Retracted confession in foreign exchange adjudication can be relied on when corroborated by surrounding documentary and oral evidence.

A retracted confession in foreign exchange adjudication may still be relied on when the retraction is unsupported by convincing particulars and the statement is corroborated by surrounding documentary and oral material. Loose chits were treated as admissible supporting material, and the proceedings were held not to be strictly governed by the Evidence Act. On the contravention issues, recovered currency, the appellant's admission, co-noticee statements, and recipient statements were viewed as mutually reinforcing evidence, and the Department was required to establish the case on reliable surrounding circumstances rather than mathematical precision. The alleged contraventions were treated as proved and the penalty was sustained.

---

---

Issues: (i) Whether the retracted statement of the appellant, supported by loose chits and other surrounding material, could be relied upon as corroborated evidence in foreign exchange adjudication. (ii) Whether contravention of section 9(1)(b), section 9(1)(d) and section 9(1)(f)(1) of the Foreign Exchange Regulation Act, 1973 was established so as to sustain the penalty.

Issue (i): Whether the retracted statement of the appellant, supported by loose chits and other surrounding material, could be relied upon as corroborated evidence in foreign exchange adjudication.

Analysis: The retraction was not accepted as sufficient to efface the earlier admission, since the appellant did not establish threat or coercion with convincing particulars. The loose chits were treated as admissible material lending assurance to the recorded statement, even though they were not treated as an account book under section 34 of the Indian Evidence Act, 1872. The proceedings under the Foreign Exchange Regulation Act, 1973 were also treated as not being strictly controlled by the Evidence Act, and the court relied on the principle that a retracted confession may be acted upon when supported by corroborative circumstances.

Conclusion: The retracted statement was held to be usable with corroboration, and the loose chits were treated as valid supporting evidence.

Issue (ii): Whether contravention of section 9(1)(b), section 9(1)(d) and section 9(1)(f)(1) of the Foreign Exchange Regulation Act, 1973 was established so as to sustain the penalty.

Analysis: The recovered currency, the appellant's admission, the statement of the co-noticee, and the statements of recipients of money were treated as mutually reinforcing material. The Tribunal applied the principles of burden of proof and adverse inference, and held that the Department was not required to prove the matter with mathematical precision where the surrounding circumstances and corroboration pointed to the prohibited foreign exchange dealings. The appellant's explanation was found unconvincing.

Conclusion: Contravention of the invoked provisions was held to be proved and the penalty was sustained.

Final Conclusion: The appeal failed on merits and the adjudication order was affirmed, with the penalty liability maintained and the pre-deposit liable to be appropriated towards it.

Ratio Decidendi: In foreign exchange adjudication, a retracted confession may be relied upon when it is voluntary and finds corroboration from surrounding documentary and oral material, and the Department may establish contravention by a preponderance of reliable circumstances rather than by proof with mathematical precision.

---