2015 (9) TMI 196 - HC - Customs

Customs Act: Joint duty evasion = non-bailable offence.

The court held that the offence under Section 135 of the Customs Act is non-bailable if the evasion of duty exceeds a certain threshold. It ruled that ... Bail Application – Smuggling of gold – Statement of each of accused-petitioners revealed that accused-petitioners jointly and in connivance to each other on previous several occasions smuggled gold into India without declaration and payment of customs duty – As value of customs duty evaded or attempted to be evaded was more than Rupees Fifty Lacs, offence committed by each of accused-petitioners was non-bailable within meaning of sub-section (6) of Section 104 of Act – Held that:- Section 104(6) of Customs Act, 1962 provides that notwithstanding anything containing in Code, offences punishable under Section 135 of Act shall be non-bailable. If any person in relation to any goods in any way knowingly concerned in any fraudulent evasion or attempt at evasion of any duty chargeable thereon shall be punishable with imprisonment for term which may extend to seven years and with fine in case of offence relating to any goods market price of which exceeds one crore rupees or evasion or attempted evasion of duty exceeding fifty lakh of rupees – Further offence under Section 135 of Act for evasion or attempted evasion of duty must be treated to be continuous offence until customs duty is paid upon goods which have been imported without payment of customs duty upon them – Expression 'Any person' used in Section 135 of Act does not mean only one person but more than one person also if they jointly and knowingly involve themselves for fraudulent evasion or attempted evasion of customs duty chargeable of goods – If more than one person acting in concert with each other has evaded or attempts to evade customs duty, each of them should be treated as 'Any Person' within meaning of Section 135. Looking to gravity of offence, petitioners are not entitled to bail on merit – Also accused-petitioners permanently reside in Muskat and it is unlikely that they will return to India to face trial once bail is granted to them – Consequently, all applications for grant of bail hereby, dismissed – Decided against Accused. Issues Involved:1. Whether the offence under Section 135 of the Customs Act is bailable or non-bailable.2. Whether the gold allegedly imported by the petitioners on previous occasions without declaration and without paying customs duty can be clubbed with the present consignment.3. Whether the import of gold by each of the accused-petitioners is to be treated as a separate act or a joint import for calculating the market price and customs duty evaded.Detailed Analysis:Issue 1: Bailable or Non-Bailable Offence under Section 135 of the Customs Act- The foremost common question of law raised was whether the offence under Section 135 of the Act is bailable or non-bailable. The court noted that sub-section (6) of Section 104 of the Act specifies that if the evasion or attempted evasion of duty exceeds fifty lakh rupees or the market price of the goods exceeds one crore rupees, the offence is non-bailable. Sub-section (7) of Section 104 states that all other offences under the Act are bailable. Therefore, the determination of whether the offence is bailable or non-bailable depends on the value of the evaded duty and the market price of the goods.Issue 2: Clubbing of Previous and Present Consignments- The petitioners argued that there is no provision in the Act allowing the customs authorities to club previous imports with the present consignment for assessing the market price and evasion of customs duty. They contended that each import without declaration and payment of customs duty constitutes a separate and distinct offence. However, the court held that the words 'any goods' in Section 135 include goods that escaped seizure and confiscation. The court also maintained that an offence under Section 135 for evasion or attempted evasion of duty must be treated as a continuous offence until customs duty is paid. Thus, the previous imports can be clubbed with the present consignment for calculating the total market price and customs duty evaded.Issue 3: Joint or Separate Import for Calculating Market Price and Duty Evasion- The petitioners contended that each import should be treated separately and individually, and the value of the gold imported by each petitioner should not be combined. The court disagreed, stating that if more than one person jointly and in connivance with each other imports goods without paying customs duty, they should be treated as having jointly committed the offence. The total market price of the goods and the value of the customs duty evaded should be calculated based on the combined value of the goods imported by all the petitioners.Significant Findings:- The court held that the statements recorded under Section 108 of the Act are material pieces of evidence and admissible in evidence, particularly since the petitioners did not retract their statements.- The court found that the petitioners were frequent fliers and had smuggled gold into India on several previous occasions without declaration and without paying customs duty.- The court noted that the total weight of the gold jointly smuggled by the petitioners was 14,047.80 gms, valued at Rs. 3,85,35,526/-, and the value of the customs duty evaded exceeded Rs. 50 lacs, making the offence non-bailable under Section 104(6) of the Act.- The court emphasized that economic offences adversely affect the national economy and should be considered seriously when deciding on bail applications.Conclusion:- The court concluded that the offence committed by each of the petitioners is non-bailable and they are not entitled to be released on bail as of right. The applications for grant of bail under Section 439 Cr.P.C. were dismissed.