Retracted Confessional Statement and Uncorroborated Co-Accused Statements Lack Evidentiary Value under Section 108

The Hon'ble CESTAT, Regional Bench, Kolkata, in M/s. Bapi Das Versus Commissioner of Customs (Prev.), Kolkata - 2026 (7) TMI 596 - CESTAT KOLKATA held that a personal penalty cannot be sustained based solely on a confessional statement that was retracted at the very first available opportunity before a Magistrate. The Tribunal ruled that the uncorroborated statement of a co-accused constitutes a fragile form of evidence and cannot serve as the sole basis for penalising another noticee.

Facts:

• Officers of the Directorate of Revenue Intelligence ('DRI') intercepted and arrested one Kartik Sen ('co-accused') on January 13, 2018, recovering 40 pieces of smuggled gold valued at Rs. 1,50,00,000 from his possession.
• In his recorded statements dated January 13 and 14, 2018, Kartik Sen stated that a labour contractor named Sushil Bauli had introduced him to Bapi Das ('the Appellant/Accused'), and he was also introduced to Bharat Biswas, from whom the gold was being collected. Whereas, Sushil Bauli denied any role in these allegations.
• On dated July 7, 2018, the appellant admitted his involvement with Kartik Sen and his accepted that he instructed the smuggling activities. Whereas, the very next day, upon being produced before the Chief Metropolitan Magistrate, the appellant stated that his statement was extracted under severe coercion and duress by the DRI officials.
• The investigation did not yield any statements from the alleged gold suppliers, and subsequent verification revealed that the phone numbers provided by Kartik Sen belonged to unrelated individuals, while the primary alleged supplier was never found.
• The Adjudicating Authority confiscated the seized gold and imposed a personal penalty of Rs. 30,00,000 on the appellant by relying on the statement of the co-accused and retracted statements of the accused. This order was subsequently upheld by the Commissioner (Appeals) '(Impugned order'). Aggrieved by the same, the appellant approached this tribunal.

Issues:

• Whether a self-inculpatory statement, retracted at the earliest available opportunity before a Magistrate, without any independent corroborative material, is admissible?
• Whether the statements of a co-accused carry sufficient evidentiary value to form substantive basis for establishing guilt?

Held:

The Hon'ble CESTAT, Kolkata, in [M/s. Bapi Das Versus Commissioner of Customs (Prev.), Kolkata - 2026 (7) TMI 596 - CESTAT KOLKATA], held as under:

• Observed that the statement of Shushil Bauli not corroborating the statement of the appellant, the statement of the appellant cannot be taken on the facial value as evidence.
• Held that a self-implicating confessional statement recorded under Section 108 of the Act loses its credibility and evidentiary value if it is retracted at the earliest opportunity before a judicial authority, unless it is firmly backed by independent corroborative evidence. The tribunal relied on the rationale of Hon'ble Supreme Court in COMMISSIONER OF CUSTOMS (IMPORTS), MUMBAI Versus M/s GANPATI OVERSEAS THROUGH ITS PROPRIETOR SHRI YASHPAL SHARMA & ANR. - 2023 (10) TMI 364 - Supreme Court
• On the reliance placed on the statements of co-accused, it was held that a confession of a co-accused person cannot be treated as substantial evidence. The court must seek corroboration of the purported confession from independent sources. The tribunal relied on the MOHTESHAM MOHD. ISMAIL Versus SPL. DIRECTOR, ENFORCEMENT DIRECTORATE - 2007 (10) TMI 273 - Supreme Court to reach its conclusions.
• Noted that the investigation failed to produce a single piece of independent corroborative material, such as physical recoveries or financial trails, and the Call Detail Records failed to establish either the identity of the speakers or the purpose of the conversations.
• Concluded that because the findings of the lower authorities were based entirely on impermissible assumptions, presumptions, and uncorroborated, retracted statements, the imposition of the penalty was unsustainable in law.

Hence, allowed the appeal and set aside the personal penalty of Rs. 30,00,000 imposed on the appellant, granting all consequential reliefs.

Relevant Sections & Regulations:

108. Power to summon persons to give evidence and produce documents.-

[(1) Any Gazetted Officer of customs shall have power to summon any person whose attendance he considers necessary either to give evidence or to produce a document or any other thing in any inquiry which such officer is making under this Act.]

(2) A summons to produce documents or other things may be for the production of certain specified documents or things or for the production of all documents or things of a certain description in the possession or under the control of the person summoned.

(3) All persons so summoned shall be bound to attend either in person or by an authorised agent, as such officer may direct; and all persons so summoned shall be bound to state the truth upon any subject respecting which they are examined or make statements and produce such documents and other things as may be required: Provided that the exemption under section 132 of the Code of Civil Procedure, 1908 (5 of 1908), shall be applicable to any requisition for attendance under this section.

(4) Every such inquiry as aforesaid shall be deemed to be a judicial proceeding within the meaning of section 193 and section 228 of the Indian Penal Code, 1860 (45 of 1860).