AI Drafter 
TaxTMI 
TaxTMI 
2025 (12) TMI 457
X X X X Extracts X X X X
X X X X Extracts X X X X
....der. 2. The Show Cause Notice (SCN) No. T-4/70-B/94 (SCH) was issued to the Appellant Shri Ishwar Gidwani on 29.09.1994, besides making Smt. Gopi T Hirdaramani, Shri Jayanti Lal B Shah and Shri Jayesh C Shah as Co-Noticees. A list of 23 documents was annexed to the SCN, as relied upon documents (RUDs). An Order-In-Original dated 26.08.2003 was passed by then Deputy Director, ED, Mumbai. Besides imposing penalty on other Co-Noticees (exception being Shri Jayesh C Shah, who had expired), penalty was imposed on the Appellant Shri Ishwar Gidwani. The Appeal filed by the Appellant against the Order dated 26.08.2003 was disposed of by this Tribunal on 18.12.2007. The Hon'ble High Court of Bombay in its Order dated 10.09.2009 in FERA Appeal No. 55 of 2009 set aside the Order-In-Original dated 26.08.2003 along with the Order dated 18.12.2007 of this Tribunal, remanding the matter to the Original Adjudicating Authority. This resulted in the Impugned Order being issued on 15.03.2010. Initially the Impugned Order was challenged before the Special Director (Appeals) FEMA, Mumbai, however, the Appeal was dismissed on 15.05.2019, as not maintainable with observations that the Appeal need to b....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n relating to transfer of foreign exchange outside India had been arrived at. The statement made by the Appellant had been retracted before the Chief Metropolitan Magistrate. Both the Appellant and Smt. Gopi T Hirdaramani were produced before the Magistrate beyond the time prescribed by the Law. No reliance could be placed on the deposition of the ED Officer Shri D K Sinha. It was also not appreciated in the Impugned Order that each foreign national was allowed to carry US $ 10000 without declaration. Ld. Counsel for the Appellant pleaded to allow the Appeal and prayed that since the Appellant is presently 82 years old a lenient view may be taken. 5. Ld. Counsel for the Respondent Directorate submitted that statements of Appellant were recorded on 03.04.94 & 04.04.94 wherein he inter alia admitted that he dealt in foreign goods and had a shop in Elco Arcade, Bandra. He had also admitted having smuggled foreign currency on previous occasions. It was admitted by the Appellant that he purchased foreign currency at black market rate. He alleged that the Appellant was involved in buying and selling of foreign currency under the guise of dealing in foreign goods. On the basis of the s....
X X X X Extracts X X X X
X X X X Extracts X X X X
....are Lal Bhargava v. State of Rajasthan (AIR 1963 SC 1004. followed in (REVIEW PETITION (CRL.) NOS. 446-447 OF 2019 IN CRIMINAL APPEAL NOS. 1174-1175 OF 2019 Manoharan VERSUS State by Inspector of Police, Variety Hall Police Station, Coimbatore) holding that: "A retracted confession may form the legal basis of a conviction if the court is satisfied that it was true and was voluntarily made. But it has been held that a court shall not base a conviction on such a confession without corroboration. It is not a rule of law, but is only a rule of prudence. It cannot even be laid down as an inflexible rule of practice or prudence that under no circumstances such a conviction can be made without corroboration, for a court may, in a particular case, be convinced of the absolute truth of a confession and prepared to act upon it without corroboration, but it may be laid down as a general rule of practice that it is unsafe to rely upon a confession, much less on a retracted confession, unless the court is satisfied that the retracted confession is true and voluntarily made and has been corroborated in material particulars." Ld. Counsel for the Respondent pleaded to dismiss the Appea....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ious of some decisions of this Court wherein reliance has been placed for supporting such contention but we must also notice that in some of the cases retracted confession has been used as a piece of corroborative evidence and not as the evidence on the basis whereof alone a judgment of conviction and sentence has been recorded." Further, in K. T. M. S. Mohamed vs. Union of India [(1992) 3 SCC 178] the Hon'ble Supreme Court held that merely because statement is retracted, it cannot be regarded as involuntary or unlawfully obtained. In this regard, following observations were made in paragraph 34: "34. ... But suffice it 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 the 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 then statement must be rejected brevimanu. At the same time, it is to be noted that merely because a statement is retracted, it cannot be recorded as invol....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ted the case, that the officers vehemently denied the allegations while the statement was being made in the court. Further, it is not obvious from the submission of the noticee as to which portion of the statement was being retracted and what specific admission he was forced to make. (g) The noticee has placed reliance on the letters of retraction filed by Smt. Gopi T. Hirdaramani in which she is stated to have contradicted her deposition made under Section 40 of FERA. I have gone through the said retraction letters and find that in letter dated 12.04.1994 filed on her behalf by Shri Madhu Patel, Advocate, while retracting the statement it was stated as under: "-----that without realizing the implications and consequences she acted as a carrier without any consideration or benefit for or on behalf of Ishwar Gidwani. She has realized her mistake in doing so. She is repentant " The aforesaid statement appearing in the letter of retraction voluntarily filed by Mrs. Gopi T. Hirdaramani, while she was on bail and there was no question of any fear of the officers being present in her mind, indicates existence of a nexus between Shri Ishwar Gidwani and Smt. Gopi....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the noticee that his statement was forcefully extracted from him. In this respect the case of the noticee rests purely on rhetoric. Further the fact of recovery of documents containing details of transaction in foreign exchange with a large number of persons only proves the involvement of the notice in a foreign exchange racket. There is no other fact brought before me out of which an inference of high handedness or ill-treatment by the officers could be justified. I, therefore hold the contention that the statements are involuntary and cannot be relied upon is without any basis." 10. We do find that there are independent and cogent evidence to corroborate the statements made by the Appellant. There has been recovery of documents from the premises of the Appellant. The statements made by the Appellant have been in the nature of explanation to the documents recovered, cash seized and the statements of other persons. The investigation has revealed that the Appellant funded the travel expenses of Smt. Gopi T. Hirdaramani to Singapore. The fact that Smt. Gopi T. Hirdaramani was intercepted at the Airport at Mumbai while on her journey to Singapore carrying US $ 17000 cannot be ignor....