Customs, Excise and Gold Tribunal - Mumbai
Sultanali A. Lallani vs Collector Of Customs (Preventive) on 27 January, 1988
Equivalent citations: 1989(39)ELT596(TRI-MUMBAI)
ORDER K. Gopal Hegde, Member (J)
1. The revision application filed before the Government of India against the Order-in-Original bearing No. 576-A of 1981 dated 27.8.1981 passed by the Central Board of Excise and Customs statutoriry stood transferred to the Tribunal for being heard as an appeal.
2. The facts necessary for the disposal of this appeal may be stated as under : On credible information that one light green Ambassador car bearing No. 9420 parked in the compound of Agha Ali Hall contained about 300 to 350 Kg of silver, officers of the Bombay Customs Preventive Collectorate on 12.1.1980 maintained a discreet watch at a distance from the said car. Immediately when a person opened the door of the said car with the key in his possession, the customs officers intercepted the car. On the search being carried out in the presence of Panchas, certain gunny bags containing silver totally valued at Rs. 11,23,320.00 were found in the dicky and front seat of the car. The person who opened the car gave his name as Baijnath Sahadev Navik and claimed to be the driver of the said car. The car as well as the silver were seized in the reasonable belief that both of them are liable to confiscation under the Customs Act. The statement of Shri Navik was recorded. Among other things, he stated that he was employed by the present appellant Shri Sultan Ali Abdulla Lallani and pointed out the residence of the appellant which was on the ground floor of Ashar Ali Manor near which the car was parked. The driver, further, told that he was employed three days earlier to the incident by the present appellant on a salary of Rs. 400/- per month. On the previous day of the incident at the instructions of the present appellant, he had taken the Fiat car bearing No. MRW 7408 to a garrage for repairs and at that time the Ambassador car in question was parked in front of the appellant's house. He stated that the said car was parked in front of the appellant's house for the whole day. He, further, stated that the appellant told him to take the Ambassador car to the garrage for repairing the locking system and with instructions to bring back to his house after repairs. He, further, stated that the key was given by the appellant to him with instructions to return the key at his house after repairs. He, further, stated that the appellant after giving instructions told him that he would be back within two minutes. The statement of the family members of the appellant confirmed that the appellant as well as the driver Shri Navik had left the house together.
3. During the course of investigation, the residential premises of the appellant was searched. Nothing incriminating was found except six documents which were seized as they were found useful and relevant to the enquiry.
4. In his further statement recorded on 17.1.1980, the driver Shri Navik, inter alia stated that on 14.1.1980 a lawyer met him in the Court and asked him to sign on two papers and he further stated that the lawyer must have been engaged by the present appellant who was his employer. He, however, denied that the Ambassador car belonged to or in possession of the appellant. He also denied that he knows anything about the silver. He, further, does not know that the silver belongs to the appellant.
5. The statement of the appellant was also recorded under Section 108 of the Customs Act. In his statement dated 27.2.1980 the appellant denied his connection with the car or the silver seized from the"car. He, further, stated that he was out of Bombay and returned only on 23.2.1980. He also stated that he had employed the driver four or six days prior to the day he left Bombay for taking his children to school and bringing them back as one of his daughters was crippled. He, however, stated that the driver was to use the Fiat car.
6. But in his further statement recorded on 4.8.1980, the appellant stated that on the material day he was at his residence and after lunch he went out and that he decided to visit the Durgah at Ajmer to pray for his daughter who is suffering from Polio and for his wife who is suffering from high blood pressure. He left Bombay on 12.1.1980 by train and reached Ahmedabad next day. He stayed at Ajmer for 40 days and thereafter returned. On coming to know that his house has been searched by the customs officers he reported to the customs house.
7. In his third statement recorded on 7.3.1980 the appellant among other things stated that he had not fixed the salary of the driver but have told that he would have given Rs. 250/- to Rs. 300/- and he had given him Rs. 100-/ in advance. He admitted that the driver was Shri Baijnath Navik.
8. After completion of investigation, after issue of show cause notice and after consideration of the reply to the show cause notice and after affording personal hearing, the Additional Collector of Customs ordered absolute confiscation of the seized silver as well as the Ambassador car. He imposed a penalty of Rs. 1,00,000/- on the appellant and Rs. 10,000/- on the driver Shri Baijnath Navik. Feeling aggrieved by the order the appellant had preferred an appeal before the Board. The Board, however, rejected the appeal. Hence this appeal.
9. During the hearing of this appeal Shri M.M. Patel, the appellant's learned advocate, firstly contended that no evidence had been adduced to establish nexus between the appellant and the Ambassador car or the silver seized from the car. Secondly, he urged that even though three statements of the appellant were recorded all of them were exculpatory. Thirdly, he urged that the statement of the driver besides being contradictory, is unreliable and is not corroborated by any other evidence. In the circumstances the uncorroborated testimony of the co-accused or an accomplice cannot be made a basis to impose the penalty on the appellant. Fourthly, he urged that the driver's statement is exculpatory. He was trying to falsely implicate the appellant. The Board had accepted his contention that the driver's statement was not reliable. Fifthly, he urged that the concealment of the silver in the dicky of the car does not amount to attempted export and, therefore, no offence was committed. Sixthly, he urged that there was no evidence that the silver found in the car was owned or possessed or controlled by the appellant. Lastly, he urged that the appellant as well as the driver were prosecuted before the Criminal Court. The Additional Chief Metropolitan Magistrate did not even find prima facie case to frame the charge against both and he discharged both the persons. The State of Maharashtra filed Criminal Writ Petition before the High Court of Bombay and the High Court after detailed consideration confirmed the order of discharge. Therefore, Shri Patel urged that when once a Competent Criminal Court and the High Court on the very evidence did not find sufficient material even to frame charge the adjudicating authority was unjustified in imposing the penalty on the appellant and the Board committed an error in confirming the penalty. In any case, Shri M.M. Patel, submitted that since the High Court had confirmed the discharge order passed by the Magistrate, the penalty imposed on the appellant should be set aside.
10. Shri Senthivel, appearing for the Collector, however, submitted that the nexus between the appellant and the Ambassador car from which silver was seized had been established. The appellant had admitted that Shri Baijnath was the driver employed by him. The appellant had given the key of the car to the driver with which the driver had opened the door and at that stage he was apprehended. The silver was concealed in gunny bags and they were kept in the dicky and front seat of the car. The silver was found not only within the specified area within three kilometres from the coast, it was in the process of transport for export. The car was registered in the name of a fictitious person and that person was not traceable. Having regard to the value of the silver found in the car Shri Senthivel submitted that the same could not have belonged to the driver. Shri Senthivel, further, submitted just at the time of driver opening trie door of the car, the appellant was at the place but when the car and the silver were seized the appellant made his escape and he remained absent for a long time. His conduct clearly establishes his guilt. In this connection Shri Senthivel placed reliance on the decision of the Supreme Court reported in AIR 1980 Supreme Court Page 593 State of Maharashtra v. Natwarlal Damodardas Soni. It was, further, submitted by Shri Senthivel that the discharges of the appellant in a criminal prosecution has no relevance. The adjudicating proceeding and the criminal proceeding are two independent proceedings. The finding in one proceeding is not binding in another proceeding. In that connection Shri Senthivel placed reliance on the Division Bench Judgment of the Bombay High Court reported in 1986 (26) E.L.T. Page 689 (Bom.) Maniklal PokhrajJain v. Collector of Customs (Preventive), Bombay and Ors.. Shri Senthivel, further, submitted that it is permissible in law to consider the whole statement of the driver as well as the present appellant and thereafter to exclude exculpatory portion which are not worthy of credit. In this connection Shri Senthivel placed reliance on the judgment of the Supreme Court reported in AIR 1974 Supreme Court Page 699 Jathamal Pithaji v. The Assistant Collector of Customs, Bombay and Anr. It was also contended by Shri Senthivel that the evidence adduced before the Criminal Court is not the same as evidence before the Adjudicating Authrity and therefore, the finding of the Criminal Court will not be binding and in any case having regard to the judgment of the Bombay High Court, it is not obligatory for the Tribunal to set aside the penalty solely on the ground that the appellant was discharged by the Criminal Court. Shri Senthivel also submitted that the appellant did not challenge the order of confiscation of the silver either before the Adjudicating Authority or before the Board and, therefore, it is not now open to the appellant's learned advocate to contend that there was no attempted export of silver. Shri Senthivel also urged that the confiscation of silver was ordered not merely under Section 113(d) but also under Section 113(1) for violation of the provision of Chapter IVB and, therefore, even if attempted export is not established, silver could be confiscated for violation of the provision of Chapter IVB and penalty could be imposed on the appellant as he was found in possession of large quantity of silver and he did not comply with the requirement of Chapter IVB.
11. Shri Patel, in reply, submitted that even though the appellant had not challenged the order of confiscation no penalty could be imposed unless there is evidence to establish that the silver was owned or possessed or controlled by the appellant. Shri Patel reiterated his contention thatlhe statement of the driver is unreliable and should not be made a basis for imposing the penalty on the appellant. In support of his contention that the statement of the driver being unreliable the owner cannot be penalised. Shri Patel relied on the decision of this Tribunal reported in 1987 (28) ELT Page 489Bhanab-hai Khalpabhai Patel and Ors. v. Collector of Customs & Central Excise.
12. We have considered the submission made on both the sides. We have carefully perused the records of the case. The one and only question that falls for determination in this appeal is whether the penalty of Rs. 1,00,000/- imposed on the appellant by the Additional Collector and confirmed by the Board requires to be interfered with.
13. It is true that there is no direct evidence to establish the nexus between the appellant and the Ambassador car as well as the silver seized from the Ambassador car. It is also true that the driver's statement is not consistent. It is also true that there was no direct evidence to establish that the Ambassador car from which the silver was seized either possessed owned or controlled by the appellant. It is, further, true that the appellant and the driver were discharged by the Additional Chief Metropolitan Magistrate. The discharge order was confirmed by the High Court in the Criminal Revision Writ Petition filed by the State of Maharashtra. The question still remains as whether the above factors would be sufficient to set aside the penalty imposed on the appellant.
14. Insofar as the finding of the Criminal Court is concerned the law in this part of the country is well-settled. This very question came up for consideration before the Division Bench of the Bombay High Court in Maniklal Pokhraj Jain's case. For the appellant in that case it was urged that the adjudication proceedings must be held barred by the principle of issue estoppal and/or res judicata. It was also urged before the High Court that in view of the order of acquittal passed by the Trial Court and confirmed by the High Court the adjudication proceedings should not have been initiated and/or proceeded. It was further urged before the High Court that it would not be open to the customs authorities to adjudicate upon the very same facts and record inconsistant findings On behalf of the appellant in that case reliance was placed on the Kerala High Court in Subramania Moothan v. Collector of Customs I.T.R. 1972 (2) page 66. The judgment of the Madras High Court in Shaik Kasim v. Superintendent, Post Offices A.I.R. 1965 Madras 502 was also cited. The learned advocate for the appellant in that case also placed reliance on the judgment of the Bombay High Court (Nagpur Bench) in Jeevanprakash v. State Bank of India and Anr. 1983 Maharashtra Law Journal Page 508. The Division Bench of the Bombay High Court held "In our opinion, at any rate, principle of issue estoppel is not applicable to the adjudication proceedings". The Bench quoted with the approval of observation of the earlier Division Bench to which Chandurkar J. as he then was a party. The relevant observation of the earlier Division Bench which was adopted by the Later Division Bench reads :
"We already reproduced the provisions of Section 135 make it pointedly clear that the power to prosecute under Section 135 is without prejudice to the action which may be taken independently under the provisions relating to confiscation and penalty. Now, it cannot be the argument that while independent powers of making an order of confiscation and penalty can be made by the appropriate officer of the Customs, irrespective of a prosecution under Section 135 being resorted to or not, in case there is a prosecution and there is an acquittal, the power expressly bestowed under Section 112 must be treated as ineffective. Unless, we are able to hold that even in spite of the express provisions of Section 112 and Section 127, in case there is an acquittal in prosecution instituted under Section 135, their powers cannot be exercised the contention on behalf of the Petitioner could not be accepted. We see no warrant for the view that there is a prohibition against the Customs Officers to perform their statutory functions and exercise their statutory power under the Act because of a failure of the prosecution started under Section 135 and the acquittal of the person concerned. By its very nature, the two proceedings are independent of each other. In a given case, evidence which may be available for the purposes of proceedings under Section 112 may not be available or even if it is available, it may be admissible in regular Court of Law in which the admissibility and relevance is determined with reference to the provisions of the Evidence Act. In a criminal prosecution, the accused need not open his mouth nor make any statement while in the proceedings for adjudication or confiscation before the Customs Department, the statement made by the person from whom the contraband article were seized can be looked into. The scheme of the Act, therefore, clearly indicated that the two proceedings have to be dealt with independently on each other on such material as is available and permissible in these proceedings".
15. The Division Bench also rejected the contention of the learned advocate for the appellant in that case that there was no material which could be said to be sufficient as to the conclusion arrived at by the Adjudicating Authority. The Bench observed:
"It is now well established that in domestic enquiries the enquiry authorities and statutory authorities under the relevant Acts will be sole judges of facts, and sufficiency of evidence cannot be urged as ground for interference with the validity or the legality of the orders of the Departmental Authorities. If there is evidence in support of the finding, then, it will not be permissible for this Court to undertake the task of re-appreciating the evidence, unless of course it is possible for the Petitioner to show that the finding is really based on no legal evidence with the result that the finding becomes infirm."
16. The above decision of the Bombay High Court fully answers the contention of Shri Patel that because the appellant was discharged by the Criminal Court and the discharge order was upheld by the High Court the penalty should be set aside. There is no such legal obligation as has been held by the Bombay High Court. The two proceedings are independent of each other. The finding is to be based on the materials placed in the two proceedings.
17. The perusal of the order of the Additional Chief Metropolitan Magistrate as well as the order of the Bombay High Court in the Criminal Revision Petition, it is clear that the two Courts have not accepted the statement of the driver solely on the ground that he was a co-accused and his evidence is a weak type of evidence and at best it could only lend assurance to the other evidence on which conviction could be based. Now it is well-settled that the provision of the Criminal Procedure Code or the Evidence Act in terms are inapplicable to the adjudicating proceedings. The Adjudicating Authority is not bound by the provisions of the said Acts. He is to be guided mainly by the principles of natural justice and of-course he has to bear in mind the broad principles of Criminal Jurisprudence. The Adjudicating Authority had mainly relied on the conduct of the appellant immediately after the seizure of the car and the contraband silver. But then, the Additional Chief Metropolitan Magistrate in his order made no reference to the conduct of the appellant. The High Court, no doubt, observed that the prosecution cannot claim that the accused was absconding. This observation was based on the fact that none of the prosecution witnesses assorted before the Court as to the abscon-dence. But then, before the Adjudicating Authority there were the statements of the driver, the family members of the appellant as well as the appellant's himself. Shri Baij-nath Navik who was admittedly employed as driver by the appellant has stated that the key of the Ambassador car was given by the appellant. He has, further, stated that the appellant and himself were together and the appellant told him to take the Ambassador car to the garrage and he would be back within two minutes. His statement that the appellant and himself were together is supported by the statement of the family members of the appellant who have stated that the appellant and the driver had together gone out. Secondly, the appellant in his statement recorded on 27.2.1980 stated that he was not at all present in Bombay on the date of the incident. His statement gave an impression that about 4 to 6 days prior to the date of incident he had left Bombay and before leaving he had temporarily employed Shri Baijnath Navik as driver to take his children to school and bring them back as one of his daughter was crippled. But then, in his statement recorded on 4.8.1980 he admitted that he was in his residence on the date of the incident and he went out at 4.00 P.M. and thereafter he decided to go to Durga at Rajasthan and to spend 40 days to offer prayer for the well being of his crippled daugher and his wife. It is not clear why the appellant had given different versions on an innocuous circumstance as to his presence on the date of incident if he has nothing to do with the car or silver and if he had not given the key of the car to the driver. There was no need for the appellant to make two contradictory statements as to his presence at Bombay on the date of incidence. The story that he had gone to Ajmer for praying for the well being of his wife and daughter and that he remained at Ajmer for 40 days to our mind appears to have been trotted down for the purpose of this case.
18. It is true that the driver did not implicate himself. But then, it is very difficult to accept Shri Patel's contention that the driver had falsely implicated the appellant. If the key of the Ambassador car was not given by the appellant and if the Ambassador car was not possessed, owned or controlled by the appellant, there was no need for the driver, who had admittedly opened the door to state falsely that the key was given by the appellant or that the appellant had asked him to take the car to the garrage. As has been stated by him later that the stranger had given it, he could have stated the same at the earliest instance. The subsequent statement of the driver shows that the retraction was not voluntary but it was taken by his advocate on some papers. This shows that it is on the legal advice the retraction had been done. It is significant to note that according to the driver's statement in all probability the appellant had provided the legal aid to him by engaging an advocate. This shows the appellant's interest in the driver. The driver could not have been altogether a stranger or disloyal to the appellant. The appellant did not seek cross-examination of the driver. If once the appellant's story of visit to Ajmer for the purpose of offering prayer at Durga for the well being of his daughter and wife is disbelieved, his version that he engaged the driver for the purpose of taking his children to school in the Fiat car also becomes suspect. The statement recorded disclosed that even the Fiat car did not belong to the appellant. It was given to him for the purpose of sale.
19. Even if we were to accept Shri Patel's contention that the evidence of the driver requires corroboration, the corroboration contemplated can be of circumstantial evidence andneed not be direct evidence. There are tell-tale circumstances to implicate the appellant. The driver and the appellant were found together just before the customs officers seized the car as well as the silver. Immediately thereafter the appellant disappears from the scene. He reappears after delay of more than 2-1/2 months and apparently after knowing that the driver had retracted his earlier statement. The appellant himself gives two contradictory statements as to the date on which he left Bombay to Ajmer. He left Bombay even without the knowledge of the members of the family though according to his statement he was to be away for not less than 40 days. It is very unlikely that he would leave Bombay when his wife was not in good health and the daughter was crippled requiring assistance. The conduct of the appellant clearly indicates his connection with the Ambassador car and the contraband goods found therein. In the circumstances, we are unable to accept Shri Patel's contention that the Additional Collector was unjustified or incorrect in imposingHhe penalty.
20. We are unable to accept Shri Patel's contention that the material placed before the Adjudicating Authority did not establish the attempted export of silver. Admittedly, the silver was found in the dicky and in the front seat of the car. The car was pre load within the distance of two kilometres from the coast. If the driver was not apprehended by the customs officers there would have been movement of the car in the course of attempted export. If the silver was not for the attempted export, there was no need for keeping the silver in the dicky of the car. All the circumstances taken together clearly established that the silver was intended to be exported and the driver was to take the silver in the Ambassador car. Therefore, attempted export was established. Even assuming that the evidence was insufficient to establish attempted export the contravention of Chapter IV B was not disputed. Therefore, the silver could have been confiscated for the contravention of Chapter IVB. As has been rightly urged by Shri Senthivel, the appellant had at no stage challenged the confiscation of the silver and, therefore, he cannot be now allowed to take up such a contention. Shri Patel had, however, contended that unless nexus is established between the appellant and the silver no penalty can be imposed on him for contravention of Chapter IVB.
21. As has been observed by the Supreme Court in the case of Collector of Customs v. D. Bhoormull 1983 E.L.T. 1546 (S.C.). "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 Section 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."
The above observation of the Supreme Court aptly applies to the facts of the present case. No direct evidence is possible to establish nexus between the appellant and the car or the silver seized from the car. It is only from the circumstantial evidence nexus can be established. The circumstances established in this case are :-
(1) Car key was with the appellant. It was handed over to the driver.
(2) The appellant's presence alongwith the driver just before the seizure.
(3) The disappearance of the appellant immediately after the customs officers appear at the scene and seized the car and the silver.
(4) Inconsistent statements as to his absence from Bombay.
The cumulative effect of all the circumstances in our opinion is sufficient to establish nexus between the appellant and the Ambassador car as well as the silver.
22. The decision relied on by Shri Patel of this Bench namely, Bhanabhai Khalpabhai Patel's case is distinguishable on facts. In Bhanabhai Khalpabhai's case the Bench did not accept the driver's statement because the prosecution failed to produce the documentary evidence namely the chit stated to have been given by the owner to the driver. Further, the conduct of the owner after the incident in dismissing the driver from his service. The Bench also held in that case that attempted export are not established because the evidence only showed that silver was concealed underneath the ground at a distance of 50 kilometres or so from the coast. The movement of silver was also not established.
23. On careful consideration of all the aspects, we see no reasons to interfere with the orders passed by the authorities below. Accordingly we reject this appeal.