2025 (5) TMI 2145 - HC - Customs

Admissibility of Statement recorded under Section 108 of the Customs Act 1962 - smuggling - Recovery and seizure of gold biscuits - benefit of doubt - Offence Punishable under Section 135(1)(a) - Maintainability of Appeal filled under Section 378(2) Cr.P.C. - HELD THAT - The entire case of the Prosecution was that while the Respondent was making an endeavour to take the packet from the toilet for handicap persons he was apprehended. It is pertinent to observe that PW43/Smt. Sudesh who is the most important witness had denied that Respondent had earlier visited the Handicap Toilet or that on his second trip he was able to put the packet in his belt which he was wearing under his pants but the packet fell and was seized by the Custom Officers. She has denied the presence of the Respondent near the Toilet or that he had made an endeavour to take away the brown packet. Though she has been consistent in deposing that a brown packet was recovered by the Custom Officers from under the wash-basin which was seized and in respect of which Panchnama was prepared but her testimony totally exculpates the Respondent about having entered the Toilet or having picked up the Packet or that it fell which was recovered by the Customs Officers. The testimony of PW3 therefore establishes the recovery of the packet from under the wash basin but does not implicate the Respondent in any manner. Rather her testimony establishes that the respondent was making an endeavour to enter the Toilet but was prevented by her. The truthfulness of the Statement under Section 108 Customs Act made by the Respondent could have been fully tested either by recovery of the vehicle the number of which was disclosed by the Respondent or by tracing Bhagirath who was allegedly the master mind behind the smuggling of gold. Clearly no investigations on this aspect were conducted. The testimony of PW6 creates a serious doubt of the appropriate procedure having been followed to assess that the recovered item was in fact gold as is claimed by the Appellant. It need not be over emphasized that no Qualification Certificate has been produced to show that he was a qualified Goldsmith competent to certify the purity of the gold. The learned ACMM had rightly referred to the observations made by the Adjudicating Authority in its Order dated 13.06.2001 while assessing the entire evidence as led herein to conclude that there was no evidence whatsoever to prove the recovery of the from any of the three persons including the Respondent. The learned ACMM has therefore rightly extended the benefit of doubt to the Respondent while acquitting him for the offence under Section 135 (1) (a) of the Customs Act 1962. There is no infirmity in the impugned Judgement and the Appeal is hereby dismissed.

Summary

1. ISSUES PRESENTED and CONSIDERED

- Whether the Statement of the Respondent recorded under Section 108 of the Customs Act, 1962 is admissible and sufficient to convict the Respondent for the offence under Section 135(1)(a) of the Customs ActRs.

- Whether the recovery of 24 gold biscuits from the Arrival Immigration Hall at IGI Airport and the seizure of incriminating articles from the Respondent were proved beyond reasonable doubtRs.

- Whether the testimony of the prosecution witnesses, including the panch witnesses and the sweeper, reliably established the Respondent's involvement in smuggling goldRs.

- Whether the Respondent's retraction of his statement under Section 108 Customs Act affects the admissibility or the weight of that statementRs.

- Whether the departmental exoneration of the Respondent precludes the criminal trial or affects the maintainability of the appealRs.

- Whether the appeal filed by the Customs Department under Section 378(iv) Cr.P.C against the acquittal by the ACMM is maintainableRs.

- Whether the evidence on record satisfies the statutory requirements and legal standards to sustain conviction under the Customs ActRs.

2. ISSUE-WISE DETAILED ANALYSIS

Admissibility and Sufficiency of Statement under Section 108 Customs Act

The legal framework recognizes that a statement recorded under Section 108 of the Customs Act is admissible in evidence without compliance with Section 164 Cr.P.C., as held in authoritative precedents. The Court cited multiple Supreme Court decisions affirming that confessional statements recorded under statutory compulsion or voluntarily pursuant to summons or surrender are admissible and not vitiated by inducement or promise.

The Court noted the Respondent's statement admitted recovery and seizure of gold biscuits and implicated him in the smuggling attempt. The statement was not retracted at the earliest opportunity, lending it a presumption of truthfulness.

However, the Court observed that the truthfulness of the statement could have been tested by tracing the alleged co-conspirator Bhagirath and the vehicle involved, but no such investigation was undertaken. The absence of corroboration on this critical aspect weakened the evidentiary value of the statement.

Regarding retraction, the Court acknowledged that retraction does not per se render the statement inadmissible, but it affects the weight to be accorded. The Court considered the totality of circumstances in assessing the reliability of the statement.

Proof of Recovery and Seizure

The prosecution's case rested on the recovery of 24 gold biscuits wrapped in brown plastic adhesive tape from the toilet for handicapped persons at the Arrival Immigration Hall. The gold biscuits weighed 2.819 kg and bore Swiss markings. A cloth belt with a stitched pocket tied to the Respondent's waist was also seized.

The testimony of PW2, the Customs officer who conducted the search and seizure, supported the recovery of the packet from under the wash basin and the seizure of the gold biscuits and cloth belt from the Respondent.

However, the testimony of PW4, the sweeper who was the first to notice the Respondent near the toilet, was hostile to the prosecution. She denied seeing the Respondent entering or leaving the toilet or handling the packet. She admitted only the presence of the brown packet under the wash basin but denied any interaction with the Respondent concerning it.

The two panch witnesses (PW8 and PW9) also turned hostile, stating that their signatures were obtained on pre-written documents without knowledge of contents, thereby undermining the reliability of the seizure panchnama and related documents.

The Court found the testimony of the sweeper and panch witnesses inconsistent with the prosecution's narrative and noted their vulnerable status as contract employees subject to influence.

Assessment of Evidence Regarding Gold Purity

The goldsmith (PW6) who certified the purity of the gold biscuits stated that he used the Touch Stone method, which tests only the surface purity and is not scientifically conclusive. He admitted no drilling or other scientific testing was conducted, and he lacked formal qualification evidence to establish competency.

This raised serious doubts about the adequacy and reliability of the procedure followed to establish that the recovered material was indeed gold of 24 carat purity.

Application of Law to Facts and Treatment of Competing Arguments

The Court noted that the prosecution failed to prove the recovery of gold from the Respondent conclusively. The packet was found under the wash basin, not on the Respondent, and the key eyewitness (the sweeper) denied any involvement of the Respondent in handling the packet.

The Respondent denied involvement, claiming he was falsely implicated due to intervening in a fight. The departmental exoneration of the Respondent was also highlighted, indicating no official finding of guilt.

The Court observed that the prosecution's evidence was riddled with contradictions, hostile witnesses, and lack of independent corroboration. The absence of reliable panch witnesses and failure to trace the alleged co-conspirators further weakened the prosecution case.

The Court also considered the procedural irregularities, including the manner in which statements and panchnamas were recorded and signed, which cast doubt on the integrity of the evidence.

The Court rejected the contention that minor contradictions should be overlooked, emphasizing that the benefit of doubt must go to the accused where prosecution evidence is not cogent and consistent.

Maintainability of Appeal and Departmental Exoneration

The Court noted the Respondent's argument that the appeal was not maintainable as it was filed without requisite sanction and that the Central Government alone has the authority to file such appeals under Section 378(2) Cr.P.C. The Court observed that no such sanction was obtained.

Further, the Court remarked that there is no provision for appeal under Chapter XVI of the Customs Act against acquittal under Section 135.

The departmental exoneration of the Respondent was considered relevant, as the same evidence was the basis for both departmental and criminal proceedings. The Court referred to case law holding that criminal prosecution is not maintainable where departmental proceedings have exonerated the accused on the same facts.

3. SIGNIFICANT HOLDINGS

"The truthfulness of the Statement under Section 108 Customs Act made by the Respondent could have been fully tested either by recovery of the vehicle, the number of which was disclosed by the Respondent or by tracing Bhagirath, who was allegedly the mastermind behind the smuggling of gold. Clearly, no investigations on this aspect were conducted."

"The testimony of PW4 Smt. Sudesh, the sweeper, who is the most important witness, totally exculpates the Respondent about having entered the Toilet or having picked up the Packet or that it fell which was recovered by the Customs Officers."

"The two independent panch witnesses admitted that they were only made to put their signatures on the documents which were already prepared, thereby undermining the reliability of the seizure panchnama."

"The testimony of PW6, the goldsmith, creates a serious doubt of the appropriate procedure having been followed to assess that the recovered item was in fact gold as is claimed by the Appellant."

"There was no evidence whatsoever to prove the recovery of the gold from any of the three persons including the Respondent."

"The learned ACMM has rightly extended the benefit of doubt to the Respondent while acquitting him for the offence under Section 135 (1) (a) of the Customs Act, 1962."

"There is no infirmity in the impugned Judgement and the Appeal is hereby, dismissed."

Core principles established include:

• Statements under Section 108 Customs Act are admissible but their truthfulness must be tested by corroborative evidence.
• Retracted statements affect the evidentiary weight but do not automatically exclude admissibility.
• Hostile witnesses and procedural irregularities in recording evidence weaken prosecution's case.
• Benefit of doubt must be given to accused where prosecution evidence is inconsistent and unreliable.
• Departmental exoneration on the same facts is relevant and may preclude criminal prosecution.
• Appeals under Section 378(iv) Cr.P.C require proper sanction and may not be maintainable against acquittals under Customs Act.

Final determination was that the prosecution failed to prove the Respondent's guilt beyond reasonable doubt, and the acquittal by the ACMM was upheld. The Appeal by the Customs Department was dismissed accordingly.