Custom, Excise & Service Tax Tribunal
Kasim Mustafa vs Cc, Chennai on 20 February, 2008
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
SOUTH ZONAL BENCH, CHENNAI
C/125/02, C/154/02 & C/165/2002
(Arising out of Order-in-Original No. 1/2001 dated 18.12.2001, passed by the Commissioner of Central Excise (Appeals), Chennai)
For approval and signature
Honble P. G.CHACKO, Member (Judicial)
Honble P.KARTHIKEYAN,Member (Technical).
___________________________________________
1. Whether Press Reporters may be allowed to see the :
Order for Publication as per Rule 27 of the
CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the :
CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether the Honble Member wishes to see the fair
copy of the Order.
4. Whether order is to be circulated to the
Departmental Authorities? ____________________________________________
1. Kasim Mustafa : Appellants
2. Nemi Chand
3. G. Subramanian
Vs.
CC, Chennai : Respondents
Appearance Shri G.M. Syed Fasiuddin, Adv. for the appellant Shri. S.R. Krishnan, Consult.
Shri B.L. Meena, SDR, for the respondents CORAM Shri P.G. CHACKO, Member (Judicial) Shri P. KARTHIKEYAN, Member (Technical) Date of hearing : 20.02.2008 Date of pronouncement|:
FINAL ORDER No.________/2008 Per P. KARTHIKEYAN On 28.12.85 and 29.12.85, pursuant to intelligence on traffic in contraband, officers of the department led by the DRI conducted searches in various premises in Chennai. As a result, rough diamonds, 17 semiprecious stones, a TV, three cameras, two pens, 13 watches, a calculator, currencies all believed to be of foreign origin and, primary gold, Indian currencies, a scooter of Indian origin and receptacles of valuables were seized for action under the Customs Act, 1962(the Act) and the Gold Control Act, 1968(GCA).The premises searched included the residence of Shri M.K.S.Abubacker and other associates gathered to be involved in smuggling and trading in contraband. Diamonds seized from the premises of Shri M.K.S.Abubacker were valued at Rs.23,04,290/- , Indian currencies were of value Rs 11,54,250/-, primary gold estimated to be of value Rs.8220/- , semiprecious stones of value Rs.162/- and various foreign currencies of value less than US$ 50. From Shri G.Subramaniam, an amount of Rs.2,27,576/-, pens, watches, calculator and the Indian scooter were seized when he called at the premises from where M/s Pioneer Pharmacy functioned when the search was going on. The TV was seized from the possession of Shri A.Sundararajan who occupied a room in Tourist Home at Egmore. Following the information received from Shri.G.Subramanian on 28.12.85, the residence of Shri.Nemichand was searched on 29.12.85, and the watches and cameras of value Rs.7600/-seized.
2. On completion of investigation and after the Honble High Court of Madras allowed the petition of Shri Abubacker in 1998 and stopped the department from re-assaying the diamonds during the course of adhjudication, the adjudication of the confiscability of the seized goods and the liability to penalty of various persons under the Act and the GCA were completed following due process. In the impugned order, the Commissioner found that the allegations of smuggling, sale and possession of contraband were established by confessional statements of S/Shri M.K.S.Abubacker, Nemichand, G.Subramaniam, A.Sundararajan, Kasim Mustafa and others. The retraction statements to establish the Indian origin of the diamonds were made long after the confessional statements had been recorded. Diamonds were specified under Section 123 of the Act at the material time and the person from whom the diamonds were seized or the person who claimed its ownership had to establish its licit origin/possession. This was not done. As per the initial statements diamonds were smuggled goods. The Indian currencies were found to be sale proceeds of smuggled goods and liable for confiscation under Section 121 of the Act. Seized goods of foreign origin other than currencies, scooter & TV were found liable for confiscation under Section 111(d) read with Section 3(2) of the Import & Export (Control) Act 1947 and /or 111 (m)/or 111(p) /or 111 (o) of the Act. The scooter and TV were confiscated under Section 119 of the Act finding them to have been used for conveying contraband. The primary gold was confiscated under Section 71 of GCA. A fine of Rs.10000/- was ordered to be paid towards value of the scooter which had already been released. Indian currency of Rs.16,100/- had already been released on the orders of the Honble High Court of Madras.
2.1. Penalties were imposed under Section 112 of the Act on the persons found to have been engaged in the offending transactions as follows: Rs. One lakh each on MKS. Abubacker & MKS Syed Ahmed Kabeer, Rs.50000/- on Kasim Mustafa and Rs.10,000/- each on others including S/Shri.Subramaniam, SMS Haja Moideen and Sundararajan.
3. The captioned appeals have been filed by the following persons:
S/Shri.
1) Kasim Mustafa
2) Nemichand
3) Subramanian Ld Counsel appearing for Shri Kasim Mustafa submitted copy of judgment dated 24.01.08 of the Additional Chief Metropolitan Magistrate in E.O.C.C. No.290/89 filed by the Assistant Collector of Central Excise, Preventive Unit, Chennai. The complaint was filed to prosecute the appellants under Section 135 of the Act for the offences relating to smuggling adjudicated in the impugned order. He read the judgment over to us whereby the Honble ACJM acquitted Shri Kasim Mustafa of the charges punishable under Section 135(1)(b)(i) of the Act. Ld. Counsel submits that the complaint was based on the same evidence as relied on by the Commissioner to pass the impugned order. We find that the Honble ACJM heavily relied on the statements recorded by the DRI in deciding the complaint. However, during trial by the court, the officer who had recorded the statement of Shri Mustafa deposed that he had not recorded the same but had only signed the same to that effect as instructed by his superior. Though the court disbelieved the evidence produced to establish that Shri Mustafa had received the diamonds of Indian origin from merchants of Mumbai and handed them over to Shri.Abubacker, it allowed benefit of doubt as regards its origin. In view of the courts finding we hold that Shri Kasim Mustafa did not abet smuggling of diamonds. The appeal filed by Shri.Kasim Mustafa is allowed.
3.1 As regards the other appellants the same grounds as advanced before the Commissioner and later before the ACJMs court are reiterated. Additionally it is submitted that the Commissioner had ignored evidence of 26 witnesses examined before him. Order had been passed without application of mind. Shri.Nemichand was wrongly held to be the same person as one Madan against whom DRI had received information of involvement in smuggling.
3.2. We have also heard the DR who reiterates the findings in the impugned order and seeks dismissal of the appeals.
4. We find that in the judgment of the ACJM Court the following persons were the accused No.A1 to A6 respectively. The judgment exonerated accused No.A5 and convicted the remaining persons.
S/Shri.
1) M.SK Abubacker
2) Subramanian
3) Nemichand
4) SundarRajan
5) Kasim Mustafa
6) SMS Haja Mohideen.
4.1. The Honble Court made the following observations as regards the statements they gave. The charges against them were based on their confessional statements and the goods seized from their possession. The Commissioner had found them guilty of the same offences in the proceedings before him.
52. All the accused were questioned u/s 313 (1)(b) Cr.P.C. and they admitted that they had given statement to the DRI officials, but it was obtained by the authorities under threat and coercion. Except Kasim Mustafa, A.5 none of the accused had proved that they were tortured by the DRI officials and the same was recorded in their own handwriting. It is seen that admittedly after recording of the statement of the accused they were produced before Magistrate. Except A.5 none of the accused had made any complaint to the Magistrate about the torture of the DRI officials and the allegation against the officials were raised only subsequently. Therefore obviously it was only an afterthought. So no weightage could be given to the argument of the counsel for the defence on this aspect. 4.2. In paragraph 57 the court concluded that it was of the opinion that the statement given by the accused u/s 108 of the Customs Act is voluntary one and it was proved by prosecution beyond any reasonable doubt and it can form basis for conviction as far as A2,A3,A4 and A6 are concerned. The Magistrate convicted accused No. A2 to A4 and A6, the persons who have assailed the order impugned.
4.3. We find that the offence charged against the appellants in both the adjudication and prosecution proceedings are same. Both the cases are based on the same set of facts. The main evidence considered by the adjudicating authority and the criminal court to find the guilt of the appellants is the statements recorded by DRI. After appreciating the evidence, the criminal court convicted the accused after finding that the charge against them had been proved. It is settled that adjudication and criminal proceedings are independent of each other and that the degree of evidence required by the adjudicating authority for imposing penalty is much less than that required by criminal court for convicting the accused. This legal position has been upheld by the Apex Court.
4.4. The judgment of ACJM in the complaint E.O.C.C. No.290/89 filed by the department exonerated accused No.A5 and convicted the remaining persons, namely the appellants. In view of the findings of the Honble Court, we decline to interfere with the impugned order as regards these appellants. Their appeals are rejected.
(Pronounced in open court on )
(P.KARTHIKEYAN) (P.G.CHACKO)
MEMBER(T) MEMBER(J)
BB