2022 (12) TMI 1244 - HC - FEMA

High Court Reverts Sentence, Petitioner Released,

Muneesh Suneja @ Goldy Versus Chief Enforcement Officer, Enforcement Directorate, Jalandhar

The High Court set aside the sentence enhancement by the lower appellate court, reinstating the trial court's verdict of six months imprisonment and a ... Offence under FERA - sentence on economic offence - petitioner was found involved in huge transaction of foreign exchange and was dealing in prohibited items i.e. gold biscuits of foreign origin - judgment of enhancement of sentence - order of sentence holding petitioner guilty of offence u/s 8(1) & 8(2) of FERA and sentencing him to undergo imprisonment for a period of six months and to pay a fine of Rs.5,000/- and in default of payment of fine, to further undergo R.I. for a period of three months - appeal filed by the complainant for enhancement of the sentence was allowed and the petitioner was directed to undergo R.I. for a period of two years and to pay a fine of Rs.5,000/-. In default of payment of fine, to further undergo R.I. for a period of two months under Section 56 of FERA. HELD THAT:- Present revision petition is partly allowed to the extent that impugned judgment passed by the lower appellate Court, enhancing six months R.I. and fine of Rs.5,000/-, as awarded by the trial Court, to 02 years R.I. and to pay a fine of Rs.5,000/- and in default thereof, to further undergo R.I. for two months, is set aside and that of the trial Court is restored. As the fine has already been paid and the petitioner, as per the custody certificate, has already undergone 07 months of sentence i.e. over and above 06 months R.I. awarded by the trial Court, no further action is called for, as he has already undergone the entire sentence. With the aforesaid modifications, present revision petition is disposed of. Issues Involved:1. Legality of the conviction under Sections 8(1) & 8(2) of the Foreign Exchange Regulation Act (FERA).2. Validity of the confessional statement and its retraction.3. Justification for the enhancement of the sentence by the lower appellate court.4. The procedural fairness and evidence evaluation during the trial.Issue-wise Detailed Analysis:1. Legality of the Conviction under Sections 8(1) & 8(2) of FERA:The petitioner was convicted for violating Sections 8(1) & 8(2) of FERA due to possession of DM5300 without authorization. The trial court found the petitioner guilty based on the recovery of foreign currency from his premises. However, it was held that the prosecution failed to prove that the gold or Rs.3.00 lacs recovered were linked to foreign exchange trading. The lower appellate court upheld this conviction but enhanced the sentence.2. Validity of the Confessional Statement and its Retraction:The petitioner argued that his confessional statement was involuntary, made under duress, and retracted at the first opportunity. The trial court and the lower appellate court both recorded that the confessional statement was proved by PW3, and the testimony of PW1 and PW2 supported its voluntary nature. The petitioner relied on the Supreme Court's judgment in Vinod Solanki Vs. Union of India, emphasizing that the prosecution must prove the voluntary nature of a confession, especially when retracted. The court noted that the petitioner was in custody and lacked legal assistance when the confession was made.3. Justification for the Enhancement of the Sentence by the Lower Appellate Court:The lower appellate court enhanced the sentence from six months to two years, citing the gravity of the offence. However, the High Court found that no special reasons were recorded by the lower appellate court to justify the enhancement. The High Court referred to the Supreme Court's ruling in Shiv Govind Vs. The State of M.P., which mandates that strong reasons must be disclosed for enhancing a sentence. The High Court found that the lower appellate court failed to provide such reasons, making the enhancement unjustified.4. Procedural Fairness and Evidence Evaluation during the Trial:The High Court observed that the trial court had acquitted co-accused Rakesh Kumar and Sanjay, whose statements implicated the petitioner. The prosecution did not challenge their acquittal, weakening the link to convict the petitioner. The High Court also noted procedural lapses, such as the lack of respectable witnesses during the search of the petitioner's premises and contradictions in the testimonies of PW2 and PW3. The petitioner claimed he was forced to make involuntary statements under duress, which was supported by medical reports indicating torture.Conclusion:The High Court set aside the enhancement of the sentence by the lower appellate court, restoring the trial court's sentence of six months R.I. and a fine of Rs.5,000/-. The petitioner, having already undergone seven months of incarceration, was deemed to have completed his sentence. The revision petition was disposed of with these modifications.