aurangabad was a fictitious company.
7. Nandkishore Rupchand Choudhary of M/s. Choudhary Roadways in his statement dated 19.03.2009 informed the DRI officers that on the earlier occasions, during the period between May 2008 and January 2009, they had transported six consignments of M/s. Perfect Chemicals to Vapi; the consignees Page 10 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 in all these consignments were shown as M/s. Bhatia Chemicals. He furnished the details of the Lorry Receipt number etc. He also informed that Jayeshbhai Chunibhai Vadaliya had collected the earlier consignments also and produced the acknowledgment copy with reference to three of the Lorry Receipts, i.e. 22040 dated 23.9.2008, 22489 dated 8.12.2008 and 22715 dated 19.1.2009 respectively. The acknowledgment receipt was signed by Vadaliya with the Mobile No.9979942428.
8. Thus, it is the case of the Revenue that the Ketamine consignment were procured by Sanjay Gadhesariya from Rajesh Joshi of Aurangabad in different lots. The consignments were transported from Aurangabad to Vapi under a bill of a fictitious company, namely, M/s. Perfect Chemicals, Aurangabad. One another fictitious company, viz. M/s. Bhatia Chemicals, Vapi, was shown as the consignee. The transportation was made through M/s. Choudhary Roadways and the Shrinath Travels. Sanjay Gadhesariya, in his statement recorded under Section 108 of the Customs Act dated 24th June 2009 stated that about 160 kgs. of Ketamine was received through M/s. Choudhary Roadways and about 25 kgs. through the Shrinath Travels. It is also the case of the Revenue that Sanjay Gadhesariya is in the business of illegal export of Ketamine Hydrochloride powder. Before the seizure by the DRI of 25 kgs. of the Ketamine Hydrochloride powder, he had already improperly exported approximately 165 kgs. of Ketamine to the various foreign buyers. It is the case of the Revenue that 25 kgs. of Ketamine from the seized consignment was also to be exported by Sanjay Gadhesariya following the same modus operandi which he had adopted for the past exports.
Page 11 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 TESTING OF SAMPLES :
9. The samples drawn from the consignment seized and detained on 06.03.2009 from M/s. Choudhary Roadways, Phase-
I, Opp: GEB Office, GIDC, Vapi, were sent to the Forensic Science Laboratory, Surat, under the Test Memo No.01/2009 from F.No.DRI/ SRU/ Inv-1/2009 dated 07.03.09 (RUD-33), for chemical analysis. The Deputy Director, Regional Forensic Science Laboratory, Government of Gujarat, Surat vide letter No. RFSL(SRT)/FM/ 23/2 dated 07.03.09 forwarded the chemical analysis report No.RFSL(SRT)/FM/23/3 dated 07.03.09 (RUD-
34) submitted by the Scientific Officer-Cum-Asstt. Chemical Examiner, Regional Forensic Science Laboratory, Government of Gujarat, Surat, which revealed that the said samples tested were of 'Ketamine Hydrochloride'.
10. It appears that Ketamine is a drug used in human and veterinary medicine developed in 1962. The street terms for Ketamine are: 'jet', 'super acid', Special 'K', 'green', 'K', 'cat Valium', etc. It comes in a clear liquid and a white or off-white powder form. Ketamine is a tranquilizer most commonly used on animals. The liquid form can be injected, consumed in drinks, or added to smokable materials. The powder form can be used for injection when dissolved. In certain cases, it is being injected intramuscular. Ketamine, along with the other 'club drugs', has become popular among teens and young adults at dance clubs and 'raves'. The use of the drug can cause delirium, amnesia, depression and long term memory and cognitive difficulties. The Page 12 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 export of Ketamine is governed by the Notification No.67 (RE- 2007)/2004-2009 dated 27.12.2007 issued by the DGFT, wherein, the export of the drug is subject to the NOC from the Narcotics Commissioner.
11. Ketamine Hydrochloride is a psychotropic substance presently included with the name of Ketamine at serial number 110A of the Schedule of the NDPS Act, Ephedrine Hydrochloride and Pseudoephedrine Hydrochloride are both declared to be 'controlled substances' in terms of Section 9A of the NDPS Act, the possession or dealings etc. in respect of which is made punishable by Section 25A of the NDPS Act. The possession and dealings etc. in manufactured narcotics drugs and psychotropic substances etc are punishable under Section 21 of the NDPS Act, Section 23 of the said Act deals with the illegal import or export etc. of narcotic drugs and psychotropic substances etc. and Section 28 of the Act makes punishable any attempts to commit an offence under the said Act or to cause such offence to be committed.
12. A show-cause notice came to be issued to the respondent under Section 124 of the Act 1962, calling upon the respondent to show-cause as to why :-
(i) The 165 kgs. of Ketamine Hydrochloride Powder valued at Rs.57,75,000/- (local market value) and international value of about Rs.16.50 crore, illegally exported by them, should not be held liable for confiscation under Section 113(d) of the Customs Act, 1962. However, Page 13 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 since the goods are not available for confiscation, why fine in lieu of confiscation should not be imposed on them.
(ii) The 25 kgs. of Ketamine Hydrochloride Powder valued at Rs.8,75,000/- and international value of about Rs.2.50 crore, detained from M/s Choudhary Roadways, Vapi and subsequently seized under panchnama dated 27.03.09, should not be confiscated under Section 113(d) of the Customs Act, 1962.
(iii) Penalty should not be imposed on each of them, individually, under Section 114(i) of the Customs Act, 1962.
13. At the end of the adjudication of the above show-cause notice, the Commissioner proceeded to pass the following order :
"(i) I order the 25 kgs. of Ketamine Hydrochloride Powder valued at Rs.8,75,000/- and international value of about Rs.2.50 crores, detained from M/s.Choudhary Roadways, Vapi and subsequently seized under panchnama dated 27.03.2009 to be confiscated absolutely under Section 113(d) of the Customs Act, 1962;
(ii) I hold the 165 kgs. of Ketamine Hydrochloride Powder valued at Rs.57,75,000/- (Local Market Value) and international value of about Rs.16.50 crores, illegally exported by them, to be liable for confiscation under Section Page 14 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 113(d) of the Customs Act, 1962 but are not available for such confiscation. Therefore for the reasons recorded supra, no fine in lieu of confiscation is being imposed.
(iii) I impose penalty under Section 114(i) of the Customs Act, 1962, as under :
(a) Shri Sanjay Manjibhai Gadhesariya - Rs.50 lakh (Rupees Fifty Lakh);
(b) Shri Kishanbhai Manjibhai Gadhesariya - Rs.5 lakh (Rupees Five Lakh);
(c) Shri Rajesh Joshi - Rs.10 lakh (Rupees Ten Lakh)"
14. The respondent, being dissatisfied with the aforesaid order passed by the Commissioner, went in appeal before the Tribunal. The Tribunal, vide order dated 1st October 2019, allowed the appeal, holding as under :
"4. Heard both the sides and perused the case records. The adjudicating authority has passed the impugned order on the basis of statements given by Shri Jayesh who had gone to take delivery of Ketmaine HCL from the office of M/s Choudhary Roadways, courier companies who had exported the goods, statement of Appellant Shri Sanjay Manjibhai Ghadesariya, the emails printouts of M/s Raghunath agencies and other concerns allegedly floated by Shri Page 15 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 Sanjay. Reliance has also been placed upon statement of one Shri Nagesh Barsale who introduced Shri Rajesh Joshi the supplier of impugned goods to Shri Sanjay. The adjudicating authority has imposed penalty on Shri Sanjay Manjibhai on charges of smuggling of goods whereas in case of Appellant Shri Kishanbhai, the penalty was imposed on the ground that he had taken delivery of one of the consignment and during investigation had thrown away some banned substances. Further that he was fully aware of activities of his brother.
5. I find that though the show cause notice and the adjudicating authority has relied upon the statements of Shri Jayesh Vadaliya or the courier companies or the persons who received the money in their account on such sale, but nowhere it is appearing as to when the goods were exported by Appellant. Even after investigation at courier company, there is no findings as what is the mode of export and to which country the exports were made. It is alleged that the Appellant had received 165 Kgs of Ketamine in past. The show cause notice alleges that the goods were sent by Shri Rajesh Joshi to Shri Sanjay and that Shri Rajesh Joshi was introduced to Shri Sanjay by Shri Nagesh Barsale. Shri Rajesh Joshi who has allegedly supplied such goods cannot be even traced by the investigating officers inspite of the fact that Shri Nagesh Barsale was knowing him. The Appellant has agitated the allegation of receipt of impugned goods. It is also a fact that neither the Incharge of Choudhary Roadways at Surat nor Shri Choudhary at Vapi knows Shri Sanjay. In such a case it was necessary to find Page 16 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 the source who had supplied the alleged quantity to the Appellant. Only on the basis of statement of Shri Jayesh it cannot be concluded that he had collected the ketamine consignments from transporter on behalf of Appellant. The supplier of goods has not been found nor there is any evidence that the goods were intended for the Appellant. The Appellant Shri Sanjaybhai Manjibhai has retracted his statement from jail. His retraction cannot be brushed aside on the ground that same was delayed. It is obvious that when a person is in jail, it will take time from him to understand the charges or investigation being made against him and after being aware of the situation to retract the same. The fact remains that the retraction was made during investigation itself and hence the statements cannot be made sole basis to make charges against the Appellant. It is also on record that during investigation, no incriminating documents were found from the office of the Appellants. Further as pointed out by the ld. Counsel there has been contradiction in statements of Shri Jayesh Vadaliya. In his first statement dt. 06.03.2009, he stated that he was given the bilty and letter for further transfer of goods by unknown person. However in second statement dt. 11.08.2009 he stated that he collected the said papers from office of Shri Sanjay. The payment alleged to have been received by Appellant on account of export goods is also based merely upon hearsay. None of the payments could be linked to the Appellant Shri Sanjay. It is only statement of persons that payments were received on account of Sanjay but no other details are forthcoming as to how the same were related to Shri Sanjay. No person would permit any other person to Page 17 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 receive payment in his account unless he is sure of any legal transaction. I also find that none of the buyers of the goods has been identified. No consignment alleged to have been exported has been brought on record. It is not appearing when the goods were exported, what mode of transportation was made, no shipping or airway bill linking with alleged exports is on record. There is no evidence as to how the Appellant paid for alleged receipt of Ketamine to the supplier. Shri Jayesh Vadaliya was not made even noticee even though he was the person alleged to be taking delivery of Ketamine and forwarding the same in name of fictitious firms. The movement of goods for export is through courier firms but nowhere the clearance of goods exported were doubted even though the export goods are subjected to testing and examination and especially in case of drugs. It is also not on record as to when and how the Appellant dealt with the impugned goods in transporting, packing the export consignments. In such case we find that only on the basis of statements, it cannot be concluded that the Appellant had exported 165 Kgs of Ketmaine HCL. As regard 25 kgs of Ketamine seized from Choudhary transport, I find that no evidence has been brought on record to show that the Appellant was attempting to export the same. No evidence of Appellant having in contact with any foreign buyer for export of said quantity is on record. No export documents were prepared or no shipping bill airway bill was prepared. In such case it cannot be said that the Appellant was attempting to export the goods. my view is also based upon the judgment in case of Ranjit Export Pvt. Ltd. 1985 (21) ELT 353 (Mad.). Similar view has been taken Page 18 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 in orders in case of Kashmiri Vs. Collector 1991 (57) ELT 284 (TRI), Sripar Upadhyay 2001 (138) ELT 768, Suresh Jhunjhunwala 2005 (183) ELT 60 (CESTAT), Bhanbhai Khalpabhai Patel 1987 (28) ELT 489, K. Baburao & Othrs 1986 (26) ELT 766.
6. In view of my above findings I hold that the Appellants cannot be accused of export of 165 Kgs of Ketmaine HCL or of attempt to export 25 Kgs of Ketamine seized from Choudhary Roadways. Resultantly I set aside the impugned order in as much as it relates to imposition of penalty on Shri Sanjay Manjibhai Gadhesariya and Shri Kishan Manjibhai Gadhesariya. The Appeals of both the Appellants are allowed with consequential reliefs."
15. Thus, from the aforesaid, it appears that the Tribunal took into consideration the following :
(a) The Tribunal declined to look into the statements of various individuals recorded under Section 108 of the Customs Act;
(b) The Tribunal insisted for direct evidence so far as the export of the Ketamine Hydrochloride Powder is concerned;
(c) The Tribunal laid much stress on the fact that one of the respondents herein, namely, Sanjaybhai Page 19 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 Manjibhai Gadhesariya, had retracted his statement under Section 108 of the Act from jail;
(d) The Tribunal recorded a finding that no evidence had been brought on record to indicate that the respondents herein had attempted to export 25 kgs.
of the Ketamine Hydrochloride Powder.
16. Being dissatisfied with the aforesaid order passed by the Tribunal, the Revenue is here before this Court with the present Tax Appeals.
SUBMISSIONS ON BEHALF OF THE REVENUE :
17. Mr.Dhaval D.Vyas, the learned senior standing counsel appearing for the Revenue, vehemently submitted that the Tribunal committed a serious error in passing the impugned order. According to Mr.Vyas, the Tribunal completely ignored, or rather, overlooked the thumping and convincing evidence on record pointing towards the involvement of the respondent in the illegal export of the Ketamine. Mr.Vyas would submit that the Ketamine Hydrochloride Powder being 25 kgs. was physically seized and was ordered to be confiscated under Section 113(d) of the Act 1962. The order of confiscation never came to be challenged and the same has attained finality.
18. Mr.Vyas would submit that during the investigation the statements of the accomplices, the retrieval of the emails Page 20 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 operated by the respondent and the international despatch details reveal that an approximate 165 kgs. of the Ketamine Hydrochloride Powder had been procured by Sanjay from Aurangabad which was later exported without obtaining the permission from the Narcotics Commissioner. In such circumstances, the Ketamine Hydrochloride Powder of the quantity of 165 kgs. was not physically available and, therefore, the order of confiscation under Section 113(d) of the Act 1962 could not be passed. He would submit that the penalties under Section 114(i) of the Act 1962 have been imposed on Sanjay and Kishan having regard to the role played by both in illegally exporting the Ketamine.
19. Mr.Vyas would submit that there are statements of the respondents herein recorded under Section 108 of the Act practically admitting everything, more particularly, the mode and manner in which the 165 kgs. of the Ketamine was illegally exported in the past and also in what manner the 25 kgs. of the Ketamine which was to be exported but which came to be seized by the DRI officials.
20. Mr.Vyas would submit that the retraction of such statement recorded under Section 108 of the Act would not absolve the respondents from their liability to pay the penalty.
21. In such circumstances referred to above, Mr.Vyas prays that both the appeals be allowed as there being merit in the substantial question of law raised by the Revenue. He prays that the substantial question of law be answered in favour of the Revenue and against the respondents/assessees.
Page 21 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 SUBMISSIONS ON BEHALF OF THE RESPONDENTS/ ASSESSEES :
22. Mr.D.K.Trivedi, the learned counsel appearing for the assessees, vehemently submitted that no error, not to speak of any error of law, could be said to have been committed by the Tribunal in quashing the order imposing the penalty under Section 114(i) of the Act 1962.
23. According to Mr.Trivedi, the question of law as raised by the Revenue cannot be termed as a substantial question of law for the purpose of Section 130 of the Act 1962. According to Mr.Trivedi, what has been decided by the Tribunal is nothing but a pure question of fact.
24. Mr.Trivedi would submit that the impugned order passed by the Tribunal is a well-reasoned order. The Tribunal has set- aside the penalties imposed on both the assessees. Even if it is possible to take a different view than the one taken by the Tribunal, this Court may not interfere. The view taken by the Tribunal could be said to be a plausible view.
25. Mr.Trivedi would submit that the allegation of export of 165 kgs. of the Ketamine Hydrochloride Powder is baseless and there is no legal evidence to substantiate such allegations. Mr.Trivedi would submit that the Adjudicating Authority failed to take into consideration the fact that the statements recorded under Section 108 of the Act came to be retracted before the Page 22 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 Chief Judicial Magistrate on 4th July 2009. He would submit that the emails relied upon by the Revenue were collected from unknown sources. No incriminating documents were found from any of the premises of the respondents herein.
26. Mr.Trivedi would submit that the department has failed to adduce any credible evidence as to when the export of the Ketamine Hydrochloride Powder took place. He would also submit that the Adjudicating Authority has not been able to indicate in any manner as to what preparation the respondents herein had made for the alleged illegal export of the 25 kgs. of the seized consignment.
27. He would submit that the procedure as prescribed under Section 138(c) of the Act 1962 was not followed before taking the printouts of the emails. There is no certificate from the person who had operated and was incharge of the computer.
28. In such circumstances referred to above, Mr.Trivedi prays that there being no merit in both the appeals, those may be dismissed.
ANALYSIS :
29. Having heard the learned counsel appearing for the parties and having gone through the materials on record, the only question that falls for our consideration is, whether the Tribunal committed any error in passing the impugned order.
Page 23 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 SCOPE OF APPEAL UNDER SECTION 130 OF THE ACT 1962 :
30. At the first blush, it would appear that what has been decided by the Tribunal could be termed as a question of fact. Whether a consignment of Ketamine Hydrochloride Powder was improperly exported or there was an attempt to improperly export, would essentially be a question of fact. However, even while deciding the same, if the Tribunal overlooks certain basic principles of law applicable to the case on hand and records a finding which could be termed as perverse, then definitely, such decision of the Tribunal would give rise to a question of law.
31. Although the expression 'substantial question of law' has not been defined in any Act or in any of the statutes, yet the true meaning and connotation of this expression is now well-settled by various judicial pronouncements. It was observed by the Supreme Court in Sir Chunilal V.Mehta & Sons Ltd. vs. Century Spg. & Mfg. Co. Ltd. [1962 AIR 1314 : 1962 SCR Supl. (3) 549] that "a question of law would be a substantial question of law if it directly or indirectly affects the rights of parties and/or there is some doubt or difference of opinion on the issue". But "if the question is settled by the Apex Court or the general principles to be applied in determining the question are well-settled, mere application of it to a particular set of facts would not constitute a substantial question of law." Where the determination of the issue depended upon the appreciation of evidence or materials resulting in ascertainment of basic facts without application of any principle of law, the issue merely raises a question of fact. A Page 24 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 question of fact becomes a question of law, if the finding is either without any evidence or material, or if the finding is contrary to the evidence, or is perverse or there is no direct nexus between the conclusion of fact and the primary fact upon which that conclusion is based. But, it is not possible to turn a mere question of fact into a question of law by asking whether as a matter of law the authority came to a correct conclusion upon a matter of fact. Where the determination of an issue depends upon the appreciation of evidence or materials resulting in ascertainment of basic facts without application of any principle of law, the issue raises a mere question of fact.
32. The Delhi High Court, in DCIT vs. Marudhar [245 ITR 138], laid down the following four tests to determine whether the question involved is one of fact or law :
"(1) As the Tribunal is the ultimate fact-finding authority, if it has reached certain findings upon examination of all relevant evidence and materials before it, the existence or otherwise of certain facts at issue is a question of fact.
(2) Any inference from certain facts is also a question of fact. If a finding of fact is arrived at by the Tribunal after improperly rejecting evidence, a question of law can arise.
(3) While the Tribunal acts on materials partly relevant and partly irrelevant, it can give rise to a question of law if it is impossible to say to what extent the irrelevant material was used to arrive at the finding. Such a finding is vitiated Page 25 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 because of the use of inadmissible material.
(4) Where any finding is based on no evidence or material, it involves a question of law."
33. In the aforesaid context, and more particularly, keeping in mind the evidence in the form of statements recorded under Section 108 of the Act, we must look into the observations of the Supreme Court in the case of Collector of Customs, Madras and others vs. D. Bhoormall reported in AIR 1974 SC 859, which reads thus:
"31 It cannot be disputed that in proceeding for imposing penalties under Clause (8) of Section 167 to which Section 178-A does not apply, the burden of proving that the goods are smuggled goods, is on the Department. This is a fundamental rule relating to proof in all criminal or quasi- criminal proceedings, where there is no statutory provision to the contrary. But in appreciating its scope and the nature of the onus cast by it, we must pay due regard to other kindred principles, no less fundamental, of universal application. One of them is that the prosecution or the Department is not required to prove its case with mathematical precision to a demonstrable degree; for, in all human affairs, absolute certainty is a myth, and as Prof. Brett felicitously puts it all exactness is a fake El Dorado of absolute proof being unattainable, the law accepts for it, probability as a working substitute in this work a day world. The law does not require the prosecution to prove the Page 26 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 impossible. All that it requires is the establishment of such a degree of probability that a prudent man may, on its basis, believe in the existence of the fact in issue. Thus, legal proof is not necessarily perfect proof; often it is nothing more than a prudent man's estimate as to the probabilities of the case.
32 The other cardinal principle having an important bearing on the incidence of burden of proof is that sufficiency and weight of the evidence is to be considered to use the words of Lord Mansfield in Batch v. Archer (1774) 1 Cowp. 63 "according to the proof which it was in the power of one side to prove, and in the power of the other to have contradicted". Since it is exceedingly difficult, if not absolutely impossible, for the prosecution to prove facts which are especially within the knowledge of the opponent or the accused, it is not obliged to prove them as parts of its primary burden."
34. In the case of A.N.Guha & Co. vs. Collector [1996 (86) E.L.T. 333], the CESTAT, West Zonal Branch, Mumbai held that it is not necessary for the department to establish a fact with mathematical precision. Once the presumption as to the existence of a fact is raised against the assessee that the input has not been transported in the vehicle mentioned in the invoices, it is reasonable to say that the inputs were not received in the factory. In the case of R.V.E. Venkatachala Gounder vs. Arulmigu Viswesaraswami & V. P. (order dated 8th October 2003 in Civil Appeal No. 10585 of 1996), the Supreme Court held as follows:
Page 27 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 "Whether a civil or a criminal case, the anvil for testing of 'proved', 'disproved' and 'not proved', as defined in Section 3 of the Indian Evidence Act, 1872 is one and the same. A fact is said to be 'proved' when, if considering the matters before it, the Court either believes it to exist, or considers its existence so probable that a prudent man ought, under the circumstances of a particular case, to act upon the supposition that it exists. It is the evaluation of the result drawn by applicability of the rule, which makes the difference. "The probative effects of evidence in civil and criminal cases are not however always the same and it has been laid down that a fact may be regarded as proved for purposes of a civil suit, though the evidence may not be considered sufficient for a conviction in a criminal case.
BEST says : There is a strong and marked difference as to the effect of evidence in civil and criminal proceedings. In the former a mere preponderance of probability, due regard being had to the burden of proof, is a sufficient basis of decision : but in the latter, especially when the offence charged amounts to treason or felony, a much higher degree of assurance is required. (BEST, S.95). While civil cases may be proved by a mere preponderance of evidence, in criminal cases the prosecution must prove the charge beyond reasonable doubt." (See Sarkar on Evidence, 15th Edition, pp. 58-59) In the words of Denning LJ (Bater V.B, 1950, 2 All ER 458,
459) "It is true that by our law there is a higher standard of proof in criminal cases then in civil cases, but this is subject Page 28 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 to the qualification that there is no absolute standard in either case. In criminal cases the charge must be proved beyond reasonable doubt, but there may be degrees of proof within that standard. So also in civil cases there may be degrees of probability." Agreeing with this statement of law, Hodson, LJ said "Just as in civil cases the balance of probability may be more readily fitted in one case than in another, so in criminal cases proof beyond reasonable doubt may more readily be attained in some cases than in others. (Hornal V. Neuberger P. Ltd, 1956 3 All ER 970, 977)."
35. In the case of Collector of Customs, Madras vs. D.Bhoormul (supra), the Court further held as follows :
"It cannot be disputed that in proceeding for imposing penalties, under Clause (8) of S.167 to which S. 178-A does not apply, the burden of proving that the goods are smuggled goods, is on the Department. This is a fundamental rule relating to proof in all criminal or quasi- criminal proceedings, where there is no statutory provision to the contrary. But in appreciating its scope and the nature of the onus cast by it, we must pay due regard to other kindred principles, no less fundamental, of universal application. One of them is that the prosecution or the Department is not required to prove its case with mathematical precision to a demonstrable degree; for, in all human affairs, absolute certainty is a myth, and as Prof Brett felicitously puts it all exactness is a fake" El Dorado of absolute proof being unattainable, the law accepts for it, probability as a working substitute in this work-a-day Page 29 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 world. The law does not require the prosecution to prove the impossible. All that it requires is the establishment of such a degree of probability that a prudent man may, on its basis, believe in the existence of the fact in issue. Thus, legal proof is not necessarily perfect proof; often it is nothing more than a prudent man's estimate as to the probabilities of the case. The other; cardinal principle having an important bearing on the incidence of burden of proof is that sufficiency and weight of the evidence is to be considered - to use the words of Lord Mansfield in Batch v. Archer (1774)1 Cowp. 63 "according to the proof which it was in the power of one side to prove, and in the power of the other to have contradicted".
Since it is exceedingly difficult, if not absolutely impossible, for the prosecution to prove facts which are especially within the knowledge of the opponent or the accused, it is not obliged to prove them as parts of its primary burden. Smuggling is clandestine conveying of goods to avoid legal duties. Secrecy and stealth being its covering guards, it is impossible for the Preventive Department to unravel every link of the process. Many facts relating to this illicit business remain in the special or peculiar knowledge of the person concerned in it. On the principle underlying S.106, Evidence Act, the burden to establish those facts is cast on, the person concerned; and if he fails to establish or explain those facts, an adverse inference of facts may arise against him, which coupled with the presumptive evidence adduced by the prosecution or the Department would rebut the initial presumption of innocence in favour of that person, and in the result prove him guilty. As pointed out by Best in 'Law of Evidence', (12th Edn. Article 320, page 291), the Page 30 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 "Presumption of innocence is, no doubt, presumption juris, but every day's practice shows that it may be successfully encountered by the presumption of guilt arising from the recent (unexplained) possession of stolen property", though the latter is only a presumption of fact - Thus the burden on the prosecution or the Department may be considerably lightened even by such presumption of fact arising in their favour. However, this does not mean that the special or peculiar knowledge of the person proceeded against will relieve the prosecution or the Department altogether of the burden of producing some evidence in respect of that fact in issue. It will only alleviate that burden to discharge which very slight evidence may suffice."
36. The concepts of 'reasonable doubt' and 'preponderance of probability' have been lucidly explained by the Supreme Court in the case of State of Rajasthan vs. Mohan Lal [2009 (237) E.L.T. 435 (S.C.)] as follows:
"36. Doubts would be called reasonable if they are free from a zest for abstract speculation. Law cannot afford any favourite other than truth. To constitute reasonable doubt, it must be free from overemotional response. Doubts must be actual and substantial doubts as to the guilt of the accused persons arising from the evidence, or from the lack of it, as opposed to mere vague apprehensions. A reasonable doubt is not an imaginary, trivial or a merely possible doubt, but a fair doubt based upon reason and common sense. It must grow out of the evidence in the case.Page 31 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022
C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022
37. The concepts of probability, and the degrees of it, cannot obviously be expressed in terms of units to be mathematically enumerated as to how many of such units constitute proof beyond reasonable doubt. There is an unmistakable subjective element in the evaluation of the degrees of probability and the quantum of proof. Forensic probability must in the last analysis, rest on robust common sense and, ultimately, on the trained intuitions of the Judge...."
RELEVANT PROVISIONS OF LAW :
37. Section 113(d) of the Act 1962 is reproduced below :
"113(d) Confiscation of goods attempted to be improperly exported, etc. The following export goods shall be liable to confiscation : -
(a) to (c) xxx xxx
(d) any goods attempted to be exported or brought within
the limits of any customs area for the purpose of being exported, contrary to any prohibition imposed by or under this Act or any other law for the time being in force;"
38. The word 'prohibition' has been derived from the word 'prohibit' which means to forfeit by law or authority.
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39. Section 2(33) of the Act 1962 defines what is prohibited goods, which is as follows :
"'prohibited goods' means any goods the import or export of which is subject to any prohibition under this Act or any other law for the time being in force but does not include any such goods in respect of which the conditions subject to which the goods are permitted to be imported or exported, have been complied with;"
40. Section 114(i) of the Act 1962 reads thus :
"114. Penalty for attempt to export goods improperly, etc. Any person who, in relation to any goods, does or omits to do any act which act or omission would render such goods liable to confiscation under section 113, or abets the doing or omission of such an act, shall be liable, -
(i) in the case of goods in respect of which any prohibition is in force under this Act or any other law for the time being in force, to a penalty not exceeding three times the value of the goods as declared by the exporter or the value as determined under this Act whichever is the greater;"
41. The order passed by the Adjudicating Authority and the Tribunal are based on the statements of the opponents recorded under Section 108 of the Act 1962 and also on the statements of the other persons involved in the racket.
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42. Sections 107, 108 and 125 respectively of the Customs Act, 1962 relevant for the purposes of this case are quoted as below:
"SECTION 107. Power to examine persons.--Any officer of customs empowered in this behalf by general or special order of the Commissioner of Customs may, during the course of any enquiry in connection with the smuggling of any goods,--
(a) require any person to produce or deliver any document or thing relevant to the enquiry;
(b) examine any person acquainted with the facts and circumstances of the case.
SECTION 108. Power to summon persons to give evidence and produce documents.-
(1) Any Gazetted officer of Customs shall have power to summon any person whose attendance he considers necessary either to give evidence or to produce a document or any other thing in any inquiry which such officer is making under this Act.
(2) A summons to produce documents or other things may be for the production of certain specified documents or things or for the production of all documents or things of a certain description in the possession or under the control of the person summoned.
Page 34 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 (3) All persons so summoned shall be bound to attend either in person or by an authorised agent, as such officer may direct; and all persons so summoned shall be bound to state the truth upon any subject respecting which they are examined or make statements and produce such documents and other things as may be required:
Provided that the exemption under section 132 of the Code of Civil Procedure, 1908 (5 of 1908), shall be applicable to any requisition for attendance under this section.
(4) Every such inquiry as aforesaid shall be deemed to be a judicial proceeding within the meaning of section 193 and section 228 of the Indian Penal Code, 1860 (45 of 1860).
SECTION 125. Option to pay fine in lieu of confiscation.-
(1) Whenever confiscation of any goods is authorised by this Act, the officer adjudging it may, in the case of any goods, the importation or exportation whereof is prohibited under this Act or under any other law for the time being in force, and shall, in the case of any other goods, give to the owner of the goods or, where such owner is not known, the person from whose possession or custody such goods have been seized, an option to pay in lieu of confiscation such fine as the said officer thinks fit:
Provided that, without prejudice to the provisions of the proviso to subsection (2) of section 115, such fine shall not Page 35 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 exceed the market price of the goods confiscated, less in the case of imported goods the duty chargeable thereon.
(2) Where any fine in lieu of confiscation of goods is imposed under subsection (1), the owner of such goods or the person referred to in sub-section (1), shall, in addition, be liable to any duty and charges payable in respect of such goods."
43. The Supreme Court, while interpreting Sections 107 and 108 respectively of the Customs Act, held in Romesh Chandra Mehta vs. State of West Bengal, MANU/SC/0282/1968 : (1969) 2 SCR 461, that any statement made by a person against whom an enquiry is made by a Customs Officer is not a statement made by a person accused of an offence, but he being an officer concerned or the person in authority, Section 24 of the Indian Evidence Act would be attracted and which provides that a confession made by an accused is irrelevant in a criminal proceedings, if the making of the confession appears to the Court to have been caused by any inducement, threat or promise having reference to the charge against accused persons, proceeding from a person in authority and sufficient in the opinion of the Court, to give the accused person grounds, which would appear to him reasonable, for supposing that by making it he would gain any advantage or avoid any evil of a temporal nature in reference to the proceedings against him.
44. In Collector of Customs, Madras and others vs. D.Bhoormall, MANU/SC/0237/1974 : (1974) 2 SCC 544, while examining the provisions of Sections 167(8) and 178A of the Sea Customs Act, the Supreme Court held:
Page 36 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 "33. Another point to be noted is that the incidence, extent and nature of the burden of proof for proceedings for confiscation under the first part of the entry in the 3rd column of Clause (8) of Section 167, may not be the same as in proceedings when the imposition of the other kind of penalty under the second part of the entry is contemplated.
We have already alluded to this aspect of the matter. It will be sufficient to reiterate that the penalty of confiscation is a penalty in rem which is enforced against the goods and the second kind of penalty is one in personam which is enforced against the person concerned in the smuggling of the goods. In the case of the former, therefore, it is not necessary for the Customs authorities to prove that any particular person is concerned with their illicit importation or exportation. It is enough if the Department furnishes prima facie proof of the goods being smuggled stocks. In the case of the latter penalty, the Department has to prove further that the person proceeded against was concerned in the smuggling."
45. In K.T.M.S. Mohd. and another vs. Union of India, MANU/ SC/0349/1992 : (1992) 3 SCC 178, the Court made a distinction between the provisions of the FERA and the Income Tax Act held in para 31 as follows :
"31. Leave apart, even if the officers of the Enforcement intend to take action against the deponent of a statement on the basis of his inculpatory statement which has been subsequently repudiated, the officer concerned must take both the statements together, give a finding about the nature Page 37 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 of the repudiation and then act upon the earlier inculpatory one. If on the other hand, the officer concerned bisects the two statements and make use of the inculpatory statement alone conveniently bypassing the other, such a stand cannot be a legally permissible because admissibility, reliability and the evidentiary value of the statement of the inculpatory statement depend on the bench mark of the provisions of the Evidence Act and the general criminal law."
46. Holding in categorical terms that Section 24 of the Indian Evidence Act shall apply, it was held:
"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 Custom 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 is to be noted that merely because a statement is retracted, 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 Page 38 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 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 a voluntary one should apply its mind to the retraction and reject the same in writing. It is 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 Customs Act etc. the detaining authority should consider the subsequent retraction and record its opinion before accepting the inculpatory statement lest the order will be vitiated."
47. The Court then held in para 25 that the initial burden to prove that the confession was voluntary in nature, would be on the department. The special or peculiar knowledge of the person proceeded against would not relieve the prosecution or the Department altogether of the burden of producing some evidence in respect of that fact in issue.
48. In Vinod Solanki v. Union of India, MANU/SC/8446/ 2008: 2009 (233) ELT 157 (SC), the Supreme Court considered the effect of retraction of the statement in proceedings of penalty under Foreign Exchange Regulation Act, 1973. The Supreme Court held that indisputably a confession made by an accused would come within the purview of Section 24 of the Indian Evidence Act, 1872. The proceedings under the Act are quasi criminal in nature. Section 50 of the Act is penal provision. It prescribes that in the event of contravention of any of the provisions of the Act or the Rules, directions or order penalty in Page 39 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 exceeding 5 times of the amount of value involved in any such contravention may be imposed. Section 71 of the Act provides for burden of proof in certain cases. Sub-section (2) of Section 71 provides for burden of proof that foreign exchange acquired by such person, has been used for the purpose for which permission to acquire was granted, shall be on such person. The Act as Special Act confers various powers under the authorities. Even if salutary principle 'mens rea' and 'actus reus' in the proceedings under the Act may not be held to be applicable, it is now a settled principle that presumption of innocence as contained in Article 14(2) of the International Covenant on civil and political rights is a human right, although per see it may not be treated to be a fundamental right within the meaning of Article 21 of the Constitution of India. Sub-section (2) of Section 71 places burden of proof upon an accused or proceedee only when the foreign exchange acquired has been used for the purpose for which permission to acquire it was granted and not for mere possession thereof. The Parliament advisedly did not make any provision placing the burden of proof on the accused/ proceedee.
49. In para 22 the Supreme Court said :
"22. It is a trite law that evidence brought on record by way of confession which stood retracted must be substantially corroborated by other independent and cogent evidences, which would lend adequate assurance to the Court that it may seek to rely thereupon. We are not oblivious of some decisions of this Court wherein reliance has been placed for supporting such contention but we must also notice that in Page 40 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 some of the cases retracted confession has been used as a piece of corroborative evidence and not as the evidence on the basis whereof alone a judgment of conviction and sentence has been recorded." [See Pon Adithan v. Deputy Director, Narcotics Control Bureau, Madras, MANU/SC/ 0403/1999 : (1999) 6 SCC 1].
50. In K.I. Pavunny vs. Assistant Collector (HQ), Central Excise Collectorate, Cochin, MANU/SC/2070/1997 : (1997) 3 SCC 721, it was held that a person suspected by a Customs Officer is not an accused at that stage. He becomes an accused only when summons are issued by a competent Court/ Magistrate pursuant to a complaint lodged by the competent Customs Officer. His statement recorded under Section 108 or during confiscation proceedings is not that of an accused within the meaning of Section 24 of the Evidence Act. The Customs Officer in such case although not police officer, is an authority within the meaning of Section 24 of the Evidence Act. The evidence is admissible under Section 135 of the Customs Act, although subsequently retracted, if on facts found voluntary and truthful. Only in such case it can form exclusive basis for conviction. It is, however, a rule of prudence and practice that the Court seeks assurance from other facts and circumstances to corroborate retraction of confession. The Supreme Court held that object of the Act in empowering the Customs Officer to record evidence under Section 108 is to collect information of the contravention of the provisions of the Act or concealment of the contraband, to avoid or avoidance of the duty of excise so as to enable them to collect the evidence of the proof of contravention of the provisions of the Act for initiating proceedings for further action Page 41 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 of confiscation of the contraband or imposition of penalty. By virtue of authority of law the officer exercises the power under the Act is an authority, within the meaning of Section 24 of the Evidence Act.
51. There is no prohibition under the Evidence Act to rely upon retracted confession to prove the prosecution case so as to make the same the basis for conviction of the accused. The practice and prudence require that the Court could examine the evidence adduced by the prosecution to find out whether there were any other facts and circumstances to corroborate the retracted confession. It is not necessary that there should be corroboration from independent evidence adduced by the prosecution to corroborate each detail contained on the confessional statement. The Court is required to examine whether the confessional statement was voluntary; in other words whether it was not obtained by threat, duress or promise. If the Court is satisfied from the evidence that it was voluntary, then it is required to examine whether the statement is true. If the Court on examination of the evidence finds that the retracted confession is true, that part of the inculpatory portion could be relied upon to base the conviction. However, prudence and practice require that the Court would seek assurance getting corroboration from other evidence adduced by the prosecution.
WHAT WOULD CONSTITUTE AN 'ATTEMPT' :
52. In the matter of petition of R.Maccrea MANU/UP/ 0046/1893 : ILR [(1893) All. 173], Knox, J. observed as follows :-
Page 42 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 "It is no doubt most difficult to frame a satisfactory and exhaustive definition which shall lay down for all cases where preparation to commit an offence ends and where attempt to commit that offence begins. The question is not one of mere proximity in time or place. Many offences can easily be conceived where, with all necessary preparations made, a long interval will still elapse between the hour when the attempt to commit the offence commences and the hour when it is completed. The offence of cheating and inducing delivery is an offence in point. The time that may elapse between the moment when the preparations made for committing the fraud are brought to bear upon the mind of the person to be deceived and the moment when he yields to the deception practised upon him may be a very considerable interval of time. There may be the interposition of inquiries and other acts upon his part. The acts whereby those preparations may be brought to bear upon his mind may be several in point of number, and yet the first act after preparations completed will, if criminal in itself, be beyond all doubt, equally an attempt with then inety and ninth act in the series.
Again the attempt once begun and a criminal act done in pursuance of it towards the commission of the act attempted, does not cease to be a criminal attempt, in my opinion, because the person committing the offence does or may repent before the attempt is completed. The attempt to defraud a widow of valuable security commenced by an act of criminal intimidation committed in such attempt and Page 43 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 towards the fraud does not cease to be an attempt because the perpetrator repents and abstains from completing the attempt.
The question whether the act is an act of preparation or an act in the attempt and towards commission is a fact to be determined upon the evidence. It is in most cases a question for the jury to distinguish between an act before attempt has begun, an act after attempt begun, and towards commission of the offence attempted, and an act independent of the attempt altogether."
53. Blair, J., concurring with Knox, J., observed as follows :-
"It seems to me that section uses the word 'attempt' in a very large sense; it seems to imply that such an attempt may be made up of a series of acts, and that any one of those acts done towards the commission of the offence, that is, conducive to its commission, is itself punishable, and though the act does not use the words, it can mean nothing but punishable as an attempt. It does not say that the last act which would form the final part of an attempt in the larger sense is the only act punishable under the section. It says expressly that whosoever in such attempt, obviously using the word in the larger sense, does may act, shall be punishable. The term 'any act' excludes the notion that the final act short of actual commission is alone punishable, and the notion that any of the other acts would be without the ranges of this section is probably derived from the ruling in Page 44 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 the English cases cited...........
*** The difficulty with s. 511 might easily have been removed by saying that where in such an attempt using the word in the larger sense, any person does any act towards the commission of an offence he shall be held to have committed an 'attempt' within the meaning of this section. That I take to be the real meaning and drift of the section, differentiating in a marked manner the definition of 'attempt' in the definition of 'attempt' in the Indian Penal Code and the accepted English doctrine."
54. In Queen Empress vs. Luzman Narayan Joshi (1899) 2 Bom. LR 286, Sir Lawrence Jenkins, C.J., defined 'attempt' as "an intentional preparatory action which failed in object through circumstances independent of the person who seeks its accomplishment. In Queen Empress v. Vinayak Narayan Bhartye (1899) 2 Bom. LR 304, the same learned judge defined "attempt" as "when a man does an intentional act with a view to attain a certain end, and fails in his object throughout some circumstances independent of his own will".
55. In Emperor vs. Ganesh Balwant Modak MANU/MH/0005/ 1909 : ILR (1910) 34 Bom. 378, a Division Bench of the High Court at Bombay, consisting of Chandavarkar and Heaton, JJ., held as follows :-
Page 45 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 "Under the Indian Penal Code (Act XLV of 1860) all that is necessary to constitute an attempt to commit an offence is some external act, something tangible and ostensible or which the law can take hold as an act showing progress towards the actual commission of the offence. It does not matter that the progress was interrupted."
56. In Jaimal vs. Emperor (MANU/LA/0474/1926 : Air 1926 Lahore 147), Shadi Lal, C.J., opined as follows :-
"....When a man does an intentional act with a view to attain a certain end and fails in his object through circumstances independent of his own will, then that man has attempted to effect the object at which he aimed."
57. In Rama Mat Ali vs. Emperor AIR 1927 Lah 634. Tekchand, J., relied on the dictum of the Bench of the High Court at Bombay in Ganesh Balwant Modajk v. Emperor MANU/MH/ 0005/1909 : ILR (1910) 34 Bom. 378, and, on the facts upheld the conviction for attempt to cheat.
58. In Narayanaswamy Pillai vs. Emperor (1932) MWN 545, the accused was held not to be guilty under section 511 of the Indian Penal Code, because though he intended to transport opium into French territory, he was frustrated before he crossed the border.
59. In Asgarali Pradhantha vs. Emperor ILR (1934) Cal. 54, a Bench of the High Court at Calcutta, consisting of Lord-Williams Page 46 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 and Mcnair, JJ., chose to sum up the law in India on the aspect of "attempt" in the following terms :-
"So far as the law in India is concerned, it is beyond dispute that there are four stages in every crime, the intention to commit, the preparation to commit, the attempt to commit and, if the third stage is successful, the commission itself. Intention alone or intention followed by preparation are not sufficient to constitute and attempt. But intention followed by preparation followed by any 'act done towards the commission of the offence' is sufficient. 'Act done towards the commission of the offence' are the vital words in this connection."
60. In Veerayya vs. Emperor (1935) MWN 651, Burn J., held that the accused, who was found to be making some preliminary diggings, which were necessary to remove the earth so that he would get at a stone slab fixed to a Buddhist stups, was not guilt under section 511, Indian Penal Code, and the learned Judge further held that his act amounted to a preparation and not to an attempt to commit theft.
61. In Muniratnam Reddi, In re : (1955) AWR 53, a Bench of the High Court of Judicature of Andhra at Guntur, consisting of Subba Rao, C.J., as he then was, and Satyanarayana, J., while defining "attempt to commit murder" pointed out as follows :-
"The crucial words in section 511, Indian Penal Code, are that the accused should have done the act, 'towards the Page 47 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 commission of the offence.' The two illustrations appended to the section bring out the intention of the Legislature.
There are decided cases which recognise the existence of three stages in the commission of crime (1) intention to commit, (2) preparation to commit, and (3) attempt to commit. If the attempt results in the actual commission of the offence, the crime is complete. But the Indian Penal Code makes the attempt also an offence, if the accused does any act towards the commission of the offence, the distinction between preparation and attempt may be clear in some cases, but in most of the cases the dividing line is very thin. Nonetheless it is a real distinction. The crucial test is whether the last act, if uninterrupted and successful, would constitute a crime. If the accused intended that the natural consequence of his act should result in death but he was frustrated only by extraneous circumstances he would be guilty of an attempt to commit the offence of murder. The question is really one of fact depending upon the circumstances of each case."
62. In State of U.P. vs. Ram Charan MANU/UP/0092/1962 :
AIR 1962 All 359, a Bench of the High Court at Allahabad, consisting of Takru and Sharma, JJ., after extracting the following passage occurring in Russel in his well-Known Treatise on Crimes, 8th Edition, Volume 1, pages 145 and 148, held that the passage reflects the subject of the Indian law also.
"The question in each case is whether the acts relied on Page 48 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 constituting the attempt were done with intent to commit the complete offence, and as one or more of a series of acts or omissions directly forming some of the necessary steps towards completing that offence, but falling short of completion by the intervention of clauses outside the volition of the accused, or because the offender of his own free will desisted from completion of his criminal purpose for some reason other than mere change of mind."
63. In State vs. Parasmal MANU/RH/0014/1969, Tyagi, J., defined "attempt" in the following terms :
".... When a person intends to commit a particular offence and then he conducts himself in such a manner which clearly indicates his desire to translate that intention into action, and in pursuance of such an intention if he does something which may help him to accomplish that desire, then it can safely be held that he committed an offence of attempt to commit a particular offence. It is not necessary that the act which falls under the definition of an attempt should in all circumstances be a penultimate act towards the commission of that offence. That act may fall at any stage during the series of acts which go to constitute an offence under section 511 of the Indian Penal Code."
64. In Abhayanand vs. State of Bihar, MANU/SC/ 0124/1961 :
1961 CriLJ 822, two learned judges of the Supreme Court approved the decision and the reasons therefore in the matter of the petition of R.Maccrea, MANU/UP/0046/1893 : ILR (1893) Page 49 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 All. 173 and the views of the Supreme Court were summarised in paragraph 26 of the Judgment as follows :
"We may summarise our views about the construction of S. 511, I.P.C., thus : A person commits the offence of attempt to commit a particular offence. When (i) he intends to commit that particular offence; and (ii) he, having made preparations and with intention to commit the offence, does an act towards its commission; such an act need not be the penultimate act towards the commission of that offence but must be an act during the course of committing that offence."
65. In Malkiat Singh vs. State of Punjab - MANU/SC/ 0534/1969 : 1970 CriLJ 750, three learned judges of the Supreme Court dealt with a case where paddy, booked by a firm in Punjab to consignee to Delhi, was carried in a lorry driven by the first appellant and the lorry was stopped by the police at a place which was 32 miles from Delhi, that is, inside the State of Punjab (the Punjab Delhi boundary was 18 miles from Delhi), and the appellants, along with others, were prosecuted and convicted for an offence under section 7 of the Essential Commodities Act, and the Supreme Court, while holding that no offence has been committed by the appellant nor was there an attempt to commit an offence analysed the question and expressed its opinion in the following terms :
"... It was merely a preparation on the part of the appellants and as a matter of law a preparation for committing an offence is different from attempt to commit it. The preparation consists in devising or arranging the means or Page 50 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 measures necessary for the commission of the offence. On the other hand, an attempt to commit the offence is a direct movement towards the commission after preparations are made. In order that a person may be convicted of an attempt to commit a crime, he must be shown, first, to have had an intention to commit the offence, and secondly, to have done an act which constitutes the actus reus of a criminal attempt. The sufficiency of the actus reus is a question of law which had led to difficulty because of the necessity of distinguishing between acts which are merely preparatory to the commission of a crime, and those which are sufficiently proximate to it to amount to an attempt to commit it. If a man buys a box of matches, he cannot be convicted of attempted arson, however, clearly it may be proved that he intended to set fire to a haystack at the time of the purchase. Nor can he be convicted of this offence if he approaches the stack with the matches in his pocket, but, if he bends down near the stack and lights a match which he extinguishes on perceiving that he is being watched, he may be guilty of an attempt to burn it. Sir James Stephen, in his digest of Criminal Law, Art. 50 defines an attempt as follows :-
"An act done with intent to commit that crime, and forming part of a series of acts which would constitute its actual commission if it were not interrupted. The point at which such a series of acts begins cannot be defined, but depends upon the circumstances of each particular case. The test for determining whether the act of the appellants constituted an attempt or Page 51 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 preparation is whether the overt acts already done are such that if the offender changes his mind and does not proceed further in its progress, the acts already done would be completely harmless. In the present case it is quite possible that the appellants may have been warned that they had no licence to carry the paddy and they may have changed their mind at any place between Samalkha Barrier and the Delhi-Punjab boundary and not have proceeded further in their journey. Section 8 of the Essential Commodities Act states that 'any person who attempts to contravene, or abets a contravention of, any order made under section 3 shall be deemed to have contravened that order'. But there is no provision in the Act which makes a preparation to commit an offence punishable. It follows therefore that the appellants should not have been convicted under S.7 of the Essential Commodities Act.""
66. In Sudhir Kumar Mukherjee vs. State of West Bengal (1974) II SCJ 2, two learned Judges of the Supreme Court, referred to its earlier pronouncement in Abhayanand vs. State of Bihar AIR SC 1698, but however, on facts held that what the accused did in that case was a definite step towards the commission of cheating, though it was not the penultimate step.
67. In State of Maharashtra vs. Moh. Yakub MANU/SC/ 0239/1980 : 1980 CriLJ 793, the Supreme Court dealt with a case of an attempt of evasion of duty within the meaning of Page 52 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 section 135(1)(a) of the Act. That was a case of an appeal by the State of Maharashtra against an order of acquittal of the respondents by the High Court. The facts run as follows :-
"At about midnight a jeep, driven by respondent 1, and a truck stopped near a bridge at a creek and while the accused started removing some bundles from the truck and placing them aside on the ground, the customs officers, who were following them on the basis of definite information rushed to the spot and accosted the persons present there. At the same time, the sound of the engine of a mechanised seacraft from the side of the creek was heard by the officers. Thereafter, two residents of the area were called for and in their presence silver ingots were recovered from the two vehicles. Some ingots were also found near the footpath leading to the creek. From the personal search of respondent 1, a pistol, a knife and currency notes were found. On questioning he gave false name and address. It was found that the accused were not dealers in silver. The trial court convicted the accused under section 135(1)(a) read with section 135(2) of the Customs Act for attempting to smuggle out of India silver ingots worth about Rs. 8 lakhs in violation of the Foreign Exchange Regulation Act, the Imports and Exports (Control) Act and the Customs Act. But the Additional Sessions Judges acquitted them on the ground that the facts proved by the prosecution fell short of establishing that the accused had 'attempted' to export silver in contravention of the law. The High Court upheld the acquittal."Page 53 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022
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68. Sarkaria, J. defined as to what would constitute an 'attempt' in paragraph 13 of the judgment as follows :-
"Well then, what is an 'attempt' ? Kenny in his Outlines of Criminal Law defined 'attempt' to commit a crime as the 'last proximate act which a person does towards the commission of an offence, the consummation of the offence being hindered by circumstances beyond his control'. This definition is too narrow. What constitutes an 'attempt' is a mixed question of law and fact, depending largely on the circumstances of the particular case. 'Attempt' defies a precise and exact definition. Broadly speaking, all crimes which consist of the commission of affirmative acts are preceded by some covert or overt conduct which may be divided into three stages. The first stage exists when the culprit first entertains the idea or intention to commit an offence. In the second stage, he makes preparations to commit it. The third stage is reached when the culprit takes deliberate overt steps to commit the offence. Such overt act or step in order to be 'criminal' need not be the penultimate act towards the commission of the offence. It is sufficient if such act or acts were deliberately done, and manifest a clear intention to commit the offence aimed, being reasonably proximate to the consummation of the offence. As pointed out in Abhayanand Mishra v. State of Bihar MANU/SC/0124/1961 : 1961 CriLJ 822 there is a distinction between 'preparation' and 'attempt'. Attempt begins where preparation ends. In sum, a person commits the offence of 'attempt to commit a particular offence' when
(i) he intends to commit that particular offence; and (ii) he, Page 54 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 having made preparations and with the intention to commit the offence, does an act towards its commission; such an act need not be the penultimate act towards the commission of that offence but must be an act during the course of committing that offence. Chinnappa Reddy, J., concurring with Sarkaria, J., stated the result of search and research on the question in paragraph 32 of the judgment as follows :-
"Let me now state the result of the search and research. In order to constitute 'an attempt', first, there must be an intention to commit a particular offence, second some act must have been done which would, necessarily have to be done towards the commission of the offence, and third, such act must be 'proximate' to the intended result. The measure of proximity is not in relation to time and action but in relation to intention. In other words, the act must reveal, with reasonable certainty, in conjunction with other facts and circumstances and not necessarily in isolation, an intention, as distinguished from a mere desire or object, to commit the particular offence, though the act by itself may be merely suggestive or indicative of such intention, but, that it must be, that is, it must be indicative or suggestive of the intention. For instance, in the instant case, had the truck been stopped and searched at the very commencement of the journey or even at Shirsat Naka, the discovery of silver ingots in the truck might at the worst lead to the inference that the accused had prepared or were preparing for the Page 55 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 commission of the offence. It could be said that the accused were transporting or attempting to transport silver somewhere but it would not necessarily suggest or indicate that the intention was to export silver. The fact that the truck was driven up to a lonely creek from where the silver could be transferred into a sea/faring vessel was suggestive or indicative though not conclusive, that the accused wanted to export the silver. It might have been open to the accused to plead that the silver was not to be exported but only to be transported in the course of inter-coastal trade. But, the circumstance that all this was done in a clandestine fashion, at dead of night, revealed, with reasonable certainty, the intention of the accused that the silver was to be exported.""
69. In Russel on Crime, 12th Edition, Volume I, the elements of liability in attempt were set out as follows :-
"The courts, and the writers, have never purported to find themselves in any special difficulty to define the mens rea of attempt. What they have found difficult is to express with precision a test whereby to decide what constitutes the physical element, the actus reus, of attempt."
"In all crimes it is the law which defines the actus reus; therefore it is important to note that in the crime of attempt the question whether the accused persons conduct did reach a point which constituted an actus reus is one of law for the judge."Page 56 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022
C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 *** "Many suggested definitions of the actus reus of attempt as are to be found in the authorities are so vague as to be useless in practice. The one most commonly cited is contained in the judgment of Parke B. in R. v. Eagleton (1855) dear 515."
"The mere intention to commit a misdemeanour is not criminal. Some act is required and we do not think that all acts towards committing a misdemeanour are indictable. Acts remotely leading towards the commission of the offence are not to be considered as attempts to commit it, but acts immediately connected with it are'. When this portion of the judgment is carefully examined, it will be seen that Baron Parke was not setting out a definition of attempt. He was merely laying down certain necessary characteristics of the crime;"
*** "The position can perhaps be summed up thus. So soon as attempt emerged clearly as a specific crime at common law the courts were faced with the task of defining it, and this was not achieved quickly. Parke B. was concerned to make one point plain and this was that there must be an actus reus, and it must consist in some step taken to achieve the desired end. The whole series of acts from the first done after the purpose was first conceived, along the line until the Page 57 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 ultimate end should be achieved, was available for judicial selection. The learned Baron seems to have favoured the last possible act before the achievement rejecting all earlier steps. Notwithstanding the numerous instances in which the judges since that time have cited R. v. Eagleton with approval it is quite clear that they have not followed this narrow doctrine in all cases."
70. In cases on Criminal law by Kenny, the cases of Regina vs. Cheeseman. Crown case Reserved 1862, stands embodied and therein we get the judgment of Blackburn, J., agreeing with Erle, C.J., on the question of attempt to commit larceny, and the learned Judge observed as follows :-
".... There is, no doubt, a difference between the preparation antecedent to an offence, and the actual attempt. But, if the actual transaction has commenced which would have ended in the crime if not interrupted, there is clearly an attempt to commit the crime...."
71. In Halsbury's Laws of England Halisham Edition, Volume 9, at page 41 "attempt" has been defined in the following terms :-
"Any overt act immediately connected with the commission of an offence, and forming part of a series of acts which, if not interrupted or frustrated, would end in the commission of the actual offence (assuming the commission of that offence to be possible), is if done with a guilty intent, an attempt to commit the offence."Page 58 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022
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72. From the conspectus of the above discussed case-law, Section 113(d) can be divided into two parts. The first part speaks about the goods attempted to be exported and the second part speaks about the goods being brought within the limits of any customs area for the purpose of being exported. In the case on hand, the second part has not come into play because indisputably, the goods, i.e. 25 kgs. of the Ketamine Hydrochloride Powder, were not brought within the limits of the customs area for the purpose of being exported, contrary to the prohibitions. If the goods have come with such an intention within the limits of the customs area, then the second part would definitely be attracted. However, the first part of Section 113(d) covers a larger area. Even, without being brought within the limits of the customs area, there can be an attempt to export the goods in contravention of the prohibitions. To attract the first part of Section 113(d), the process of movement of the goods for the purpose of taking them out of India must be shown to have began.
73. In the context of the present case, we cannot lose sight of the definition of 'export' found in Section 2(18) of the Act. The essential ingredient of export is the taking out of India. The acts complained of must fall in the course of movement of the goods with an intention to take them out of India. All other acts done anterior to this step, namely, movement would only partake the character of preparations. If the respondents have done any act towards the exportation, namely, taking of the goods out of India and if the act or acts could be fitted in the course of such movement of the goods, or, in other words, the act could fall in Page 59 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 the course of progress towards the actual physical taking of the goods out of India, the mischief of Section 113(d) would be attracted. There should be a direct physical movement towards the taking of the goods out of India after all the preparations are made and which preparations may also fall within the satisfaction of the provisions and completion of the formalities under the Act. There must be an act or acts done towards the actual physical movement of the goods with an intention to take them out of India. That alone, in our view, would constitute an attempt to export the goods, that too depending on the facts and circumstances of the case. The essential feature to be taken note of for assessing this question is as to whether the act of the person did reach a point which constituted an actus reus. This question is one of law depending upon the facts and circumstances of the case to be decided by the Court. If there is no taking of the goods out of India, there is no exportation. Hence, 'attempt' must also have relevance to the taking of the goods out of India. We are not concerned with the actual completion of the exportation. We are concerned only with the attempt. But, if no feature which would constitute actus reus or physical element towards taking of the goods out of India is made out on the facts and circumstances of the case, it will be far fetched to invoke the first part of Section 113(d) of the Act.
74. Section 113(d) of the Customs Act makes it clear that the liability of goods for confiscation arise as soon as the goods are attempted to be exported and an attempt to export the goods necessarily precedes the actual export of the goods. This proposition has been propounded by the Full Bench of the Calcutta High Court in the case of Euresian Equipment and Page 60 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 Chemicals Ltd. and others vs. Collector of Customs and others, AIR 1980 Cal 188.
75. In the above said decision, there was a show cause notice issued by the department for taking penal action against the exporter under Section 114 of the Customs Act for violation of Section 12(1) of the Foreign Exchange Regulation Act, 1947. The contention of the department was that by virtue of the amendment of the Foreign Exchange Regulation Act, 1947 it was necessary for the exporter to submit the G.R.I. Forms declaration true in all material particulars under the provisions of Section 12(1) of the said Act. Since this was not done, the export of the goods were liable to prohibition under the above Notification No.G.S.R. 2641 dated 14-11-1969. By virtue of Section 23A the prohibition also falls, under Section 11 of the Customs Act, 1962, and hence the goods were liable to confiscation under Section 113(d) and (1) of the Customs Act, 1962. M/s. Euresian Equipments and Chemicals Ltd., Calcutta, S/Sri Laxmi Prasad Jajodia, Manick Chand Jajodia and Jugal Kishore Jajodia were the persons concerned for the mis-declaration of the goods and values of the goods exported and hence liable for penal action under Section 114(1) of the Customs Act, 1962, M/s. Euresian Equipments and Chemicals Ltd., Calcutta and its directors S/Sri Laxmi Prasad Jajodia, Manick Chand Jajodia and Jugal Kishore Jajodia were called upon to explain the matter in writing and to show cause to the Collector of Customs, Calcutta, why penal action under Section 114 of the Customs Act, 1962 should not be taken against them.
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76. The validity of the above said show cause notice was challenged by the exporter in a writ petition. The learned single Judge rejected the writ application holding that if the export is made on the basis of incorrect declaration under Section 12(1) of the Foreign Exchange Regulation Act, the same would amount to contravention of the Customs Act. On appeal, the matter was referred to the Full Bench and the following questions of law were raised before the Full Bench:
"(1) Whether, by virtue of Section 23A of the Foreign Exchange Regulation Act, 1947, the provisions of Sections 113 and 114 of the Customs Act, 1962 are attracted for the contravention of Section 12(1) of the Foreign Exchange Regulation Act, 1947, in relation to goods which had been exported beyond India.
(2) Whether, when goods have been exported beyond India such goods may be said to be export goods as defined in Section 2(19) of the Customs Act, 1962 and liable to confiscation under Section 113 for the purpose of imposition of penalty under Section 114 of the said Act."
77. The Full Bench of the Calcutta High Court, after hearing the submissions on both sides, answered the above questions of law in the following manner:
"25. We have earlier set out the provisions of Section 11 of the Customs Act which confers power on Central Government to prohibit importation or exportation of goods Page 62 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 for purposes mentioned therein. These purposes indeed cover very very wide fields. Some of the purposes for which the prohibition may be imposed as stated in Section 11(2) are, prevention of smuggling, prevention of shortage of goods of any description and prevention of the contravention of any law for the time being in force. Section 113 provides for liability of the goods to confiscation in case of any violation of the prohibition imposed under Section 11 of the Act and Sections 11 provides for personal penalty for those whose acts or omissions render the goods liable to confiscation under Section 113. To construe the said sections to mean that Section 114 can only be attracted when the goods are attempted to be exported and will have no application when goods have in fact been exported will defeat the purpose and object for which the said provisions have been introduced. The submissions that the Legislature has so intended by using the words attempt to export in Section 113(a), (b) and (d) and the analogy of the offence of attempt to commit suicide given in this connection are, in our opinion, misleading and devoid of merit. An attempt to commit suicide is indeed an offence and the act of committing suicide resuling from the successful attempt may not be considered to be an offence. This is so for the simple reason that once a person attempting to commit suicide succeeds in his attempt he places himself beyond the reach of law and no punishment is intended to be inflicted on the dead person or his heirs and legal representatives by imposing any fine or penalty, as they may in no way be liable or responsible for the said act. As we have earlier observed the liability of the goods to confiscation arises Page 63 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 under Section 113(d), as soon as the goods are attempted to be exported and the attempt to export the goods necessarily precedes the actual export of the goods. Goods become liable to confiscation as soon as the attempt is made. There is no provision in the Act to suggest that this accrued liability is wiped out or extinguished with the exportation of the goods. It may be that after the goods had in fact been exported the liability of the goods to be confiscated may not be enforceable by actual confiscation of the goods. Personal penalty of any person who, in relation to the goods, does or omits to do any act which act or omission renders the goods liable to confiscation under Section 113 or abets the doing or omission of such an act has been provided in Section 114. This provision is attracted as soon as the goods incur the liability to confiscation under Section 113 and such liability, as we have earlier held, arises when the goods are attempted to be exported contrary to any prohibition. It is to be noted that at the time when the goods are sought to be exported they are undoubtedly export goods within the meaning of Section 2(19) of the Customs Act. The liability of personal penalty provided in Section 114 of the Act, which arises with the accrual of the liability of the goods to confiscation under Section 113 of the Act at the stage of the attempt to export the said goods, clearly remains and the said liability is capable of enforcement. In the case of illegal export of any goods contrary to prohibition the effect may be that the liability of the goods to confiscation which arises and accrues may not be capable of enforcement but the personal liability which arises with the accrual of liability of the goods to confiscation can be enforced and by Page 64 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 enforcement of the personal liability the offender can still be brought to book and this kind of offence may be checked. We must, therefore, hold that by virtue of Section 23A of the Foreign Exchange Regulation Act, 1947 the provisions of Sections 113 and 114 of the Customs Act, 1962 are attracted, when there is a contravention of Section 12(1) of the Foreign Exchange Regulation Act, 1947 in relation to goods which had in fact been exported. This was indeed the first question which came up for consideration before the Division Bench and has been referred to the Full Bench and our answer to this question is therefore in the affirmative.
26. An order by the proper officer permitting clearance and leading of the goods under Section 51 of the Customs Act does not effect the position. We have earlier noticed that under Section 113 of the Customs Act export goods incur the liability to confiscation at the stage when they are attempted to be exported. The attempt to export necessarily precedes actual export. At the time of attempting to export the goods contrary to prohibition, the liability of the goods to confiscation arises and at that point of time when the liability to confiscation arises, the goods are goods which are to be taken out of India to a place outside India and are, undoubtedly, export goodsµ within the meaning thereof as defined in Section 2(19) of the Act. Actual export of the goods, as a result of the attempt succeeding subsequent to the stage of the attempt, is not indeed of any material consequence. The goods are export goodsµ as defined in Section 2(19) of the Customs Act, 1962 at the time the goods incur the liability to confiscation under Section 113 of the Page 65 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 said Act. We accordingly answer the second question which came up for consideration before the Division Bench and which has been referred to the Full Bench in the manner indicated above."
INCRIMINATING MATERIALS ON RECORD :
78. In the case on hand, a consignment of the Ketamine Hydrochloride Powder of 165 kgs. had already been exported. If the goods had already been exported, the question of confiscation would not have arisen and that has been rightly observed by the adjudicating Commissioner. The adjudicating Commissioner rightly held that since the goods were not available for confiscation, there is no point in ordering confiscation. Therefore, he proceeded to impose penalty in terms of Section 114 of the Act, which is in accordance with the provisions of the Customs Act.
79. The investigation revealed that the respondent had illegally procured the Ketamine Hydrochloride from Aurangabad for onward export. The Ketamine Hydrochloride is a commonly abused recreational drug known for its sedative qualities. By the Notification No.67(RE-2007) 2004-2009 dated 27.12.2007 issued by the Director General of Foreign Trade, the export of the Ketamine Hydrochloride Powder without the permission/no objection certificate from the Narcotics Commissioner has been prohibited. The goods were seized under Section 43 of the NDPS Act, 1985. The Ketamine Hydrochloride are 'prohibited goods' as per Section 2(33) of the Customs Act, 1962 and liable for Page 66 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 absolute confiscation under Section 125 of the Customs Act, 1961.
80. Under an invoice dated 3.3.2009 issued by M/s. Perfect Chemicals, Aurangabad, the goods in question were transported as Benzahydrol Powder. The goods were delivered to M/s. Choudhary Roadways at Vapi on 5.3.2009. Upon the intelligence received, the premises of Choudhary Roadways was raided and sample of the goods was drawn for the purpose of scientific analysis. The scientific analysis report dated 7.3.2009 revealed that the goods in question were the Ketamine Hydrochloride Powder and not Benzahydrol Powder as declared under the invoice dated 3.3.2009 by M/s Perfect Chemicals. During the investigation it was found that no unit of M/s Perfect Chemicals was existing at the given address.
81. During the course of investigation, the statement of one Nandkishor Rupchand Chaudhary, proprietor of Choudhary Roadways, Vapi was recorded on 19.03.2009 and Rameshwar Amarsingh Takale, In-charge of Choudhary Roadways, was recorded on 19.05.2009. Both the said persons have stated that, the present consignment received from M/s Perfect Chemicals, Aurangabad was for M/s Bhatia Chemicals, Vapi. It was further stated by the said persons that one Jayeshbhai Chunilal Vadaliya, under the written authority of M/s Bhatia Chemicals, Vapi, had been collecting all the consignments, including the present consignment, received from M/s Perfect Chemicals, Aurangabad. During the investigation, it was found that M/s Bhatia Chemicals, Vapi was a bogus company.
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82. Jayeshbhai Vadaliya, who is the relative of the respondent, in his statement dated 3.4.2009 recorded under Section 108 of the Customs Act, 1962, has reiterated the facts stated by him in the earlier statements dated 6.3.2009 and 7.3.2009 respectively as true. He has further stated as under :
"On being shown the following L/Rs (Account Copies) of M/s Choudhary Roadways : 21098, dated 9.5.08 (1 bag) 21904, dated 4.9.08 (1 bag) 22040, dated 23.9.08 (1 bag) 22157, dated 11.10.08 (2 bag) 22489, dated 8.12.08 (2 bag) 22715, dated 19.1.09 (1 bag) 22987, dated 3.3.09 (1 bag) and on perusing the above bilties (L/Rs), he put his dated signature on them and stated that the delivery of goods of the bilties(L/Rs) shown at Sr no.1 to 6 were taken by him from Choudhary Roadways, Vapi at the instructions of Shri Sanjaybhai Gadhesariya; that the goods were brought from Waluj, Aurangabad. Shri Sanjaybhai used to come mostly alone in his Innova car while he used to come on motor bike No. GJ5 DB 745; Shri Sanjay never came to the office of transporter, Choudhary Roadways with him, but he used to stay away in this car; that after taking delivery of the goods, he used to take the same in his car to Surat; that he did not remember the registration number of the car, but the word "Venkatesh" was written on the car; That Shri Kishanbhai had come once with Shri Sanjaybhai to take delivery of one parcel, but he did not remember the exact parcel whose delivery they had come for; Shri Kishanbhai Manjibhai stays at Bungalow No. 22, Shyam Sunder Society, A.K. Road, Varaccha Surat.He was further shown Page 68 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 two photographs, one photograph assigned No.1 and the other photograph assigned No.2 and on seeing the Photograph No.1, he stated that the said photograph was of Shri Kishanbhal Manjibhai Gadhesariya and the Photograph No.2 was of Shri Sanjay Manjibhai Gadhesariya; that he had put his dated signatures below both the photographs in token of having identified them; that Shri Sanjay Gadhesariya was a little handicapped. He was further shown Pages 1 to 10 of the printouts (details) of the calls received and made by him from his Mobile No.99799 42428 during the period 1.3.2009 to 16.3,2009, obtained from Vodaphone Company and on being asked, he stated that on page No.6, there was a detail of call received on his mobile from a mobile No.93750 93755 on 5.3.09 at 20:32:57 hrs.; that similarly on Page No.7, there were details of calls received on his mobile from a mobile No.93750 93755 on 6.3.09 at 11:19:01 hrs., 12:03:36 hrs. and at 13:15:34 hrs.; that also on Page No.8, there are details of calls received on his mobile from a mobile No.9375093755 at 16.14:14 hrs., 18:48:11 hrs. and at 18:51:22 hrs.; that the said mobile phone belongs to Shri Sanjay Gadhesariya whose photograph he had identified and he had talked to him on 5.3.2009 and 6.3.2009 with regard to taking delivery of the parcel; that the above Mobile No.93750 93755 was being used by Shri Sanjaybhai himself; that the mobile No. of Shri Kishanbhai Gadhesariya was 93752 64220.
He reiterated that the goods or chemical which they brought from Aurangabad through M/s. Choudhary Roadways were being exported out of the country, but he did not know how Page 69 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 and where they were exporting; that he was working with them in their looms factory situated at Hojiwala Estate, Sachin, but the same factory was closed after this incident; that he neither met them (Sanjay & Kishan) nor he received any phone call from them since 6.3.2009, the day the parcel was detained; that Shri Sanjaybhal and Shri Kishanbhai had a shop at 2440-2441, New Bombay Market, Umarwada, Surat which he visited 2-3 times; that Shri Sanjaybhai use to sit there and was dealing in some pharmaceutical business; that this fact was not disclosed by him in his earlier statements dated 6.3.09 and 7.3.2009."
83. Jayesh Vadaliya, during his investigation, produced a letter dated 5.3.2009 issued by M/s. Bhatia Chemicals authorizing him to take delivery of the goods in question under his statement dated 6.3.2009, as also the invoice dated 06.03.2009 for re- booking the parcel for its onward delivery to Surat. The said authority letter was signed by J.B.Bhatiya, the proprietor of the company. Sanjay Ghadesariya (respondent) in his statement dated 26.6.2009 had confirmed that the authorization was signed by him and was given to Jayeshbhai Vadaliya for taking delivery of consignment transported from the Aurangabad.
84. The statement of Sanjay was recorded under Section 108 of the Customs Act, 1962 on 21.4.2009 and 29.04.2009 respectively, wherein he has stated, "he knew Shri Jayeshbhai Vadaliya because he is a relative of his brother, Shri Kishanbhai and son of Shri Chunilal Vadaliya; he did not know whether he (Jayeshbhai Vadaliya) did any other side business......"
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85. In his further statement which was recorded on 24.6.2009 Sanjaybhai stated that :
"he had ordered for the delivery of the consignment of Ketamine seized vide panchnama dated 27.3.2009 from Aurangabad to Vapı; he had purchased the said goods from one Shri Nagesh Barsale and he had a person named Shri Rajesh Joshi from whom the material was purchased; Shri Rajesh Joshi's mobile number was 9822951313; that 2or 3 years ago Mr. Nagesh Barsale was contactable on 0240- 2345652 but he did not have his present mobile number; in the year 2005-2006, he came in contact with them through B2B site; he emailed Nagesh Barsale regarding the availability of Ketamine, after knowing from B2B portal that he (Nagesh Barsale) was dealing in the trade of Ketamine; accordingly, Shri Nagesh Barsale replied by email mentioning his contact numbers; after some period of time he had given him (Nagesh Barsale) a call on the numbers mentioned on his (Nagesh Barsale) email for the availability of the product Ketamine; Shri Nagesh Barsale replied that he could offer Ketamine at the rate of Rs.17000/- per kg; to check the credentials of Shri Nagesh Barsale, he again contacted him (Nagesh Barsale) on telephone after a gap of 6 to 8 months and he again showed his willingness to supply the product Ketamine to him; in the beginning of the year 2007, he contacted Shri Nagesh Barsale for supply of 2 Kgs of Ketamine on sample basis; Shri Nagesh Barsale gave him the mobile number of one Shri Rajesh Joshi and informed him to contact Shri Rajesh Joshi on his mobile Page 71 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 number 9822951313 for any requirement regarding Ketamine; accordingly, he contacted Shri Rajesh Joshi on his above mobile from his (Sanjay) mobile number 9979386867 and the deal was finalized; as per the deal, Shri Rajesh Joshi dispatched 2 Kgs of Ketamine to Surat from Aurangabad through Shrinath Travels and gave him the necessary receipt number; the product was then collected from Shrinath Travels by giving the receipt number; the payment for the sold consignment was made by him 107 through local Angadia called "S. Ramesh Kumar", who had transferred the money through "D Natwarlal"; the mobile number of Shri Rajesh Joshi was given to the local Angadia for the delivery of the money in Aurangabad and accordingly, Shri Rajesh Joshi received the money; in the year 2006-2007, he was in contact with foreign buyers to whom he was supplying Suhagra/Silagra through illegal channels; the said buyers enquired about Ketamine and accordingly, he had purchased the product to supply it to the foreign buyers;
On being asked regarding the quantum of Ketamine purchased by him from Aurangabad till 24.06.2009 and the mode of transportation from Aurangabad to Surat, he stated that Initially in the year 2007-2008, he had ordered few consignments each of 4 to 5 Kgs which were sent from Aurangabad to Surat by Shri Rajesh Joshi through Shrinath Travels and later, on increasing demand, he had ordered larger quantity I.e. 25 to 50 Kgs each time which were sent from Aurangabad to Vapl through Choudhary Roadways and from Vapi the said parcels were either re- booked in Page 72 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 some transport company for onward transport to Surat or were brought in personal vehicles. Accordingly, in all about 25 Kgs of Ketamine had been received by him from Aurangabad to Surat by Shrinath Travels and about 160 Kgs of Ketamine had been received in the lot of 5-6 consignments through Choudhary Roadways Vapi;
On being asked as to in whose names Ketamine ordered by him was booked from Aurangabad and under what documents he had received the consignment, he stated that from Aurangabad, Ketamine was booked by showing consignee as M/s Bhatia Chemicals. The goods booked through Shrinath Travels were received by him without any documents from Aurangabad and in respect of goods booked through Choudhary Roadways, bills of M/s Perfect Chemicals were sent along with the goods and the consignee name was shown as Bhatia Chemical, Vapi.
On being asked regarding the disposal of Ketamine procured by him from Aurangabad, he stated that most of the Ketamine procured by him was illegally exported to foreign buyers at UK, USA, Canada, except 20 to 30 Kgs which were destroyed by him; Regarding the quantity of each lot of Ketamine exported by him, he stated that the Quantity of each lot varied from 100 grams to 4 Kgs.
Regarding the price at which he had sold the goods to foreign buyers, he stated that the price varied from $ 2000 to $ 4000 per Kgs; that Ketamine received by him in bulk Page 73 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 quantity was packed in small containers of 100 grams, 250 grams, 500 grams, 1 kgs upto 4 Kgs as per the requirement of foreign buyers, in small plastic containers; that the bulk quantity was stored by him at their factory office in Hojiwala and the packing was personally done by him in plastic containers purchased by him from the local market; that the plastic containers were then packed with corrugated paper and then the lids were sealed with adhesive taps; that the foreign buyers were contacted by him from various B2B sites like Tradekey, Indiamart, Alibaba, Tradeboss etc; that he used to correspond with the foreign buyers through e-mail supply of the products from his email [email protected].; that he was also having another email address "[email protected]" which was also used to communicate with foreign buyers.
On being asked as to when the above said email accounts were opened by him, he stated that the above email id [email protected] was opened by him in the year 2005 and the email id: [email protected] was opened by him in 2007.
On being asked as to how he accessed his above said email account and who were the other persons who could also access the above said accounts, he stated that he had a laptop, Compaq make, on which he had net connection of "Reliance Infocomm" through which he used to access his email accounts; that he was the only person who could Page 74 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 access the above email address; that Ketamine was handed over to the local courier in Surat for sending to Mumbai to M/s Pacific Express Corporation and one Mr. Shri Harshad to further connect to foreign country; that the material used to be packed by him as per the quantity required by the customer and the same was handed over to Shri Jayesh Vadaliya for further giving it to Purohit Couriers in Navsari; that on the parcel they used to write the name of the person and his cell number and the address of the customer abroad was written on the packed parcel inside; that on reaching Mumbai, Shri Harshad or any person of M/s Pacific, to whom the parcel was sent by him from Navsari used to tear off the outer packing and booked for overseas buyers as per the address written on the inside packing of the said parcel; that earlier Shri Harshad was working with M/s Pacific Express Corp and later on he started working for a company called Swiss International; that after booking the parcel, Shri Harshad or persons of M/s Pacific Express Corporation used to send him tracking number of the parcels either through SMS on his mobile number 9375093755 or verbally on phone; that thereafter he used to forward the said tracking number to customer at abroad from his email address [email protected] or raghunaath@ hushmail.com along with the tracking sites to enable the customer to track his parcel shipped from India; that Shri Jayesh Vadaliya did not know the contents of the parcels; that Purohit Courier used to charge Rs. 100 toRS. 200 per parcel upto Mumbai and the person from Mumbai used to charge according to the weight slab i.e. Rs.1500 to Rs.3500- 4000 per consignment.Page 75 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022
C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 On being asked as to how the payments from his Customers abroad was received by him, he stated that the payment from the customers was received by him through Western Union Money Transfer Agency; that he used to take the names of the person on whose name the transfer could be made from one of his friend in Rajkot; that his friend used to take the names from the Western Union Agent and advise him about it; that he used to further send the name to the foreign buyer and once transfer is made, they (customers) used to give the MTCN details and with the MTCN details, the funds were being picked up and the person from Rajkot used to send him the funds by Local Angadia to Surat; that the name of Angadia through which the funds used to come was S. R. Agnadia.
On being asked to give the name, address and contact no. of his friend in Rajkot, he stated that the name of his friend in Rajkot is Shri Vijay Pandhi and his contact number is 9427738100; that he is staying on Kalawad Road in Rajkot and he did not know his full address, but he was unaware about the payments received by him from customers abroad."
86. In his further statement dated 26.6.2009 Sanjay confirmed the facts mentioned in his earlier statements and had stated as under:
"On being asked his whereabouts on 06.03.2009, he stated that as usual he went to his office at 2440-41, New Bombay Page 76 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 Market in the morning of 06.03.2009 at 11 a.m. and remained in the office till 6:00 PM in the evening; that at around 01:00 PM, he called Shri Jayesh Vadaliya to his office and asked him to go to M/s Choudhary Roadways, Vapi for collecting one parcel booked from Aurangabad in the name of M/s Perfect Chemical, Aurangabad; that he had also handed over to him one Authority letter dated 05.03.2009 in the name of M/s Bhatia Chemicals, plot No 2219, GIDC Estate, Ankleshwar, Tel: 9979386867 addressed to the Dispatch Manager, Choudhary Roadways, Vapi authorizing a person as Mr. Anuj Shah; that the authority letter was signed by him as proprietor "J.B. Bhatia"; that he had asked Shri Jayesh Vadaliya to disclose his name as Shri Anuj Shah before the said transport Company.
On being asked to reproduce the signature appearing on the above said letter he reproduced the same in his above said statement; that apart from the above letter, he had also handed over to Shri Jayesh Vadaliya one invoice number:
JB/BC001dtd. 06.03.09 in the name of M/s J.B. Enterprises, A 212 Simit Shopping Centre, GIDC Char Rasta, Vapi, Tel: 9979386867; that in the invoice the consignor was shown as M/S 1 B. Enterprises and the consignee was shown as M/s. Bhatia chemicals, D-4/11 GIDC, Sachin, Surat; that the signature appearing on the invoice as authorized signatory was signed by him. He further reproduced the said signatures in his above said statement; that the above letter of M/s Bhatia Chemicals and bill of J.B. Enterprises were prepared by him on his Page 77 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 laptop and the prints out of the same were taken in his above office at Bombay Market;
On being asked regarding the address of the office of the above said companies as well as the mobile number i.e. 9979386867 mentioned on the above said bill and letter, he stated that both the addresses are bogus and the mobile number 9979386867 was being used by him for the last 3-4 years and the said mobile connection is not in his name as the same was arranged by one of his friend.
Regarding the payments of bill of the above said mobile number, he stated that the connection was prepaid connection.
He further stated that the above letter and invoice were given by him to Shri Jayesh Vadaliya, for taking the delivery of the parcel from Choudhary Roadways, Vapi and to re- book the same in the Surat Ahmedabad Transport Company at Vapi for onward transportation to Surat.
On being shown the above said letter of Bhatia Chemicals and invoice of J.B. Enterprises produced by Shri Jayesh Vadaliya on 06.03.2009, he identified the same as the documents prepared by him and handed over to Shri Jayesh Vadaliya.
On being asked, he further stated that on the same day on 06.03.2009, at around 4:15 PM, he contacted Shri Jayesh Page 78 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 Vadaliya from his (Sanjay's) mobile number 9375093755 but as there was no response from Shri Vadaliya, he suspected that either Shri Jayesh Vadaliya was caught with the parcel or something else had gone amiss at Vapi; that therefore, he along with his brother Kishan went to Hojiwala factory at around 07:00 PM on two different vehicles; that he immediately collected 3 packets in which Alprazolam tablets, Diazepam tablets, Lorazepam tablets and some other tablets were kept in Hojiwala office and some Ketamine Powder which was kept in plastic bags and asked his brother Shri Kishan take an employee Shri Kishore Yadav and throw. away the tablets and powder; that his brother Shri Kishan acted as per his direction, but was not aware about the activities and dealings in such types of Ketamine powder and tablets.
Regarding the place where Ketamine Powder was thrown by him on the night of 06.03.2009 and its quantity, he stated that he had thrown the Ketamine powder of quantity 20 to 25 Kgs in the gutter; that after destroying the above powder and tablets, he and his brother left the factory for home around 10.00 PM; that thereafter at 11.00 o'clock in the night of 06.03.2009, he left Surat along with his family and Shri Kishanbhai for Rajkot; that at Rajkot he stayed at his sister's house for 10 to 12 days and then came back to Surat to approach the advocate and after 2 to 3 days again left for Rajkot; that thus after 06.03.2009 for a month and a half he traveled between Rajkot and Surat.
Page 79 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 He was also shown the statement of Shri Kishore Yadav recorded on 09.05.2009 and he had gone through the said statement and confirmed that Shri Kishore Yadav was one of his employees working in their Sachin factory and the facts stated by him in his above statement are true and correct. In token of having seen the same he put his dated signature on the last page of said statement.
He was further shown the LR's bearing numbers 21098 dated 09.05.2008, 21904 dated 04.09.2008, 22040 dated 23.09.2008, 22157 dated 11.10.2008, 22489 dated 08.12.2008, 22715 dated 19.01.2009 of M/s Choudhary Roadways, produced by Shri Nandkishore R. Choudhary, Proprietor of M/s Choudhary Roadways under his statement dated 19.03.2009; that he had gone through the same and confirmed that Ketamine Hydrochloride powder was transported from Aurangabad to Vapi as ordered by him to one Shri Rajesh Joshi of Aurangabad.
On being asked regarding the documents given by the supplier at the time of booking of above said Ketamine powder at Aurangabad for transportation to Vapi, he stated that on all the occasions bills of M/s Perfect Chemicals, Waluj, Aurangabad were given at the time of booking and after booking, consignee copy of LR was sent to Surat through Shrinath Travels from Aurangabad; that Shri Rajesh Joshi used to inform him regarding dispatch of material through Choudhary Roadways and dispatch of LR for collecting the material, through Shrinath Travels; that he used to collect the LR from Shrinath Travels at Surat and on Page 80 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 all the occasions after collecting the LR either on the same day or the very next day, he had sent Shri Jayesh Vadaliya to Choudhary Roadways, Vapi for collecting the Ketamine powder. He further stated that only on 2 occasions i.e. on 06.03.2009 and goods received in January, 2009, he had given fake invoice of J.B.Enterprises to Jayesh Vadaliya for onward transportation of goods from Vapi to Surat and in rest of cases goods were personally brought by Jayesh from Vapi to Surat.
He was shown panchnama dated 06.03.2009 drawn at M/s Choudhary Roadways, Vapi under which his consignment of 25 Kgs of Ketamine was detained; that he was also shown LR no.22987 dated 03.03.2009 of M/s Choudhary Roadways, Aurangabad and Invoice DC No.124 dated 03.03.2009 of M/s Perfect Chemicals, Waluj Aurangabad related to the above said consignment and produced by the transport under the above said panchnama; that he had gone through the above said panchnama and documents and confirmed that the same type of invoice of Perfect Chemicals as mentioned above was received by him along with all the consignments of Ketamine transported by Shri Rajesh Joshi from Aurangabad. However on each occasion the description of Ketamine powder was wrongly stated to be Benzahydrol Powder, Sodium Salt etc., in the bills of Perfect Chemicals accompanying the said goods and after the Ketamine consignment reached Surat, he used to destroy the bills. Regarding the main buyers of Ketamine to whom he had supplied Ketamine abroad stated main buyers were Page 81 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 [email protected]", ksceince@hushmail. com and [email protected].
Regarding the names and persons of the above stated buyers, he stated that he did not know their names as he only used to contact them on their above said email id. He further stated that in the trade of Ketamine, buyers as well as sellers do not disclose their actual identity and for this reason he was also corresponding with them from his email id's i.e [email protected] and raghunaath@ hushmail.com which were opened by him by mentioning fake name as well as fake contact numbers and address.
Regarding his other B2B portals (trade portals), he gave the same as under:
(1) Name: Indianmart.com Username:
[email protected] Password:
Sankis
(2) Name: Tradekey Username: raghunaath
Password: sankis
(3) Name: "trademart".com Username: raghunaath
Password : Do not remember.
(4) Name: "Alibaba".com Username:
[email protected] Password:--
(5) Name: "Tradeboss.com" Username: raghunaath Password:-Page 82 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022
C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 (6) Name: "Tradeholding.com" Username:
raghunaath Password He further stated that for marketing the product Ketamine, Viagra, Suhagra, Alprazolam, Diazepam etc. he had opened the above said B2B portals by mentioning fake name, address and contact numbers; that except his B2B portal in his Indiamart.com, he had shown the of his company Sudarshan Chemicals"; that he opened his B28 portal on tradevey. and Indiamart through internet in DRI office and the printouts of his company profile were taken in his presence and rest of the portals could not be opened as he did not remember the password; that he had seen the printouts and put his dated signature on the same.
Regarding the IEC code of Raghunaath Agencies, he stated that he aid not have any IEC number and the company was first floated on the B2B portal for taking orders from foreign buyers and also illegal export of Ketamine, Vlagro. Alprazolam, Diazepam etc, were made by using the name of company as "Raghunaath Agencies".
Regarding any export documents prepared by him for Ketamine exports, he stated that he had prepared the bills / invoices in the name of 3 different fake firms ie. M/s Regal chemicals, Ankleshwar, M/s Raj Exports, Metodo GIDC, Rajkot and M/s Shraddha Chemicals, Ankleshwar, from his laptop by showing fake addresses of the firm and the exports of Ketamine were shown as "sodium Bisulfite"; that all the exports of Ketamine were shown to be from one of the Page 83 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 above said 3 companies by mentioning the name and address of the buyer and the actual quantity of Ketamine as provided to him by the foreign buyer.
Regarding the copies of bills of the above said 3 fake firms under which Illegal exports were made, he stated that he had generated only one copy of bill at the time of sending the material from Surat to Mumbai for onward shipment to foreign buyer and the same was sent along with the goods to the foreign buyer; that on one occasion in the end of February, 2009, one consignment of Ketamine was sent to Rajkot through bus Kathiyawad Travels and the same was received by Shri Vinay Upadhyay who then sent the said material to Delhi under the invoice of Raj Exports, Metoda GIDC, Rajkot sent by him from Surat inside the parcel of Ketamine; that in Delhi, the said parcel was received by "Online Logistics" located at Cannaught Place, Delhi and then exported from Delhi in the name of Raj Exports.
Regarding other exports from Delhi, he stated that on 8 to 10 occasions, he had also sent parcels of Ketamine powder from Surat to Delhi through On Dot Couriers, Belgium Tower, Surat. The said parcels were booked in the name of either Regal Chemicals or Shraddha Chemicals for onward delivery to M/s Online Logistics, Delhi and from Delhi, and from Delhi, the parcels were exported to the foreign customers.
Regarding the charges of parcel from Surat to Delhi and Delhi to abroad, he stated that M/s On Dot Courier have Page 84 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 charged are Rs.300 to Rs.500 per parcel for delivery to Delhi and M/s Online Logistics have charged him Rs.3500 to Rs.4000 per parcel for delivery at UK, USA etc; that all the payments were made in cash; that the payments to "Online Logistics, Delhi" were sent by him through Angadia M/s Madhav Magan in Varachha and payments to Surat Courier, on Dot were made directly by him or Shri Jayesh.
On being asked whether he had taken NOC (No objection certificate) form Narcotics Commissioner for exports of Ketamine Hydrochloride from his aforesaid 3 firms, he stated that he had not taken any NOC from Narcotic Commissioner for the exports.
On being asked regarding the various mobile phones belonging to him or being used by him, he stated the mobile numbers as under :
(1) 9979386867
(2) 9979386900
(3) 9375093755
He further stated that the mobile connection stated at serial number (1) and (2) are prepaid connections arranged by his friend and are in other names; that the mobile number 9375093755 is the mobile number he used and it is in the name of one of his friend Shri Sunil Kakadiya Mumbai.
Regarding usage of above said mobile numbers, he stated Page 85 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 that mobile number 9979386867 was being used by him for procurement of Ketamine and its exports. The mobile number 9979386900 was being used by him mainly for dealing with Shri Vinay Upadhyay of Rajkot for Courier purpose and sometimes with other persons also; that the mobile number 9375093755 was being used for his personal use including purchase of medicines from India and other business of textiles, diamond etc. He was further shown panchnama dated 23/24.06.2009 under which his email account raghunaathagencies@ yahoo.com was accessed as per the password provided by him and the prints out of the email correspondence available in his above said account were taken out in his presence and the same were filed in File no.01 and File no. 02, as mentioned in the above said panchnama and confirmed that the facts recorded therein are true and correct. He was further shown File no.01 containing email print outs of sent box of his email account: "[email protected]"
taken out under panchnama dated 23/24.06.2009 and after going through the said file, he stated that the said file contained the prints out of the malls sent by him to various persons/buyers of Alprazolam, Diazepam, Lorazepam, Suhagra, Silagra, Ketamine etc. during the period from January 07, 2009 to March 5, 2009; that most of the malls are regarding illegal export of above said products.
Regarding the receipt of payments from the foreign buyers against the export of Ketamine and other tablets, he stated that payments were received by him through Western Union Page 86 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 Money Transfer, Money Gram and hawala payments through Angadlas. He further stated that for transfer of money through Western Union or Money gram, he used to inform the buyer about the names for transfer of money through email and accordingly the foreign buyers have transferred the amount and Informed the MTCN number (Money Transfer Control Number) through mails; that after receipt of MTCN number, the funds were collected from the Western Union/ Money Gram by Shri Vijaybhal his friend at Rajkot and then the same were sent to him through S.R.Angadia. He further stated that each transfer of funds through Western Union or Money Gram was below 50000/-; that many times, the funds were also transferred through hawala and in such cases the name and number was forwarded to the buyers abroad and they transferred the funds through their channel; that he used to get a call on mobile number 9979386867 for the funds and used to tell them to deposit the funds through Angadia as he did not meet them; that he used to give them the name "Ramjibhai Desai" for the collection of the funds.
On being asked whether the payment for supply of Ketamine and other tablets was received by him in advance or after the delivery of products, he stated that payments were mostly received in advance or in some cases payment were also received after the delivery of the products.
He was further shown e-mail print outs taken out from his e- mail account available at page no.137,138,131 & 44 in file no.02 and on being asked, he stated that the same related Page 87 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 to transfer of funds from foreign buyers through western Union Money Transfer against supply of Ketamine powder.
On being asked regarding the name of the person who had booked parcels of Ketamine powder at Choudhary Roadways, Aurangabad, he stated that Shri Rajesh Joshi was managing everything including booking at Aurangabad and he only used to inform him on mobile regarding dispatch of goods and LR.; that he did not know the names of the persons who were going to Choudhary Roadways at as it was managed by Shri Rajesh Joshi.
Regarding the whereabouts of the laptop being used by him, he stated that after knowing that his consignment of Ketamine was caught on 06.03.2009, he had broken the same and thrown away the pieces on the sides of the road from a moving car.
On being asked regarding the whereabouts of all the 3 mobile phones being earlier used by him, he stated that the Sim cards of the said mobile connections and also the mobile instruments were crushed and thrown away by him."
87. During the course of investigation, the email exchanges between Sanjay and foreign buyers were retrieved, from which the following dates have been unearthed:
Page 88 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 "(A) File No.2.
(i) At page 1 & 2, it appears that there is an e-mail correspondence by one [email protected] to "[email protected]" as under:
"Dear Raghunaathagencies.. We have found your advert regarding the sale of Ketamine hcl. And require a long term business relationship for the materials you offer. Are target contract is 50- 100kgms per year we would need a sample order to start with of 250gms 500gms or 1kgms. Are second order we would require 5kgms bulk dispatch to are farm. Please email back with a realistic price on your offer.
PROFILE// The Oreintel herbal Company import and distribute a diverse range of organically certified raw materials, some of these produced from the organic farm on which we are based. Established over 20 years ago we are the leading supplier of organic herbal raw materials to the UK market and are also a major player in Europe. We Now market various other meds and pharmaceuticals worldwide.
Contacts// Susan andersson Orientel herbals sales 01998786654 jeff mills Orientel herbals Markets 01998786654 Regards, Susan anderson."Page 89 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022
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(ii) At page no. 3, 4 & 5, it appears there is an e-mail correspondence by Shri Sanjaybhai from his email id [email protected] to one "kssceince@ hushmail.com on 02.12.08 wherein he had intimated that he would send them 1 kilogram of Ketamine but they have to send 1000 UK Pounds in advance and after receipt of the material they have to send the balance and slowly clear the old dues.
(iii) The print out available at page no. 13 is an e-mail correspondence sent by Sanjaybhai ksscience@ hushmall.com asking him to send 250GBP so that he could send him 100 grams of Ketamine and has also forwarded the name of "Toyota Baghu" to transfer the funds.
(iv) At page no. 25, it appears that there is an e-mail correspondence on 28.02.09 from his e-mail Id by Shri Sanjaybhai on "[email protected]" to one "[email protected]" wherein he had Intimated that he was not able to pick up the funds and requested to change the name to KANTILAL JAIN from AJIT JAIN. Further, in reply to the said message, some "J" from "[email protected]" has written on 02.03.09 that he would try to have the change made the next day and further asked whether K (Ketamine) has been already shipped as it didn't arrive last week as requested by him. Further, In the email message available at pg. 24 the said "J" from "[email protected]" has written on 03.03.09 that the name of the Western Union was changed and also written that they have no stock of "K" (Ketamine) and hope to Page 90 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 receive the delivery in the next day or two. Further, In the e- mail message available at page no.22, Shri Sanjaybhai on 05.03.09 from his e-mail id "raghunaathagencies @yahoo.com" had intimated to "[email protected]" that the "K" (Ketamine) has already been shipped last week and they are expecting the connecting numbers at any moment. It was further intimated that the delay is because there are strict checks at the moment in the UK Customs.
(v) At page no. 66 & 67, it appears that there is an e-mail sent by (A) Shri Sanjaybhai on 21.02.09 from his e-mail id "[email protected]" to one "viagralad@hush. com" from wherein he had written as under:
"On Sat, 21 Feb 2009 07:44:20 +0100 Raghunaath Agencies <[email protected]> wrote:
We have received ur email today ie, saturday morning....have waited for your email whole day. Now we can try for the delivery by the weekend, but cannot guarantee. Our shipping system is something like this: We hand over the goods today and once we hand it over it takes 2 days for the goods to be delivered to the person in India, bcos it goes thru the secure channel as transporting it even within India is difficult. After that they ship out the goods from India and sometimes it takes more then 2 days for them to get the material out, bcos the persons availability at both the ends should be there for the clearance. Thus we would request u not to hurry and cant work out In the specific time frame bcos somethings are not in our Page 91 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 hand and we have depend on others, if v hurry up the things it can cause confusions and make a mess. We shall once again wait for your email before moving ahead, bcos we dont want issue later in which if u do not receive the material in timely manner and after that u feel that the material Is of no use to u. We would also thus accordingly request your buyers ahead for the same. Let us know if u made the transfer for the funds that u were going to make, also something for K too. With best regards,"
In reply to the above e-mail "[email protected]" have written as under:
"I emailed you 2 days ago and said to go ahead, so you shouldn't even need these 2 further emails. Now If it isn't here by the weekend, I will look unreliable in front of my customers because I told them it would be. And again it will just mean me loosing some more customers, so then I order less, and less frequently from you. We have already given the money and details to the person for Western Union. They sent the balance for the Alpraz and Diaz. I am waiting for the MTCN details from them, to forward on to you. Now please don't delay any further... I need the K here by the end of next week (before next weekend) so please don't delay and wait on any more emails from me... just get the goods sent! Thanks"Page 92 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022
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(vi) At page no.78 &77, it appears that there is an e-mail sent by Shri Sanjaybhai 18.02.09 from e-mail id "[email protected]" to one "viagralad@ hush.com" wherein he had sent two names i.e. Ajit Jain and Ojas Sheth and further intimated that the price of K (Ketamine) remained same as usual and asked them how much they would be requiring so that he can accordingly get the stuffs ready. Further, in reply to the same some "J" from [email protected] has written, on 19.02.09, as under:
"Hi, I need 1KG of K then. Please only send 1KG. I will make the outstanding payments (Alp and Diaz) within the next day and send you the details as soon as possible. With the K... we require delivery VERY VERY QUICKLY. Unless it be here early next week, it is no use to us. So please send it quickly, and if it wont be early next week, please tell me now as we may not need the order in that situation, I look forward to hearing from you soon. Thanks, J.
(vii) At page no.131, there is an e-mail sent by Shri Sanjaybhai on 28.01.09 from his e-mail id "[email protected]" to one "viagralad@ hush.com" wherein he had intimated to get the order collected from the Post Office. Further, in reply to the same, "J" from [email protected] has sent two MTCN numbers along with the names of the persons regarding transfer of 590 GBP In each account.
(viii) At page no. 138 & 137, there is an e-mail sent by Shri Sanjaybhai on 06.01.09 from his e-mail id "[email protected]" to one "ksscience@ Page 93 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 hushmail.com" wherein he had written to send 250GBP and he would send them 100 grams. He had also asked to send the funds in the name of "Toyta Bhagu" and further asked him to mail the MTCN details along with the shipping address. Further, on the above said pages, one "Fay" from said "[email protected]" has, in reply, sent the shipping address and the MTCN no. as 2330949901 and confirmed that the amount of 250 GBP is payed over. He had further asked to dispatch the 100 gms on receipt and further written that when he would receive the material he would pay 750 GBP for 300 gms.
(ix) At page no. 458, there is an e-mail from Mr. Nagesh Barsale of Priya Chemicals, Aurangabad wherein he had given the address of his company mentioning that they are Aurangabad based manufacturer in Ketamine hcl, Fluticasone, propionate, epirubicin hcl.
(x) At page 193, there e-mail from
[email protected] to one maximilian.
[email protected] wherein cell no. '+91-9979386867' was given to call in case any queries. Similarly, the cell no. was given on various other mails, as available in the above said file.
(B) File No.1
(i)At page no. 7, there is an e-mail from Shri Sanjaybhai to "[email protected]" on 08.01.09 wherein he had intimated that the pending balance for the "K" was $ 5625 Page 94 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 I.e. equivalent to GBP 3,748 (UK Pounds). He further Intimated that he had been paid for 500 grams i.e. $1875 and he had shipped them the material for 2000 grams thus in US$ it would be $5625 as pending balance on converting to UK GBP It will be 3,748 out of which 2000 has been pald by [email protected]. He further Intimated that he is just sending the said details for reference.
(ii) At page no. 57, there Is an e-mall from Shri Sanjaybhai to "[email protected]" on 26.01.09 wherein he had intimated the names l.e. "Yatin Sangol" & "Ladulal Bordia"
for transfer of funds and further written that he is expecting around INR 84,000 from them as the payment for the 100 Alpra and 1100 Kama and pending K (Ketamine).
(iii) In the e-mail correspondence available at page no. 105, on 21.02.09 [email protected] wrote [email protected], that he would send only 200$ for 575 gms. In response raghunaathagencies @yahoo.com intimated that "OK not an issue, they would send the goods asap" (as soon as possible). In the e-mall correspondence available at page no. 106 [email protected] again intimated on 23.02.09 that they would send the goods as soon as they have the transfer details from [email protected] side. It was further intimated that everything is ready on their end and the container with 575 gms of material i.e. Ketamine is ready to be shipped.
Page 95 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022
(iv) In the e-mail correspondence available at page no. 113, Raghunaath Agencies wrote to bob_coalition@ hushmail. com, on Monday, February 23, 2009 6:58 AM as under:
"As soon as we have the transfer details from your side we have the goods ready for dispatched for you. The headache and the system involved for shipping is the same even if v ship 50 grams or 500grams or 5kgs. We can ship you upto 5kgs of material every time as and when u want it in future. With best regards,"
(v) In the e-maill correspondence available at page no. 114, Raghunaath Agencies wrote to [email protected], on Monday, February 24, 2009 as under: "Friends, Its almost a week we have handed over 1000 pills of Diaz to my connecting person, but at the moment things arę strict in India at all the ports and there are lot of seizures and thus one has to be very aware and cautious about the moving of the stuffs. U can read yesterday's news and u will feel that we all are safe just bcos we take all the necessary steps to be discreet. This is the only reason we are asking u in advance about ur requirements. If u can forsee that u will 2kgs of K or 1kgs of k even after 2 weeks u advise us in advance so that we take the shipping accordingly in our schedule in such a way that u get the products in time. We admit there are many times delay in the delivery and as u trust our words u would intimate the customer ahead of u about it, and when the products doesn't hits in time, it definitely affecting the credit of our and your words, but u Page 96 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 always advise the customers once it starts tracking, bcos there are whole lot of things involved in this business and it would be difficult for us to make u understand about it. With best regards,"
(vi) In the e-mail correspondence available at page no. 126, Raghunaath Agencies wrote [email protected], on 04.03.2009 as under:
"Hello !!!!... The K has been already shipped last week and we are expecting the connecting numbers at any moment as soon as we have it we shall forward u the numbers. The delay is bcos there are strict chks at the moments in the UK customs. With best regards."
88. The Cellular Company had provided the call details of the mobile number which was used by Sanjay, as admitted by him in the statement dated 26.06.2009, for communication with the foreign customers. The scrutiny of frequent calls made from this number revealed that frequent calls were also made to Rajesh Joshi, Aurangabad who was the supplier of Ketamine.
89. Kishor Yadav, the employee of Sanjaybhai and his brother Kishan who had evaded the summons and chose not to appear before the authorities was recorded under Section 108 of the Customs Act wherein he has stated as under:
"On 06.03.2009 he was on day duty which starts at 7 a.m. and finishes at 7 p.m.; Shri Sanjaybhai and Shri Kishanbhai Page 97 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 had visited the factory on 06.03.2009 at around 7 pm on different vehicles i.e. on bike and Scooty; they had brought with them three carton boxes which were kept near the office door; thereafter he was called by Shri Sanjay and Kishanbhai to their office and was told by Shri Kishanbhai that he had to go out with him; he was told to take all the three cartons and accordingly, he carried all the three cartons which were not heavy in weight, but as per his knowledge, they contained strips of medicines; he and Shri Kishanbhai left the factory on his (Kishanbhai's) bike; the bike was driven by Shri Kishanbhai and he took hold of the cartons; he did not remember the motor bike number; he was taken to a road leading to Palsana where he threw one carton as directed by Kishanbhai around 8 0'clock at night; they proceeded on the road towards Palsana and threw away the second carton; the third carton was thrown away as told by Shri Kishanbhai somewhere in a Nala where there was water and it was a place near Hojiwala Estate; he did not know what kind the said medicines were and he was not at all told anything about the same by both Shri Sanjay and Shri Kishanbhai; they came back to the factory after throwing all the three cartons; the cartons were grey in colour but were not big in size;
Shri Sanjay and Shri Kishanbhai had kept some documents which were burnt in an open place in front of the factory as per their direction; he came back to the factory within 5-10 minutes after burning the documents; Shri Sanjaybhai and Shri Kishanbhai then both left on their two-wheelers, but before leaving, he was told to flush the toilet which was Page 98 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 near their office on second floor with 2-3 buckets of water; when he threw the water into the toilet, the water became red in colour; he did not know what they had thrown into the toilet;
He could show all the places where the cartons were thrown on 06.03.2009;
Factory did not work the next day on 07.03.2009 after the said incident;
On 06.03.2009, Shri Jayesh Vadaliya had left the factory with one worker at around 12'0 clock or 1 PM; he did not know where they had gone; Shri Jayesh did not come back till late night that day;"
90. As per the locations disclosed by Kishore Yadav in his statement dated 09.05.2009, various places were visited on 9.5.2009 along with the independent witnesses and Kishore Yadav, and recovery of Diazepam, Lorezpam, Viagra tablets etc. were made from two places as shown by Kishore Yadav under panchnama dated 9.5.2009.
91. In view of the statement of Jayesh Vadaliya that the transport was being made through the Purohit Courier, the investigation was extended to the said firm. The statement of Manager of Purohit Courier was recorded on 17.08.2009 and 18.08.2009 respectively, wherein he has stated as under :
Page 99 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 "On being asked as to how many parcels were brought by a person named as Shri Jayesh Vadaliya during the period from 2007 to March 2009, he stated that he had joined the courier company in April 2008 and after that they have prepared the duplicate copies of Memo of their company dated 08.05.2008, 15.07.2008, 08.02.2009 and
19.02.2009, under which parcels were delivered to M/s Pacific Express Corporation, Mumbai. The copies of the said memos were produced by him under his above statement. He further stated that parcels mentioned in the said Memos were delivered from their branch at Navasari to their Mumbai Office and from there the same were delivered to Shri Harshadbhai of M/s Pacific Express Corporation, Mumbai.
He was working in M/s Purohit Couriers and Cargo Service, Mumbai since 2004 and from the year 2007 he was working as a Manager and looking after all the work of their Mumbai office; owner of their courier company is Shri Nagaraj Purohit; their company had offices in Ankleshwar, Sachin and Navsari; he had gone through the statement dtd. 17.08.09 of Shri Prem Singh, Branch Manager of their Navsari office and confirmed that the statement given by Shri Prem Singh was true and correct and he agreed with the same; the goods discussed in the above statement of Shri Prem Singh were delivered by them to M/s Pacific Express Corporation, Mumbai and Shri Harshad of M/s Swiss International & Cargo Inc., Mumbai;
Page 100 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 They were informed that the parcels contained Medicines and were to be delivered carefully; as soon as the said parcels arrived in their Mumbai office, they used to receive the phone call either from M/s Pacific Express Corporation, Mumbai or Shri Harshad of M/s Swiss International & Cargo Inc., Mumbai and accordingly the delivery was made by them; the parcels weighed about 5-6 kgs and the names of the recipient M/s Pacific Express Corporation, Mumbai or Shri Harshad of M/s Swiss International & Cargo Inc., Mumbai were written on the said parcels and as soon as they received the phone call they used to deliver the said parcels; that they did not obtain any receipts in token of having delivered the said parcels from the above said courier companies;
On being asked about M/s Pacific Express Corporation, Mumbai and M/S Swiss International & Cargo Inc., Mumbai, he stated that both are courier companies engaged in delivery of parcels to foreign countries and their office is situated near their (Purohit Courier) office;
- All the parcels received by them from their Navsari office were delivered by them to the above said two courier companies and all the said parcels were booked as containing medicines; that no bills were received by them along with the above said parcels and only the name of the recipient of the parcels were written on the said parcels."
92. The statement of Manager of the Swiss International & Cargo Inc. was recorded on 19.08.2009, wherein he has stated Page 101 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 as under:
"he perused his earlier statement recorded on 19.8.2009 and the same was correct; as stated in his earlier statement, he furnished copy of the AWB No.40940 dated 20.5.2008 of Continental India Courier Service and the said AWB pertained to the referred consignment received by him on 8.5.2008 from M/s. Purohit Courier & Cargo Service, Navsari; the consignment weighing 5 kgs. pertained to Shri Sanjaybhal M. Gadhesariya; he also submitted a photo copy of Invoice No.NCC001-08 dated 7.5.2008 of M/s. Venus Speciality Chemicals, 1-15/28, A-Gora Gandhi Building, Gora Gandhi co-op. Housing Society, Opp: Lower Parel Station, Lower Parel (East),Mumbal 400013 (Tel.2305 1740, Fax: 23051749); sald Invoice No. NCC001-08 dated 07.05.2008 was attached with the parcel when it came from Navsari and based on the consignee address mentioned on the invoice and the said package, he instructed Mr. Mano vale to forward the same to the given consignee le. Nelleys Chemical Corporation, 539 East, 23 Street, 1" Floor, Brooklyn, New York 11210 USA; the product name shown on the said invoice dated 7.5.2008 was 'Sulfamic Acid':
(Synonyms mentioned on the invoice were Amidosulphonic Acid, Sulphamic Acid);
The said consignment was exported to USA vide AWB No.H7509650143 dated 20.5.2008 of UPS; this work of sending the package through UPS was done by Mr. Manoj Kale as per his instruction; he had paid him for the same as mentioned in his earlier statement dated 19.8.2009;Page 102 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022
C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 about the payment received by him from Sanjay M. Gadhesariya, he stated that he received the money as stated in his statement dated 19.8.2009 and the same was collected from Angadia víz. Ramesh Kumar Ambalal, near Laxminarain Mandir, Andheri East; that the payment mentioned in his statement dated 19.8.2009 includes the freight amount; that he submitted the AWB No.40940 dated 20.5.2008 of Continental India Courier Service and Invoice No.NCC01-08 dated 7.5.2008 and he put his dated signature on the same in token of having furnished the same; that the address of M/s. Continental India Courier Service as appearing on the AWB is 4, Bismillah Building, Ranade Road, Dadar West, Mumbai 400028; that he had handled about 10 consignments of Sanjay M. Gadhesariya in the past."
93. The statement of the proprietor of M/s. Pacific Express Corporation was recorded on 20.08.2009 wherein he has stated as under:
"on being asked regarding the parcels (1) weighing 6 kgs. Received from M/s. Purohit Courier & Cargo Service, Navsari on 19.2.2009 (1)weighing 5 kgs. received from M/s. Purohit Courier & Cargo Service, Navsari on 8.2.09 and (III) one parcel received from M/s. Purohit Courier & Cargo Service, Navsari on 15.7.2008, all the three of Shri Sanjay M. Gadhesariya, he stated that he had received the said consignments from Shri Sanjay M. Gadhesariya who was known to them as "Shri Sanjay Patel";Page 103 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022
C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 he knew Sanjay Patel for the last 5 years and he was earlier exporting dyes, dyestuff; that since the consignments referred above were more than 5-6 months old, they did not have any records such as Invoice copy, Packing List, AWB;
the consignments at Sr. No.(I) and (ii) were consigned to Kamran Amini, Gillerbacken, S6 ETR, 12464 BANDHAGEN, SWEDEN, 12464; these two parcels pertain to Sanjay Patel and he sent the same directly to them from M/s. Purohit Courier & Cargo Service; as per the directions given by Sanjay Patel, the two parcels were sent to Sweden to the address provided by Sanjay Patel; the payment for the same was received in cash from Sanjay Patel; that he did not recollect the exact amount received from Sanjay Patel for these two consignments but it is the normal rate of about Rs.500 per kg. for Europe Sector; that the AWBs Nosfor the two parcels under reference is 00146510/23-02-2009 and 00145112/11.2.2009;"
94. The statement of Vijaybhai of Rajkot was recorded on 27.06.2009 under Section 67 of NDPS Act, 1985, wherein he has stated that, 'he knew Sanjay Gadhesariya'. Around a year and half ago Sanjay Gadhesariya had informed him over telephone that some money is to come to Rajkot through the Western Union Bank and he was to collect the said money from M/s Prabho Tours & Forex Pvt Ltd., Rajkot'. Further, from the retrieved emails which were operated by Sanjay, the MTCN intimated by the foreign customers to Sanjay for collecting payment were found. The monies which were transferred by the Page 104 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 foreign customers vide the said MTCN were received by Vijay Pandhi on behalf of Sanjay Gadhesariya.
95. The veracity of the facts admitted in the statements dated 21.4.2009, 29.4.2009, 24.6.2009 and 27.6.2009 respectively by Sanjay also find support from the statements of others/accomplices and the evidence which were found pursuant thereto, during the investigation. Although the said statements later came to be retracted by subsequent statement recorded on 4.7.2009 before the JMFC in the Criminal Proceedings under the NDPS Act, 1985, yet, the statements recorded under Section 108 have evidentiary value and constitute substantive evidence. A belated retraction after considerable length of time would not have the same efficacy in law as the retraction made at the earlier point of time from the day of the statement.
96. The attempt to export 'prohibited goods' should be appreciated from the point of inquiries from the foreign buyers for the prohibited substance consequent upon which the respondents made arrangements for procuring the same from Aurangabad. After the arrangements were made, the goods were in fact transported from Aurangabad albeit as the 'Benzahydrol Powder' for onward exports via Vapi, when the same were intercepted and seized pursuant to the intelligence inputs. Pertinently, Jayesh was already authorized vide the letters dated 05.03.2009 and 06.03.2009 respectively by Sanjay to take delivery of the consignment and for rebooking the parcel for onward transit towards the intended export, had the substance Page 105 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 not been seized at Vapi. The overt act of physical movement of the prohibited substance was proximate to the intention of respondents to take them out of India which thus constitutes an 'attempt' to export as per Section 113(d) of the Customs Act, 1962.
97. The intention of the statute is to proceed against the offender attempting to export goods contrary to the provisions of the Act. Similarly, a personal penalty is on a person who, in relation to the goods, does or omits to do any act, which act or omission of such an act, shall render the goods liable for confiscation under Section 113 or abets the doing or omission of such an act has been provided in Section 114 of the Customs Act.
SECTION 138C OF THE ACT 1962 :
98. Mr.Trivedi, the learned counsel appearing for the respondents, also touched the issue as regards the alleged breach of the provisions of Section 138C of the Act 1962. According to Mr.Trivedi, reliance can be placed on the computer printouts subject to the compliance of the provisions of sub- section (2) of Section 138C of the Act 1962. To put it in other words, the submissions is that the computer printouts taken out from the computer cannot be considered as evidence unless certificate as required under sub-section (2) of Section 138C of the Act is issued. Mr.Trivedi pointed out that Section 138C of the Act 1962 is pari materia to Section 65B of the Evidence Act. Section 138C reads thus :
Page 106 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 "138-C. Admissibility of micro films, facsimile copies of documents and computer print outs as documents and as evidence.-
(1) Notwithstanding anything contained in any other law for the time being in force,-
(a) a micro film of a document or (the reproduction of the image or images embodied in such micro film (whether enlarged or not); or
(b) a facsimile copy of a document; or
(c) a statement contained in a document and included in a printed material produced by a computer (hereinafter referred to as a "computer print out"), if the conditions mentioned in sub-section (2) and the other provisions contained in this section are satisfied in relation to the statement and the computer in question, shall be deemed to be also a document for the purposes of this Act and the rules made thereunder and shall be admissible in any proceedings thereunder, without further proof or production of the original, as evidence of any contents of the original or of any fact stated therein of which direct evidence would be admissible.
(2) The conditions referred to in sub-section (1) in respect of a computer print out shall be the following, namely :-Page 107 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022
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(a) the computer print out containing the statement was produced by the computer during the period over which the computer was used regularly to store or process information for the purposes of any activities regularly carried on over that period by the person having lawful control over the use of the computer;
(b) during the said period, there was regularly supplied to the computer in the ordinary course of the said activities, information of the kind contained in the statement or of the kind from which the information so contained is derived;
(c) throughout the material part of the said period, the computer was operating properly or, if not then any respect in which it was not operating properly or was out of operation during (that part of that period was not such as to affect the production of the document or the accuracy of the contents; and
(d) the information contained in the statement reproduces or is derived from information supplied to the computer in the ordinary course of the said activities.
(3) Where over any period, the function of storing or processing information for the purposes of any activities regularly carried on over that period as mentioned in clause
(a) of sub-section (2) was regularly performed by computers, whether-Page 108 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022
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(a) by a combination of computers operating over that period; or
(b) by different computers operating in succession over that period; or
(c) by different combinations of computers operating in succession over that period; or
(d) in any other manner involving the successive operation over that period, in whatever order, of one or more computers and one or more combinations of computers, all the computers used for that purpose during that period shall be treated for the purposes of this section as constituting a single computer; and references in this section to a computer shall be construed accordingly.
(4) In any proceedings under this Act and the rules made thereunder where it is desired to give a statement in evidence by virtue of this section, a certificate doing any of the followings things, that is to say, -
(a) identifying the document containing the statement and describing the manner in which it was produced;
(b) giving such particulars of any device involved in the production of that document as may be appropriate for the purpose of showing that the document was produced by a computer;
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(c) dealing with any of the matters to which the conditions mentioned in sub-section relate, and purporting to be signed by a person occupying a responsible official position in relation to the operation of the relevant device or the management of the relevant activities (whichever is appropriate) shall be evidence of any matter stated in the certificate; and for the purposes of this sub-section it shall be sufficient for a matter to be stated to the best of the knowledge and belief of the person stating it.
(5) For the purposes of this section,-
(a) information shall be taken to be supplied to a computer if it is supplied thereto in any appropriate form and whether it is so supplied directly or (with or without human intervention) by means of any appropriate equipment;
(b) whether in the course of activities carried on by any official, information is supplied with a view to its being stored or processed for the purposes of those activities by a computer operated otherwise than in the course of those activities, that information, if duly supplied to that computer, shall be taken to be supplied to it in the course of those activities;
(c) a document shall be taken to have been produced by a computer whether it was produced by it directly or (with or without human intervention) by means of any appropriate equipment.
Page 110 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 Explanation.- For the purposes of this section,-
(a) "computer" means any device that receives, stores and processes data, applying stipulated processes to the information and supplying results of these processes; and
(b) any reference to information being derived from other information shall be a reference to its being derived therefrom by calculation, comparison or any other process."
99. We do not find any merit in the above submission of Mr.Trivedi. The truth or the relevance of the documents has been admitted in no uncertain terms by the respondents in their statements recorded under Section 108 of the Act 1962. In such circumstances, it is too much for the respondents to say that the electronic evidence could not have been taken into consideration. In fact, the electronic evidence on record fortifies what has been stated by the respondents in their statements recorded under Section 108 of the Act.
100. In the aforesaid context, we may refer to one order passed by the CESTAT Principal Bench, New Delhi, in the case of Laxmi Enterprises vs. Commissioner of Customs (Prev.), New Delhi, reported in 2018 (361) E.L.T. 1054 (Tri. - Del.). We quote the relevant observations made by the Principal Bench of the Tribunal as under :
Page 111 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 "11. The appellant has raised objections to the admissibility of the documents recovered from the laptop. They have cited the provisions of Section 138C of the Customs Act. We find such objections without basis in as much as the truth of the documents printed-out from the laptop has been admitted by Shri Sumit Chawla son of the proprietor in clear terms.
Further, their clear admission by him that these invoices recovered, reflect the correct valuation at which the transaction was concluded with the valuation supplier. Further the appellant was given an opportunity to prove the correct transaction value of the goods imported under 32 bills of entry by providing bank attested genuine invoices but Shri Sumit Chawla did not make same available. On the other hand, in his statement dated 19.01.2016, that the prices indicated in the invoices/commercial invoices could be taken for assessment of all past imports as the rate of product did not change much during period of imports. We are of the view that there is no infirmity on the part of the adjudicating authority in re-determining the value of the past imported goods on the basis of such invoices. In the peculiar facts and circumstances of the present case, there is no need for the Revenue to collect evidence in the form of contemporaneous imports."
101. The aforesaid order passed by the Tribunal was challenged before the High Court of Delhi. The Delhi High Court dismissed the appeal vide order dated 6 th August 2019. The order passed by the Delhi High Court was further challenged by the assessee before the Supreme Court. The Supreme Court dismissed the Page 112 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 SLP [Laxmi Enterprises vs. Commissioner of Customs - 2020 (372) E.L.T. A33 (S.C.)], observing as under :
"There is an inordinate delay of 623 days in filing this appeal and moreover we are not inclined to interfere with the impugned order passed the Customs, Excise and Service Tax Appellate Tribunal. Consequently, the appeal stands dismissed on the ground of delay as well as on merits."
102. The Appellate Tribunal in its impugned order had held that the misdeclaration of the customs value in respect of the past clearances made under 32 Bills of Entry was established in view of the recovery of certain invoices/commercial invoices pertaining to the goods imported from laptop and mobile phones during the course of the search indicating procurement of goods from the foreign supplier at significantly higher prices than the amount declared to the department at the time of filing the Bills of Entry. These facts and the payment of money through extra banking channels were admitted during the investigations. Accordingly, the Adjudicating Authority rightly rejected the transaction value of the goods in terms of rule 12 of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007.
OUR FINAL CONCLUSIONS MAY BE SUMMARISED AS UNDER :
103. The statement made before the customs officials is not a statement recorded under Section 161 of the Code of Criminal Procedure, 1973 and, therefore, it can be said to be a material Page 113 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 piece of evidence collected by the customs officials under Section 108 of the Customs Act.
104. If a statement recorded under Section 108 of the Customs Act incriminates the accused, inculpating him in the contravention of the provisions of the Customs Act, it can be considered as a substantive evidence to connect the accused/individual with the contravention of the provisions of the Customs Act. In the case on hand, the statements recorded of various individuals including the respondents under Section 108 of the Customs Act were rightly relied upon by the Commissioner (Customs) as substantive evidence connecting the respondents herein with the contravention of the provisions of Section 113(d) of the Act.
105. The Tribunal is the ultimate fact finding authority and an appeal to the High Court under Section 130 of the Customs Act is provided only on a substantial question of law. The findings of fact entered by the Tribunal are normally binding on the High Court. However, if those findings are perverse or rather so unreasonable that no person, properly instructed on facts and in law, could have reached the findings which the Tribunal did, it is open to the High Court to disregard the findings of fact as not binding on it. This is a well-settled position and has been accepted in several cases.
106. We find that the Tribunal, in the case on hand, has not examined the Order in Original passed by the Commissioner (Customs) in the manner required of it and also failed to look into the cogent, convincing and thumping evidence on record to Page 114 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022 C/TAXAP/254/2021 JUDGMENT DATED: 14/02/2022 find out if the crucial findings of the Commissioner (Customs) were justified.
107. We are of the view that the findings of fact arrived at by the Tribunal are in complete disregard to the evidence on record. We, therefore, do not feel bound by the findings of the Tribunal. It is true that the order of the Tribunal cannot be said to give rise to a substantial question of law merely because the High Court is of the view that it would have come to a different conclusion on the same evidence; however, where the appreciation of the evidence is wholly unsatisfactory and the crucial aspects of the evidence have been missed, it is case of finding or conclusion which no person properly instructed on the facts and the legal position would have reached. That is what has happened in the present case.
108. In the overall view of the matter, we have reached to the conclusion that the Tribunal committed an error in disturbing the order passed by the adjudicating Commissioner.
109. In the result, both the Appeals of the Revenue succeed and are hereby allowed. The impugned order passed by the Tribunal is hereby quashed and set-aside. The substantial question of law as framed by this Court is answered in favour of the Revenue and against the respondents-assessees. Civil Applications stand disposed of.
(J. B. PARDIWALA, J.) (NISHA M. THAKORE, J.) /MOINUDDIN Page 115 of 115 Downloaded on : Sun Apr 24 12:56:13 IST 2022