Telangana High Court
Senior Intelligence Officer, Hyd., vs Gurram Dasaratha Reddy, And 15 Others, on 10 January, 2025
THE HONOURABLE SRI JUSTICE K.SURENDER
CRIMINAL APPEAL No.1719 OF 2005
JUDGMENT:
This appeal is filed by DRI (Directorate of Revenue Intelligence), challenging the acquittal recorded by the Metropolitan Sessions Judge, Hyderabad, in S.C.No.350/2002, vide Judgment dt.30.06.2005, for the offences under Sections 22, 25, 27-A & 29 of NDPS Act against A1; 22, 25-A, 27-A & 29 of NDPS Act against A2; 22, 27-A, 29 of NDPS Act against A3; 22, 29 of NDPS Act against A4; 22, 25 & 29 of NDPS Act against A5; 22, 25 & 29 of NDPS Act against A6; 22, 25 & 29 of NDPS Act against A7; 22 of NDPS Act against A8; 22 & 25 of NDPS Act against A9; 22 of NDPS Act against A10; 22 of NDPS Act against A11; 25-A & 31 of NDPS Act against A12; 25-A of NDPS Act against A13 to A16.
2. The case of the prosecution is that specific intelligence was gathered which indicated that Methaqualone, a Psychotropic Substance specified in the schedule to Narcotic Drugs and Psychotropic Substances Act, 1985 (for short 'NDPS Act') was being manufactured at M/s.Neepa Chem Laboratories Private Limited, located at Survey No.441, Brahmanpally Road, Bibinagar, Nalgonda District and further being converted into tablets at H.No.1-1, Masanpally Village, Basheerabad Mandal, Ranga Redddy 2 District. The gist of intelligence was recorded by LW.1-S.Yanadi Reddy, Senior Intelligence Officer and in compliance with section 42 of the NDPS Act, LW.1-S.Yanadi Reddy reported the gist of intelligence to his immediate official superior LW.2- M.Subramanyam, Senior Deputy Director vide letter dated 9.05.2002. On the basis of search authorizations issued by LW.1- S.Yadagiri Reddy, the officer of Directorate of Revenue Intelligence along with Central Excise Officer conducted search at the above mentioned premises on 10.05.2002 in the presence of independent witnesses and the proceedings were drawn under the respective panchanamas dated 10.05.2002.
3. The search party headed by LW.3-A.V.S.Mallikharjuna Rao, Intelligence Officer conducted the search of Plant-II (New Shed) of M/s.Neepa Chem Laboratories Private Limited, Survey No.441, Brahmanpally Road, Bibinagar, Nalgonda District, in the presence of two independent witnesses LW.4-P.Ramesh and LW.5- I.Swamanna. At that time A8 was present and later A1, A2 and A3 came to the premises. The process of operations were in progress. During the search, off-white coloured powder packed in 10 polythene bags on the machine floor and certain quantity of off white coloured powder in the drying-chamber, besides other chemicals, reaction mass and in-process residue were found. The 3 officers conducted tests on the off-white coloured powder with the help of a field-test-kit brought by them and the same tested positive for the presence of Methaqualone, a psychotropic substance specified in the scheduled to the NDPS Act. The officers also searched a Tata Safari vehicle bearing No.AP 9AC 9145 parked at the said premises and recovered a passport bearing No.72723 issued in the name of A2 and a polythene cover containing off- white coloured powder, which also tested positive for the presence of Methaqualone. Before conducting the personal search of A1, A2, A3 and A8, they were asked whether they would like to be searched before a Magistrate or Gazetted Officer. They informed that they had no objection to be searched before any Officer. Thereafter, the personal search of the above accused persons was conducted before LW.6-Shaik Khan Saheb, Superintendent of Central Excise who is a Gazetted officer. Nothing was recovered from the personal search of A1. The incriminating documents recovered from A2 include, among others, a slip showing requirement of bags which later was identified as in the hand-writing of A1, cheque No.862637, dated 31.05.2002 drawn in favour of M/s.Sain Chem Pharma Private Limited for an amount of Rs.41,21,200/- signed by one Prashant, which later admitted to be in the hand writing of A1 and a digital diary containing, among others, the telephone 4 numbers of A1, A3, A4, A7, A8, A9, A10 and A11. The incriminating documents recovered from A3 include, among others, a slip showing details of raw materials and a slip showing time cycle of manufacturing process of Methaqualone. A small sachet containing powder and a polythene cover containing dull white powder were also recovered from A3. The incriminating documents recovered from A8 include, among others, a diary in which details of raw material were written and a paper slip containing manufacturing process of Methaqualone, which was identified later as in the hand-writing of A3. The officers have drawn representative samples, in duplicate from the said powder, weighed and placed them in heat sealed polythene covers, which were in turn placed in paper envelopes and sealed with DRI seal. The powder recovered from the TATA Safari vehicle was also weighed and placed in a heat sealed polythene cover which was in turn placed in a paper envelope and sealed with DRI seal. All the paper envelopes were duly marked. Representative samples, in duplicate, were also drawn from the chemicals, reaction mass and in-process residue, were packed and sealed. The off-white coloured powder recovered from the premises and from the Tata Safari vehicle was packed, weighed and sealed with DRI seal. The officers have also inventorised the plant and machinery used for the manufacture of 5 Methaqualone. Then the officers seized the powder weighing 686.811 kgs., chemicals, reaction mass, in-process residue, plant and machinery, equipment and Tata Safari vehicle bearing No.AP 9AC 9145 on reasonable belief that the same are liable to confiscation under the Act.
4. The entire search proceedings were reduced into writing under panchanama dated 10.05.2002. In compliance with Section 57 of the NDPS Act, LW.3-A.V.S.Mallikarjuna Rao, Intelligence Officer has submitted report regarding the above seizure to his immediate official superior LW.1-S.Yanadi Reddy vide letter dated 10.05.2002.
5. Simultaneous search was also conducted by the team of officers headed by LW.7-C.Sridev Kumar, Intelligence Officer at H.No.1-1, Masanpally village, Basheerabad Mandal, Ranga Reddy District on 10.05.2002 in the presence of two independent witnesses LW.8-Shaik Riyaz Ahmed and LW.9-Mohd.Subhan. A.10 was present at that place. As a result of the search of the cattle shed in the premises, the officers found powder, granules and tablets which were tested by the officers with the help of a field test kit and the same tested positive for Methaqualone. The tablets contained ' * ' (star) marking on one side and 'M' marking on the other side. The officers also found tablet punching machine, mass 6 mixer and a drier in the cattle shed. The officers also recovered certain raw materials and equipment from the outer shed of the premises. Before conducting his personal search, A10 was asked whether he would like to be searched before a Magistrate or a Gazetted officer. Thereafter, personal search of A10 conducted before LW.10-R.Rajendran, Superintendent, Central Excise, who is a Gazetted Officer, resulted in recovery of inter alia a telephone diary and paper slips containing names and telephone numbers of A2, A3, A7 and A12 and also the telephone number of Hotel Manjeera, Hyderabad. Later, the officers searched a Maruti Omni van bearing No.AP 10F 3145 found parked in the premises and as a result of the search, tablets and powder were recovered. The same tested positive for Methaqualone when tested with the help of a field-test-kit. Then the officers searched the residential portion of the premises and recovered certain documents. Representative samples, in duplicate, were drawn from the material recovered from the cattle shed and the Maruti Van, the same were weighed and placed in heat sealed polythene covers, which were in turn placed in paper envelopes and sealed with DRI seals. All the paper envelopes were duly marked. Representative samples, in duplicate, were also drawn from the raw material, and were weighed, packed and sealed with DRI seal. The powder, granules and tablets 7 recovered from the premises and from the vehicle were packed, weighed and sealed with DRI seal. The officers later seized the Methaqualone in the form of tablets/powder/granules totally weighing 602.50 kgs., and other raw materials on a reasonable belief that the same are liable for confiscation under the Act. The officers also seized the Maruti Omni Van bearing registration No.AP 10F 3145, tablet punching machine, mass mixer, drier and other equipment on a reasonable belief that they are liable to confiscation under the Act.
6. On the same day i.e. 10.05.2002, A1, A2, A3, A8, A10 and A11 were summoned to DRI office and their statements were recorded under section 67 of the Act.
7. On 14.05.2002, the officers of Directorate of Revenue Intelligence headed by LW.13-Shivaji Rao, Intelligence Officer searched the residence of A4, located at 19-91/4, plot NO.156, East Kalyanpuri, Uppal, Hyderabad in the presence of two independent witnesses LW.14-K.M.Avadhani and LW.15- S.Srinivasa Rao, which resulted in recovery of inter alia diary containing cell phone number 9849318712 of A2.
8. On 14.05.2002 the officers of Directorate of Revenue Intelligence headed by LW.16-K.Lakshmipathi, Intelligence Officer, 8 searched Plot No.34, V.S.Nagar, Telephone Exchange Road, Nacharam, Hyderabad, in the presence of LW.17-Y.Yugandhara Rao and LW.18-D.Raja Sekhar and seized 2975 kgs. of Yellowish green coloured fine powder on a reasonable belief that the same was meant for using in the manufacture of Methaqualone. LW.13- Shivaji Rao, Intelligence Officer who was present at that time in the premises was summoned and the statement of M.R.Rahman who was present was recorded by Shivaji Rao wherein he stated that he is a friend of A9 and he allowed A9 to store the material. Representative samples, in duplicate, were drawn which were weighed, packed and sealed with DRI seal.
9. On 14.05.2002, A4, A5 and A6 were summoned to Directorate of Revenue Intelligence Office and their statements were recorded under Section 67 of the Act. The statement of A4 was recorded by LW.11-D.Aroop Das and the statements of A5 and A6 were recorded by LW.1-S.Yanadi Reddy. As they were found to have committed offences punishable under the Act, they were arrested on 14.05.2002 by LW.1-S.Yanadi Reddy and LW.11- D.Aroop Das and were remanded to judicial custody by the Metropolitan Sessions Judge, Hyderabad.
10. On 15.05.2002, the officers of Directorate of Revenue Intelligence headed by LW.19-S.Ravindranath, Intelligence officer 9 searched the table drawers and cupboards used by A4 at IICT, Hyderabad in the presence of two independent witnesses LW.20- S.Srinivas Rao and LW.21-G.Shyam Rao. As a result of the search incriminating documents, among others, literature on Methaqualone and two polythene sockets containing off-white coloured powder were recovered. The powder on testing with the help of the field test kit, tested positive for Methaqualone. Representative samples, in duplicate were drawn, weighed the same and kept in a heat sealed polythene cover which were in turn kept in a paper envelope, marked and sealed with DRI seal. The recovered powder was also weighed, packed and sealed with DRI seal. The officers seized the said powder as the same is liable to confiscation under the Act. The officers also seized the documents in connection with the investigation.
11. On 18.05.2002, A9 was summoned to Directorate of Revenue Intelligence office and his statement was recorded under Section 67 of the Act. As he was found to have committed offences under the Act he was arrested by LW.11-D.Aroop Das on 18.05.2002 and remanded to judicial custody by the Metropolitan Sessions Judge, Hyderabad.
12. On 24.05.2002, the Directorate of Revenue Intelligence officers headed by LW.22-M.V.Sreeram searched M/s.National 10 Pharma Lab, 3-4-495/A, Hiline Apartments, Barkatpura, Hyderabad, in the presence of two independent witnesses LW.23- S.Gyaneshwar and LW.24-P.V.Harikrishna. A15 was present in the premises. During the search, the officers recovered among others a diary work book containing references such as Nikitha Chemicals, A4 (Acetic Anydride) and Sukesh Reddy-A14.
13. A14, A15 and A16 were summoned to Directorate of Revenue Intelligence Office and their statements were recorded under Section 67 of the Act.
14. On 06.06.2002, A7 was summoned to Directorate of Revenue Intelligence Office and his statement was recorded by LW.11- D.Aroop Das under Section 67 of the Act. As he was found to have committed an offence under the Act, he was arrested.
15. A12 and A13 were summoned to Directorate of Revenue Intelligence Office and their statements were recorded on 13.06.2002 and 17.06.2002 by LW.1-S.Yanadi Reddy under Section 67 of the Act. As they were found to have committed an offence under the Act, they were arrested.
16. Analysis reports for the samples sent to the Customs Laboratory, Customs House, Chennai were received vide their letters L.Nos.31 to 45/21-5-2002, dated 18.06.2002, L.Nos.46, 48, 11 62 and 76-77/21-5-2002 dated 22.07.2002, L.Nos.47, 61, 63, 78 and 79/21-5-2002 dated 22.07.2002, L.Nos.49-57/21-05-2002 dated 17.07.2002, L.Nos.58-60/21.05.2002 dated 18.07.2002 and L.Nos.64-75/21.05.2002 dated 17.07.2002. The reports indicate that the off-white coloured powder seized at M/s.Neepa Chem Private limited, Bibinagar and powder, granules and tablets seized at Masanpally, powder seized from the cupboard of A4 at IICT, Powder seized from Tata Safari vehicle bearing registration No.AP9AC 9145, powder and tablets seized from Maruthi Omni bearing registration No.AP 10F 3145 and powder seized from the person of A3 have tested positive for Methaqualone. The other chemicals and raw material have also tested positive for the respective substances. In respect of reaction mass seized from the reactors at M/s.Neepa Chem Lab Private Limited the reports indicate that the substance is composed of a complex organic compound and in respect of in-process reside, the report indicate that the substance is an aqueous solution containing organic compounds. In respect of the Intermediary product seized from the person of A3, the report indicates that the substance is composed of complex organic compound.
17. From the investigation the following emerge; 12
a) That around February, 2002, A1 and A2 at the behest of A17 a Dubai based narcotics dealer, hatched a conspiracy to manufacture and supply 3 million Methaqualone tablets at the rate of Rs.5/- per piece. In pursuit of the said common goal, A1 and A2 roped in A3 who is a post graduate in Chemistry having good knowledge in the field of specialty chemicals and drugs. The trio agreed to share the profits equally.
b) A1, using his past acquaintance contacted A5 and managed to convince him to permit to use plant-II (new shed) in the factory premises of M/s.Neepa Chem Lab Private Limited. A1 and A2 visited the factory premises, inspected the plant and machinery and entered into a verbal understanding with A5 and A6 to rent out the premises for manufacture for a consideration of Rs.1,00,000/- per ton. A5 and A6 received an amount of Rs.70,000/- as advance from A1 and A2 for letting out the factory premises. They also loaned the materials from their factory stocks to A2 for the manufacturing of Methaqualone as evident from the statement of LW.45-Chille Satyanandam.
c) In pursuance of the said conspiracy and in the same transaction, A2 has selected his in-laws' residence located in a remote village called Masanpally as a safe place for carrying out the illicit activity. He managed to convince A7, who is his brother-in-law, to allow 13 cattle shed in the premises to be used for manufacturing activity. A7 agreed to rent out the shed for a consideration of Rs.1,500/- per month. A7 also received Rs.25,000/- from A1 and A2 as advance for the purpose of reconstruction of the cattle shed.
d) In pursuance of the said conspiracy and in the same transaction, A17 provided A1 a finance of Rs.10 lakhs which was used by A1 and A2 for procuring chemicals and raw materials required for the manufacture of Methaqualone. A3 contributed an amount of Rs.2 lakhs and A2 used contacts and procured chemicals and raw materials worth Rs.6 lakhs on a loan basis. A1 and A2 procured chemicals from LW.40-P.V.K.S.B.Brahmananda Rao who supplied the same on loan basis on the recommendation of A5 and A6. A1 and A2 procured acetic anhydride and anthranilic acid, the two precursors for manufacture of Methaqualone, from A12 and A13. The anthranilic acid was procured using the name of LW.36-G.Prashant. A1 also procured 3 MT of orthotoluidine arranged by A17. The chemicals and raw materials were stored in the factory without names and lables on the packing apparently to keep the identity of the chemicals secret.
e) In pursuance of the said conspiracy and in the same transaction, A1 procured tableting machine arranged by A17, A1 and A2 also bought mass mixer from LW.37-M.V.Mallikarjun Rao, drier from 14 LW.48-K.Brahmam and punches from LW.34-V.Chittaranjan. The above equipment required for tableting the Methaqualone substance were installed at Masanapally.
f) In pursuance of the said conspiracy and in the same transaction, A3 developed the process of manufacture of Methaqualone, tested Mathaqualone samples, provided methods for improving the yield and quality of Methaqualone substance and supervised the production of Methaqualone in the factory. 10 grams of Methaqualone was recovered and seized from his person.
g) In pursuance of the said conspiracy and in the same transaction A1 and A2 also roped A4 into the conspiracy, a senior scientist in the Indian Institute of Chemicals Technology, Hyderabad, who knowingly tested Methaqualone samples, met A1, A2 and A3 and discussed about the manufacture of Methaqualone and also advised them how to improve the quality and yield of Methaqualone. He also furnished literature and technical details of Methaqualone to A2. A2 visited Indian Institute of Chemical Technology on 06.03.2002, 19.03.2002, 01.04.2002 and 03.04.2002 in the name of Ramesh Kumar and met A4 in this connection. A4 received Rs.12,000/- for extending the above favour. 28 grams of Methaqualone was recovered from his personal cupboard. Thus, A4 became party to the conspiracy. 15
h) Though A5 and A6 learnt about the manufacture of Methaqualone in their factory through A3, they failed to stop the illicit manufacture. They also did not bring this to the notice of the directors of their company. Instead they had a meeting with A1, A2 and A3 at Hotel Taj Banjara on 09.05.2002, where they agreed to continue to extend the facility of manufacture of methaqualone in their factory for an additional consideration of Rs.5 lakhs and profits, which A1 promised to give them. Thus, A5 and A6 became parties to the conspiracy.
i) A7 having come to know of the manufacture of Methaqualone tablets at his Masanpally premises, failed to stop the same for a financial consideration. He actively assisted A1 and A2 in the procurement, handling and transport of punching machine, mass mixer and drier. At the behest of A1 and A2, he visited Mumbai on 31.03.2002 and stayed in A1-Fatah Guest House in the assumed name of Rajkumar and received a standard Methaqualone sample from an unidentified person sent by A.17 and delivered it to A1 and A2. On 10.05.2002 he carried the methaqualone sample manufactured at the behest of A1 and A2 and stayed in the same hotel in the assumed name of Vinod Patel for delivering the same to a person to be sent by A17.
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j) A8 at the behest of A3 actively assisted A3 in the manufacture of methaqualone substance in the factory premises.
k) A9 assisted A1 and A2 in procurement, handling and transport of chemicals and equipment used in the manufacture of methaqualone as evident from the statements of LW.33- M.A.Rahman, LW.35-Y.R.P.Shetty, LW.36-G.Prashant, LW.37- M.V.Mallikarjun Rao, LW.48-K.Brahmam, LW.49-B.Mallesh, LW.50-N.V.Krishna Rao, LW.51-Mohd.Ghouse, and LW.59- Bhattacharya. At the behest of A1 and A2, A9 carried Methaqualone sample to Mumbai and stayed in Madina Hotel on 30.04.2002 in the name of Mohd.Hasan and delivered the same to an unknown person sent by A17. A9 installed the tableting machine, mass mixer and drier in the cattle shed at Masanpally village. He permitted A2 to use his Maruti Van bearing No.AP 10F 3145 from which 4 kgs. of Methaqualone powder and tablets were recovered and seized.
l) A10 knowingly assisted in the tableting of methaqualone substance at the cattle shed in Masanpally village at the behest of A1 and A2. He was present in the premises when the search was conducted by the officers on 10.05.2002.
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m) A11 acting as driver of A1, actively assisted in handling and transportation of machines, equipment and raw materials used in connection with the manufacture of methaqualone. He transported methaqualone substance from the factory premises to Masanpally village using Tata Safari vehicle bearing registration No.AP 9 AC 9145 as evident from the statement of LW.45-Chille Satyanandam.
n) A1 and A2 also transported the methaqualone substance from factory to Masanapally using Tata Safari vehicle bearing registration No.AP 9 AC 9145 and Maruthi Omni bearing registration No.AP 10F 3145 as evident from the statement of LW.45. The Tata Safari vehicle bearing registration No.AP 9AC 9145 from which 281 grams of methaqualone powder was recovered belongs to M/s.GDR International India Limited, represented by A1.
o) The investigation revealed that A16 who has been carrying on business in chemicals in the name of Nikita Chemicals, purchased acetic anhydride from one Vikas of Mumbai whose identity could not be established. In the month of August, 2001, A16 sold the said acetic anhydride to A15 who in turn sold the same to A12 and A13 and the same was sent to M/s.Coastal Labs, Sullurpet, as evident from the statement of LW.44-Y.Murali Manohar. 18
p) In the month of April, 2002, when A2 required acetic anhydride for the manufacture of methaqualone, which was brought from Sullurpet to Hyderabad by engaging M/s.Kranthi road Transport Private limited, Uppal Branch, Hyderabad, vide Lorry Receipt Nos.54653 and 54654 dated 05.04.2002. A2 has taken the delivery of the said acetic anhydride in 8 drums as evident from the statement of LW.39. A1, A2 and A13 travelled from Secunderabad to Sullurpet on 04.04.2002 in connection with the transportation of the said acetic anhydride. A12 and A13 also sold 5,000 kgs. of anthranilic acid required for the manufacture of methaqualone to A2 in the month of April, 2002 as evident from the statements of LW.33-M.A.Rahaman, LW.35-R.Y.P.Setty, LW.36-G.Prashant, LW.53-M.Pratap Reddy and LW.54-D.Vijaya Bhaskar Reddy. The said acetic Anhydride and anthranilic acid were used in the manufacture of methaqualone which was seized.
q) the acetic anhydride is a controlled substance as specified in standing order No.198(E) dated 24.03.1993 issued under Section 9A of the Act. A2, A12 to A16 have not followed the prescribed procedure and maintained any records or filed any returns in respect of the above said acetic anhydride, as required under the Narcotic Drugs or Psychotropic Substances (Regulation of 19 Controlled Substance) Order, 1993 thereby contravened Section 25-A of the Act.
18. The trial Court charged the accused as under:
Accused Number Section contravened Punishable under sections A1 8(c), 24, 27A, 29 25, 25, 27A, 29 A2 8(c), 9A, 27A, 29 22, 25A, 27A, 29 A3 8(c), 27A, 29 22, 27A, 29 A4 8(c), 29 22, 29 A5 8(c), 25, 29 22, 25, 29 A6 8(c), 25, 29 22, 25, 29 A7 8(c), 25, 29 22, 25, 29 A8 8(c) 22 A9 8(c), 25 22, 5 A10 8(c) 22 A11 8(c) 22 A12 9A, 31 25A, 31 A13 9A 25A A14 9A 25A A15 9A 25A A16 9A 25A A17 27A, 29 27A, 29
19. Reasons given by the Court below to acquit the accused;
The trial Court found that there was Non-compliance with Section 42 of the NDPS Act.
The Court observed that;
"......
When the Intelligence officer working under PW.50 gathered the information and submitted the said information to PW.50 orally and PW.50 recorded the same into chits and later he sent the same to PW.54, but the same process is not contemplated under 20 the NDPS Act. Ex.P.295 does not satisfy the requirement of Sec.42(1) of the Act or 42(1) of the Act...... If really PW.50 received the information from his subordinates either by way of chits or he reduced into writing on the chits whenever his subordinates informed about the present offence. PW.50 ought to have preserved the said chits to corroborate his evidence that he sent the gist of information as in Ex.P.295 to his superior officer after verifying the said chits. Under the above circumstances, the contention of Sri Kumar that PW.50 violated the mandatory provisions of Sec.42(1) of the NDPS Act is to be accepted. In view of my above discussion, Sec.42 of the NDPS Act which is mandatory one is not complied, and the accused persons are entitled for acquittal since the trial itself would vitiate."
20. The trial Court also found that there was Non-compliance with Sec.50 of the NDPS Act.
The Court observed that;
"......
But in view of my discussion, the contention of Sri B.Adinarayana Rao that search of some of the accused was conducted by the concerned officers by complying provisions of Sec.50 of the NDPS Act cannot be sustained. In fact, PW.4 and PW.7 who are gazette officers on the member of search party. Hence their evidence cannot be taken into consideration.
The principle laid down in the decision reported in K.Mohanan v. State of Kerala [2000 SCC (Cri) 1228] rendered by their Lordships of the Supreme Court in the above cited case, is squarely applicable to the facts of the 21 present case, if the evidence of PW.1 is taken into consideration on the aspect of search. Hence the search of the accused conducted by concerned officers in this case is in violation of mandatory provisions of Sec.50 of the NDPS Act."
21. Trial Court further held that seizure was not legal. The trial Court observed as;
"............it can be said that even the complainant has not proved that the powder that was found either in the factoryor in the cattle shed of factory at A1 at Masanapaly is Methaqualone as defined in Schedule-I under Psychotropic substance of the NDPS Act. Under the said circumstances, it can be said that the prosecution failed to prove that charges leveled against A1 beyond all reasonable doubt."
22. Learned Special Public Prosecutor for DRI submitted that the field test kit is a customized testing kit designed by experts in United Nations. The said test kits were used by the seizing officers to come to a preliminary confirmation about the presence of specific contraband for enabling them to seize the same. It requires no technical expertise to operate the said test kit. After preliminary confirmation of presence of specific illicit NDPS substances, the material is seized on a reasonable belief and the samples from the seized material are drawn in such manner as specified in the 22 prescribed instructions laid down under the Act and the said samples are forwarded to the competent and authorized laboratories for conducting further tests by experts to determine the presence of illicit drug. Hence, the Trial Court failed to appreciate the procedures laid down.
23. In the present case, the said test report was given by Chemical Examiner to the government CFSL, Chennai, who are designated as experts under Sec.293 of Cr.P.C. The trial Court has examined such chemical examiners who have given the test report confirming that the forwarded samples were tested for presence of Methaqualone.
24. Ex.P295 has been submitted by PW.50 to his superior officer PW.54 on 09.05.2022 and the searches were conducted on 10.05.2022. The said Ex.P.295 is undoubtedly the gist of intelligence. It is not mandated in Sec.42(1) of NDPS Act that the pieces of information received over a period of time should be made as evidence. Mere non production of such chits would vitiate the entire trial proceedings is absolutely incorrect. The said Ex.P.295 is the gist of intelligence gathered by the officer who had been receiving the information over a period of time and the same has been documented in the form of intelligence when the same was 23 figured out as actionable intelligence. No serious prejudice is caused to the accused by non-production of such chits. The gist of intelligence under Ex.P.295 has resulted in seizure of huge quantity of contraband. The said Ex.P.295 has been submitted by PW.50 to his superior officer PW.54 and all the compliances under sec.42(1) are met with.
25. The respective accused have expressed their willingness to be searched before the gazette officer and accordingly respective accused were searched on person by the seizing officer before a gazette officer. Such submission of the prosecution has been documented in respective panchanama marked Ex.P.17, Ex.P72 and the same was ignored by the Trial Court. Further, it is the conclusion of trial Court that no recovery was made on the person of many accused, still it concluded that Trial was vitiated due to non-compliance of Sec.50. Such conclusion of non-compliance of Sec.50 by trial Court would have gained prominence had the personal search of the accused was not conducted before the presence of Gazetted officer or a Magistrate which is not so in the present case.
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26. Further, the provision of sec.50 of NDPS Act does not envisage that the person being searched has to be told about their right to be searched before the gazette officer or Magistrate.
27. The voluntary statement of A.1 under Section 67 of NDPS Act cannot be considered as truth and the prosecution cannot be put to blame that they could not establish the money trail of Rs.10 lakhs between A.1 and A.17. The seizure of huge quantities of contraband from respective places prove the case of prosecution beyond doubt with regard to manufacture and possession of illicit drug. Not establishing the link between A.17 and A1 will not vitiate the case of the prosecution. Further, the statement of A.1 under Sec.67 is a voluntary statement given out of his free will.
28. Learned Special Public Prosecutor relied on the following Judgments.
i. Mohd.Younus and another v. State of Telangana 1
ii. Karnail Singh v. State of Haryana 2
iii. Madan Lal and another v. State of H.P. 3
iv. Om Prakash Sood v. Union of India and another 4
1
2018 SCC OnLine Hyd 1965
2
(2009) 8 Supreme Court Cases 539
3
(2003) 7 Supreme Court Cases 465
4
(2003) 7 Supreme Court Cases 473
25
v. Krishna Kanwar (smt) Alias Thakuraeen v. State of
Rajasthan 5
vi. Tata Power Company Limited v. BSES Ltd. And others 6
vii. Jagdish Budharoji Purohit v. State of Maharashtra7
29. Learned Counsel for the accused argued on the findings of the trial Court being reasonable. He argued that:
i. The complaint was filed stating that the conspiracy of manufacturing 3 million Methaqualone tablets was hatched by A17, A1 & A2. No material evidence was found regarding A17, giving advance of Rs.10,00,000/- to A.1 and any association of the accused with A.17.
ii. The claim of DRI officials that seizure of contraband substances which is worth more than 6 crores was an alleged advance of Rs.10,00,000/- is beyond any rational reasoning and establishes that the investigation is totally false.
iii. Nothing has been specified related to the field test kit or change of colour of the sample with test kit or procedure followed while testing with the kit in the Panchanama. PW.1 confirms that he has not prepared any test notes while conducting the tests and he has not placed any such notes in the sample papers. PW.1 also 5 (2004) 2 Supreme Court Cases 608 6 (2004) 2 Supreme Court Cases 620 7 (1998) 7 Supreme Court Cases 270 26 confirms that he has taken signatures of the accused on the outer covers of the samples but not on polythene covers containing the samples. He also admits that from the polythene covers itself it is not possible to say from which accused the substance was seized.
Samples of powder taken was not furnished by the accused. The admissions made by the witnesses in the Cross-examination clearly establish beyond reasonable doubt that the alleged samples collected are not intact and does not bear any identity from whom and from where the samples were drawn and sealed in the covers for sending them to Chemical Examiners.
iv. The accused persons voluntarily visiting the DRI office and receiving summons and subsequently getting arrested and produced before the Magistrate is false.
v. None of the Accused know the details of Methaqualone and some of the accused are not even properly educated.
vi. Nothing has been recovered from the personal search of A1. There were no details of weighing scales used in the search & Seizure Operations. There is no evidence as to how the samples were drawn from the alleged seizure when the weighment of the samples is in grams to kilograms. There is no evidence as to how the small quantities of contraband substance was measured during Search & Seizure. The witness PW.11's deposition in Cross- 27 examination that he has carried weighing scale to IICT premises during the search & seizure is not corroborated by any material evidence on record and it is only an afterthought. vii. There is no evidence that the Panch witnesses have signed & authorized on the test Memos prepared while sampling the alleged seized contraband substances. As per PW.2, in his cross- examination the identity slips were not found affixed to the envelops containing the samples. There is no evidence on record that the DRI official have not carried any covers, polythene bags & gunny bags for sampling the alleged contraband substance found in both the locations (neepa Chem & Masanapally) and the same was also asserted by multiple witnesses. There is no evidence on record which establishes that DRI officials have carried heat sealing equipment for sealing the sampled polythene covers. Also the covers containing the samples were not pasted and were only stapled with all the signatures on one side and DRI seal on the other side of the covers. PW.1 confirms that the Panch Slips were not placed inside the sample covers.
viii. As per PW.11 there is only one Brass Seal in DRI Hyderabad office. On 10.05.2002, two locations were simultaneously searched. One at Neepa Chem Laboratory Private Limited in Bibi Nagar and other at residence of Sri M.Madhusudan Reddy at Masanpally 28 Village. As per the complaint, two teams were deployed after alleged meeting at 5:30 A.M. on 10.05.2002, wherein both teams started their search & seizure around 8:30 A.M. and both teams reached DRI office at 8:30 p.m. & 9:30 p.m. Both the locations have approximately 200 k.m distance between them and they have to pass through Hyderabad. With one brass seal of DRI, the Panchnamas, sampling of contraband substances, statements recorded simultaneously at both the locations on the same day is beyond comprehension.
ix. There is no evidence on record that the Neepa Chem Labs Private Limited has any association with A1. All the invoices & bills of the chemical substances are in the name of Neepa Chem Labs Private Limited and there is no correlation on factual and evidence basis as to how these invoices can be used to implicate the accused alleged to have been present at location of Neepa Chem Private Limited.
30. In this case, even the evidence of PW.50 would disclose that he received information from his subordinates through chits and after preparing the chits as in Ex.P295, he destroyed the said chits. If PW.50 really received the information from his subordinates either by way of chits or he reduced into writing on the chits whenever his subordinates gave information about the present 29 offence, PW.50 ought to have preserved the said chits to corroborate his evidence that he sent the gist of information as in Ex.P295 to his superior officer after verifying the said chits. Section 42 of the NDPS Act which is a mandatory one, is not complied.
31. The evidence of the seizure officers PW.1 and PW.5 is that they tested the powder found in the factory at Bibinagar and also at Masanpally with the help of the testing kit and the said powder tested positive for Methaqualone. Thereafter, the said samples were sent for analysis and examiners also opined that the sample is of Methaqualone and submitted their report. PW.1 and PW.5 are not experts who can give opinion that the said powder is Methaqualone with the help of the testing kit available with them. It is not even explained by the prosecution that they are competent to test the narcotic substance and give their opinion with regard to the same. The chemical name of Methaqualone is mentioned in Schedule-I under the caption by 'Psychotropic Substances' in NDPS Act. As per the same, the chemical name of 'Methaqualone' is "2-Methys-3- 0-toyl-4 (3H)-quinazolinone". But experts have not stated that they found the same chemical in the said powder. If the said chemical name is not found in the experts report, the opinion given by the experts that it is 'Methaqualone' cannot be accepted. 30
32. The search and seizure is illegal since the complainant has not complied with the provisions of Sec.42 of the NDPS Act; the charge leveled against A3 also cannot be sustained. Some powder and incriminating material was recovered from the drawer and the cup-board of A.4 in the office and that itself is not sufficient to come to a conclusion that A.4 conspired with A.1 to A3 and participated in the conspiracy in preparing the Methaqualone. The complainant has to prove that A.4 knew Methaqualone is a narcotic substance and the possession of it or providing information regarding the improvement in the quality of Methaqualone is an offence under NDPS Act. No evidence is adduced to substantiate the same.
33. The allegation made against A.5 and A6 is that they let out their premises for the purpose of manufacture of Methaqualone. The case of the prosecution is that one day prior to their search, A.5 and A.6 came to know that A.1 to A.3 were manufacturing the Methaqualone in the said premises. If so, how did the DRI officials come to know what happened on the previous night on 09.05.2002 in Taj Banjara Hotel, where A.5 and A6 are alleged to have met A.1 to A.3 and discussed as to why Methaqualone powder was being manufactured in their premises. Hence the evidence adduced on 31 this aspect by the prosecution with regard to knowledge of A.5 and A6 of manufacturing Methaqualone cannot be believed.
34. Charges leveled against A.7 are that he played a role in getting raw material and the machine and got the same fixed at Masanapally and other places and allowed the premises for conversion of Methaqualone powder into tablets. But, the evidence which is on record is not sufficient to come to a conclusion that A.7 had knowledge that Methaqualone is a Narcotic Substance and the preparation of Methaqualone in his cattle shed, is an offence. Apart from it, the search itself is illegal.
35. Charge leveled against A.8 is that he was found in the Neepa Chem Laboratory. As per the case of the prosecution he is the person who was managing the manufacturing of the Methaqualone in the said Neepa Chem laboratory. But, the evidence which is on record is not sufficient to come to a conclusion that A.8 had knowledge that the product which was being manufactured in the said factory is Methaqualone.
36. The offence alleged against A.10 is that he is the person who was present at the cattle shed of Masanapally village participating in the manufacturing process at that place. It may be that PW.10 was present at that place and he was indulging in the 32 manufacturing process, but, the evidence on record is not sufficient to come to a conclusion that A.10 had knowledge that Methaqualone is a Narcotic substance and its manufacturing is an offence under NDPS Act.
37. The allegations made against A9 is that he allowed the use of his vehicle to carry Methaqualone powder from Neepachem Laboratories to Masanapally and he also stored Anthranalic acid in the godown of Rehman. The complainant has not placed any material to show that A.9 had knowledge that the Anthranalic acid is Narcotic substance and storing the same is an offence.
38. The allegation made against A.11 is that while acting as a driver of A.1, he actively participated in getting raw material in connection with the manufacturing of Methaqualone and he transported the Methaqualone from the factory premises to the Masanapally village using Tata Safari vehicle belonging to A.1. But, the complainant has not placed any evidence to show that A.11 had knowledge that the powder which is being carried by him from the factory to Masanapally is Methaqualone.
39. The learned Public Prosecutor mainly places reliance on the Judgment of the Honourable Supreme Court in Jagdish Budharoji Purohit's case (supra 7) and argued that once the spot test was 33 determined as Methaqualone, the Honourable Supreme Court held that the said finding initially about the substance would suffice. The Apex Court held in the facts of the case that the chemical examiner received the samples in a sealed condition. In the 313 Cr.P.C. examination, the accused did not state about closing the factory and taken over by someone else. The facts in the Jagdish Budharoji Purohit's case differs from the facts on hand. All the accused denied being involved in manufacturing any kind of Narcotic substance. Further, the trial Judge has also found favour with the defence version that the sealing of the samples was not proper and tampered with.
40. In Ravi Sharma v. State (Government of NCT of Delhi) and another 8, the Hon'ble Supreme Court held that while dealing with an appeal against acquittal, the appellate court has to consider whether the trial Court's view can be termed as a possible one, particularly when evidence on record has been analysed. The reason is that an order of acquittal adds up to the presumption of innocence in favour of the accused. Thus, the appellate court has to be relatively slow in reversing the order of the trial court rendering acquittal.
8 (2022) 8 Supreme Court Cases 536 34
41. In Ghurey Lal v. State of Uttar Pradesh 9 the Hon'ble Supreme Court after referring to several Judgments regarding the settled principles of law and the powers of appellate Court in reversing the order of acquittal, held at para 70, as follows:
"70. In the light of the above, the High Court and other appellate Courts should follow the well-settled principles crystallized by number of Judgments if it is going to overrule or otherwise disturb the trial court's acquittal:
1. The appellate court may only overrule or otherwise disturb the trial court's acquittal if it has "very substantial and compelling reasons" for doing so.
A number of instances arise in which the appellate court would have "very substantial and compelling reasons" to discard the trial court's decision. "Very substantial and compelling reasons" exist when:
i) The trial court's conclusion with regard to the facts is palpably wrong:
ii) The trial court's decision was based on an erroneous view of law;
iii) The trial court's judgment is likely to result in "grave miscarriage of justice";
iv) The entire approach of the trial court in dealing with the evidence was patently illegal;
v) The trial court's judgment was manifestly unjust and unreasonable;
vi) The trial court has ignored the evidence or misread the material evidence or has ignored material documents like dying declarations/report of the ballistic expert, etc.
vii)This list is intended to be illustrative, not exhaustive.
2. The appellate court must always give proper weight and consideration o the findings of the trial court.
3. If two reasonable views can be reached__ one that leads to acquittal, the other to conviction __the High Courts/appellate courts must rule in favour of the accused."
42. As discussed above, since the violation of Sections 42 and 50 of NDPS Act are apparent, and the chemical formula of 9 (2008) 10 Supreme Court Cases 450 35 Methaqualone was not specified in the FSL reports, the finding of the learned Sessions Judge cannot be interfered with.
43. Accordingly, Criminal Appeal is dismissed.
___________________ K.SURENDER, J Date:10.01.2025 tk