TaxTMI 
TaxTMI 
TaxTMI 
2025 (10) TMI 71
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.... counsel for the appellant made a reference of the order of the High Court dated 15.02.2010 and subsequent order of acquittal passed by the Trial Court and upheld by the High Court in C.R.A 46 OF 2021 vide its order dated 09.02.2022. It was to impress upon that once the appellant has been acquitted for contravention under the regime of FERA, this Tribunal should set aside the order passed by the Adjudicating Authority dated 02.03.2005. We would address the issue aforesaid also but before that we may give reference of the facts involved in the case. Brief facts of the case: 2. It is a case where the investigation in the matter was initiated on the basis of specific information. The search of residence/shop/office premises of the appellant was made on 24.04.1996. It resulted in seizure of cash of Rs. 21.80 lakhs and discovery of incriminating documents. The statement of the appellant was recorded in Bengali under Section 40 of Foreign Exchange Regulation Act (FERA), 1973 (in short 'the Act of 1973'). It transpired that the appellant is an Indian National having Indian Passport. Apart from his engagement as broker, he was also engaged in receiving payments locally in India and m....
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....ons under the order and instructions from three Bangladeshi Nationals named in the statements. It is with further disclosure of the telephone numbers and thereby notice was issued to the person whose name was disclosed by the appellant but that alone was not sufficient to hold a case against the appellant, rather when there was retraction of the statement, it could not have been relied and if at all retracted statement is to be relied, it should have been corroborated with the other statement, which is missing herein. 5. The learned counsel for the appellant further submitted that the confessional statement was recorded on 24.04.1996 when the appellant was in the custody of the Enforcement Directorate. It was under physical torture and not with freewill or voluntary statement. The confessional statement said to have been retracted at the first available occasion though without specifying the date of retraction from the confessional statement made by the appellant. In the light of the aforesaid, there was no evidence available with the respondents to hold contravention of Section 9(1)(b) and 9(1)(d) of the Act of 1973 to impose penalty of Rs. 20 lakhs. 6. The learned counsel f....
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.... notes of Rs. 21.80 Lakhs were recovered and seized apart from the documents. The summons were issued to the appellant under Section 40 of the Act of 1973 who appeared before the authority on 24.04.1996 and gave a detailed statement clarifying the seized documents and documents in vernacular. The appellant, inter alia, stated that he is an Indian National having Indian Passport. He was engaged in receiving payments from different persons and making payments to other persons in consideration. He was receiving commission @ Rs. 200/- on each transaction of one lakh rupees. He was doing it on the instructions of three persons of the Bangladesh. Name of those persons was given by the appellant. In clarification and in corroboration of the seized documents, the appellant admitted and explained the entries and notes written on the documents. The transactions in the seized documents were written in code words with figures of the transaction. The figures mentioned in the documents were to be multiplied by 1000. In respect of the seized amount of Rs. 21.80 lakhs, the appellant stated to have received the amount as per the instructions of Osman Ali, Chand Ali and Nirmal Babu of Bangladesh. He....
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....was not considered, rather meticulously examined and referred. The appellant has tried to explain the source of Rs. 21.80 Lakhs but it was found that he was not maintaining the books of accounts and even the tax returns were filed subsequent to the date of search and was submitted belatedly. The appellant has shown loan and advance to the tune of Rs. 4,05,000/- in the assessment year 1996-97 but no corroborative evidence was submitted before the Investigating Authority and the Adjudicating Authority to support the plea though while contesting in trial, the appellant had tried to prove his income from legitimate source. However, these proceedings would rest on the pleadings and the materials placed before the Adjudicating Authority. It is also under the circumstances that there is not only confessional statement but it is supported by corroborative evidence in the shape of documents recovered at the time of search demonstrating not only names of the persons involved and at whose instance the appellant was doing Hawala transaction but their telephone numbers also. It was corroborated even by the statement of the co-noticees and, therefore, Adjudicating Authority caused the finding in....
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....7 but no corroborating evidence was ever submitted either before the Investigating Authority or before Adjudicating Authority. The CMM Kolkata has also not taken any cognizance of the story of assault as stated by the Noticee No. 1. He has stated to have filed a retraction petition before the Court but the records show that no notice was served in this regard to the Directorate either by the Noticee No. 1 or by the Court. This further substantiated the point that the Ld. Court has not taken any cognizance of such retraction. The fact remains here that cash of Rs. 21,80,000/- was found from the premises of the Noticee No. 1 and he has squarely failed to give any explanation regarding the legal source of the same. The submission made by the Noticee No. 1 clearly shows that such amount was received and paid from time to time. He admitted action has been done under instruction from 03 persons of foreign origin and residents of Rajshahi of Bangladesh. Such statement has been corroborated with all material evidence and also with the seized cash. He has admitted in the statement that he has received Rs. 91,12,300/- under instruction from person resident outside India and, similar....
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.... required to be made going on the reason of retraction. If the confessional statement is recorded under freewill and without duress, subsequent retraction would not nullify those confessional statements rather it alone can be taken basis for conviction. The view has been expressed by us based on the judgment of the Apex Court in the case of K.I. Pavunny Vs. Asstt. Collr. (HQ), C.E reported in MANU/SC/2303/1997. The Apex Court has laid down the law on the issue and for that Para 16 of the judgment is relevant and is quoted thus: "16. The question then is: whether the retracted confessional statement requires corroboration from any other independent evidence? It is seen that the evidence in this case consists of the confessional statement, the recovery panchnama and the testimony of PWs 2, 3 and 5. It is true that in a trial and propria vigore in a criminal trial, courts are required to marshal the evidence. It is the duty of the prosecution to prove the case beyond reasonable doubt. The evidence may consist of direct evidence, confession or circumstantial evidence. In a criminal trial punishable under the provisions of the Indian Penal Code it is now well settled legal posi....
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....pital offences". It has been held that the confessional statement can be formed sole basis for conviction. The first proposition needs to be clarified that confessional statement need no corroboration by other evidence, rather can be taken as the sole basis for conviction. 13. The second proposition laid down by the Apex Court is that even if it is retracted, must be decided whether confessional is voluntary or truthful. If it is without duress or coercion, the retraction would not be to the benefit of the accused. In the instant case the reference of the retraction of the statement has been given without showing the reason and even to prove as to when the appellant retracted from his statement. The statements were not recorded during the custody of the appellant with the respondents, rather it was recorded after issuance of summons thus was made with freewill and without duress and coercion. The fact further remains that during the course of recording the statement, the appellant read the documents collected from him with the information of three Bangladeshi nationals and other four persons for commission of crime. The documents were containing the name of four persons along....
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....e Court has made reference of the earlier judgment on the issue and more specifically in the case of Yakub Abdul Razak Memon Vs. State of Maharashtra reported in MANU/SC/0268/2013 where it was held that the original confession was truthful and voluntary thus the court can rely upon such confession to convict the accused in spite of a subsequent retraction and its denial in statement under Section 313 of the Code of Criminal Procedure. 14. We may further refer to the judgment of the Apex Court in the case of Central Bureau of Investigation and Ors. Vs. Mohd. Parvez Abdul Kayuum & Ors. reported in MANU/SCC/0883/2019. Para 149 of the said judgment is also quoted hereunder: "149. In Mohmed Amin and Anr. v. Central Bureau of Investigation, MANU/SC/8265/2008 : 2008 (15) SCC 49 this Court observed: 69. If the confessions of the Appellants are scrutinised in the light of the above-enumerated factors, it becomes clear that the allegations made by them regarding coercion, threat, torture, etc. after more than one year of recording of confessions are an afterthought and products of the ingenuity of their advocates. The statements made by them Under Section 313 Code of Cri....
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....ce getting corroboration from other evidence adduced by the prosecution." 16. It would be gainful to refer the judgment of the Apex Court in the case of Maulana Naseeruddin Mohd. Haneefuddin Vs. State of Gujarat reported in MANU/SC/7806/2007 where it was held that though there is no time period for retraction but it has to be done within a reasonable time. Para 12 of the said judgment is quoted hereunder: "12. It is no doubt true that there is no time statutorily fixed during which the confessional statement, if any, can be retracted; but it has to be done within a reasonable time". 17. In view of the law propounded by the Apex Court, we are unable to frame our order in reference to the judgment of the Calcutta High Court upholding the acquittal of the appellant for the reason that confessional statement was retracted and it was not corroborated by the other evidence while according to the law laid down by the Apex Court, confessional statement recorded with freewill needs no corroboration and can be taken basis for conviction. At this stage we may clarify that in the criminal case, the prosecution is required to prove its case beyond doubt while in the civil litigat....