2005 (9) TMI 700

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....he application for dispensation of the pre-deposit, both the appellants were directed to make pre-deposit of Rs. 2,50,000 in their respective appeals by order dated 15-10-2003 passed by this Tribunal. The appellants have made pre-deposit of Rs. 2,50,000 each in compliance of the said order. Shri T.K. Gadoo, DLA, confirms the same. Presently, these appeals are taken up for final disposal on merits. As these appeals have arisen out of common Adjudication Order so are disposed off by this common order. 2-3. The admitted facts are that the appellant in appeal No. 344/1996, while travelling in his car in front of house No. M 241, Greater Kailash-II, New Delhi, was searched and foreign currency recovered in notes of US dollar 2,350 and in travelling cheques of US dollar 41,786 and UK pound 9,150, including of Canadian dollar 3,500. The registration book of the Car No. DHC 8,306 is also found and recovered which is in the name of the appellant Hazari Lal Jain in appeal No. 344/1996 who also made confessional statement admitting that he was proceeding and going to sell the recovered foreign currency to another appellant Charan Singh in appeal No. 311/1996, in front of whose house the ca....

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....34(5) of the Foreign Exchange Regulation Act, 1973, inasmuch as that they did not reside in the locality where search was conducted and were neither presented for cross-examination despite demand. Moreover, search witness Triloki Nath alias Trilok Singh is a (sic) witness employed in the office of Enforcement Directorate. Also, the confessional statement was recorded in the night of 22/23-11-1991 under duress and threat which was retracted on the first available opportunity on 23-11-1991, when the appellant was produced before a criminal court on expiry of 24 hours of custody. The denial of cross-examination of the witnesses of the search is violative of the principles of natural justice, especially when witness Triloki Nath is a workman in the Canteen of Enforcement Directorate. In this regard, reliance is placed on (1) Central Government represented by the Director, Enforcement Directorate FERA v. Fr. Alfred James Fernandez AIR 1987 Ker. 179; and (2) State of Kerala v. K.T. Shaduli Grocery Dealer AIR 1977 SC 1627 with a plea that denial of demanded cross-examination of witness is nothing but violation of principles of natural justice whereupon impugned order becomes illegal. 6....

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.... 8. Though recovery of foreign exchange is totally denied from the car of the appellant Hazarilal Jain while travelling but the amount recovered is substanting. The fact of not calling witnesses from the locality before conducting the search is prescribed in section 34(5), does not make the recovery inadmissible in evidence. The fact of recovery can be proved and accepted. The irregularity in conducting the search cannot wipe out the factum of recovery of the foreign exchange from the case of appellant Hazarilal Jain. In this regard law is well-settled. The panch witness even when not from the locality the recovered items can be accepted in evidence. This evidence cannot be discarded merely because the witness was not a local resident-Abdul Sattar v. State of Maharashtra 1989 Cri. LJ 430 (Bom.). It has been held by Punjab & Haryana High Court in Kishan Lal v. State of Haryana 1996 Cri. LJ 1401 that analogous provisions of section 100(4) Criminal Procedure Code are not mandatory but are only directory in nature. Therefore, the arguments against non-availability of the witnesses from locality are required to be rejected as they do not contain any merit. 9. The amount of foreign c....

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....racticed on him for procurement of the confessional statement. Here also the Supreme Court judgment in K.T.M.S. Mohd. v. Union of India [1992] 3 SCC 178 can be safely referred to where the Hon'ble Apex Court has observed as follows:- "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 Customs authorities or the officers of Enforcement under the relevant provisions of the respective Acts is a sine qua 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 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 actin....

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....flexibility is in-built and any attempt to oust the same is neither correct nor logical. The reliance on the above-quoted two judgments in para 13 above by the counsel for the appellant Hazarilal Jain is not correct. He is insisting and reading the language of the judgment again and again forgetting that the words used in a judgment are for the purposes of discussion. In judgment cannot be read like Euclid theorem or a statute but has to be understood with the factual flexibility contained therein. 15. In this regard, Apex Court stated in Escorts Ltd. v. CCE [2004] 8 SCC 335 that circumstantial flexibility, one additional or different fact may make a world of difference between conclusions in two cases and disposal of cases by blindly placing reliance on a decision is not proper, and has observed as follows:- "8. Courts should not place reliance on decisions without discussing as to how the factual situation fits in with the fact situation of the decision on which reliance is placed. Observations of Courts are neither to be read as Euclid's theorems nor as provisions of the statute and that too taken out of their context. These observations must be read in the context i....

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..... Hence, the arguments contain little merit and are rejected. 18. This Tribunal is also cautious of the fact that in FERA proceedings the standard of proof is beyond reasonable doubt. However, factual and circumstantial evidence set up and establish a different story beyond doubt against the appellants. This reminds us of a Calcutta High Court judgment by Justice P.B. Mukherjee (as his Lordship then was) discussing standard of proof in an adultery dispute in Adelaide Mande Tobias v. William Albert Tobias AIR 1968 Cal. 133. There it is observed as follows:- "...The ratio of that decision is that it is not necessary that there should be direct evidence of adultery as it is not easily available and direct proof is rather rare. It is noticed there and circumstantial evidence must be sufficiently strong and conclusive. Association coupled with opportunity, illicit affection, undue familiarity, guilty attachment are some of the instances which create an inference upon which the Court can act. In that case the old Latin maxim leavened by Scottish humour is quoted with painful repetition: 'Solum cum sola in suspecto loco non presumitur dicere pater noster'. Behind this Latin ma....