1971 (1) TMI 126 - HC - Indian Laws

Magistrate overstepped jurisdiction in Foreign Exchange case, emphasizing proper procedures for Enforcement Directorate

The court held that the Magistrate misdirected himself by involving in a case under the Foreign Exchange Regulation Act that fell within the jurisdiction ... - Issues:1. Whether the Magistrate misdirected himself in directing the parties to adduce evidence in a case involving contravention of the Foreign Exchange Regulation Act.2. Whether the Magistrate has the authority to inquire into the ownership of seized property in cases not triable by him or cognizable by the police.3. Whether the Magistrate should disburse seized money to the accused or hand it over to the Enforcement Officer for further investigation under the provisions of the Act.4. Whether the confession made by the accused to the Enforcement Officer is admissible and should be considered by the Magistrate.Analysis:1. The criminal revision involved a case where the 2nd respondent was found in possession of a significant amount of money suspected to be obtained in violation of the Foreign Exchange Regulation Act. The Enforcement Officer filed a petition seeking custody of the money for investigation. The Magistrate directed the parties to adduce evidence, which was deemed a misdirection as the offense fell under the jurisdiction of the Enforcement Directorate, not the Magistrate. The Act provides for a full inquiry by the Enforcement authorities, and the Magistrate's role is limited to procedural matters, not substantive investigation.2. The Magistrate's direction for the parties to adduce evidence regarding the ownership of the seized money was deemed inappropriate. The Enforcement Officer sought custody of the money for investigation purposes, not to determine ownership. The Magistrate's role in such cases is procedural, and the ownership inquiry falls under the purview of the Enforcement authorities. The Magistrate's misinterpretation of Section 523 of the Criminal Procedure Code was highlighted, emphasizing that the property should be delivered to the party entitled to its possession, not necessarily its owner.3. The court addressed the issue of whether the Magistrate should disburse the seized money to the accused or hand it over to the Enforcement Officer for further investigation. It was argued that allowing the accused to retain the money would be futile as the Enforcement Officer could immediately arrest the accused and seize the money. Citing previous judgments, the court emphasized the impracticality of releasing the accused with the money only to be re-arrested by the Enforcement Officer, advocating for direct custody transfer to the Enforcement Officer for a seamless investigation process.4. The admissibility of a confession made by the accused to the Enforcement Officer was also discussed. The accused had initially confessed but later retracted, alleging physical torture. The court concluded that the admissibility of the confession should be determined by the officer conducting the inquiry under the Act, not the Magistrate. The court set aside the Magistrate's order and directed the delivery of the money to the Enforcement Officer for further proceedings, emphasizing the procedural limitations of the Magistrate in cases falling under the jurisdiction of specialized enforcement authorities.