Kerala High Court
C.K.Boban vs The Union Of India on 29 April, 2005
Author: K.T.Sankaran
Bench: K.T.Sankaran
IN THE HIGH COURT OF KERALA AT ERNAKULAM
Bail Appl No. 2593 of 2005
1. C.K.BOBAN, S/O. KOCHUNNI,
... Petitioner
Vs
1. THE UNION OF INDIA,
... Respondent
For Petitioner :SRI.BABU S. NAIR
For Respondent :SRI.JOHN VARGHESE, ASSISTANT SG
The Hon'ble MR. Justice K.T.SANKARAN
Dated : 29/04/2005
O R D E R
.........L.......T.......T.......T.......T.......T.......T......J K.T. SANKARAN, J.@@ jAAAAAAAAAAAAAAAAA
--------------------------------@@ j @@ j B.A. NOS. 2593 & 2670 OF 2005@@ j
--------------------------------@@ j @@ j Dated this the 29th day of April, 2005.@@ j AAAAAAAAAAAAAAAAAAAAAAAAAA @@ j O R D E R@@ jEEEEEEEEE .SP 2 ((HDR 0 B.A.NOS.2593 & 2670 OF 2005 :: # ::@@ j )) .HE 1 B.A.No.2593 of 2005 is filed by the first accused while B.A.No.2670 of 2005 is filed by the third accused in O.R.No.33/04-05 of the Directorate of Revenue Intelligence, Cochin. These bail applications are filed under Section 439 of the Criminal Procedure Code. The first accused, C.K.Boban was arrested on 18.3.2005. The third accused, K.T.Charly was arrested on 1.4.2005. The first accused moved an application for bail before the Court of the Additional Chief Judicial Magistrate (Economic Offence), Ernakulam unsuccessfully. He also filed a bail application before the Court of the Sessions Judge (Vacation Court), Ernakulam which was also dismissed. The third accused moved for bail before the Court of the Additional Chief Judicial Magistrate (Economic Offence), Ernakulam, which was dismissed.
2. There are four accused persons in the case. The petitioners in the bail applications under consideration are accused Nos.1 and 3. The second accused, Ajish is an employee of a Customs Clearing Agent. The second accused was released on bail. Accused No.4 Unnikrishnan is a Customs Clearing Agent. He is absconding.
3. The first accused is an importer having Import/Export Code (IEC). During 2004-2005 the first accused imported six consignments from abroad. On the basis of the intelligence information that M/s. Trichur Traders, Kunnamkulam was attempting to smuggle out of Cochin Port Trust contraband goods without customs examination, without payment of duty and without observing the Customs formalities, the Senior Intelligence Officer, Directorate of Revenue Intelligence, Cochin and party conducted a search. They found that M/s.Trichur Traders had filed Bill of Entry and the goods covered by the Bill of Entry were destuffed at shed No.Q10 of Cochin Port Trust. On examination, it was found that the packing list and invoice submitted along with the Bill of Entry indicated that 3600 pieces of toys were packed in 50 cartons of 72 pieces each. As per the Bill of Entry the imported cargo was declared to have a weight of 15000 kgs. However, on examination, it was found that the total weight was only 2050 kgs. The Customs House Agent was not in a position to explain the discrepancy in weight. The first accused and the third accused pleaded ignorance. On investigation, it was found that the Customs House Agent on instructions of the first accused produced the contents of Container TEXU 2222222 for Customs examination in the guise of the contents of Container IALU 1201439 and tried to hide the contents of the container IALU 1201439 and evade customs examination of the goods. On further examination, it was found that the contents of the container IALU 12021439 were 7,80,000 batteries, 33,000 CF lamps, garments worth Rs.4,10,400/- and 27 other items of assorted quantity having a value of about Rs.1,80,875/-. The import of batteries is not permitted as per Bureau of Indian Standard norms. For CF lamps, heavy anti-dumping duty is payable. Garments would attract very high rate of specified duty. It was found on examination that the goods would attract customs duty of Rs.15 lakhs and anti-dumping duty of Rs.71 lakhs, totalling Rs.86 lakhs. The contents of both the containers were seized on 17.3.2005.
4. Statements under Section 108 of the Customs Act were taken from accused Nos.1 and 3. They admitted the import of the goods in question and their attempt to evade payment of duty. In the statement given under Section 108 of the Customs Act, accused No.1 admitted that three months before he had imported a container containing CF lamps, batteries, garments etc. He could not clear the same since they attracted prohibitions and high rate of duty. Therefore, he re-exported the same. Accused No.1 went to Dubai and again imported the same goods with the intention to get the same cleared by adopting dubious methods. The further case against the first accused is that he had smuggled out goods on earlier occasions also on the strength of wrong declarations. It is stated that duty to the tune of Rs.3 crores have already been evaded by dubious acts of the gang in which accused Nos.1 and 3 are parties.
5. Accused No.1 contended that he is a businessman settled at Kunnamkulam and he has studied only upto 10th standard. He used to import goods from foreign countries, mainly from Dubai under valid import licence. The goods so imported by him were being delivered to him after the Customs examination/clearance and other formalities by the Customs House Agent. The Customs House Agent used to submit documents before the customs authorities on the basis of the invoice/bills of the goods produced and imported by the first accused. The value of the goods and other details would be written by the Clearing Agent and the first accused has no role in that matter. The first accused further contents that the imported goods are expected to be cleared by the customs officials on duty only after conducting an open examination of all the goods and after being satisfied themselves about the quantity, quality and value of the goods. The first accused would only contact the Customs House Agent/Clearing Agent and would sign whatever documents given by the Agent. The first accused was questioned on several occasions by the DRI Officials and his statement under Section 108 of the Customs Act was recorded. On 17.3.2005, the DRI Officials obtained a statement from him wherein it is recorded that he admitted commission of the offence.
6. In so far as the third accused is concerned, it is alleged that incriminating documents and materials such as Customs seals used by Customs for movement of container under their control have been recovered. In the statement given by the third accused, he admitted of having smuggled three containers from Cochin Port without payment of duty and without customs examination with the active assistance and connivance of the Customs House Agent and others.
7. Heard Sri.Babu S.Nair, counsel for the first accused, Sri.S.Vijaya Kumar, counsel for the third accused and Sri.John Varrghese, Assistant Solicitor General of India.
8. The counsel for the accused contended that the offence alleged against the accused persons is under Section 135(1) of the Customs Act and going by the allegations, only Section 135(1)(ii) would be attracted whereunder the punishment is only for a term which may extend upto three years. It is contended that if so, the third category of Part II of Schedule I of the Code of Criminal Procedure would apply and the offence would be only a bailable offence. For the sake of convenience, Section 135(1) of the Customs Act and Part II of the Schedule I of Cr.P.C. are extracted below.
...............L.......T.......T.......T.......T.......T.J .SP 1 "135. Evasion of duty or prohibitions:@@ EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE (1) Without prejudice to any action that may be taken under this Act, if any person
(a) is in relation to any goods in any way knowingly concerned in mis-declaration of value or in any fraudulent evasion or attempt at evasion of any duty chargeable thereon or of any prohibition for the time being imposed under this Act or any other law for the time being in force with respect to such goods, or
(b) acquires possession of or is in any way concerned in carrying, removing, depositing, harbouring, keeping, concealing, selling or purchasing or in any other manner dealing with any goods which he knows or has reason to believe are liable to confiscation under section 111 or section 113; as the case may be, or
(c) attempts to export any goods which he knows or has reason to believe are liable to confiscation under section 113, he shall be punishable,--
(i) in the case of an offence relating to any of the goods to which section 123 applies and the market price whereof exceeds one lakh of rupees, with imprisonment for a term which may extend to seven years and with fine:
PROVIDED that in the absence of special and adequate reasons to the contrary to be recorded in the judgment of the court, such imprisonment shall not be for less than three years;
(ii) in any other case, with imprisonment for a term which may extent to three years, or with fine, or with both."
........L.......T.......T.......T.......T.......T.......T.......J .SP 2 "THE FIRST SCHEDULE@@ j CLASSIFICATION OF OFFENCES@@ j "II CLASSIFICATION OF OFFENCES AGAINST OTHER LAWS@@ j
-------------------------------------------------------- .SP 1 .JN Offence Cognizable or Bailable or By what non-cognizable non-bailable Court triable
-------------------------------------------------------
If punishable with death, imprisonment for life, or impri-
sonment for more than Court of
7 years. Cognizable Non-bailable Session.
If punishable with
imprisonment for 3
years, and upwards Magistrate
but not more than of the
7 years Ditto Ditto first class
If punishable with
imprisonment for
less than 3 years Non-cogni- Bailable Any
or with fine only. zable. Magistrate"
.JY
.SP 2
9. The argument put forward by the counsel for the accused is that under Section 135(1)(ii), the imprisonment prescribed is "for a term which may extend@@ CCCCCCCCCCCCCCCCCCCCCCCCCC to three years". Part II of Schedule I Cr.P.C. provides@@ CCCCCCCCCCCCCCCC that if the offence is punishable with imprisonment "for@@ CCCC less than three years" or with fine only, the offence is@@ CCCCCCCCCCCCCCCCCCCCCCCCC bailable. The counsel contended that the expression "for a term which may extend to three years" means that the sentence of imprisonment that could be awarded is for a period of less than three years. The counsel relied on the decision reported in Sreerajan v. State of Kerala@@ EEEEEEEEE EEEEEEEEEEEEEEE (2001(1) KLT 827) to fortify their contention. In Sreerajan's case, this Court was considering the scope of the proviso to Section 167(2) of the Code of Criminal Procedure. The proviso to Section 167(2) reads thus:
...............L.......T.......T.......T.......T.......T.J .SP 1 "Provided that
(a) the Magistrate may authorize the detention of the accused person, otherwise than in the custody of the police, beyond the period of fifteen days, if he is satisfied that adequate grounds exist for doing so, but no Magistrate shall authorize the detention of the accused person in custody under this paragraph for a total period exceeding,--
(i) ninety days, where the investigation relates to an offence punishable with death, imprisonment for life or imprisonment for a term of not less@@ CCCCCCCCCCCCCCCCCCCCCC than ten years;@@ CCCCCCCCCCCCCCC
(ii) sixty days, where the investigation relates to any other offence, and, on the expiry of the said period of ninety days, or sixty days, as the case may be, the accused person shall be released on bail if he is prepared to and does furnish bail, and every person released on bail under this sub-section shall be deemed to be so released under the provisions of Chapter XXXIII for the purposes of that Chapter;"
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10. I do not agree with the argument put forward by the counsel for the accused. The expression "an offence punishable with death, imprisonment for life or imprisonment for a term of not less than ten years"@@ CCCCCCCCCCCCCCCCCCCCCCCCCCC occurring in the proviso to Section 167 of the Code of Criminal Procedure is quite different from the expressions "if punishable with imprisonment for three@@ CCCCCCCCC years and upwards" and "if punishable with imprisonment@@ CCCCCCCCCCCCCCCCC for less than three years". The position would be clear@@ CCCCCCCCCCCCCCCCCCCCCCCCCC from the second item in Part II of Schedule I of the Code of Criminal Procedure which provides that if the offence is punishable with imprisonment for three years and up wards, the offence is non-bailable. The expression used is "three years and upwards" which would definitely@@ CCCCCCCCCCCCCCCCCCCCCCCCCC include an offence punishable for a term upto three years. Part II of Schedule I of Cr.P.C. is clear that if the offence is punishable for a term of three years and upwards, that offence is non-bailable. What is bailable is an offence punishable with imprisonment for a term of less than three years. The question can be answered in another way as well. Can you punish an accused with imprisonment for a term of three years under Section 135(1)(ii) of the Customs Act? If the answer is `yes', then the second item in Part II of the First Schedule of the Code of Criminal Procedure would apply. Obviously, the offence would be non-bailable in such a case. Therefore, the contention raised by the counsel for the petitioners that the offence under Section 135(1)(ii) of the Customs Act is bailable does not deserve acceptance. Moreover, at this stage, it cannot be held that Section 135(1) of the Customs Act wherein imprisonment for a period of seven years is provided would not be attracted in the case.
11. The counsel for the petitioners contended that the petitioners/accused Nos.1 and 3 are in judicial custody from 18.3.2005 and 1.4.2005 respectively and there is no justification for detaining them further. It was contended that the accused persons were questioned and their statements under Section 108 of the Customs Act were recorded. The counsel for the third accused contended that the third accused was roped in only on the basis of the statement given under Section 108 of the Customs Act by the first accused. The statement made by the first accused was retracted at the earliest opportunity, that is, when he filed the bail application dated 19.3.2005. A retracted confession of the first accused cannot be made a basis for implicating the third accused in the offence. The counsel for the third accused also contended that the investigation as against the third accused is over. He also pointed out that the statement given by the third accused was retracted at the earliest possible opportunity.
12. The Assistant Solicitor General, on the other hand, contended that the investigation is not over. Accused No.4 is yet to be arrested. He contended that this case cannot be treated as a case involving of an offence pertaining to evasion of customs duty alone. The Assistant Solicitor General relied on the statement dated 22.4.2005 filed by him in B.A.No.2593 of 2005. In that statement, it is stated thus: "The investigation is in progress. The chances of the petitioner having smuggled out goods that are more detrimental to National interest cannot be ruled out at this stage. This activity of smuggling was operated by a gang which had earlier used fabricated documents for the containers cleared from the Port without Customs examination and hence the allegation is not only mis-declaration and duty evasion." The Assistant Solicitor General submitted that the investigation points out to commission of graver offences under the Indian Penal Code. The seizure of Customs seals from the residence of accused No.3 shows the seriousness of the matter. The Assistant Solicitor General further contended that it is necessary to question several persons, peruse several documents and collect data from various places including other countries and therefore, it is not safe to release the petitioners on bail. He also pointed out, if bail is granted, the petitioners would definitely try to influence the witnesses and indulge in activities which would seriously affect the proper investigation.
13. The nature of the allegations levelled against the accused are certainly an important factor to be considered. The apprehension that the accused persons were indulging in activities detrimental to national interest is another factor to be taken note of. The seizure of Customs seals from the residence of accused No. 3 assumes importance in this context. "National interest" includes interests of the people. Pitted against the interests of the people/national interest, the individual rights of the citizen are of less importance. Interests of the citizen are only subservient to national interest and not vice versa. These matters are not irrelevant while considering an application for bail. The contentions raised by the Assistant Solicitor General merit acceptance.
14. The first accused has raised a contention that he has studied only upto X standard and he is not well versed in Customs matters. It is stated that he used to rely on what the Customs House Agent advised. The ignorance pleaded by the first accused cannot be accepted at all. Ignorance of law is not an excuse. It is true that there is no presumption that every person knows the law. But a person cannot be heard to say that he has not committed an offence under the Customs Act because he has studied only upto X standard and he is ignorant of the Customs laws. The statement made by the first accused indicates that on an earlier occasion he tried to clear out the same goods, and on failure, he got them back to Dubai and imported the same goods again after visiting Dubai. It cannot be believed, prima facie, such a person is ignorant of Customs laws. When the petitioners retracted from the statements made by them under Section 108 of the Customs Act, the investigating agency would require all the relevant data to be collected. I am of the view that this aspect would not advance the plea of the petitioners in these bail applications; on the other hand, it would be detrimental to the plea for granting bail.
For the foregoing reasons, I am of the view that the petitioners cannot be released on bail at this stage. The Bail Applications are accordingly dismissed.
.SP 1 .JN (K.T. SANKARAN)@@ AAAAAAAAAAAAAAAAAAA Judge@@ AAAAAAAA ahz/ .PA .........L.......T.......T.......T.......T.......T.......T.........J ((HDR 0 )) .HE 2 .JN .SP 2 K.T.SANKARAN, J.@@ AAAAAAAAAAAAAAAAA
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B.A.NOS.2593 & 2670 OF 2005 O R D E R 29th April, 2005
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