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Judgment
This appeal is directed by the complainant against the judgment dated 6-4-1993 acquitting the accused for the offence u/s 9(1)(b) and 9(1)(d) punishable u/s 56 of the Foreign Exchange Regulation Act, 1973 (for short ''the Act'') in CC No. 173 of 1991 on the file of the Special Judge for Economic Offences, Hyderabad.
The case of the prosecution is that the accused M.A. Wajid went to Kuwait in the year 1977 for employment and worked there as a salesman and returned back to India on 14-9-1986. The Enforcement Directorate on reliable information that the accused was indulging in receiving heavy payments from persons in India and making payments to persons in India on behalf of persons residing outside India without any general or special permission from the Reserve Bank of India, searched the premises of the accused at Muradnagar on 17-8-1987 in pursuance of the search warrant issued by the Assistant Director, Enforcement Directorate, Madras, u/s 37 of the Act, in the presence of mediators and seized six documents under cover of mediators report, Ex.P2 and recorded the statements of the accused on 17-8-1987, 18-8-1987 and 15-9-1987 by PW1, the Chief Enforcement Officer, Hyderabad, u/s 40 of the Act. It is alleged that the accused made voluntary statements admitting the receipt of monies of Rs.9,15,000/- from persons in India on behalf of Mohd. Ower at Kuwait and distributed the said amount as per die list received by him along with the monies and the list did not contain full address and since the persons received monies at a selected place after fixing prior appointment and that the list and documents pertaining to the transactions were destroyed soon after completing the distribution work. The accused was arrested u/s 35 of the Act and produced before the Court on 18-8-1987 and the Additional Director after considering the material on record found the accused guilty for contravention of the provisions of Section 9(1)(b) and 9(1)(d) of the Act and imposed a fine of Rs.2,50,000/-under each count and filed complaint against the accused.
The Assistant Director of Enforcement under the Act and the then Chief Enforcement Officer was examined as PW1 and Exs.P1 to P6 were marked. The defence of the accused was that the statements under Exs.P2 to P5 were obtained by threat and coercion and none were examined on his behalf.
After hearing both the Counsel and on considering the material on record, the learned Special Judge for Economic Offences held that the statements recorded by PW1 are inadmissible in evidence as no caution as contemplated u/s 164(2) Cr.PC was administered and there is no other material on record to prove the guilt of the accused and hence, found him not guilty and acquitted him.
Aggrieved by the said judgment, the complainant preferred this appeal.
It is not in dispute that on 17-8-1987 the house of the appellant-accused was searched in pursuance of the search warrant issued under Ex.P1 by the Enforcement Director, Madras, in the presence of the mediators and seized six documents under Ex.P2 and the appellant-accused gave statements on 17-8-1987, 18-8-1987 and 15-9-1987 before PW1 under Ex.P2 to P5 after explaining the provisions of Section 40 of the Act and consequences thereof. The appellant-accused contended that the said statements under Exs.P2 to P5 were obtained by threat and coercion. It is also not in dispute that no caution or warning was administered to the accused as contemplated u/s 164(2) Cr.PC before he gave statements under Exs.P2 to P5.
Learned Standing Counsel for Central Government, Sri R. Adinarayana Rao, submits that the person appearing in pursuance of the summons issued u/s 40 of the Act is not an accused at that stage and also statements given or recorded from him are not the statements recorded by a Magistrate u/s 164 Cr.PC. Therefore, the question of giving any caution or warning as contemplated u/s 164(2) Cr.PC does not arise, and hence, the finding of the trial Court is unsustainable in law and he relied on a decision Poolpandi Vs. Superintendent, Central Excise and others etc. etc., ; Romesh Chandra Mehta Vs. State of West Bengal, ; Illias Vs. Collector of Customs, Madras, and Haroon Haji Abdulla Vs. State of Maharashtra, .
The learned Counsel for the respondent, Sri K.F. Baba, submitted with equal vehemence that the Division Bench of this Court in N.S.R. Krishna Prasad and Vs. Directorate of Enforcement Loknayak Bhawan Khan Market, New Delhi and Others, , has held that the statements recorded in pursuance of the summons issued u/s 108 of the Customs Act without administering warning or caution to the person making the confessional statement, as contemplated u/s 164(2) Cr.PC is inadmissible in evidence and non-compliance of the said mandatory provision is not curable u/s 463 Cr.PC. He also relied on judgment of the learned single Judge of this Court in Assistant Collector of Central Excises Rajahmundry Division Vs. Duncan Agro Industries Ltd. and Others, , held that the statements recorded without giving a caution or warning as contemplated u/s 164(2) Cr.PC in pursuance of the summons issued u/s 14 of the Central Excise and Salt Act are inadmissible in evidence; and relying on these decisions, the trial Court has rightly held that confessional statements said to have been given by the respondent under Exs.P2 to P5 are inadmissible in evidence and so acquitted the respondent-accused.
To appreciate the contentions of both the parties, it is useful to extract Section 40 of the Act :
"40. Power to summon persons to give evidence and produce documents :--
(1) Any Gazetted Officer of Enforcement shall have power to summon any person whose attendance he considers necessary either to give evidence or to produce a document during the course of any investigation or proceeding under this Act.
(2) A summons to produce documents may be for the production of certain specified documents or for the production of all documents of a certain description in the possession or under the control of the person summoned. (3) All the persons so summoned shall be bound to attend either in person or by authorised agents, as such officer may direct; and all persons so summoned shall be bound to state the truth upon any subject respecting which they are examined or make statements and produce such documents as may be required :
Provided that the exemption u/s 132 of the Code of Civil Procedure, 1908 (5 of 1908) shall be applicable to any requisition for attendance under this section.
(4) Every such investigation or proceeding as aforesaid shall be deemed to be a judicial proceeding within the meaning of Sections 193 and 228 of the Indian Penal Code (45 of 1860)."
It is clear from perusal of the above provision that any Gazetted Officer of Enforcement shall have the power to summon any person whose attendance he considers necessary either to give evidence or to produce documents during the course of any investigation and all persons shall be bound to attend either in person or by authorised agents, as such officer may direct and all persons so summoned shall be bound to state the truth upon any subject respecting which they are examined or make statements and produce such documents as may be required; further any such investigation or proceeding shall be deemed to be a judicial proceeding within the meaning of Sections 193 and 228 of Indian Penal Code.
It is indeed relevant to mention that the provisions of Section 171-A of Sea Customs Act, Section 108 of Customs Act, Section 14 of the Central Excise and Salt Act and Section 40 of the Act are analogous and the ratio laid down with reference to any of the provisions contained in any one of the above enactments is applicable to the cases arising under the other enactments.
The facts leading to Haroom Haji Abdulla''s case (supra) are that the appellant along with 17 others were prosecuted before the Chief Presidency Magistrate, Bombay for offences u/s 120B of the Indian Penal Code read with Section 167(81) of the Sea Customs Act and certain offences under the Foreign Exchange Regulation Act, 1947, and the Customs Authorities recorded the statements of co-accused. The question there arose was whether the statements recorded by the Customs Officer in pursuance of the summons issued u/s 171-A of Sea Customs Act are admissible in evidence and their Lordships in para 6 of the judgment have observed as under :
"...This leads us to the consideration of the statements of Bengali and Noor Mohammed which were received in corroboration of Kashinath ''s testimony. These statements contain admission constituting the guilt of the makers under the charged sections. They also mention the name of Haroon among others, as being concerned in the smuggling and in much the same way as docs the accomplice. The question is, can they be used to corroborate him? These statements are not confessions recorded by a Magistrate u/s 164 of the Code of Criminal Procedure, but are statements made in answer to a notice u/s 171-A of the Sea Customs Act. As they are not made subject to the safeguards under which confessions are recorded by Magistrates, they must be specially scrutinised to finding out if they were made under threat or promise from somebody in authority. If after such scrutiny they are considered to be voluntary, they may be received against the maker and in the same way as confessions are received, also against a co-accused jointly tried with him. Section 30 of the Evidence Act docs not limit itself to confessions made to Magistrates, nor do the earlier sections do so, and hence, there is no bar to its proper application to the statements such as we have here.."
The contention of the appellant that person appearing in pursuance of the summons issued u/s 40 of the Act is not an accused is no longer res integra and the Apex Court has consistently taken the same view in Poolpandi''s case (supra), wherein their Lordships held that person called for investigation by the authorities under the Customs Act or PER Act is not an accused and observed as follows :
"...A person called for questioning during investigation by authorities under the provisions of the Customs Act or the Foreign Exchange Regulation Act (FERA) is not an accused. He cannot, therefore, claim that in view of the possibility of his being made an accused in future he is entitled to the presence of his lawyer when he is questioned. Refusal to allow presence of lawyer in such case would not be violative of protection under Article 20(3). Nor can it be said that when a person is called away from his own house and questioned in the atmosphere of the Customs Office without the assistance of his lawyer or his friends his constitutional right under Article 21 would be violated. It could not be said that if the person who is used to certain comforts and convenience is asked to come by himself to the Department for answering questions it amounts to mental torture. Thus even on applying the "just, fair and reasonable test", the refusal to allow presence of lawyer would not violate Article 21.."
The Supreme Court in Ramesh Chandra Mehta ''s case (supra), also held that a person against whom enquiry held u/s 171 of Sea Customs Act is not a person accused of an offence and the same view was again reiterated by a Constitution Bench of Apex Court in K.I. Pavunny Vs. Assistant Collector (HQ), Central Excise Collectorate, Cochin, , wherein it was held as under :
..Though the authority/officer on suspecting a person of having committed the crime under the Act can record his statement, such a person perforce is not a person accused under the Act. Appellant was not a person accused of the offence under the Act when he gave his confessional statement u/s 108 of the Act on 6-12-1980 at 1.00 p.m. in the office of the Superintendent of Customs, PW2. The assumption that the appellant was an accused as on 6-12-1980 is erroneous, since as on the date no formal complaint had been laid against the appellant. Hence, a statement recorded or given by the person suspected of having committed an offence during the inquiry u/s 108 of the Act or during confiscation proceedings is not a person accused of the offence within the meaning of Section 24 of the Evidence Act.
A person whose statement on being suspected by the authority/officer of having committed an offence, is recorded by that authority/officer becomes accused of the offence under the Act only when a complaint is laid by the competent Customs Officer in the Court of competent jurisdiction or Magistrate to take cognizance of the offence and summons are issued.."
The expression "confession" is not defined, the Supreme Court in Sahoo Vs. State of Uttar Pradesh, , has held that a confession is a statement made by an accused admitting his guilt. Communication to another is not an essential ingredient of the concept of "confession".
It is also pertinent to mention at this juncture that Section 164 Cr.PC envisages recording of confessions and statements of persons made during the course of investigation, by a Magistrate and caution or warning as contemplated u/s 164(2) Cr.PC is to be given while recording confession of a person but not statements. It is already observed that confession is a statement made by an accused admitting his guilt and the Apex Court has consistently held that a person appearing in pursuance or the summons issued u/s 40 of the Act, or 108 of the Customs Act is not an accused at that stage, and the object of the Act in empowering concerned officers to record the evidence under relevant provision is to collect information of the contravention of the provisions of the Act or concealment of the contraband or avoidance of the duty of excise so as to enable them to collect the evidence of the proof of contravention of the provisions of the Act for initiating proceedings for further action of confiscation of the contraband or imposition of the penalty under the Act etc.
When the said person is not an accused, the question of giving warning or caution as envisaged u/s 164(2) Cr.PC does not arise in that view of the matter also.
A Division Bench of this Court in N.S.R. Krishna Prasad''s case (supra), held that the statements recorded in pursuance of summons issued u/s 108 of Customs Act by the Competent Authority without administering caution or waning, as contemplated u/s 164(2) Cr.PC are inadmissible in evidence and the defect is not curable u/s 463 Cr.PC. But the ratio laid down by the Supreme Court in Haroom Haji Abdulla''s case was not brought to the notice of the Division Bench at the time of disposal of the said case.
The learned single Judge of this Court in Duncan Agro Industries Limited''s case (supra), held that the statements recorded u/s 14 of the Central Excise and Salt Act without giving warning or caution as envisaged u/s 164(2) Cr.PC are inadmissible in evidence; distinguishing the principle laid down by the Supreme Court in Haroom Haji Abdulla''s case and observed as follows :
"That decision has not considered the question whether a Customs Officer recording the confession u/s 171-A of the Sea Customs Act has to follow the prescribed procedure u/s 164 of the Code of Criminal Procedure."
The Apex Court specifically held that the statements recorded in answer to a notice issued u/s 171 -A of the Sea Customs Act are not confessions recorded by the Magistrate u/s 164 Cr.PC and further observed that the statements are not made subject to the safeguards under which the confessions are recorded by the Magistrate and cautioned to scrutinise carefully to find out if they are made under threat or promise from some body in authority and if they are found to be voluntary, then they may be received as against the maker and in the same way as confessions are received against him and also against the co-accused jointly tried with him. The emphasis is, the said statement are not confessions recorded by a Magistrate u/s 164 Cr.PC and are not made subject to the safeguards under which the confessions are recorded by the Magistrate and cautioned to scrutinise specially, makes it crystal clear that the procedure prescribed for recording the confessions by the Magistrate need not be followed. In my understanding of the judgment of the Supreme Court, the statements recorded in answer to the notice issued u/s 171 -A of the Sea Customs Act need not follow the procedure prescribed for recording the confessions by the Magistrate, as envisaged u/s 164 Cr.PC and the said statements are recorded by virtue of statutory compulsion and with due respect, the learned Judge has not properly deduced the principle laid down in Haroom Haji Abdulla ''s case and not followed the dicta laid down therein.
The Apex Court in Harbansingh Sardar Lenasingh and Another Vs. The State of Maharashtra and Others, , held that the statement recorded by a Customs Officer under the Customs Act is admissible in evidence and not hit by Section 25 of the Evidence Act or Article 20(3) of the Indian Constitution.
The Apex Court in Badku Joti Savant Vs. State of Mysore, , further held that the statement made by an accused to the Deputy Superintendent of Customs and Excise would not be hit by Section 25 of the Evidence Act and would be admissible in evidence.
Therefore, in the light of foregoing discussion and in the light of the ratio laid down by the Supreme Court in Haroom Haji Abdulla''s case, I hold that the statement made in answer to the notice issued u/s 40 of the Act is not a confession recorded by the Magistrate and hence, the question of giving warning or caution as envisaged u/s 164(2) Cr.PC does not arise. Therefore, the finding of the lower Court that the statements under Exs.P2 to P5 are inadmissible in evidence as no caution was administered before recording the said statements is unsustainable in law and liable to be set aside.
hi the result, the appeal is allowed and the judgment of the trial Court is set aside and the matter is remanded to the lower Court to consider the statements under Exs. P2 to P5 keeping in view the contention of the respondent/accused and dispose of the matter afresh in accordance with law at an early date.