Delhi District Court
(2)Sh. R.K. Malhotra vs Central Bureau Of Investigation on 22 January, 2013
IN THE COURT OF SH. P.S. TEJI, DISTRICT JUDGE (EAST) :
SPECIAL JUDGE (CBI), KARKARDOOMA COURTS, DELHI
C.A. No.13/2012
Unique Case ID No.02402R0158842012
(1)Ashu Exports
70, Okhla Indl. Estate,
PhaseIII, New Delhi20
Through its Prop.
Sh. R.K. Malhotra
(2)Sh. R.K. Malhotra
R/o C166, Sector48,
Noida, U.P. ...Appellants
Versus
Central Bureau of Investigation
CGO Complex, Lodhi Road,
New Delhi
Through its Director. ...Respondent
Date of Institution : 02.06.2012
Date of order reserved : 08.01.2013
Date of order : 22.01.2013
C.A. No.14/2012
Unique Case ID No.02402R0158852012
C.A.No.13/2012 Ashu Exports etc. vs CBI Page 1 of 19
(1)Ashu Exports
70, Okhla Indl. Estate,
PhaseIII, New Delhi20
Through its Prop.
Sh. R.K. Malhotra
(2)Sh. R.K. Malhotra
R/o C166, Sector48,
Noida, U.P. ...Appellants
Versus
State Through
Central Bureau of Investigation
CGO Complex, Lodhi Road,
New Delhi
Through its Director. ...Respondent
Date of Institution : 02.06.2012
Date of order reserved : 08.01.2013
Date of order : 22.01.2013
O R D E R
By this common order, I shall decide two appeals bearing C.A. No.13/2012 & C.A. No.14/2012 arising out of common judgment of conviction dated 12.03.2012 and order on sentence dated 05.05.2012, passed by the Ld. Additional Chief Metropolitan C.A.No.13/2012 Ashu Exports etc. vs CBI Page 2 of 19 Magistrate (East), Karkardooma Courts, Delhi.
2 Vide impugned judgment dated 12.03.2012, appellants have been convicted for the offences punishable under Sections 420/468/471 IPC and under Section 5 of the Imports and Exports Act, 1947 in case bearing RC No.2(S)/1994/SIUIX. Appellants have also been convicted for the offences punishable under Section 5 of Imports and Exports Act, 1947 in case bearing RC No. 2(S)/1994/SIUX. Appellant Ashu Exports has been directed to pay fine of Rs.50,000/ for the offence under Section 420 IPC, fine of Rs. 50,000/ for the offence under Section 471 IPC as the forgery is equivalent u/s 468 IPC and fine of Rs.50,000/ for the offence under Section 5 of Imports and Exports Act in case bearing RC No. 2(S)/1994/SIUIX. Appellant R.K. Malhotra has been sentenced to undergo simple imprisonment for 3 years and fine of Rs.5,000/ for the offence u/s 420 IPC. In default of payment of fine, he shall further undergo SI of 2 months. Appellant R.K. Malhotra has been sentenced to undergo simple imprisonment for 3 years and fine of Rs.5,000/ for the offence u/s 471 IPC. In default of payment of fine, he shall further undergo SI of 2 months. Appellant R.K. Malhotra has been sentenced to undergo simple imprisonment for 3 years and fine of Rs.5,000/ for C.A.No.13/2012 Ashu Exports etc. vs CBI Page 3 of 19 the offence u/s 5 of Imports and Exports Act. In default of payment of fine, he shall further undergo SI of 2 months. All these sentences have been awarded to appellant R.K. Malhotra in case bearing RC No.2(S)/ 1994/SIUIX.
3 Appellant Ashu Exports has been directed to pay fine of Rs.50,000/ for the offence under Section 5 of Imports and Exports Act, whereas appellant R.K. Malhotra has been sentenced to undergo simple imprisonment for 3 years and fine of Rs.5,000/ for the offence u/s 5 of Imports and Exports Act. In default of payment of fine, appellant R.K. Malhotra shall further undergo SI of 2 months. These sentences have been passed in case bearing RC No.2(S)/1994/ SIUX. 4 Benefit under Section 428 IPC has been granted to the appellant R.K. Malhotra. All the sentences have been ordered to run concurrently in case bearing RC No.2(S)/1994/SIUIX, but separately from case bearing RC No.2(S)/1994/SIUX i.e. The sentence in case RC No.2(S)/1994/SIUX should run after the sentence in case RC No.2(S)/1994/SIUIX.
5 I have heard Ld. Counsel for the appellant as well as Sh. K.C. Dubey, Ld. AGSC for CBI/DGFT. I have meticulously C.A.No.13/2012 Ashu Exports etc. vs CBI Page 4 of 19 gone through the material available on record and the submissions made from either side.
6 Facts leading to filing of the present appeals are that two complaints were filed by CBI bearing RC No.2(S)/1994/SIU IX and RC No.2(S)/1994/SIUX against accused/appellants Ashu Exports and its proprietor R.K. Malhotra. First complaint was under
Section 120B IPC read with Section 420/468/471 IPC and Section 5 of Imports and Exports Act, 1947 and substantive offences thereof. Second complaint was under Section 120B IPC read with Section 5 of Imports and Exports Act, 1947. In the first complaint, it was alleged that M/s Ashu Exports had moved an application for grant of advance license for Rs.9,72,625/ for import of 100% cotton denim. Documents i.e. photocopy of RCMC, original treasury challan of Rs. 975/, copy of export order and income tax declaration were annexed. After processing of application, advance license No.P/K/24270741 dated 13.01.1986 was issued with the conditions that the firm should export jeans 15,000 pieces and long coat (gents) 10,000 pieces for a value of Rs.16,70,000/. Said firm furnished an agreement whereby it was agreed that the importer should earn foreign exchange of value of Rs.16,70,000/ and on its failure should pay custom duty with interest C.A.No.13/2012 Ashu Exports etc. vs CBI Page 5 of 19 of 18% from the date of import. Import documents were received from foreign supplier M/s Miralka Enterprises (HK) Ltd. Import documents received from Andhra Bank were handed over to M/s Vinod S. Mehta and Company along with license and DEEC Book. M/s Vinod S. Mehta and Co. after getting the material cleared, stored the same in the godown of M/s Thakkar Warehousing Agency which sent material to M/s Sharda Trading Co. some of the material was sent to the godown of Gurugovind Industrial Estate, Bombay. Said material was transported through M/s New Safe Carriers but it never reached Delhi and was illegally disposed of by selling in open market. It was alleged that accused/appellant R.K. Malhotra submitted false export order which was prepared by himself in the name of M/s Star Enterprises.
7 It was also alleged that another advance license No.P/K/3148753 dated 23.04.1986 was obtained for import for brass scrap amounting to Rs.9,80,000/ and a false export order was issued by M/s Exotica along with application for advance license. Conditions imposed for grant of said advance license was that the firm should export 70 M.T. Brass artware of value of Rs.20,00,000/. Requisite amount was again deposited in Andhra Bank. After saving import C.A.No.13/2012 Ashu Exports etc. vs CBI Page 6 of 19 documents from bank, same were handed over to M/s Shri Sainath Shipping Corp. Bombay for clearance of material. The said material was received and sent to Delhi through M/s Key Cess Carriers but it never reached Delhi and it was alleged that same was disposed of illegally.
8 It was further alleged that license No.P/K/2427033 dated 03.10.1986 for import of brass scrap was obtained with the conditions that importer had to export 49 M.T. Brass artware for a value of Rs.14,40,000/. Said material was cleared by M/s Sainath Shipping Corp. but it never reached Delhi and itwas alleged that same was illegally disposed of. It was alleged that corresponding export was never made by the accused/appellants after obtaining advance licenses and no entries in export books were made. 9 In the second complaint bearing RC No.2(S)/1994/ SIUX, it was alleged that an application for grant of advance license for Rs.9,85,600/ was filed for import of mulberry raw silk. Advance license No.P/K/2441493 dated 15.01.1987 was issued with the conditions that the importer should export 100% mulberry raw silk fabric weighing 3500 Kgs for a value of Rs.20,62,000/. Andhra Bank received import documents from China Silk Corporation. Appellant C.A.No.13/2012 Ashu Exports etc. vs CBI Page 7 of 19 R.K. Malhotra deposited Rs.9,58,818/ in the bank for which foreign currency documents were handed over to him. Appellant R.K. Malhotra handed over import documents to M/s Sunil Shipping Agency which got the clearance of goods. No custom duty was levied on the said goods as the import was DEEC scheme. After clearance, goods were handed over to M/s Aryavarta Parivahan for transporting it to Delhi, but on the instructions of M/s Ashu Exports, material was handed over to Shri Brij Lal Goel and thus the imported material was disposed of illegally. It was alleged that Ashu Exports was declared defaulter as it failed to produce documents of export. 10 In case bearing RC No.2(S)/1994/SIUIX, charges under Section 120B IPC read with Section 420/468/471 IPC and under section 5 of the Imports and Exports Act and substantive offences thereof were framed to which appellant R.K. Malhotra pleaded not guilty and claimed a trial, whereas in case bearing RC No.2(S)/1994/ SIUX, charges under section 120B IPC read with section 5 of the Imports and Exports Act were framed to which accused/ appellant R.K. Malhotra pleaded not guilty and claimed trial. 11 Prosecution has examined 22 witnesses in support of its case and after recording statement of accused/appellant R.K. C.A.No.13/2012 Ashu Exports etc. vs CBI Page 8 of 19 Malhotra under section 313 Cr.P.C., he had examined himself as DW1.
12 After conclusion of trial of the case, Ld. ACMM convicted both the appellants under Section 420, 468, 471 IPC and under section 5 of Imports and Exports Act in case bearing RC No. 2(S)/1994/SIUIX, whereas in case bearing RC No.2(S)/1994/SIUX, both the appellants have been convicted for offence under section 5 of Imports and Exports Act and appellants have been awarded sentences, as referred to above.
13 Being aggrieved with judgment of conviction and order on sentence, appellants have preferred the present appeal on the grounds that they have been wrongly convicted under section 5 of Imports and Exports Act as ingredients required for invocation of said sections were not satisfied. Appellants could not fulfill export obligations due to the reasons beyond control. Appellant had filed an application for extension of time for fulfillment of export obligations which was not allowed. It was wrongly held that forgery in documents including purchase orders was made. It was confirmed by Consulate General, USA that purchase order was validly issued. It was wrongly held that Registration cum Membership Certificate C.A.No.13/2012 Ashu Exports etc. vs CBI Page 9 of 19 issued by AEPC was fake. Further ground taken is that if conditions of license were not fulfilled, then only the duty could be demanded but the appellant has been wrongly booked in the present case. There was no evidence to support the case of prosecution. Appellant has been wrongly sentenced to undergo imprisonment in both the cases separately. It is submitted that both the cases were for same cause of action and sentences should run concurrently.
14 I have gone through the material available on record. So far as advance license Nos.P/K/3148753 and P/K/2427033 are concerned, no charge against the appellant pertaining to these licenses was framed. Therefore, only two advance licenses i.e. No.P/K/24270741 and No.P/K/2441493 remain to be considered. 15 Witness Jeevan Singh Bisht (PW5) deposed that the documents collectively Ex.PW5/1/G1 i.e. application for grant of import license of 100% cotton denim bore the signatures of accused R.K. Malhotra. These documents are with regard to advance license No.P/K/24270741. Appellant R.K. Malhotra had also made declaration to Joint Chief Controller of Imports and Exports and had applied for grant of import license on behalf of Ashu Exports (Appellant No.1). PW5 has also proved that visitors pass bearing C.A.No.13/2012 Ashu Exports etc. vs CBI Page 10 of 19 signature of appellant R.K. Malhotra were submitted by him. Signature of appellant R.K. Malhotra also appeared on the interview slip as deposed by PW5. Legal agreement was also signed by the appellant R.K. Malhotra which bore his signatures. PW5 deposed that along with this legal agreement, appellant R.K. Malhotra had submitted an undertaking to honour the covenants of the agreement. This legal agreement bore the signature of witness Charanjit and Jeevan Singh Bisht (PW5). However, PW5 Jeevan Singh Bisht categorically denied his signatures on the legal agreement. The signatures of Jeevan Singh Bisht marked Q162, as per report Ex.PW18/C1 of the handwriting expert (PW18), had not matched with the sample handwritings S67 to S71 of witness Jeevan Singh Bisht (PW5). Q164 is name and address of witness Jeevan Singh Bisht (PW5) and same, as per report of the handwriting expert, is proved to be in the handwriting of appellant R.K. Malhotra. Thus, it was established from the report of the handwriting expert (PW18) that accused/appellant R.K. Malhotra had forged the signatures of witness Jeevan Singh Bisht (PW5) and signatures of PW5 on legal undertaking Ex.PW5/1/G at page 89 to 93 were forged and the said forgery was committed by appellant R.K. Malhotra. As per report of the C.A.No.13/2012 Ashu Exports etc. vs CBI Page 11 of 19 handwriting expert, appellant R.K. Malhotra had also forged the signatures Q34 & Q174 of witness Jeevan Singh Bisht (PW5). 16 The document Ex.18/A2 is the letter issued by the Star Enterprises to Ashu Exports (Appellant No.1) purportedly bearing the signature of its Secretary. However, as per report of the handwriting expert Ex.PW18/C1 and Ex.PW18/C2, the purported signature of Secretary of Star Enterprises marked as Q91, matched with the specimen as well as admitted handwriting of appellant R.K. Malhotra. Thus, it was proved that appellant R.K. Malhotra had forged this document also showing export order and used it for securing import advance licence No.P/K/24270741. 17 As per report Ex.PW18/C1 of the handwriting expert, appellant R.K. Malhotra had forged the signature of the President of Star Enterprises on export order dated 04.03.1986 Ex.PW5/38 and also the words "confirmed and accepted", because the said writings and signature have been written/made by the person whose sample signatures were S4 to S63, S73 to S74 and A1 to A5 (which are the sample signatures/writings and admitted signatures /writings of appellant R.K. Malhotra). It is, therefore, clear that accused/appellant R.K. Malhotra had obtained the advance import C.A.No.13/2012 Ashu Exports etc. vs CBI Page 12 of 19 license by committing forgery on the documents and used the same as genuine.
18 Witness PW17 Sh. Kirit S. Mehta has stated that vide bill of entry Ex.PW17/J, goods were cleared regarding license No.P/K/2427041 and vide bill Ex.PW17/K, goods were transported. He has proved the bill of entry in respect of said license as Ex.PW17/A. The testimony of PW17 shows that goods vide above license number were imported. Vide letter Ex.PW5/36 written by appellant R.K. Malhotra to Thakkar Warehousing Agency, goods were booked for transportation to Delhi and as per case of the prosecution, said imported goods never reached Delhi and were disposed of in the way. As per testimony of witness Sh. Harish Chander Wadhwa (PW20), he had an agreement with M/s Ashu Exports for manufacturing of fabric. This witness deposed that since he did not receive the material from M/s Ashu Exports for manufacturing of the fabric, he could not manufacture the same. It has been established that appellant R.K. Malhotra imported goods after obtaining advanced license and got its clearance and then booked the same to be transported to Delhi. It has also come in evidence that the goods imported by appellant R.K. Malhotra never reached Delhi and as per C.A.No.13/2012 Ashu Exports etc. vs CBI Page 13 of 19 testimony of PW20, he had not received the raw material for manufacturing of fabric.
19 Even in his statement under Section 313 Cr.P.C., appellant R.K. Malhotra admitted that license granted to him was subjected to the condition that he would made the corresponding export within the period of nine months. It has been established on record that appellant R.K. Malhotra obtained advance license for import and the condition for the grant of said license was that he would export the goods within the period of nine months. It is admitted case of the appellant R.K. Malhotra himself that he could not export the material and sought extension of time, which was never granted to him. It has been submitted by the ld. Counsel for the appellant that one Sunil Mandnani misappropriated the material on behalf of the appellant and had the appellant obtained the extension of time in exporting the goods, he would have fulfilled the export obligation. In his crossexamination as DW1, appellant R.K. Malhotra has admitted that it was Sunil Madnani who had arranged clearance of imported raw material from the customs and sold the goods to his known persons, nevertheless he had admitted that he signed the requisite documents for release of said goods from Bombay and when C.A.No.13/2012 Ashu Exports etc. vs CBI Page 14 of 19 the goods did not arrive at his godown, he applied for extension of time for export obligation. Appellant also admitted that he had never made any complaint against said Sunil Madnani to the police or to any other department. Since it has been established that the goods were imported by appellant R.K. Malhotra, he was duty bound to abide by the terms and conditions of the advance license and nonexport of goods by him was the breach of license conditions. Since, he failed to fulfill the conditions of advance license, he was rightly convicted for committing cheating under Section 420 IPC and also under Section 5 of the Imports and Exports Act.
20 Now coming to second advance license No.P/K/ 241493 for import of mulberry raw silk. Application for the grant of license moved by appellant R.K. Malhotra has been proved as Ex.PW18/A13. All documents annexed with the application have been proved as Ex.PW5/1C. As per conditions of said advance license, appellant R.K. Malhotra was to export the goods within nine months from the date of clearance of the first consignment or 30 days after the import of first consignment. The stamp paper Ex.PW5/M1 contains the said bond executed by appellant R.K. Malhotra bearing his signature. Letter Q300 which form part of Ex.PW1/C is a letter C.A.No.13/2012 Ashu Exports etc. vs CBI Page 15 of 19 written by appellant R.K. Malhotra to the office of Joint Chief Controller of Imports and Exports, New Delhi wherein he had mentioned that the buyer Joy Shree International had cancelled the silk fabric order, therefore, appellant wanted to change the item of export. 21 After appellant R.K. Malhotra was granted the advance license, he had requested for change of the item of export which was a violation of issuance of advance license, thus he has been rightly convicted under Section 5 of the Imports and Exports Act for the advance license No.P/K/241493.
22 As discussed above, it was the clear violation of advance licenses granted to the appellant firm Ashu Exports and appellant R.K. Malhotra. The conditions attached to the issuance of advance licenses was that the appellants had to export the material within the specified period, but as per own admission of the appellant R.K. Malhotra, he could not fulfill the conditions of licenses in time and that he was not granted extension of time. In view of this position, now the appellant cannot take the ground that they were wrongly convicted under Section 5 of the Imports and Exports Act as it is his own admitted case that he did not fulfill the export obligations. 23 As discussed above in detail, the prosecution has C.A.No.13/2012 Ashu Exports etc. vs CBI Page 16 of 19 successfully established its case against the appellants that they have committed cheating by submitting forged documents before the authority for obtaining advance licenses and managed to obtain the licenses fraudulently by using the said forged documents as genuine. It has also been successfully established by the prosecution that the appellants did not fulfill the conditions of issuance of advance licenses and thus committed the offence punishable under Section 5 of Imports and Exports Act. Therefore, the judgment of conviction dated 12.03.2012, passed by the Ld. ACMM is hereby upheld. 24 On the quantum of sentence awarded to appellant R.K. Malhotra, it has been submitted by the ld. counsel for the appellants that appellant R.K. Malhotra is a senior citizen aged about 75 years. He is suffering from various ailments and that his wife is also an old lady suffering from age related ailments. 25 In view of above facts and circumstances, the order on sentence passed in respect of appellant No.1 Ashu Exports is hereby upheld in both the cases i.e. RC No.2(S)/1994/SIUIX and RC No.2(S)/1994/SIUX. But in view of old age and ailments of appellant No.2, namely, R.K. Malhotra, sentences awarded to him are modified as under :
C.A.No.13/2012 Ashu Exports etc. vs CBI Page 17 of 19
(i)Appellant R.K. Malhotra is directed to pay fine of Rs.50,000/ for the offence punishable under Section 420 IPC. In default of payment of fine, he shall undergo SI for six months. (in case of RC No.RC No.2(S)/1994/SIUIX)
(ii)Appellant R.K. Malhotra is directed to pay fine of Rs.50,000/ for the offence punishable under Section 471 IPC. In default of payment of fine, he shall undergo SI for six months. (in case of RC No.RC No.2(S)/1994/SIUIX)
(iii)Appellant R.K. Malhotra is directed to pay fine of Rs.50,000/ for the offence punishable under Section 5 of Imports and Exports Act. In default of payment of fine, he shall undergo SI for six months. (in case of RC No.RC No.2(S)/1994/SIUIX)
(iv)Appellant R.K. Malhotra is directed to pay fine of Rs.50,000/ for the offence punishable under Section 5 of Imports and Exports Act. In default of payment of fine, he shall undergo SI for six months. (in case of RC No.RC No.2(S)/1994/SIUX) C.A.No.13/2012 Ashu Exports etc. vs CBI Page 18 of 19
26 As observed above, appeal stands disposed of.
Record of the trial court along with a copy of the order be sent back to the court concerned.
27 A copy of the order passed in appeal bearing C.A. No.13/2012 be placed in the file of appeal bearing No.14/2012.
Appeal file be consigned to record room.
Announced in the open Court ( P.S. TEJI )
Dated: 22.01.2013 District Judge (East)
Special Judge (CBI)
Karkardooma Courts : Delhi
C.A.No.13/2012 Ashu Exports etc. vs CBI Page 19 of 19