TMI Blog2000 (4) TMI 85X X X X Extracts X X X X X X X X Extracts X X X X ..... and also a locked briefcase. From the godown, the officers recovered foreign origin goods valued at Rs. l,01,400/- (MV) and Rs. 34,295/- (CIF) and also certain documents. The briefcase, which was opened and examined at Custom House, was found to contain a currency note of US $ 100/-, five bank drafts/cheques of various amounts in foreign exchange totalling US $ 29,740/- and some other documents/papers. Since Shri S.K. Dhingra (1st respondent) could not produce evidence of lawful acquisition, possession etc. of the recovered goods of foreign origin, the same mere seized by the officers under Section 110 of the Customs Act. The Indian/US currencies and the bank drafts/cheques were also seized under Section 121 of the Act. All other papers/documents recovered were also seized. Statements of Shri S.K. Dhingra were recorded under Section 108 of the Customs Act on 11-10-1991 and subsequently several times. Statements of Shri Nirmal Munda (employee of Shri S.K. Dhingra) and several other persons were also recorded. Certain follow-up enquiries were also conducted. 2.On the basis of the materials and information gathered through the aforesaid statements and enquiries, show-cause notice da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd large, based on Shri S.K. Dhingra's statement as recorded by Shri C.L. Paul, Superintendent of Customs on 11-10-1991. In that statement Shri S.K. Dhingra had stated, inter alia, that the goods of foreign origin recovered from his residence, shop and godown on that day had been imported into India illegally and he had been dealing in such goods; that the bank drafts had been given to him by diplomats to purchase such goods; and that the Indian currency was his income from the purchase and sale of such goods. The said statement of Shri Dhingra was written on his behalf by one Shri Mahinder Kumar Satiya. Shri Dhingra retracted the statement on 12-10-1991 before the A.C.M. Magistrate, Patiala House, New Delhi in his bail application, wherein he stated, inter alia, that he was a chronic heart patient hospitalised in serious condition in M.P. Heart Hospital at Greater Kailash; that on 11-10-1991 Customs officials had raided his residential and business premises and unlawfully seized currency notes worth Rs. 15 lakhs and some cheques and drafts belonging to some diplomats and also some household articles which were in use in his house; that the Indian currency was meant for declaration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder coercion. He denied and retracted the same. 5.The ld. Collector, considering the above facts and circumstance, reached the finding that Shri Dhingra's statement of 11-10-1991 was not voluntary and hence not reliable. The appellants have contended that this finding is incorrect and ld. SDR had argued in support of such contention. Ld. Advocate has opposed the said contention and submitted that there is no presumption of voluntary nature of any confessional statement and that voluntariness should be ascertained from circumstances such as the state of mind of the person, his physical condition etc. He has drawn support for this argument from the decision of the Calcutta High Court in the case of Mahindra Chandra Dey v. CEGAT [1992 (58) E.L.T.192 (Cal.)]. In that case, the High Court negatived the Tribunal's approach and held that, in accepting a confessional statement as voluntary, the approach should be whether there were circumstances indicating the confessional statement to be a voluntary one. The court observed that the Tribunal ought to have enquired into the state of mind of the writ petitioner at the time of making the confessional statement, i.e. whether he was under me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd in the appeal. The said findings, which we have considered in para (4) of this order, are correct in law and therefore the ld. Collector's conclusion that Shri Dhingra's statement of 11-10-1991 was not voluntary has to be upheld by applying the case law cited by the ld. Advocate. 9.As regards Shri Dhingra's statement of 13-10-1991, wherein he had, inter alia, stated that he wanted to disclose the amount of Rs. 15 lakhs voluntarily to Income-tax authorities, the ld. Collector, again, did not accept it as evidence. Appellants have submitted that Shri Dhingra (while giving the statement of 13-10-1991) "not only reaffirmed the statement dated 11-10-1991 but also refused to add anything to it". We have already held that Shri Dhingra's statement of 11-10-1991 was not voluntary. The subsequent statement "reaffirming" the earlier one was recorded just on the third day and the same was also written by a third person (nurse of the hospital). It was the Department's burden to show that the statement was voluntary since they sought to rely on the statement for fixing guilt on the respondents. This burden, in our view, was all the more heavy inasmuch as the statement in question was one wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... partment also could not rebut Shri Dhingra's case that he delivered the imported goods to the diplomats and did not divert the same for sale in the market. The burden of proof which shifted from the respondents to the Department was not successfully discharged by the latter. 11.The strongest evidences in the hands of the Department against the respondents appear to be the statements of Shri Sanjay Dhawan and Shri Nirmal Munda. Shri Dhawan stated that he had taken his friend, Shri Minto to Shri Dhingra's shop and that Shri Minto had purchased goods of foreign origin worth Rs. 20,000/- from Shri Dhingra. According to Shri Dhawan, the entry at page No. 107 of the documents seized by Customs officers related to that transaction. However, as rightly found by the adjudicating authority, the said entry did not indicate that the goods were of foreign origin, nor was Shri Minto examined to prove the veracity of Shri Dhawan's statement. As regards the statement of Shri Munda, employee of Shri Dhingra, who was present during the search operations in the Karol Bagh shop, the adjudicating authority found that he could not distinguish between Indian and foreign origin goods. The authority, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lomats for onward transmission to foreign suppliers for goods to be imported and did not represent sale proceeds of any smuggled goods. 14.The Indian currency of Rs. 15 lakhs seized from the 1st respondent's residential premises was, according to the respondents, their income from various businesses and the same was kept for disclosure to Income-tax authorities under the Voluntary Income Disclosure Scheme of the Central Government. Shri Dhingra took the same stand before the Delhi High Court in a related Writ Petition. As a matter of fact, he deposited a part of the above amount in the National Housing Bank under the above Voluntary Disclosure Scheme pursuant to the High Court's order. Department alleged that the amount was the sale proceeds of smuggled goods. This allegation was based on Shri Dhingra's retracted statement of 11-10-1991. The adjudicating authority, having already held Shri Dhingra's statemnt dated 11-10-1991 to be unreliable, found no cogent evidence to prove the Department's case that the amount represented sale proceeds of smuggled goods. The authority also noted that Indian currency was not an item notified under Section 23 of the Customs Act, 1962. 15.We ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that he proposed to deposit the same with the Reserve Bank of India. The adjudicating authority has accepted the plea, having regard to factors such as the probable goodwill of the diplomat towards his indenting agent, the custom of gift-giving on the above ceremonial occasion and the factum of the currency not being a big amount for a foreign diplomat. We have also noted that, in his bail application before the A.C.M. Magistrate, Shri Dhingra had, inter alia, submitted that he had made all arrangements to celebrate his son's Mundan ceremony on 18-10-1991 and had invited all his relatives and friends to that occasion. The ground of challenge (vide ground No. 11) against the ld. Collector's finding on the point appears to be too flimsy to be accepted. We are inclined to endorse the lower authority's finding. 17.Out of the goods seized from Shri Dhingra's residence, shop and godown, the adjudicating authority segregated the notified (under Section 11-B of Customs Act) goods from the non-notified ones and in respect of the latter, held that the Department had not been able to make out a prima facie case that the goods (non-notified) were smuggled goods inasmuch as the respondents' ..... X X X X Extracts X X X X X X X X Extracts X X X X
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