Customs, Excise and Gold Tribunal - Delhi
Savinder Lal Verma vs Cc on 18 January, 1999
Equivalent citations: 1999(82)ECR17(TRI.-DELHI)
ORDER G.A. Brahma Deva, Member (J)
1. The facts of the case, in brief, are as follows:-
2. On 27.11.1985 acting on an information, the officers of Customs and Central Excise Division, Ambala, apprehended the appellant at a three wheeler Scooter stand opposite Bus Stand, G.T. Road, Ambala Cantt and conducted his personal search in the presence of two independent witnesses. A cloth "Vansali" was found tied around this waist, which on examination was found to contain 5 gold bars of 10 tolas each bearing foreign markings "Swiss Corporation 10 tolas 999.0" wrapped in a piece of Urdu Newspaper tied with rubber band. Appellant on demand could not produce any evidence, documentary or otherwise in support of the lawful import/purchase/possession/acquisition of the said 5 Gold Bars 10 tolas each of foreign origin and valued at Rs. 1,20,000/- and as such the same were seized under Section 110 of the Customs Act, 1962 and Section 66 of the Gold Control Act, 1968 on the reasonable belief that the same had been smuggled into India in violation of the restriction imposed on the import thereof and as such were liable to confiscation under the provisions of the Act. Statement of Shri Savinder Lal Verma, appellant was also recorded on 27.11.1985 in which he admitted the recovery and claimed ownership of 5 gold bars of 10 tolas each of foreign markings seized from his possession. He said that he had brought the said seized gold bars from one Shri Purshotam Lal of Katra LSat Narain, C'handni Chowk, Delhi, having telephone No. 2528694 installed therein; that he also brought 5 Gold Bars in the 2nd week of November, 1985; that out of those 5 gold bars, he sold out most of them to M/s. Hans Raj Inder Lal, Halwai Bazar, Ambala City, that rest of the gold bars were sold to different Goldsmiths of Ambala City in small pieces and that he used to deal in Gold Bars & primary gold from his shop situated in a street opposite Bata Shop, Ambala City. On making a detailed investigation, the party was issued show cause notice. Show cause notice was duly answered by denying the charges. Commissioner who adjudicated the matter negatived the contentions of the party and held that 5 gold biscuits of 1.0 tolas each recovered from the appellant are liable for confiscation under Section 111(d) of the Customs Act and ordered accordingly. In addition to imposing penalty of Rs. 60,000/- under Section 112(b) of Customs Act and a penalty of Rs. 15,000/- under Section 74 of the Gold Control Act on Purshotam Lal, the main party, he also imposed penalty of Rs. 20,000/- under Section 112(b) of the Customs Act and Rs. 5,000/- under Section 74 of the Gold Control Act, 1968, on the appellant.
3. Shri S.C. Puri, learned Advocate, appearing for the appellant challenged the recovery of gold. He submitted that according to the department, gold was recovered in the presence of two independent witnesses on the night of 27.11.1985 but no such gold has been recovered in the presence of the witnesses as can he seen from the statement of Sat Pal who has clearly stated that he was called in the Custom's office in Ambala in between 12.00 P.M. and 1.00 noon. Nothing was recovered in his presence but he was told that gold has been recovered from one person. He submitted that other witness did not appear during adjudication proceedings in spite of the specific request made by the party. Further, he said that department has also initiated prosecution proceedings and Chief judicial Magistrate, Ambala has acquitted the accused (appellant) by obuifing that the prosecution has not been able to prove charge against the accused beyond a reasonable doubt. He submitted that the statement of the appellant given on 27.11.1985 cannot be taken cognizance since it was given under duress. The very next day the appellant was sent a telegram on 27.11.1985 stating "Wrongfully implicated in custom case and statements recorded forcibly. Pray justice." On cross-examination of the punch witness on 10.6.1996, he has stated that no gold was recovered in his presence but he has been informed that gold has been recovered from one person. Apart from statement of Sal Pal during cross-examination, learned Counsel drew my attention to the finding given by the Commissioner that there is a contradiction in the statement of Purshotam Lal and Sant Lal. Further the Commissioner in the impugned order observed that seizure was effected on 27.11.1985 and the proceedings were pending for 11 years which itself is torture and punishment.
4. Shri T.A. Arunachalam, learned JDR countering the arguments submitted that recovery proceedings as such cannot be weak because of statement of punch witnesses since the statement of the Investigating Officer has not been shattered and precisely this was finding of the Chief Judicial Magistrate in the proceedings before him. He referred to the decision of the Supreme Court in the case of Modan Singh v. State of Rajasthan, reported in AIR 1978 Supreme Court 1511wherein it was held that if the evidence of investigating officer who recovered the material objects is convincing the evidence as to recovery need not be rejected on the ground that seizure witnesses do not support the prosecution version. He also submitted that no evidence has been placed on record to show that statement of co-accused was taken under duress relying upon the decision . Further he referred to the decision of the Supreme Court in the case of Narcsh J. Sukhawani, reported in 1996 (83) ELT 258 (SC) : 1996 (62) ECR 366 (SC) wherein it was held that it must be remembered that the statement made before the Customs officials is not a statement recorded under Section 161 of the Criminal Procedure Code, 1973. Therefore, it is a material piece of evidence collected by Customs officials under Section 108 of the Customs Act. That material incriminates the petitioner inculpating him in the contravention of the provisions of the Customs Act. The material can certainly be used to connect the petitioner in the contravention inasmuch as co-accused's statement clearly inculpates not only himself but also the petitioner. He said that on the same analogy, the statement given by co-accused Purshotam Lal clearly indicates the involvement of himself and of the appellant.
5. I have carefully considered the submissions made by both the sides and perused the records. Chief Judicial Magistrate has acquitted the appellant against the complaint under Section 135(1) of the Customs Act and under Section 85 of the Gold Control Act, 1968 observing that the prosecution has not been able to prove the charges against the accused beyond a reasonable doubt. So the benefit of doubt is extended to the accused and he has been acquitted in the proceedings before him. He observed that nothing has been brought to show that item seized as such was gold in the absence of the examination of the item at that time. It is settled position that proceedings before the criminal Court and the method of evidence to be adduced in the criminal proceedings are altogether different from the adjudication proceedings. Before the prosecution also, recovery, as such, has not been denied. Further, there is sufficient force in the arguments advanced on behalf of the Revenue that statement of investigating officer stands intact in the absence of the cross-examination relying upon the decision in the case of Modan Singh, referred to above. But in the impugned order, the Commissioner has pointed out some discrepancies and furthermore, he observed that since seizure was effected on 27.11.1985 and the proceedings have been pending for 11 years against the appellant which in itself is a torture and punishment. In the facts and circumstances and giving credence to the submissions made by the appellant's counsel with reference to the alternative prayer, I am of the view that some reduction is called for with reference to the quantum of penalty. Taking into consideration the overall facts and circumstances and the fact that the Gold Control Act was repealed subsequently. I do not find any justification for imposing penalty under the Gold Control Act. However, imposition of penalty under the Customs Act is justified but some lenient view is called for in view of the foregoing conclusion. Accordingly, the penalty is reduced to Rs. 10,000/- as against Rs. 20,000/- but for this modification, the order of the Commissioner is upheld.
6. The appeals are disposed of in the above terms. At this stage, Shri Puri submitted that penalty of Rs. 10,000/- has already been deposited at the time of stay.
Dictated in open Court.