TMI Blog2023 (2) TMI 620X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Appellants in spite of having ample opportunities, establishes the non-voluntary nature of said initial statements all dated 07.03.2017 of the said Appellants. Hence, the said initial statements cannot be basis of any penal consequence in the present case. Though Section 138B of Customs Act, 1962 provides for examination of the makers of any statement, the Adjudicating authority did not exercise such power with respect to the first three Appellants herein before taking cognizance of such initial statements which were retracted before the Ld. Magistrate. Moreover, from the impugned Order-in-Original it would be evident that in course of adjudication, the fact of retraction was also duly brought before the Adjudicating authority by the Ld. Advocate appearing for the Appellants, but the Ld. Adjudicating authority simply ignored the same while arriving at his findings with respect to the statements dated 07.03.2017 of the Appellants and proceeded on the basis of such statements as being voluntary in nature and has mis-directed himself by arriving at a finding at para 4.17(xii) of Order-in-Original that the retraction was in reply to Show Cause Notice and hence, such finding i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 07.03.2017 of the first three Appellants herein, is also perverse in nature inasmuch as apart from such retracted statements of the co-accused, there is nothing on-record to implicate the fourth accused in the alleged act of smuggling of the seized gold. Hence, in absence of any independent corroborative evidence against the fourth Appellant, penalty upon him is not imposable. Further, single penalty under both the clauses (a) (b) of Section 112 of Customs Act, 1962, is erroneous in law in as much as both such clauses operates at separate domain altogether - the imposition of single penalty upon the fourth Appellant i.e. Akash Jagdish Issrani by the Adjudicating authority under both clauses (a) and (b) supports the contention on behalf of the said Appellant that the Adjudicating authority was not sure about the alleged role of the said Appellant in the alleged act in want of specific allegations against him in the Show Cause Notice, but mechanically imposed the penalty on him. Such imposition of penalty is liable to be quashed. Appeal allowed. - Customs Appeal Nos.75232, 75233, 75234 & 75406 of 2022 - FINAL ORDER NO. 75055-75058/2023 - Dated:- 13-2-2023 - SHRI P.K.CHOUDHAR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eighing 1000 gms. each from Shri Ajay Kumar Gond. There was no recovery of gold from Shri Sanjay Gond or Shri Akash Jagdish Issrani. Another person viz. Md. Ali was also intercepted somewhere outside the NSCBI Airport from whose possession Indian Cash Currency amounting to Rs. 2,20,000/- was recovered. Indian cash currency amounting to Rs. 51,870/- Rs.67,940/- respectively was recovered from Appellant Shri Amit Ghosh and Shri Sanjay Kumar Gond. 2.2. The recovered 4 pcs of gold weighing in total 4000 gms. valuing Rs.1.22 Cr. (approx.) and cash Indian currencies were seized under Section 110 of the Customs Act, 1962 and the entire process of drawing of Panchnama and Inventory/Seizure List was completed at 23:50 hrs. of 06.03.2017. Separate statements all dated 07.03.2017 of the Appellants were recorded u/s. 108 of Customs Act, 1962 wherein allegedly they have admitted their complicity with the smuggling activity of gold. That all the Appellants were arrested under Section 104 of Customs Act, 1962 and were remanded to judicial custody on 08.03.2017 as per order of the Ld. Chief Metropolitan Magistrate, Bankshall at Calcutta. 2.3. On completion of investigation, Directorate of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... raction Petitions before the Chief Metropolitan Magistrate, Calcutta on 14.03.2017 i.e. next date of production from judicial custody and the Chief Metropolitan Magistrate, Calcutta had duly reflected such filing of Retraction Petitions in his Order dated 14.03.2017 in Misc. Case No. 14718/17. The Appellants in their respective Retraction Petition dated 14.03.2017 explained the fact of torture, both physical and mental, and extraction of statements dated 07.03.2017 by the DRI and prayed for not to take any cognizance of such statements. They also explained as to why the Retraction Petition could not be filed on 08.03.2017 during the first production before the Ld. CMM. It is submitted that hence, statements dated 07.03.2017 of the Appellants cannot be considered as their voluntary statements and/or confession since the same were duly retracted at the earliest opportunity by the Appellants and no subsequent and/or further statement of the Appellants were ever recorded by the DRI Authority. Nowhere in the Show Cause Notice or Order-in-Original it is also alleged that the retractions so made by the Appellants were not proper or correct. Reliance has been placed in the Judgement of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ants by way of Show Cause Notice dated 05.09.2017, but no ( a month s previous notice in writing ) such intended proceeding was ever issued to the Appellants. Hence, the entire proceeding against the said Appellants under the said Show Cause Notice culminated into Order-in-Original imposing penalty/s upon the Appellants and Orderin- Appeal rejecting Appeals of the Appellants, is void abinitio for noncompliance of the mandatory provision of Section 155(2) of the Customs Act, 1962. Reliance with respect to applicability of the provision of Section 155(2) of the Customs Act, 1962 is placed in the Order No. FO/A/75056-75060/2019 dated 15.01.2019 in Customs Appeals Nos.460, 541-544/09 [Shri Prabir Kumar Guha Ors. v. Commr. of Customs (Airport Admn.), Kolkata] passed by this Tribunal. 4. Shri Nilotpal Chowdhury, Ld. Advocate appearing for the fourth Appellant viz. Shri Akash Jagdish Issrani submitted inter alia that the entire basis of proceeding and imposition of penalty against him is the initial statements of the other three accused/ Appellants in the proceeding. If the said three accused/ Appellants are denying their said initial statements, there can be no proceeding against ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... act was not in good faith . He prayed for upholding of the Order-in-Appeal. 6. Heard all the parties and perused the documents made available by the appearing Counsels. All the parties filed their written notes of argument. I have gone through the Appeal records and relevant documents on record. It is not of much dispute that the entire case of Revenue is based upon the allegation of recovery of gold from Shri Amit Ghosh and Shri Ajay Kumar Gond and the statements all dated 07.03.2017 of the first three Appellants. The Appellants have denied the fact of recovery and said statements to be voluntary in nature. 7.1. I find that it is not in dispute that the first three Appellants were arrested on 07.03.2017 at 22.00 hrs. as mentioned in the respective Memo of Arrest, while they were apprehended on 06.03.2017 at 20.40 hrs. as evident from the Panchanama dated 06.03.2017. The respective Summons under Section 108 of Customs Act, 1962 all dated 06.03.2017 were issued upon the first three Appellants requiring their respective appearance on 06.03.2017 at 10.30 PM. All the initial statements of said three Appellants are dated 07.03.2017 as recorded at the office of DRI, Kolkata. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed/ Appellants at judicial custody after the Order dated 14.03.2017 when more particularly the retractions were filed on 14.03.2017 before the Chief Metropolitan Magistrate, Calcutta. 7.4. It is also on-record that vide Order dated 11.04.2017 while granting bail to the Appellants in Misc. Case No. 14718/17 the Chief Metropolitan Magistrate, Calcutta saddled the accused/ Appellants with the condition to meet the I.O once in a week until further orders. There is no allegation in the Show Cause Notice that the accused/ Appellants did not comply with such condition of bail. Surprisingly, there is even no recording of statement from any of the first three Appellants during their such visits at the office of DRI, Kolkata. 7.5. The Hon ble Supreme Court of India in the case of Vinod Solanki v. Union of India [2009 (233) E.L.T. 157 (S.C.)] has held that 34. A person accused of commission of an offence is not expected to prove to the hilt that confession had been obtained from him by any inducement, threat or promise by a person in authority. The burden is on the prosecution to show that the confession is voluntary in nature and not obtained as an outcome of threat, etc. if ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Tribunal as also the Authorities misdirected themselves in law insofar as they failed to pose unto themselves a correct question. The Tribunal proceeded on the basis that issuance and services of a show cause notice subserves the requirements of law only because by reason thereof an opportunity was afforded to the proceedee to submit its explanation. The Tribunal ought to have based its decision on applying the correct principles of law. The statement made by the appellant before the learned Chief Metropolitan Magistrate was not a bald statement. The inference that burden of proof that he had made those statements under threat and coercion was solely on the proceedee does not rest on any legal principle. The question of the appellant s failure to discharge the burden would arise only when the burden was on him. If the burden was on the revenue, it was for it to prove the said fact. The Tribunal on its independent examination of the factual matrix placed before it did not arrive at any finding that the confession being free from any threat, inducement or force could not attract the provisions of Section 24 of the Indian Evidence Act. As such, the burden is on Revenue to e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld be used as a substantial piece of evidence against the respondents. 23. That the authorities below had totally relied on the confessional statement for passing the impugned order against the respondents and it is to be examined as to whether in absence of any other evidence it was reasonable or prudent for holding the respondents guilty for the offence under Sections 111 112 of the Customs Act. 24. In the case of Surinder Kumar Khanna v. Intelligence Officer Directorate of Revenue Intelligence - 2018 (8) SCC 271 = 2018 (362) E.L.T. 935 (S.C.) paragraphs 11 and 12 is reproduced herein under :- 11. in Kashmira Singh v. State of Madhya Pradesh MANU/SC/0031/1952; (1952) SCR 526, this Court relied upon the decision of the Privy Council in Bhuboni Sahu v. The King MANU/PR/0047/1949 : (1949) 76 Indian Appeal 147 at 155 and laid down as under : Gurubachan s confession has played an important part in implicating the appellant, and the question at once arises, how far and in what way the confession of an accused person can be used against a co-accused? It is evident that it is not evidence in the ordinary sense of the term because, as the Privy Council say in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion of Section 30 goes not further than this : where there is evidence against the co-accused sufficient, if believed, to support his conviction, then the kind of confession described in Section 30 may be thrown into the scale as an additional reason for believing that evidence . In Bhuboni Sahu v. King the Privy Council has expressed the same view. Sir John Beaumont who spoke for the Board, observed that a confession of a co-accused is obviously evidence of a very weak type. It does not indeed come within the definition of evidence contained in Section 3 of the Evidence Act. It is not required to be given on oath, nor in the presence of the accused, and it cannot be tested by cross-examination. It is a much weaker type of evidence than the evidence of an approver, which is not subject to any of those infirmities. Section 30, however, provides that the court may take the confession into consideration and thereby, no doubt, makes it evidence on which the court may act; but the section does not say that the confession is to amount to proof. Clearly there must be other evidence. The confession is only one element in the consideration of all the facts proved the case; it can be pu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estions formulated by the petitioner and are of the considered opinion that no substantial question of law arises for determination of this Court in as much as the questions raised by appellant have already been conclusively decided by the Hon ble Supreme Court. 27. We do not find any infirmity with the order of the CESTAT dated 22-5-2018 and no substantial question of law raises in these appeals which are hereby dismissed. As such, the position of law is no more res integra that the retracted statements cannot be the sole basis of penalty under Section 112 of Customs Act, 1962. In the present case, if the said initial statements all dated 07.03.2017 of the first three Appellants, which were retracted on 14.03.2017 before the Ld. Magistrate, are taken out of record, there would be nothing to implicate the Appellants herein as liable for any penal action under Section 112 of the Act. In such circumstance, imposition of penalties upon the Appellants on the basis of such retracted statements, all dated 07.03.2017, is liable to be quashed. 7.7. As regards the opportunity of cross examination of the panch witnesses in this case, I find that the very fact of recovery of go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o accept the position maintained in the counter affidavit that the opinion of the adjudicating officer was final on the question as to what could be relevant in the defence of the petitioner. The matter should have been left to the petitioner and the adjudicating authority should not have taken that burden on him. We are inclined to agree with Mr. Mohante that principles of natural justice have been violated and the petitioner have been denied a reasonable opportunity to substantiate his stand. 17. The Central Board of Excise and Customs in the case of Vaidyanath Agency [1981 E.L.T. page 94 (CBEC)] held that the denial of cross-examination of the officer who conducted the inspection of stock is denial of natural justice. As stated earlier what is required to be considered is not as to whether the party has the right to cross-examine a witness but to consider whether the facts and circumstances of the case justify granting of such a request made by the party who was required to rebut the charges and was to establish his defence. Likewise, in the present case, when the Appellants denies the allegation of recovery of gold from their possession, it was incumbent upon the Re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hout giving the Central Government or such officer a month s previous notice in writing of the intended proceeding and of the cause thereof, or after the expiration of three months from the accrual of such cause. That from the reading of the said provision of the Customs Act, 1962 it would be evident that sub-Section (1) and sub-Section (2) thereof operates at different circumstance. While sub-Section (1) ibid applies to the Officer of Central Government on-duty, sub-Section (2) ibid applies to all the Officers of Central Government w.r.t. any proceeding in pursuance of the Customs Act, 1962. The argument advanced on behalf of Revenue that sub-Section (2) must be preceded by sub-Section (1) of Section 155 ibid cannot be accepted since the said provisions are neither disjunctive nor conjunctive in nature. 7.11. This Tribunal after considering several earlier judicial pronouncements in the Order No. FO/A/75056-75060/2019 dated 15.01.2019 in Customs Appeals Nos. 460, 541-544/09 [Shri Prabir Kumar Guha Ors. v. Commr. of Customs (Airport Admn.), Kolkata] has held that the mandates of Section 155(2) of Customs Act, 1962 are to be fulfilled while contemplating a proceeding under ..... 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