TMI Blog2015 (8) TMI 1358X X X X Extracts X X X X X X X X Extracts X X X X ..... stion of law is answered in favour of the appellant. Whether the proceedings are vitiated by bias in as much as the then Deputy Director of Enforcement Directorate, Chennai, Mr.A.Subramani had participated in the investigation and later issued the show cause notice and adjudicated the case himself? - Held that:- In order to avoid the embarassing position and to allow the prosecution to play fair in an unbiased manner, the process of adjudication should have been handed over to some other Officer. But in this case it is unfortunate to say that the Officer viz., Mr.S.Subramanian, who had an occasion to search the premises of the appellant and to issue the memorandum of show cause notice was entrusted with the task of adjudication of the show cause notice against the appellant and that is why it went on the wrong side and ended with the result as against the appellant. In this connection, we would like to place it on record that the Adjudicating Authority is required to take an independent decision as a quasijudicial authority and pass appropriate orders. We therefore, find that when the adjudication is to be done by an Independent Officer where no role was played by the Investi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 4. The Adjudicating Authority (the Deputy Director of Enforcement Directorate) had passed an order of adjudication(order in original) on 20.09.2000 and thereby concluded that the appellant had contravened the Provisions of Sections 9 (1) (b) and 9 (1) (d) of the Foreign Exchange Regulation Act, 1973 to the extent of ₹ 43,00,000/- and also found him guilty of the charges as afore stated and imposed a penalty of ₹ 2,50,000/- for the contravention of Section 9(1) (b) of the Act and a penalty of ₹ 2,00,000/- for the contravention of Section 9 (1) (d) of the Act by virtue of the powers conferred on him under Section 50 of the Act. 5. The correctness of this order was challenged by the appellant before the Appellate Tribunal for Foreign Exchange, New Delhi. After hearing both sides, the Appellate Tribunal had proceeded to confirm the order of the Adjudicating Authority with an observation that the Enforcement Directorate had proved the charges against the appellant beyond all reasonable doubts and that the impugned order withstands judicial scrutiny, which is liable to be confirmed. While dismissing the appeal, the Appellate Authority had also directed the pred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ealers in foreign exchange by order of Mr.Mohamed Saliq, Singapore and Mr.Ismail, Dubai respectively, persons resident outside India in contravention of Section 9 (1) (d) of the Act. 10. Hence, a show cause notice dated 14.05.1999 was issued to the appellant requesting him to show cause in writing within 15 days from the date of receipt of memorandum as to why the adjudication proceedings has contemplated under Section 51 of the Act should not be held against him for the above said contravention. 11. Before the Adjudicating Authority i.e., the Deputy Director of Directorate of Enforcement, the learned counsel who was then appearing on behalf of the appellant had argued that with regard to the allegation of making of payments to persons at Trichy, Madurai and Paramakudi, none of the alleged recipients had been contacted and their statements were recorded. He had contended that the failure to conduct investigation against the persons alleged to have received payments from the appellant would go to show that the receipt and payment theory was fabricated. Rejecting his argument the Adjudicating Authority in its adjudication order dated 20.09.2000, had found that the argument adva ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h to measure proof at the same time contemplates of giving full effect to be given to circumstances or condition of probability or improbability. It is this degree of certainty to be arrived where the circumstances before a fact can be said to be proved. A fact is said to be disproved when the Court believes that it does not exist or considers its nonexistence so probable in the view of a prudent man and now we come to the third stage where in the view of a prudent man the fact is not proved i.e., neither proved nor disproved. It is this doubt which occurs to a reasonable man, has legal recognition in the field of criminal disputes. It is something different from moral conviction and it is also different from a suspicion. It is the result of a process of keen examination of the entire material on record by 'a prudent man'. There is a difference between a flimsy or fantastic plea which is to be rejected altogether. But a reasonable though incompletely proved plea which casts a genuine doubt on the prosecution version indirectly succeeds. The doubt which the law contemplates is certainly not that of a weak or unduly vacillating, capricious, indolent, drowsy or confused m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cessarily drawn as against the officials of the Directory of Enforcement. 17. It is the case of the first respondent that on 17.09.1998, when the three residential premises of the appellant were searched by the officials of the Enforcement Directorate, they had seized the diary from one of the residential premises of the appellant bearing Door No.95. While so, a statement was recorded by them on the narration of the appellant. 18. It is alleged that in his statement, he had stated that he had received the payments of ₹ 23,00,000/- and ₹ 20,00,000/- respectively, totalling to ₹ 43,00,000/- from the persons other than authorized dealer in Foreign exchange by order of one Mohamed Saliq of Singapore, a person resident out side India and made payments of ₹ 23,00,000/- and ₹ 20,00,000/- to a local person by order of one Mohamed Saliq of Singapore, and one Mr.Ismail of Dubai respectively, in contravention of the Provisions of the Foreign Exchange Regulation Act 1973. 19. Admittedly, a retraction letter dated 18.09.98 was sent by the appellant to the Deputy Director of Enforcement Directorate, retracting the alleged statement recorded from him saying ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r order, the Department was not required to prove its case with mathematical precision to a demonstrable degree. What is required is the establishment of such a degree of probability that a prudent man may, or its basis believe in the existence of the fact in issue, the other cardinal principle which has an important bearing on the incidence of burden of proof is the sufficiency and weight of the evidence to be considered. He has also indicated that the important peace of documentary evidence i.e., diary was seized from the custody of the appellant, which was containing address and telephone numbers of his friends and relatives. When he was confronted with that diary, he had stated the names and other details of Mr.Mohamed Saliq and Ismail. 23. We have carefully perused the records and considered the submissions made on behalf of both sides. On perusal of the impugned orders of the Adjudicating Authority as well of the Appellate Tribunal, we find that Madurai address of the appellant has not been given in the alleged statement. Though, Singapore telephone No.2250097 is found place in the statement, no calls were traced by verification. 24. It is significant to note that the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not a confession. It is an admission of a particular fact pertinent to the issue and evidence of that fact, but it is not confession . The distinction drawn between admission and confession in criminal law is substantial one. Confession involves a voluntary acknowledgement of guilt. To make an admission or a declaration, or a confession, it must amount to a clear acknowledgement of guilt. 30. In this connection, we would like to have the reference to the observations made by HOLLOWAY .J in an American case (State Vs. Guie, 56 Mont 485, cited wig Section 821), He explains this decision in the following manner: The distinction between a confession and an admission, as applied in criminal law, is not a technical refinement, but based upon substantive differences of the character of the evidence deduced from each. A confession is a direct acknowledgement of guilt on the part of the accused, and , by the very force of the definition, excludes an admission, which, of itself, as applied in criminal law, is a statement by the accused, direct or implied of facts pertinent to the issue, and tending, in connection with proof of other facts, to prove his guilt, but of itself is in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y statement of the maker is not completely relieved of his obligations in at least subjectively applying its mind to the subsequent retraction to hold that the inculpatory statement was not extorted. It thus boils down that the authority or any court intending to act upon the inculpatory statement as a voluntary one should apply its mind to the retraction and reject the same in writing. It is only on this principle of law, this Court in several decisions has ruled that even in passing a detention order on the basis of an inculpatory statement of a detenu who has violated the provisions of the FERA or the Customs Act, etc., the detaining authority should consider the subsequent retraction and record its opinion before accepting the inculpatory statement lest the order will be vitiated. Reference may be made to a decision of the Full Bench of the Madras High Court in Roshan Beevi Vs. Government of Tamil Nadu(1983) LW(Cri) 289 (Mad), to which one of us (S.Ratnavel Pandian,J) was a party . 33. With reference to burden of proof of a confession said to have been obtained from a person during investigation, his Lordship in paragraph No.25 has referred the decision of the Apex Court i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ind that, the Deputy Director of Enforcement Directorate has not considered the retraction letter of the appellant properly and without applying his mind, he has simply and mechanically given that reply saying that I reject your allegations contained in your above said letter as baseless, afterthought and devoid of any merits. 35. Keeping in view of the above fact, we find that the Appellate Tribunal has committed a grave error in stating that the retracted statement of the appellant had been corroborated by relying upon the alleged seizure of Diary, which is not even shown to the appellant. The Appellate Tribunal has also not considered the following facts. (i) the diary was not a relied upon document in the memorandum of show cause notice issued. (ii) The contents of the diary have also not been communicated to the appellant at any point of time. (iii) Factually also if such a diary has been produced it would indeed have revealed there is no entry or even the names of the sender as well as the names of the recipients. Having been considered the visible and tangible discrepancies strewn everywhere in the case of Enforcement Directorate, we are of the considered v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n this case it is unfortunate to say that the Officer viz., Mr.S.Subramanian, who had an occasion to search the premises of the appellant and to issue the memorandum of show cause notice was entrusted with the task of adjudication of the show cause notice against the appellant and that is why it went on the wrong side and ended with the result as against the appellant. 40. In this connection, we would like to place it on record that the Adjudicating Authority is required to take an independent decision as a quasijudicial authority and pass appropriate orders. We therefore, find that when the adjudication is to be done by an Independent Officer where no role was played by the Investigating Officer, no prejudice could be caused to the appellant and in that circumstance, we may safely presume that the scheme of the Act sufficiently safeguard the rights of the appellant. 41. On coming to the instant case on hand, the Deputy Director of Enforcement Directorate Mr.S.Subramanian, ought not to have adjudicated the show cause notice for the reasons afore stated. Accordingly, the question of law No.2 is also answered in favour of the appellant. 42. In the result, the appeal filed by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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