2022 (7) TMI 1195 - HC - Customs

Customs Act: Court Upholds Summons for Investigation

The court held that summoning the petitioners under Section 108 of the Customs Act, 1962 was legal and necessary for the investigation. Petitioners No.1 ... Validity of summons issues - SEZ unit - Impact of proceedings under PML Act over Customs Act - allegation of diversion of duty free gold clandestinely diverted duty into the domestic market and exported fake ornaments made from little quantity of gold by mis-declaring them as studded jewellery. - Seeking to declare the action of the respondents in summoning the petitioners under Section 108 of the Customs Act, 1962, as illegal and contrary to the provisions of the Cr.P.C. - seeking to direct the respondents to record the statement of the petitioners through video conferencing - Sections 4, 5, 160 and 161 of Cr.P.C. and Section 108 of the Customs Act, 1962 - HELD THAT:- Not only under Section 104(3) relating to arrest, but also under Section 105(2) relating to search of premises it was specifically mentioned that the Code of Criminal Procedure is applicable. Under Section 108(3) prviso, it is stated that the exemption under Section 132 of the Code of Civil Procedure shall be applicable. Thus, wherever the concerned provisions are applicable, it is specifically stated in the Act. In the PML Act, there is a specific provision under Section 65 stating that the provisions of Cr.P.C. are applied insofar as they are not inconsistent with the provisions of the said Act to arrest, search and seizure, attachment, confiscation, investigation, prosecution and all other proceedings under the Act. But, there is no such specific provision in the Customs Act, 1962, applying the Code of Criminal Procedure to all the provisions relating to the stages of investigation, trial etc. Admittedly, the Hon’ble Apex Court observed in the case of POOLPANDI VERSUS SUPERINTENDENT, CENTRAL EXCISE [1992 (5) TMI 147 - SUPREME COURT] that it was not at the whims of the person that the investigation should be done at his or her convenience. Hence, the petitioners could not take shelter of the judgment of the Delhi High court when it was not in accordance with the judgment of the Hon’ble Apex Court. Whenever a statute creates a new offence and also sets up a machinery for dealing with it, the provisions of Cr.P.C. relating to the matters covered by such Statute would not be applicable to the said offences. The Customs Act was enacted in 1962 and had created the offences under Chapter-XVI and the manner of enquiry and investigation are prescribed in Chapter-XIII. The Customs Act is enforced only by the Customs Officers by its own machinery. The Customs Officers are empowered with the power of investigation as contemplated under Chapter-XIII of the Customs Act, 1962 - The Customs Officer is not a police officer as per the judgment of the Hon’ble Apex Court in STATE OF PUNJAB VERSUS BARKAT RAM [1961 (8) TMI 28 - SUPREME COURT] and the statement made before him by a person who is arrested or against whom an enquiry is made are not covered by Section 25 of the Indian Evidence Act. As summoning of the petitioners by the respondents would not amount to taking any coercive steps like arresting them or prosecuting them, but only to proceed forward with the investigation and, however, as the learned Additional Solicitor General of India also conceded that they were not insisting on the presence of petitioners No.1 and 2, it is considered fit to allow the petition with regard to petitioner Nos.1 and 2 and to dismiss the petition with regard to petitioner Nos.3 to 5. The petitioners No.3 to 5 are directed to comply with the summons and to give their statements in person and to co-operate with the investigation in the interest of justice. The Writ Petition is partly allowed. Issues Involved:1. Legality of summoning petitioners under Section 108 of the Customs Act, 1962.2. Applicability of Section 160 Cr.P.C. to Section 108 of the Customs Act, 1962.3. Request for recording statements through video conferencing.Detailed Analysis:1. Legality of Summoning Petitioners under Section 108 of the Customs Act, 1962:The petitioners challenged the summons issued under Section 108 of the Customs Act, 1962, arguing that the investigation into the alleged mis-declaration of exports and diversion of imported gold by SKELLP and SKJPL was already complete, as show cause notices had been issued. They contended that the summons were an abuse of process and sought to have their statements recorded via video conferencing due to the pandemic and their age.The respondents argued that the petitioners were summoned to provide evidence regarding incriminating documents and electronic data recovered during the investigation. They emphasized that the Customs Act is a special statute with specific provisions for investigation and that the summons were necessary to ascertain the extent of smuggling activities.2. Applicability of Section 160 Cr.P.C. to Section 108 of the Customs Act, 1962:The petitioners argued that the proviso to Section 160 Cr.P.C., which exempts women and elderly persons from attending investigations at places other than their residence, should apply to the summons issued under Section 108 of the Customs Act. They cited judgments from the Delhi High Court and other courts supporting this view.The respondents countered that Customs Officers are not police officers and that the provisions of Sections 160 and 161 Cr.P.C. do not apply to the Customs Act. They relied on judgments from the Supreme Court and High Courts, which held that the duties of Customs Officers are distinct from those of police officers and that the Customs Act contains specific provisions for investigation.The court analyzed relevant provisions of the Cr.P.C. and the Customs Act, noting that the Customs Act is a self-contained statute with specific provisions for investigation and that the provisions of Cr.P.C. do not apply unless explicitly stated. The court cited judgments from the Supreme Court and High Courts supporting this interpretation.3. Request for Recording Statements through Video Conferencing:The petitioners requested that their statements be recorded via video conferencing due to the pandemic and their age. They argued that this would comply with the proviso to Section 160 Cr.P.C. and safeguard their rights.The respondents opposed this request, arguing that the investigation involved confidential data that could not be shared online and that the petitioners were seeking video conferencing to view the evidence against them and prepare a defense.The court acknowledged the respondents' concerns and the specific provisions of the Customs Act, which require in-person attendance for recording statements. The court also noted that the Supreme Court had not yet ruled on a related plea by the petitioners.Conclusion:The court concluded that the provisions of Section 160 Cr.P.C. do not apply to Section 108 of the Customs Act, 1962. It held that summoning the petitioners under Section 108 was legal and necessary for the investigation. However, the court allowed the petition concerning petitioners No.1 and 2, exempting them from in-person attendance due to their age and health concerns. The petition was dismissed for petitioners No.3 to 5, who were directed to comply with the summons and give their statements in person. The court did not grant the request for video conferencing, emphasizing the need for in-person attendance to ensure a thorough investigation.