Customs, Excise and Gold Tribunal - Mumbai
Felix Dores Fernandes vs Commr. Of Cus., Acc on 23 March, 2000
Equivalent citations: 2000(118)ELT639(TRI-MUMBAI)
ORDER J.H. Joglekar, Member (T)
1. The facts leading to the present appeal are as follows : The appellant on departure to Dubai was specifically asked whether he had any foreign currency. He answered in the negative. Search of his baggage resulted in recovery of foreign exchange equivalent to Rs. 10,06,615/-. This currency was seized along with one piece of paper with some noting and pocket diary. In his statement recorded on the same day the appellant claimed that he had sold a flat in Mumbai for Rs. 72 lakhs, that he had received compensation from a church of about Rs. 18.6 lakhs, that he had utilised part of such funds for purchase of assorted foreign exchange from one Mr. Raju whose name and telephone number were in the telephone diary and that he was carrying the said foreign exchange. Raju was not traced. Show cause notice was issued for confiscation of the currency and for imposition of penalty. In the reply to the show cause notice his statement was denied. It was stated that the appellant earned substantial amounts by way of retirement benefit and by way of commercial transactions while in Dubai. It was claimed that the amounts were given to other persons and those were received back. It was claimed that this amount was imported by the appellant into India but that the amount was not declared on importation. It was claimed that the same amount was being taken back by him. The Commissioner after discussing the evidence and the contentions made in the reply, ordered confiscation of the currency and also imposed penalty of Rs. 1,00,000/- on the appellant. Hence the appeal.
2. We have heard Shri S.N. Kantawala, Advocate for the appellant and Shri Deepak Kumar for the revenue.
3. The statement dated 10-5-1998 is in the appellant's handwriting in which the admission is made that the currency being carried was acquired illegally. In this statement a reference is made to sources of funds and also to a bank locker said to contain, apart from jewellery, sale deeds, and a sum of Rs. 3,00,000/- in cash. It appears that on the search the cash was found to be there. This is reflected in paragraph 22 of the impugned order. Thus the inculpatory statement is supported by the existence of the cash referred to therein. The learned counsel repeatedly made plea before the Commissioner that this statement was later retracted. The law of retraction is well settled. It is held that the retraction must be made within a reasonable time of the inculpatory statement having been made. The appellant was enlarged on bail on 15-5-1998. There is nothing on record to indicate that he had retracted the statement except a letter written by him to the Customs authority on 25-5-1998 in which a reference is made to a retraction letter. In the meanwhile on 20-5-1998 a supplementary statement was recorded in which he was to identify one Mansingh. There is nothing in the statement retracting the previously made statement. The learned counsel is unable to show us the retraction letter. In this situation we hold that the inculpatory statement made by the appellant on 10-5-1998 duly corroborated by the existence by cash in the bank locker is admissible.
4. Before the Commissioner and before us also it has been claimed that the appellant was in possession of substantial foreign exchange in the UAE and that part of this exchange was brought by him earlier which was being taken back. We find that in view of our finding as to the admissibility of inculpatory statement, there is no need or requirement for us to examine this statement.
5. In the statement dated 10-5-1998 reference is made to his telephone diary and also a chit of paper on which there were figures showing conversion of Dirhams to rupees. A sum of Rs. 1,09,800/- is shown against another person and a sum of Rs. 14,48,375/- is shown against Raju. Although Raju was never trace, these entries show that he was not a mythical person and therefore this diary and paper also act as corroboration to the inculpatory statement.
6. We, therefore, find that the orders of the Commissioner of confiscation of the currency are correct in law.
7. Shri Kantawala relies upon a number of judgments given by the Government of India in which the currency in similar circumstances was permitted to be redeemed. We have seen the judgments. In all cases of smuggling in baggage where the original adjudication is by the officers subordinate to the Commissioner, the second appeal lies to the Government of India.
8. Shri Deepak Kumar submits that the currency which is not lawfully acquired would become prohibited goods and therefore there is no need for offering a redemption. He however fairly concedes that to his knowledge these orders of the Government of India have not been challenged further. Shri Kantawala refers to order No. 298/97, dated 14-3-1997, In this case undeclared currency on arrival was held to be liable to confiscation but was released on payment of fine of about 35%. Although the Government of India's orders do not have a binding effect on the Tribunal, as we have observed above, a radically different point of view taken by the Tribunal on the issue of redemption of foreign exchange would create an awkward situation where for lesser amounts, redemption is offered by the Government and for larger amounts, it would be denied by the Tribunal. We therefore, while upholding the orders of confiscation, permit redemption of the foreign exchange on payment of fine in lieu of confiscation of Rs. 4,00,000/-. No reduction is warranted in the quantum of penalty. On redemption the appellants would be required to follow the requirements of law in possessing and/or dealing with or disposing off the currency.