2014 (2) TMI 865

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....lhi Zonal Office conducted a number of searches at the Oberoi Hotel in Delhi resulting in the recovery of foreign exchange, Indian currency etc. from the front office as well as the guest lockers in the hotel. Relevant to the present appeals, the ED is stated to have recovered from guest locker No. 21 maintained by Arun Sharma (the Appellant in Crl. A. No. 188 of 2008), who was the cashier-cum-night auditor, Indian currency totalling Rs. 49,500 and foreign currency, including US$, UKGBP, French Francs, Hong Kong Dollars etc., seven gold biscuits, two small gold coins of all foreign origin and one gold pendant. From the other locker No.38 also stated to have been allotted to Arun Sharma, a file with a bunch of 42 pages was recovered. From the person of Rajeev Wadhwa (the Appellant in Crl. A. No. 138 of 2008), who was cashier-cum-night auditor, ED officials recovered one Diners Club international card, 25 US$, 20 French francs and a bunch of 8 loose sheets. From the Employees Locker No. 49 stated to be allotted to and held by Rajeev Wadhwa, 1 Rouble and Indian currency of Rs.8,000 and a bunch of 10 loose sheets were recovered. 3. As regards Rakesh Kapoor (the Appellant in Crl. A. ....

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....conditions of the Money Changers Licence by not issuing encashment certificates of the foreign exchange tendered to the Oberoi Hotel. 8. A statement was purportedly recorded of Rajeev Wadhwa on 29th April 1989 itself. Statements were also recorded on 1st May 1989 of Rakesh Kapoor and Arun Sharma. All three of them were arrested and produced before the learned Additional Chief Metropolitan Magistrate (ACMM), New Delhi on 29th April 1989 itself and sent to judicial custody. In a letter dated 3rd May 1989 addressed to the learned ACMM, New Delhi, Arun Sharma retracted the statement made by him stating that he had given it under threat of arrest and was told that, if he wrote whatever was dictated, he would be permitted to go. He claimed that he had nothing to do with the currency or gold recovered from the guest locker. He further stated that "nothing has been recovered from my locker, I, therefore, want to retract my statement made before the Enforcement Officer". As regards Rajeev Wadhwa, he too retracted the statement made by him. 9. On the above basis, almost one year after the alleged search, a Memorandum/Show Cause Notice (SCN) 26th April 1990 was issued to the three Appel....

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.... 1996; 29th January 1997 and 3rd April 2000. 13. One feature of the case which is apparent from the record is that there has been an inordinate delay in the passing of the AO dated 17th February 2004. If according to the Appellants, no hearing took place at all after 1996, it is possible that the officer holding the post of SD who conducted the proceedings prior thereto was obviously not the same officer who actually issued the AO in 2004. The letter dated 3rd April 2000 written by counsel for Rakesh Kapoor to the ED states that after the previous hearing in 1996 no AO followed and the matter was relisted on 22nd March 2000 but no arguments took place. Counsel enclosed with the said letter a resume of the submissions. Clearly, therefore, no hearing took place immediately prior to the passing of the AO. 14. The second aspect of the matter concerns the examination of witnesses. The letter to the SD dated 23rd December, 1996 written by counsel for Rakesh Kapoor, states that R.K. Handoo was examined as a witness for the ED but his cross-examination by the noticees did not take place. It appears that for some reason, the SD decided not to continue the recording of the evidence of ....

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.... of my colleagues working as front office cashier used to collect / purchase / F. Exchange collectively and used to share the profit earned on the sale of the said F. exchange as stated. Sd/- 29/4/89 Rajeev Wadhwa 29.4.89" 18. The above statement was, of course, retracted by Mr. Wadhwa. It could not have been relied upon except where it was corroborated in material particulars by other reliable evidence. As regards Arun Sharma, as already noticed, although he is purported to have made a statement implicating himself and the co-accused, he retracted the said statement at the first available opportunity when he was produced before the learned ACMM on 3rd May 1989. In a subsequent statement recorded on 18th February 1992, he stated that his statement: ".......was taken under duress, stress & emotional blackmailing saying of torturing my wife and son and that too after keeping me for more than 25 hours at their office which no ordinary person can take it. I told them also to write what they want and I'll sign it but told me to write it as they say and sign it. Sir, that was all under threat and stress which on the first chance when I got it I retracted that statement wri....

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....rement as explained in K.T.M.S. Mohd. v. Union of India (1992) 3 SCC 178 in the following words (@ SCR p. 899): "We think it is not necessary to recapitulate and recite all the decisions on this legal aspect. But suffice to say that the core of all the decisions of this Court is to the effect that the voluntary nature of any statement made either before the Custom Authorities or the officers of Enforcement under the relevant provisions of the respective Acts is a sine quo non to act on it for any purpose and if the statement appears to have been obtained by any inducement, threat, coercion or by any improper means that statement must be rejected brevi manu. At the same time, it is to be noted that merely because a statement is retracted, it cannot be recorded as involuntary or unlawfully obtained. It is only for the maker of the statement who alleges inducement, threat, promise etc. to establish that such improper means has been adopted. However, even if the maker of the statement fails to establish his allegations of inducement, threat etc. against the officer who recorded the statement, the authority while acting on the inculpatory statement of the maker is not completely reli....