Bangalore District Court
Shyla N J vs C B I / Acb on 20 February, 2024
KABC010028702018
IN THE COURT OF THE XLVI ADDL. CITY CIVIL &
SESSIONS JUDGE AND SPL. JUDGE FOR CBI CASES
AT BENGALURU (CCH47)
Dated 20th February, 2024
: PRESENT :
Sri.H.A.Mohan, B.A.L., LL.B.
C/C XLVI Addl. City Civil & Sessions Judge
and Spl. Judge for CBI Cases, Bengaluru
Crl.Appeal.No.139/2018
APPELLANT : Smt.Shyla.N.J.
(ACCUSED) W/o N.A.Jayaram, Major,
No.53, 1st Floor,
Sannidhi Road Cross,
Basavanagudi,
Bengaluru560 004.
(By Sri.K.S.Javali, Advocate)
vs
RESPONDENT : Central Bureau of Investigation/
(COMPLAINANT) Anti Corruption Branch,
No.36, Bellary Road,
Ganganagar,
Bengaluru560 032.
2 Crl.Appeal.No.139/2018
Represented
by Senior Public Prosecutor
Sri.Shivananda Perla
JUDGMENT
This is an appeal filed under Section 374(3) of Cr.P.C. by the Accused No.2 in C.C.No.270/2013, aggrieved by the judgment and conviction dated 25.01.2018 passed by the learned 17th ACMM Court, Bengaluru, for trial of CBI cases, on the following among other grounds.
2. It is contended that the learned trial judge has sentenced the appellant and his husband, who has been shown as Accused No.1 for the offence punishable under Section 120B r/w 420, 468 and 511 of IPC and directed her to undergo sentences accordingly and also for the offence punishable under Section 132, 135, 135(A) of Customs Act and Section 7(1)(a)(ii) of the Essential Commodities Act 3 Crl.Appeal.No.139/2018 r/w Section 25(1) and (2) of Fertilizer (Control) Order, 1985. It is contended that CBI has submitted the final report by citing 88 witnesses and 58 documents for the said offence.
3. It is further contended that the order of conviction is contrary to the facts, evidence led in by the prosecution. The order of conviction is totally bad in law since there is no material to connect them. CBI had no jurisdiction relating to Special Enactment and Customs Act. The learned trial judge has failed to notice the proceedings regarding receipt of subsidy in order to link those persons for importing of muriate of potash. The learned trial judge has failed to notice that second portion of the charge related to exports already done and for which Let Export had been ordered. None of the shipping bills had been produced and secondary evidence has been produced, but the same is not 4 Crl.Appeal.No.139/2018 supported by Certificate under Section 65B of Indian Evidence Act. Therefore, the secondary evidence is not admissible in law.
4. It is further contended that the learned trial judge has failed to notice that no samples had been drawn in the presence of the accused nor had the witnesses been examined affecting the very drawing of the samples for purported tests by the CBI authorities. The learned trial judge has failed to consider the important admissions elicited in the crossexamination of important witnesses. The learned trial judge has failed to appreciate the expert evidence given by the prosecution, inspite of so many latches and lacunas. The learned trial judge has failed to notice that on presumption and in the absence of materials, a conclusion has been drawn of substantial loss having been caused to the Government of India, where none existed. 5 Crl.Appeal.No.139/2018
5. It is further contended that viewed from any angle, findings given by the learned trial judge with regard to proving the charges framed against the accused persons is bad in law and hence order of conviction cannot be sustained in law. Accordingly, prayed to call for the entire records in CC.No.270/2013 from the trial court and to set aside the judgment of conviction and sentence and acquit them of the offences.
6. After registration of the appeal, notice was ordered to the respondent. In response to the notice, the learned Sr. Public Prosecutor has appeared. Thereafter, LCR has been secured from the trial court.
7. Heard the arguments of learned counsel for the appellant Sri.Shivaji H Mane and learned Senior Public Prosecutor Sri.Shivananda Perla.
6 Crl.Appeal.No.139/2018
8. The points that would arise for my consideration are:
1. Whether charges framed by the learned trial judge for the offence punishable under Section 120B r/w 420, 468 and 511 of IPC, is tenable in law?
2. Whether the finding of learned trial judge to convict and sentence the appellant/accused No.2 under Section 132, 135, 135(A) of Customs Act and Section 7(1)(a)(ii) of the Essential Commodities Act r/w Section 25(1) and (2) of Fertilizer (Control) Order, 1985, is not proper and hence call for interference by this court?
3. What order?
9. My findings on the above points are as under:
Point No.1 : In the Negative
Point No.2 : In the Affirmative
7 Crl.Appeal.No.139/2018
Point No.3 : 'As per final order' for the
following:
REASONS
10. POINT NO.1 AND 2: Since these two points are interlinked with each other, to avoid repetition of facts, they are taken up together for discussion.
11. According to the prosecution M/s Bilwa Labs did not possess requisite license for importing/exporting of muriate of potash. But, on 12.05.2009 Accused No.2's Company authorized signatory of Accused No.3 Company submitted the invoices and packing list bearing No.009 dated 12.05.2009 for value of 39.500 US dollars and Rs.19,61,175/ in Indian currency for exporting 100 metric tones of industrial salt BL98 potassium chloride to M/s Brimont Company Ltd., Tung Shin Town, Taiwan through 8 Crl.Appeal.No.139/2018 M/s Sri.Manjunatha Shipping Pvt. Ltd., a CHA. The accused No.1 handed over the declaration for export of goods under post export DEPB Scheme and also declaration and appendix1 Form of SDF. That on 20.05.2009, the Accused No.1 also submitted invoice and packing list bearing No.EXP004 dated 20.04.2009 value of 97,500 US dollars in Indian currency Rs.48,40,875/ as authorized signatory of Accused No.3 Company for exporting 250 metric tonnes of industrial salt BL98 technical grade to M/s Jiasion Bio Technology Company, Tung Shin Town, Taiwan through M/s Sri.Manjunatha Shipping Pvt. Ltd., a CHA. Further, he handed over appendix - I form of SDF through M/s Sri.Manjunatha Shipping Pvt. Ltd. enable them to process the documents for exporting the consignment. Accused No.1 though declared 100 MT and 250 MT in his export documents, but handed over consignment of 115 MT of 9 Crl.Appeal.No.139/2018 muriate of potash under the garb of industrial salt potassium chloride by false declaration vide two shipping bills Nos.2231280 dated 12.05.2009 and 2232309 dated 20.05.2009 to inland container depot of customs department, Whitefield, Bengaluru for exporting packed in 2300 bags of 50 kg each in 5 containers. Along with the invoices he had also handed over the packing lists of the consignment, packing lists of the consignment, export value declaration and self declaration form. Thus, they tried to export 115 MT of muriate of potash, which is coded as CTH 31042000 by customs department under the garb of industrial salt as per code CTH 28273990 thereby violated the notification No.30(RE2003)/200207 dated 28.01.2004 of DGFT. The potassium chloride (muriate of potash) is imported and subsidized by the Government of India during the period of January 2007 to December 2009 to the extent 10 Crl.Appeal.No.139/2018 of Rs.6,758/ to Rs.29,804/ per MT.
12. Further, during the time of export of consignment, the expert entertained the doubt about the consignment and accordingly they asked Deputy Director of Agriculture, Fertilizer Control Laboratory, Bengaluru for drawing of samples and test the same and to submit reports. Then Sri.G.Ramaswamy the Agricultural Officer and Fertilizer Inspector, drew the samples from container Nos.PCIU 263834 (O), PCIU 273075(4), PCIU 267989 (O), PCIU 272413(4) and MOAU 020196(O) on 20.08.2009 in the presence of Venkata Rao, a representative of M/s Sri.Manjunatha Shipping Pvt. Ltd., a CHA of M/s Bilwa Labs and sent the same to the Deputy Director of Agriculture, Fertilizer Control Laboratory, Bengaluru testing the samples. The samples were tested in the said Laboratory and submitted the report dated 01.05.2009 by disclosing 11 Crl.Appeal.No.139/2018 that the samples were muriate of potash and they were according to specification. Thereafter, the Custom Department initiated the enquiry. The Investigating Officer enquired the matter, seized the material under seizure memo and submitted his report to the adjudicating authority.
13. It is further contended that Accused No.2 stated before the customs official under Section 108 of Customs Act, that the materials seized and the material of the previous export consignments were identical and thereby clearly establishing that earlier consignments were also potassium chloride (muriate of potash). The letter No.S 137/BC.7/2010 dated June 3,2010 of Ministry of Finance of the Republic of Indonesia, Directorate General of Customs and Excise, Directorate of International Affairs establishes that the materials exported by M/s Bilwa Labs, which was 12 Crl.Appeal.No.139/2018 imported by PT Gedio Makmur under HS Code 3104.90.00.00 and from the letter No.S137/BC.7/2010 dated 03.06.2010 established that materials exported by M/s Bilwa Labs, Bengaluru is muriate of potash.
14. It is further contended that DEPB benefit given to products manufactured and exported. M/s Bilwa Labs is neither a manufacturer nor exporting finished/processed goods as a merchant exporter. But, Accused No.3 even though did not entitle for DEPB benefits, filed applications with mis declaration and without proper license and availed DEPB benefits of Rs.1,28,28,541/. Investigation revealed that accused entered into a criminal conspiracy to cheat the Government of India in the matter of export of muriate of potash which is restricted item for exporting without refunding the subsidy granted by the Government of India. The accused exported potassium chloride in the 13 Crl.Appeal.No.139/2018 garb of industrial salt/potassium chloride by misdeclaring the HS code from the period October 2007 to May 2009 and exported around 24,156 MT and caused wrongful loss to the Government of India to the extent of Rs.59,62,51,362/ by way of not repaying the subsidy and corresponding wrongful gain to themselves. Further, they tried to export potassium chloride under the brand industrial salt worth of Rs.40,25,000/ and declared the value of the so called industrial salt to the tune of Rs.22,51,628/ without refunding the subsidy amount of Rs.17,73,372/ to the Government of India. Thus, they exported and tried to export potassium chloride by falsely declaring the same as industrial salt and availed the subsidy and also DEPB benefits to the tune of Rs.61,08,53,275/ and caused wrongful loss to the Government of India and corresponding gain for themselves. Thus, they have 14 Crl.Appeal.No.139/2018 committed the alleged offences.
15. After having received the said final report, the learned trial judge has taken cognizance and secured the presence of the accused and thereafter framed the charges. Thereafter, the learned trial judge has recorded the evidence of 82 witnesses as PW1 to PW82 and marked the documents as per Ex.P.1 to P.426. Thereafter, statement under Section 313 Cr.P.C. were recorded by putting the incriminating evidence available against the accused.
16. After having heard the arguments, learned trial judge has formulated the points and answered Point No.1 to 5 partly in the affirmative and passed the conviction order.
17. The learned counsel for the appellant Sri.Shivaji H Mane has pointed out that the prosecution is mainly relying upon the evidence of PW6, PW8, PW13, PW15, 15 Crl.Appeal.No.139/2018 PW19, PW20, PW26, PW29, PW33, PW41, PW62, PW68, PW70, PW71, PW75, PW80 and PW81. But, none of the said witnesses are experts to identify the material as potassium chloride or muriate of potash. When they are not experts to identify the materials seized by Customs Officers, case of the prosecution that accused have tried to export potassium chloride or muriate of potash, is absolutely false. The Investigating Officer has not properly conducted the investigation to identify the very important aspect. CBI Investigating Officer has only collected report from Customs Officer and submitted the charge sheet.
18. It is further argued that samples were not taken in the presence of the accused and as per the evidence of the said important witnesses, it is clear that in the very bag itself it was shown as potassium chloride or muriate of potash. Based upon the said mention made on the bag, the 16 Crl.Appeal.No.139/2018 so called expert has given the report. Therefore, it is not sufficient to prove the contention of the prosecution that accused have tried to export potassium chloride or muriate of potash. In fact, PW6 has clearly admitted that as per Ex.P.51, Customs Department had mentioned the sample as potassium chloride. PW6 has not conducted the test to arrive and to give Certificate as per Ex.P.50, 52, 54 and 56. He only issued Certificates as Issuing Authority. Smt.Sandhya Damodhar, who has been examined as PW12, has conducted the test and issued Certificates. So, absolutely there is no material to conclude that accused have tried to export potassium chloride or muriate of potash, but without properly analyzing the evidence placed by the prosecution, the learned trial judge has erroneously arrived at a conclusion that the prosecution has proved the charges leveled against Accused No.1 to 3 in part. 17 Crl.Appeal.No.139/2018 Therefore, interference of this Hon'ble Court is absolutely necessary.
19. On the other hand, the learned Senior Public Prosecutor Sri.Shivananda Perla has argued that the evidence of PW6 and PW12, who are the Experts and working in Agriculture Department, is sufficient to prove that accused have tried to export potassium chloride or muriate of potash. Evidence of experts have not been properly challenged by the accused persons by eliciting any evidence to discard their oral testimony and their expertise. The learned trial judge has properly analyzed the evidence and accordingly convicted the appellants. Therefore, appellant has not made out grounds to interfere with the judgment of conviction passed by the learned trial judge.
20. In the light of the said arguments, I have perused 18 Crl.Appeal.No.139/2018 the records. In this case, the first and foremost thing to be ascertained is whether the prosecution has able to prove beyond all reasonable doubt that seized articles from accused/appellant was potassium chloride/muriate of potash. In order to prove the said aspect, the prosecution is relying upon the evidence of PW6 Sri.Raghavendra. PW6 is the Consultant in Geological and Metallurgical Lab. He deposed that customs officials had sent some samples for testing the same and to submit the report. The same was sent to chemical lab and it was tested and submitted the report as per Ex.P.50 stating that percentage of potassium chloride was 98.01%. He stated that, that item is basically potassium chloride with low impurities.
21. In the crossexamination, he admitted that request for conducting test was from Customs Department. He was not present when sample was drawn. He admitted 19 Crl.Appeal.No.139/2018 that while sending the sample as per Ex.P.51, the Custom Department had mentioned the sample as potassium chloride. He admitted that his office staff did not test the same. He has not conducted the test and Smt.Sandhya Damodhar has conducted the test.
22. The next witness is PW8 Sri.H.L.Srinath, Superintendent of Central Excise. He has deposed with regard to production of number of bills. Of course, this is not so relevant because production of documents are not in dispute. In the crossexamination, he admitted that during the relevant period, he was not working and hence he does not have personal knowledge about the said documents.
23. The next important witness is Smt.Sandhya Damodhar, who has been examined as PW12. She has deposed that during the relevant period, she was working in 20 Crl.Appeal.No.139/2018 the lab and she herself and one Mr.Jagan, who were working as chemist. As per Ex.P.55 Customs Department has asked to conduct test to confirm the composition of the powder. Ex.P.56 is the said test report. She herself and Mr.Jagan have carried out the test as per IS6092 (IS means Indian Standard). Worksheet in Ex.P.56(b) is in the handwriting of herself and Mr.Jagan. They came to know that sample was potassium chloride and it was above 99.95%. Therefore, they declared it as industrial salt.
24. In the crossexamination, she admitted that at the time of conducting chemical test, chemist shall follow certain standard method, which are contemplated in the standard test procedure. Their office received letter from the Customs Department stating that suspected sample is potassium chloride. Accordingly, they conducted the test. When suggestion was made that potassium chloride and 21 Crl.Appeal.No.139/2018 muriate of potash are different, she stated that she does not now whether they are different or not. She also does not aware about nature of both the material. She also admitted that chemist should know the procedural aspects to conduct the test and also the constituents of that particular material. Further, chemist does not know the said aspect. He/she cannot give the opinion. She admitted that she has not opened the sealed specimen that was sent. She also admitted that in a routine manner, she has conducted the test of the specimen that was sent to their office. She also does not know whether potassium chloride is capable of manufacture or not. According to the report, potassium chloride is declared as industrial salt. She also admitted that scientifically potassium chloride and muriate of potash are different items and both of them have different properties, chemical components and chemical composition. 22 Crl.Appeal.No.139/2018
25. The next witness is PW13 Sri.P.Anantha Krishnan, who was working as Additional Director, Directorate of Revenue Intelligence, Kochi. He has deposed with regard to assessment of shipping bills for export. He has identified several documents. But, in the cross examination, he admitted that during the period of export of goods, he was not working as Deputy Commissioner of Customs, ICD, Bengaluru. He admitted that shipping bills have to be filled for exporting goods. He has given the details of names of such officers to the CBI to show as to who generated the bills. He has not given any chart so as to link the names of officers with their code numbers. In the shipping bills there is no codding of exporters and in some of the shipping bills one Yathiraj has signed, but he does not know as to whether he was representative of CHA or not. He admitted that whenever CHA is signing the shipping 23 Crl.Appeal.No.139/2018 bills, he has to obtain an authorization letter from the exporter. He also admitted that customs officers, who actually examined the exported goods and who issued the let export order would be the proper person to explain as to the manner of export.
26. The next witness is PW15 Smt.Suma.M.R., who was working as Deputy Director of Agriculture, Watershed Development Department. She has deposed with regard to the material that was seized. In the crossexamination, she stated that test was conducted in her supervision, but actually she did not personally conduct the test and she cannot say as to who actually conducted the test. CBI did not ask her to furnish the names of the officials, who conducted the test. The analysis report issued to Fertilizer Inspector, who had send for analysis. The request for analysis was sent to their office by Fertilizer Inspector and 24 Crl.Appeal.No.139/2018 after test, they communicated the report to the said Fertilizer Inspector. She does not know from where actually the Fertilizer Inspector had drawn the samples. The said Fertilizer Inspector is competent person to depose as to from where it was drawn. She admitted that in Court records, notes of findings of chemist are not available. They used to take the entire samples for analysis and there will not be any remnants. The Custom Department did not ask her to sent her statement. She admitted that in her statement before the CBI, she has stated that after the analysis, the Agricultural Officers had submitted the result sheet under their signature to her. On receipt of result sheet, decoded it and entered the results of analysis in the concerned register. But the records of coding and decoding result sheet forwarded by Agriculture Officer are not available in the Court records.
25 Crl.Appeal.No.139/2018
27. The next witness is PW20 G.Ramaswamy, Agricultural Officer. He deposed that in the year 2009, their Deputy Director, Agriculture (Fertilizer and Manure) had received letter from Commissioner of Customs and as per their request, sample was received for chemical test. He deposed that Superintendent of Customs showed him number of containers with 50 kg bags labeled as potassium chloride and they randomly picked 5 containers and counted the total number of bags. In PCIU 2638340 container there were 500 bags each weighing 50 kgs. In another container, there were 500 bags weighing 50 kgs each. He stated that all the said bags were belonging to M/s Bilwa Labs and they were exporting through CHA M/s Sri.Manjunatha Shipping Pvt. Ltd. The representative of M/s Manjunatha Shipping Pvt. Ltd. was also present. As per FCO 1985 sampling procedure, in the 5 container having 26 Crl.Appeal.No.139/2018 500 bags, he randomly selected 5 bags each and from each of them he drew sub samples and made 3 representative samples weighing 400 gms each. Thereafter, he stored the samples in air tight thick plastic covers. He prepared formP in triplicate and kept each representative sample along with Pform in three cotton bags and sealed. He identify the samples as Ex.P.303.
28. In the crossexamination, he admitted that dealer license is required in order to stock and sale the fertilizers and said person is called a dealer. When he prepared the mahazar as per Ex.P.288, accused were not present. In Ex.P.288 in the rubber seal, one signature is there, but he does not know as to whose signature it is. He does not have any documents to show that M/s Bilwa Labs is dealer of Fertilizer. M/s Manjunatha Shipping Pvt. Ltd. is also not having any dealership of fertilizer. He admitted that in 27 Crl.Appeal.No.139/2018 Ex.P.289 in Sheet No.6, it is certified that sample was drawn in accordance with the Fertilizer Control Order, 1985. It is certified therein that stock is from the possession of M/s Manjunatha Shipping Pvt. Ltd. In Ex.P.289, he has mentioned that the sample drawn was potassium chloride and he mentioned it based on the label on the bags. In the mahazar, he has not mentioned that there were labels on the box showing the contents as potassium chloride. Of course, he has denied the suggestion that potassium chloride and muriate of potash were different and are having different compositions. But, he admitted that muriate of potash is naturally available ore and potassium chloride may be chemically prepared. He admitted that permission of the Government of India is required for import of muriate of potash. Agriculture Department in Central Government issues the license for importing the 28 Crl.Appeal.No.139/2018 muriate of potash. He admitted that CBI officials were not present while samples were drawn and he sent one of the sample for testing. He admitted that no such samples, which he had drawn were available in the Court.
29. PW26 Sri.Venugopal Deshpande, Superintendent of Central Excise, who even though has deposed with regard to some receipts, but he does not have personal knowledge about the documents.
30. PW29 is B.S.Manjunath, Specified Officer and Authorized officer, Special Economic Zone and who conducted the search. In the crossexamination, he stated that he conducted search in respect of 5 containers during the course of process of export. But, he does not remember as to whether at the time of seizure, the shipping bills pertaining to the above said containers were seized or not. 29 Crl.Appeal.No.139/2018 He admitted that the said shipping bills now are not with the mahazar. He conducted search as per Ex.P.334 in the office of Bilwa Labs. At that point of time, Accused No.1 has explained that industrial salt is nothing but potassium chloride and potassium sulphate. While recording the statement as per Ex.P.336, the accused has stated that specifically query is around 97%. He admitted that when mahazar was drawn as per Ex.P.339, no one from M/s Bilwa Labs was present. But, he was present when Fertilizer Inspector Ramaswamy drawn the samples, but he did not put his signature to any of the documents. He does not remember as to whether Fertilizer Inspector handed over one of the samples to their custody or not. When CBI enquired him and recorded his statement, they did not show the samples. He did not enquire as to whether any samples were taken at the time of issuing let export order or not. 30 Crl.Appeal.No.139/2018
31. PW33 Sri.R.Bhaskaran has deposed with regard to shipping bills pertaining to M/s Bilwa Labs. In the cross examination, he admitted that while exporting either the sample or the material, the shipping bill has to be filled either by the party in person, who is exporter or his licensed CHA. Ex.P.363 is computer generated copy. CBI did not ask for officer's copy authorizing CHA to file the present shipping bill. He admitted that there is no prohibition or restriction for exporting the sample of potassium chloride. He has only produced documents herein and he does not have any personal knowledge as to processing the documents for exporting the samples. He admitted that while exporting the restricted item, the sample will be drawn and the test will be conducted. There is authorized officer for drawing the sample and sent it to the lab for analysis. There is no assessment officer and one examining 31 Crl.Appeal.No.139/2018 officer, who are supervisor, exporting items at the time of export. He does not know, who were assessment officers and examining officers at the time of exporting the items in question. He admitted that those officers are proper persons to depose with regard to that aspect.
32. PW70 Sri.Sivasubramanian, Retired Deputy Commissioner of Customs, in his evidence deposed that there are regulations and guidelines issued by Government of India for export and import. The department also having certain regulations for following the processing of the documents and for examination of cargo. There are notifications for restricting or prohibiting export or import. But, he does not remember the names of the officers, who were working as Inspectors and Superintendent of Customs in ICD, Bengaluru from 2007 to 2009. He was not present at the time of drawing the samples. Even PW71 32 Crl.Appeal.No.139/2018 Sri.L.Gopinath also did not have personal knowledge about goods in question. He was not present when the samples were drawn.
33. PW75 Smt.Hemalatha, Agricultural Officer has admitted that Fertilizer Inspector has to follow some mandatory procedure at the time of drawing the samples. She also admitted that he also should follow mandatory procedure even for sending samples to the laboratory. The Inspectors have to send the samples within 7 days from the date of drawing. When the samples comes to lab, within the period of 30 days from that day, the report is required to be dispatched from the lab. She was not the Head of the Lab during that period. She also admitted that on going through Ex.P.273 to 280, she cannot say as to which sample, she has analyzed, but only after going through the decode register, she is able to depose about that aspect. 33 Crl.Appeal.No.139/2018
34. PW80 G.Varadaraju, Retired Superintendent, Central Excise has admitted that on seeing Ex.P.88, he cannot say as to whether goods was loaded to container from lorry or not. The Inspector of Export Section after loading the cargo into containers put the OTL. He does not have any knowledge as to putting of OTL.
35. PW81 Vivekananda.G.Tulasigeri, Dy.S.P., Karnataka Lokayuktha, who conducted the investigation, has only deposed about collection of material and submission of charge sheet. In the crossexamination, he admitted that during the course of investigation, he has not come across importing of muriate of potash by M/s Bilwa Labs as to availment of subsidy of the said company. He also did not find out as to registration of goods by the Customs Department against the accused and so as to their arrest and producing before the special Court for economic 34 Crl.Appeal.No.139/2018 offences. He knew that after completion of investigation under the Customs Act, show cause notice will be issued to the accused. He knew during the course of investigation that even the export consignments are to be confiscated. He did not find out shipping bills that were filed in quadruplicate. He does not remember that the original shipping bills will be retained by the Customs Department. He also does not recollect as to the realization of Foreign Exchange by the Company. He stated from Ex.P.209 to P.233 and any other shipping bills there is no declaration that export consignment is muriate of potash. He did not seize any material after he took over the investigation. He did not receive any samples from the Custom Department and he did not ask the said Department officials to produce the samples provided by the Agriculture Officer CW17. He recorded the statement of CW17, but he did not ask him to 35 Crl.Appeal.No.139/2018 produce the rules prescribed in the method of taking samples and adopting the test method. He also asked CW17 as to which Laboratory, he has sent the samples. But, he did not ask him as to whether he had send the samples to Central Government notified Laboratory or not. He did not find out involvement of Custom officials and as such charge sheet was not filed under the P.C.Act.
36. From the above evidence, as rightly pointed out by learned counsel for appellant Sri.S.H.M. several mandatory procedures have not been followed by the Customs Officials while goods stated to have been seized from the custody of the accused. Accused were not present when samples were taken. In fact, samples have not been produced before the Court for the purpose of identification as to which item was tested by the Laboratory. Agricultural Officer, who stated to have been tested the samples are 36 Crl.Appeal.No.139/2018 unable to say as to who actually tested the chemical and which procedure was adopted by them for the purpose of conducting test. Further, it is very clear that based upon the label put by the Custom Officer while sending the sample, so called expert witnesses have mentioned in their report that it is muriate of potash/potassium chloride. Mandatory guidelines have not been followed while drawing samples and conducting test. Casual approach has been adopted by Customs Officers with regard to seizure of goods, taking up samples and conducting test for analysis.
37. It is to be noted that when the mandatory procedures under Customs Act, Fertilizer Control Act have not been followed by the Custom Officers while conducting investigation and when the matter was investigated by the CBI, they also did not collect the samples and conducted proper investigation with regard to the mandatory 37 Crl.Appeal.No.139/2018 procedure, that was required to be followed by the Customs officials while seizure of goods and taking samples. It is clear that there is lapse on their part. But, the learned trial judge has mainly relied upon the statement of accused recorded under Section 108 of Customs Act and conclusively held that, that is sufficient to prove the guilt. There cannot be any absolute presumption under law against the accused. Presumption always is rebuttal and hence accused are entitled to rebut the same during the course of trial.
38. Here in this case, the accused have been able to elicit important admissions during the course of cross examination of the above said important witnesses with regard to not following the mandatory procedure while seizure of goods and taking samples and conducting test analysis. The observations made by the learned trial judge 38 Crl.Appeal.No.139/2018 that statement under Section 108 of Customs Act is sufficient to prove the charges, cannot be believed and accepted.
39. It is seen that the learned counsel for Accused No.2 has cited a decision reported in 1970 AIR 940 (Ramesh Chandra Mehta v. State of West Bengal), to contend that the statement of accused recorded during the course of investigation is not admissible and it is hit by Article 20(3) of Constitution. But, the learned trial judge has given a finding that during the course of recording the statement of Accused No.2 under Section 108 of Customs Act, case was not registered by the CBI. Therefore, it is not hit by Article 20(3) of Constitution.
40. It is to be noted that when the Customs officials themselves have conducted investigation/enquiry for the 39 Crl.Appeal.No.139/2018 purpose of making use of the statement of the accused for further investigation to be conducted by the CBI and since CBI did not examine Accused No.2 during the course of their investigation, the observation that it is admissible in evidence, cannot be accepted. Because CBI wants to make use of the statement of Accused No.2 recorded under Section 108 of Customs Act during the course of enquiry. An independent investigation should have been conducted and independent material should have been collected by the CBI to substantiate the contention in that regard.
41. It is to be noted that when proper procedure has not been adopted while taking samples and taking test, which are mandatory and since sample has not been produced before the Court for the purpose of proving the samples in accordance with law and for identification, it creates a doubt with regard to genuineity of the procedure 40 Crl.Appeal.No.139/2018 adopted by Custom Officers as well as CBI Investigating Officers. It is an established principle of law that any benefit of doubt entertained during the course of trial shall be extended in favour of the accused. Since there is no reason assigned by the prosecution as to why proper procedure under Customs Act was not followed and while disposing of the seized and tested samples mandatory provision was not followed by producing the inventory Certificate issued by the jurisdictional magistrate under Customs Act, the case of the prosecution becomes doubtful. The said benefit also shall be extended in favour of the accused. But, as stated above, the learned trial judge has mainly relied upon the so called statement recorded under Section 108 of Customs Act and came to a conclusion that prosecution has proved the charges. But, the decision of Hon'ble Supreme Court would enure to the benefit of 41 Crl.Appeal.No.139/2018 accused in that regard. Therefore, without much discussion, I hold that the above said benefits shall be extended in favour of the accused. But, the learned trial judge has failed to appreciate the said aspect in proper perspective and also not properly appreciated the expert evidence, even though so many important admissions have been elicited during the course of crossexamination with regard to failure on their part to follow the mandatory provisions. Therefore, as rightly pointed out by Sri.S.H.M., the learned counsel for appellant, the grounds urged in the appeal memo are tenable in law. Therefore, interference of this Court in the judgment and conviction of the learned trial judge is absolutely necessary. In view of the said reasons, I am not inclined to accept the arguments of learned Senior Public Prosecutor for the prosecution. Accordingly, I answered Point No.1 in the Negative and Point No.2 in the 42 Crl.Appeal.No.139/2018 Affirmative.
42. POINT NO.2: In the result, I proceed to pass the following:
ORDER The appeal filed by the appellant/Accused No.2 under Section 374(3) of Cr.P.C. is hereby allowed.
Consequently, the judgment and
conviction in C.C.No.270/2013 dated
25.01.2018 passed by the learned 17th ACMM Court, Bengaluru for trial of CBI cases, is hereby set aside.
Consequently, the appellant/Accused No.2 is acquitted of the offence punishable under Section 120B r/w 420, 468 and 511 of IPC and under Section 132, 135, 135(A) of 43 Crl.Appeal.No.139/2018 Customs Act and Section 7(1)(a)(ii) of the Essential Commodities Act r/w Section 25(1) and (2) of Fertilizer (Control) Order, 1985.
Consequently, the bail bond of the appellant/Accused No.2 and that of his surety, shall stand canceled.
(Dictated to the Judgmentwriter, transcribed and computerized by her, corrected and then signed by me on this the 20th day of February, 2024).
(H.A.Mohan) C/C XLVI Addl.C.C. & S.J. and Special Judge for CBI Cases, Bengaluru.
Digitally signed by MOHAN DN: cn=MOHAN,ou= HIGH COURT OF
MOHAN KARNATAKA,o= HIGH COURT OF KARNATAKA,st= Karnataka,c=IN Date: 2024.02.20 16:40:35 IST