2017 (9) TMI 1280 - HC - Customs

Cooperation with Investigation Key for Bail Protection: High Court Quashes Sessions Court Order (3)

G.S. Thakur Versus State of Gujarat & 1

The High Court held that the petitioner did not fully cooperate with the investigation as per the bail conditions and cannot claim protection under ... Bail application - It is the case of the Department that the petitioner had well-planned the entire modus with full knowledge of the fact that the modus adopted by the petitioner amounts to offence and loss of revenue to the Department - mis-interpreting provisions of Section 108 of the Act - production of documents by petitioner - whether pending investigation under the provisions of the Customs Act, the petitioner is considered as an accused? - interpretation of statute - Held that: - The Department has challenged the order of the Sessions Court in not accepting their contention that the petitioner has not cooperated with the investigation and has erroneously concluded that when the Court granting bail had imposed condition of full cooperation to the Investigation Agency, did not include that the petitioner was required to produce any documents before the Investigating Officer. The Sessions Court appears to have limited the operation of the condition of bail conservatively. Section 108 of the Customs Act is for the very purpose to aid the investigation and in the aid of investigation, to produce documents - The nature of details sought for under the summons of Section 108 of the Customs Act issued by the Investigating Officer is on the basis of investigation carried thus far. The investigation, which is under the domain of the Investigating Officer, he was perfectly justified in calling upon the details - interpretation now given to word “fully cooperate with the investigation” stands expanded to the extent that it means to see that the petitioner to fully cooperate and such cooperation must be voluntary cooperation, thereby leaving it upon the petitioner, who is facing investigation, to decide on his own where he desires to volunteer and where he does not. Such proposition cannot be accepted in the field of investigation - The petitioner has therefore not fully cooperated with the investigation as per the conditions of bail order. Whether in the facts of the case, the petitioner, who is arrested under Section 104 of the Customs Act can be considered as an accused to bring him under the protection of Article 20(3)? - Held that: - this Court is of the view that in the facts of the present case, where petitioner is yet to attend the status of an accused arrested for commission of offence, Article 20(3) of the Constitution cannot be made applicable, which would protect the petitioner from operation of Section 108 of the Customs Act - The power of a Customs Officer to carry out investigation in Chapter 13 of the Customs Act, both Sections 104 and 108 fall in Chapter 13 when person under investigation joins the investigation with the aid of the powers in Chapter 13. Hence, when the petitioner was imposed with a condition to cooperate fully, he would be subjected to investigation under the provisions under Chapter 13 including Section 108. Therefore, when the Department was within its power to investigate, issued summons under Section 108 and it was obligatory upon the petitioner to cooperate. Non-cooperation on the grounds mentioned amounts to breach of conditions of bail. Application allowed - The order dated 10.03.2017 passed by Additional Sessions Judge, City Sessions Court No.15, Ahmedabad in Criminal Misc.Application No.3525 of 2016 is quashed - The case is relegated back to the Additional Sessions Judge, City Sessions Court No.15, Ahmedabad for fresh consideration of the application filed by the Department - petition allowed by way of remand. Issues Involved:1. Modification/Deletion of Bail Conditions2. Cancellation of Bail3. Applicability of Article 20(3) of the Constitution of India4. Interpretation of Section 108 of the Customs ActDetailed Analysis:Modification/Deletion of Bail Conditions:The petitioner, who was granted regular bail under specific conditions, filed an application to modify/delete certain bail conditions, including the permanent release of his passport and permission to travel out of India. The Sessions Court rejected this application on 26.05.2017, which led to the petitioner challenging the order. The petitioner argued that the conditions were restrictive, especially since he is a permanent resident of Taiwan and needed to travel for personal and business reasons.Cancellation of Bail:The Department filed an application for the cancellation of the petitioner’s bail, citing non-cooperation with the investigation and breach of bail conditions, specifically not marking presence in August and not providing required documents. The Sessions Court rejected this application on 10.03.2017, interpreting that the petitioner was not obligated to produce self-incriminating documents under Article 20(3) of the Constitution. The Department argued that the petitioner had planned the entire scheme to evade customs duties and was using shadow companies to facilitate this.Applicability of Article 20(3) of the Constitution of India:The core issue was whether the petitioner, being investigated under the Customs Act, could claim protection under Article 20(3) of the Constitution, which protects against self-incrimination. The petitioner contended that since he was treated as an accused, he should not be compelled to produce documents that could incriminate him. The Department, however, argued that during the investigation phase, the petitioner does not have the status of an accused and thus cannot claim this protection.Interpretation of Section 108 of the Customs Act:The Sessions Court’s interpretation of Section 108 of the Customs Act was a significant point of contention. The court initially concluded that the petitioner was not required to produce documents that could incriminate him. However, the Department argued that Section 108 empowers the Customs Officer to summon any person to produce documents necessary for the investigation, and the petitioner’s refusal to comply constituted non-cooperation. The High Court found that the Sessions Court had misinterpreted the scope of Section 108 and the petitioner’s obligation to fully cooperate with the investigation.Judgment:The High Court held that the petitioner had not fully cooperated with the investigation as per the bail conditions. It concluded that the petitioner, at this stage, does not have the status of an accused and thus cannot claim protection under Article 20(3) of the Constitution. The court emphasized that the Customs Officer’s powers under Section 108 are essential for the investigation, and the petitioner’s refusal to provide documents was a breach of bail conditions.The High Court quashed the Sessions Court's order dated 10.03.2017 and directed the Additional Sessions Judge to reconsider the Department’s application for bail cancellation, taking into account the observations made in this judgment. The petitioner was not required to surrender immediately, and the application was to be considered afresh. The operation of the judgment was stayed for four weeks to allow the petitioner to seek further legal remedies.