Full Judgment
2. The facts of the case briefly stated are that on 15.10.1988 the officers of Directorate of Revenue Intelligence searched house No. 20A, Veer Savarkar Block, Delhi in the presence of its three occupants S/Shri Rajpal Manchanda, Pawan Kumar and Bhagwat Singh Choudhary and two independent witnesses. During the search of a Maruti Car No.DBG-6227 parked inside the said house, 260 foreign marked gold biscuits of 10 tolas each valued at Rs. 96,51,200/- were recovered from two secret cavities made in the frame of the car below both the front doors. None of the persons present inside the house could produce any document to show legal possession/import of the recovered gold, the same was, therefore, seized in the reasonable belief that it was liable to confiscation under the Customs Act, 1962 and Gold (Control) Act, 1968 along with the Maruti Car. A sum of Rs. 65,000/- was also recovered from the house which was also seized as being relevant to the enquiry. One scooter DDR-8682 found parked inside the house along with some documents kept in the scooter were also seized as being relevant to enquiry under the Customs Act, 1962.
3. In the follow up action House No. D-39, Greater Kailash Enclave II, New Delhi of Rajpal Manchanda was searched on 15.10.1988. A sum of Rs. 40,000/-was recovered and seized as being relevant to the enquiries under the Customs Act. Statement of S/Shri Rajpal Manchanda, Pawan Kumar and Bhagwat Singh Choudhary were recovered. Shri Rajpal Manchanda in his statement recorded on 15.10.1988 and 16.10.1988 admitted that he had been indulging in smuggling of gold and silver from Pakistan in association with his brother Shri Satpal Manchanda. He also stated that the gold was sent by one person named Ashok @ Sharma of Dubai to Iqbal of Lahore who in turn sent the same across the Indo-Pak border to his brother Satpal Manchanda at Amritsar that from Amritsar the gold was sent by Satpal to Delhi for disposal; that the gold across the border was smuggled by Sardul Singh @ Sula Mehra and Putti, both of village Naushera Dhalla, Distt. Amritsar. Shri Rajpal Manchanda further admitted that he along with his brother Satpal had gone to Dubai in September 1988 to meet Ashok @ Sharma and start the gold smuggling; that after his return from Dubai he had received three consignments of gold; that the fourth consignment of 260 gold biscuits were brought from Amritsar to Delhi on 15.10.1988 by his nephew Shri Pawan Kumar in Maruti Car DBG-6227, that in Delhi he used to hand over the gold to one Suman who used to contact him on telephone; that the sale proceeds of the gold were handed over by Suman to Prakash and Raju, available on Delhi telephone Nos. 2913915 and 6447946; that Raju and Prakash used to send this money to Dubai. He also clarified that he used to get Rs. 30,000/- for disposal of every 100 foreign marked gold biscuits; that out of a total sum of Rs. 1,05,000/-recovered and seized from his residence and 20A, Veer Savarkar Block, Shakarpur, Delhi, he had taken Rs. 50,000/- from Choudhary Bhagwat Singh while the remaining amount was the commission of the smuggling of gold. He also admitted the recovery of 260 gold biscuits of foreign markings from Maruti Car DBG-6227.
4. Shri Pawan Kumar in his statement recorded on 15.10.1988 corroborated the statement of Rajpal Manchanda. He admitted that 260 gold biscuits seized on 15.10.1988 were brought by him from Amritsar to Delhi after concealing the same in Maruti Car DBG-6227. He also stated that on an earlier occasion he had brought a consignment of 135 gold biscuits from Amritsar to Delhi in similar manner. He also corroborated Rajpal's statement in-as-much as that Suman had given them two scooters Nos. DAD-9246 and DDR-8682; that when the time for delivery was fixed with Suman he used to take out the gold from the Maruti Car and after keeping the same in one of the scooters he used to hand over the scooter to Suman or his man at pre-determined place and time.
5. Shri Bhagwat Singh Choudhary in his statement recorded on 15.10.1988 admitted that the recovery of 260 gold biscuits, he however, denied any connection with the seized gold and smuggling activities of Rajpal and Pawan Kumar.
6. Shri Prakash Jalan in his statement recorded on 16.10.1988 stated that his brothers Raj Kumar Jalan and Bimal Kumar Jalan are engaged in hawala transactions from Delhi to Bombay. Shri Rajpal Manchanda identified Shri Raj Kumar Jalan from his photograph and stated that he was the same R.K. Jalan alias Raju who arranged for sending the sale proceeds of smuggled gold to Dubai.
7. Shri Sardul Singh alias Sula Mehra in his statement recorded on 10.1.1989 denied his involvement in the smuggling of 260 foreign marked gold biscuits. However, he admitted that he had known Rajpal and Satpal and also Putti and admitted to have indulged in smuggling of cardamom and Dalchini along with Rajpal and Satpal up to 1970.
8. Shri R.K. Jalan in his statement recorded on 27.3.1989 denied any connection with gold smuggling or hawala transactions.
9. Investigations revealed that Maruti Car DBG-6227 was registered in the name of Ashwani Kumar. Shri Rajpal in his statement dt. 15.10.1988 also stated that this car was registered in the name of Ashwani Kumar.
However, the address given in the registration papers was not correct.
It was also found that scooters DDR-8682 and DAD-9246 were registered in the name of Shri Prem Chand about the ownership of the House No.20-A, Veer Savarkar Block revealed that this property was not recorded with the Municipal Corpn. of Delhi. Enquiries made from the neighbour of the house revealed that the house was newly constructed in 1987 which was earlier an 'Akhara' owned by one Shri Bhim Pahalwan alias Pahalwan who in his statement recorded on 17.11.1988 stated that 20A Veer Savarkar Block was owned by his brother-n-law late Shri Ram Chandra, father of Shri Bhagwat Singh Chaudhary, on which he was earlier running an 'Akhara', that later he disbanded his Akhara on the request of Shri Bhagwat Singh; that Bhagwat Singh sold this plot to Shri Rajpal Manchanda who got a house built. Shri Bhagwat Singh Choudhary in his statement dt. 15.10.1988 had also stated that he had sold the plot No. 20A, Veer Savarkar Block to Rajpal Manchanda on which Shri Manchanda constructed his house.
10. A Show Cause Notice was issued to the appellants asking them to explain as to why the seized foreign marked gold biscuits should not be confiscated why Indian currency amounting to Rs. 55,000/- should not be confiscated, the Maruti car and the two scooters involved in smuggling should not be confiscated why penalty should not be imposed under Section 112 of Customs Act, 1962 and Section 74 of the Gold Control Act, 1968. Before the authorities below the appellants contended that the statements of Rajpal Manchanda, Pawan Kumar and Bhagwat Singh Choudhary on which the entire case was built were not voluntary that Rajpal Manchanda and Pawan Kumar were kept in DRI office right from 18.30 hrs on 15.10.1988 till they were produced before Court on 16.10.1988; that they had been tortured that they made a request for medical examination before the Magistrate on 16.10.1988 that they were medically examined and injuries were found on their bodies. It was, therefore, contended that the statements were not voluntary and were obtained under duress and therefore, was not to be treated as valid evidence. In support of this they cited and relied upon the judgment of the Hon'ble Supreme Court in the case of Sevantilal Karsondas Modi v.State of Maharashtra (1979) (AIR) SC 705 : 1979 Cen-Cus 196D SC : ECR C Cus 1025 SC.11. Ater careful consideration of the submissions made and perusal of the evidence and the case law cited by the appellants, Ld. Commissioner as adjudicating authority held as indicated in the preceding paragraph.
12. Shri Harbans Singh, Ld. Counsel appears for S/Shri Satpal Manchanda, Rajpal Manchanda, Pawan Kumar and Ashwani Kumar and submits that the statements of S/Shri Pawan Kumar and Rajpal Manchanda are not voluntary and true that they were beaten up and tortured and forced to write and sign incriminating statement. In support of this he referred to the certificate of Medical Examination of S/Shri Pawan Kumar and Rajpal Manchanda by the Medical Officer of Central Jail Tihar. He submits that these certificates clearly point out that S/Shri Pawan Kumar and Rajpal Manchanda were tortured and injuries inflicted on them; that the Ld. Commissioner rejected the Medical Examiner's Report on the ground that the same had not been proved by summoning the doctor. It was contended by the Counsel that in case the Ld.
Commissioner had any doubt about the authenticity of the medical examination reports he could have summoned the doctor for clarifying the position. He submitted the contention of the Ld. Commissioner that the medical examination report has been superimposed is baseless and not based on fact. He submitted that these medical examination reports were received by them in the COFEPOSA proceedings. It was contended that Ld. Commissioner relied on the statement of Bhim Singh Pahalwan that this statement cannot be taken as evidence in-as-much as no copy of this statement was supplied to them.
13. Ld. Counsel also submitted that the plot on which the house has been stated to have been built was an 'akhara' and that there was no evidence to prove that the house belonged to Rajpal Manchanda as municipal records did not indicate so. It was pleaded by the Counsel that during cross examination of the Panch-witnesses and Shri Bhagwat Singh Chaudhary it was revealed that the premises in question were a public place being used as 'akhara'.
14. Ld. Counsel submitted that no evidence has been brought on record to conclusively prove that the appellant was the owner or the user of the car during the material period. Simply because the car was registered in the name of the appellant it could not be held that the appellant was the owner or the user of the car. Ld. Counsel also submitted that there is no evidence on record to show as to who was controlling the car during the material period in-as-much as no evidence has been placed on record to show as to who produced the key of the car. Summing up his argument Ld. Counsel submitted that the car was found parked in a public place where any one can park his car, the place was a akhara'. There is no evidence that the key of the car was with the appellant who produced before recovery of the gold and therefore, the foreign mark seized gold biscuits were under the control of the appellants has not been proved. Ld. Counsel submitted that the ratio of the decision of the Apex Court in the case of Naresh J.Sukhawani v. UOI is not applicable to the facts of the present case in-as-much as Shri Dudani had not retracted his statement nor was there any evidence in that case that the statement had been recorded under threat and coercion. Ld. Counsel submitted that in the present case there is sufficient evidence to prove that the statement was obtained under threat and coercion and that it was retracted.
15. Shri M.M. Dube, Ld. DR submitted that statements of S/Shri Rajpal Manchanda, Pawan Kumar, Bhagwat Singh Chaudhary corroborate each of the facts. He submitted that the statements clearly indicate the events not only of the present case but also of the past cases and activities of the appellant. He submitted that retraction of the statement is a normal phenomena. However, the facts remained that the facts revealed in the statement were known only to the appellant and thus the statements were true and voluntary. He submitted that the ratio of the decision of the Hon'ble Supreme Court in the case of Sevantilal Karsondas (supra) relied upon by the appellant is not applicable to the facts of the present case in-as-much as the appellant in their retraction had clearly indicated as to what happened to them. In the instant case in the retraction statement, the appellant had not disclosed the facts, if any, of torture and coercion but had made a general statement that they were forced to sign the statement.
16. Ld. DR submitted that in so far as the ownership of the plot 20A, Veer Savarkar Block is concerned, Shri Bhagwat Singh Chaudhary and Pahalwan clearly stated that the land was sold to Rajpal Manchanda and that house was constructed by Shri Rajpal Manchanda on this piece of land. The contention of the appellant is that the statement of Pahalwan was not given to them and therefore was not relied upon a document is wrong in-as-much as reference to this is already in SCN and if the appellant wanted a copy they could very well take a copy of this statement.
17. In so far as the control over the Maruti car is concerned, Ld. DR submitted that the Maruti car was registered in the name of Ashwani Kumar and was being actually used by Shri Rajpal Manchanda and Shri Pawan Kumar. A detailed statement given by Shri Pawan Kumar clearly shows that the car was used by him for transporting foreign marked gold biscuits from Amritsar to Delhi. Enquiries with the transport registration authorities revealed that the information about the registered owner of the car furnished by Shri Rajpal was correct. Thus, during the material period, Ld. DR submitted that the car was under the control of Shri Rajpal Manchanda and Pawan Kumar. He submitted that all the issues pleaded before the lower authorities have been dealt with by the adjudicating authority. He reiterates the finding thereof. He, therefore, submitted that in view of this, the appeals may be rejected.
18. Heard submissions of both the sides and perused the records and citations relied upon by both the sides.
19. The first point that was agitated before us was admissibility of the statements which are pleaded to be taken under duress and coercion and then retracted. We note that the statements were given by the people stating facts about their family and their activities. In retraction they have not stated as to what part of the statement was not voluntary or was untrue. The entire statement cannot be called as untrue in-as-much as certain verifiable facts were mentioned in that statement. Now coming to the question of torture no doubt a medical certificate was produced but the medical certificate was in respect of certain contrusions whether these were on account of beating or torture cannot be verified now precisely. It is important whether the statements can be treated voluntary and true and therefore, can be relied upon or not. We note that the appellants had given statement about their activities and the persons whom they either mentioned or identified. Those persons were located their statements were recorded.
In the statement, the appellants also disclosed the particulars of the persons who used to send the sale proceeds by Hawala transactions from India to foreign countries. Similarly the persons who were the registered owner of the Maruti car was also disclosed. All these details are furnished by the appellants in their statement in as-much-as they have been corroborated by others. Take the case of Rajpal Manchanda and Pawan Kumar. Rajpal Manchanda and Pawan Kumar has corroborated each other and implicated each other also one working on the direction of the other and the other carrying faithfully the directions given by the first. Thus, looking to the facts of the case and circumstances, we find that the statements were true and voluntary.
We note that the decision in the case of Sevantilal Karsondas Modi cited by the appellant cannot be made applicable to the facts of the present case as the facts in the two cases are different. We rely more on the judgment of the Apex Court in the case of Naresh J. Sukhivani in which the Apex Court held that these things cannot be proved fully. We also find that Naresh J. Sukhwani's case is more applicable to the facts of the present case in which one accused had corroborated the statement of the other.
20. In so far as ownership of the place where the car was parked is concerned, we find that though there is no municipal record to show that Rajpal Manchanda was the owner. However, from the enquiries made by the Investigating Officers, it was found that this plot was sold to Rajpal Manchanda who had constructed a house recently. It was contended before us that a copy of the statement of Pahalwan was not supplied to the appellants. However, we note that in the SC Memo there is a detailed narration about what the Pahalwan stated and this narration was supported by Bhagwat Singh Choudhary. Thus, it was not a Akhara any longer but had a house owned by Rajpal Manchanda. Coming to the control over the car from which foreign marked gold biscuits were recovered. We note that car was parked in the house which was constructed by Rajpal Manchanda. The question of production of key is not very material at this stage to determine the control. It is a fact that there is no mention as to who produced the key of the car. It is also a fact that in cross examination, the seizing officer could not state as to who produced the key but the car was parked in the premises of Rajpal Manchanda. It was opened and searched and 260 foreign marked biscuits were recovered from the special cavities made in the frame of the car in the front door portion. The recovery of the gold was admitted not only by the appellants but also by Shri Bhagwat Singh Choudhary. The retraction by the witnesses about the recovery of the gold is not very significant in-as-much as they had not resiled from what they had witnessed in the Panchnama before they were summoned for cross examination. Shri Bhagwat Singh Choudhary was a friend of Rajpal Manchanda. The two witnesses were from the locality and thus the only conclusion for their retraction at the time of cross examination can be attributed to two causes, one is that there was a time gap and the second was that they were neighbours of the appellant and therefore to oblige them, they simply resiled. The gold was recovered from the car, the car was parked in the house which was owned by Rajpal Manchanda, The recovery was admitted not only by the two appellants but also by Shri Bhagwat Singh Choudhary and the witnesses. Therefore, their retraction at the time of cross examination is not very material in view of the facts stated above. Having discussed the position as above, we hold that Rajpal Manchanda, Satpal Manchanda and Pawan Kumar were the person concerned.
21. During the material period, import of gold was prohibited and the onus was on owners/custodians or the persons from whose possession gold was recovered to prove that the gold was possessed lawfully and legally and in the absence of any documentary proof, we uphold the confiscation of goods.
22. In so far as confiscation of the car is concerned, we find that according to the statement of Rajpal Manchanda and Pawan Kumar, the car was used for transporting 260 foreign marked gold biscuits and therefore, confiscation of the car is upheld. In so far as confiscation of the scooters is concerned, we note that scooters were not so far involved in the present case and therefore, confiscation of the scooters is set aside.
23. We note that penalty has been imposed on Ashwani Kumar and Raj Kumar Jhalan. Shri Raj Kumar Jhalan is reported to be the person involved in sending the sale proceedings of smuggled gold to Dubai through Hawala. However, no evidence has been brought on record to prove that any part of the present gold was sold and sale proceeds thereof were sent to Dubai. In the absence of any documentary evidence, we set aside the imposition of penalty on Rajkumar Jhalan.
24. In so far as imposition of penalty on Shri Ashwani Kumar is concerned, we find that Ashwani Kumar was only the registered owner of the car. No evidence has been brought on record to prove his role in the present smuggling or he had acknowledged that his car was being used by Rajpal Manchanda, Pawan Kumar and Satpal Manchanda for transporting smuggled gold. The fact has been brought out by the statement of Shri Rajpal Manchanda is that Ashwani Kumar was only the registered owner of the car and had not financed the purchase of car and that the car was purchased only by Rajpal Manchanda but name was written as Ashwani Kumar. Penalty on Shri Ashwini Kumar is set aside.
25. Looking to all the facts and circumstances of the case, we reduce the penalty on Rajpal Manchanda to Rs. 2 lakhs under Customs Act, 1962 and to Rs. one lakh under Gold Control Act, 1968. The penalty on Satpal Manchanda is reduced to Rs. one lakh under the Customs Act, 1962 and Rs. one lakh under the Gold Control Act. We do not want to interfere with the imposition of penalty on Shri Pawan Kumar as the same is sustainable in law.