2011 (3) TMI 1285 - HC - Customs

Search and seizure - Cash found source from the smuggled goods - the allegation of the prosecution is that the currencies which were seized from the possession of A3 and A4 are the sale proceeds of smuggled gold bars which were brought through fraudulent evasion and mis-declaration of value and also by evasion of duty chargeable thereon - Revision petion - Held that - As the learned Magistrate has already come to the conclusion that the perusal of evidence adduced by the prosecution would show that the prosecution has succeeded in establishing a prima facie case as alleged by the prosecution in the complaint and by adopting the very correct and legal tests, the learned Magistrate has concluded that there is no doubt, that if the accused are not able to rebut the above case made out from the preliminary evidence, it would warrant their conviction for the offences under Sections 132 and 135 of the Customs Act. Of course, the contention raised by the counsel for accused Nos. 5 to 7 that no offence under Section 135 of the Customs Act is attracted is a contention to be considered at the time of appreciation of evidence and it is for the trial Magistrate to come to a conclusion, on the basis of such contention, after appreciating the evidence. Thus the learned Magistrate is perfectly legal, correct and proper in rejecting the prayer of the revision petitioners for a discharge under Section 245 of Cr.P.C. and as such, no merit in the Crl.R.Ps. and accordingly, the same are dismissed.

Summary

Issues Involved:
1. Legitimacy of charges under Sections 132 and 135 of the Customs Act, 1962.
2. Validity of the trial court's refusal to discharge the accused under Section 245 of Cr.P.C.
3. Adequacy of sanction for prosecution under Section 132 of the Customs Act.
4. Involvement of the eighth accused based on his employment and statement under Section 108 of the Customs Act.

Detailed Analysis:

1. Legitimacy of Charges under Sections 132 and 135 of the Customs Act, 1962:
The prosecution's case is based on the allegation that Indian Currency valued at Rs. 48 lakhs, found concealed in a car, was the sale proceeds of smuggled gold of foreign origin. The investigation revealed that accused Nos. 3 and 4 admitted the currency was from smuggled gold, implicating accused Nos. 1 and 2. Further, smuggled gold bars were recovered from accused Nos. 6 and 7, who acted under the instruction of accused No. 5. The trial Magistrate concluded that preliminary evidence indicated the goods involved were smuggled gold bars, and the fabrication of invoices and bills for these bars constituted an offense under Section 132 of the Customs Act. The court found that the evidence presented established a prima facie case under Sections 132 and 135, warranting the continuation of the trial.

2. Validity of the Trial Court's Refusal to Discharge the Accused under Section 245 of Cr.P.C.:
The petitioners sought discharge under Section 245 of Cr.P.C., arguing that the confiscation of currency under Section 121 of the Customs Act did not justify charges under Section 135(1)(a) and (b)(i). The trial court, however, found sufficient preliminary evidence to support the charges. The High Court upheld this decision, stating that the burden of proof under Section 123 of the Customs Act, which shifts to the accused post-confiscation, was applicable. The court emphasized that the trial court correctly applied legal tests to conclude that the evidence warranted the charges under Sections 132 and 135, and the contention that no offense under Section 135 was attracted would be considered during the trial.

3. Adequacy of Sanction for Prosecution under Section 132 of the Customs Act:
The petitioners argued that the Commissioner of Customs (Preventive), Cochin, only sanctioned prosecution under Section 135 and not under Section 132, thus questioning the trial court's jurisdiction to take cognizance of the offense under Section 132. The High Court acknowledged this issue, noting that no court can take cognizance of offenses under Section 137 of the Customs Act without prior sanction. The trial court was directed to consider whether a separate sanction was necessary for the offense under Section 132 during the framing of charges, based on the materials and evidence on record.

4. Involvement of the Eighth Accused Based on Employment and Statement under Section 108 of the Customs Act:
The eighth accused argued that his implication was solely due to his employment at M/s. Balaji Jewellery and his statement under Section 108 of the Customs Act. The prosecution contended that he handed over the currency to accused Nos. 3 and 4 and placed orders for the smuggled gold bars. The High Court found that the trial court correctly held that the eighth accused could be proceeded against, as his involvement needed to be assessed based on the totality of evidence. The court rejected the argument that his implication was solely based on his statement under Section 108, emphasizing that the evidence, including the recovery of gold bars from his workplace, warranted further examination during the trial.

Conclusion:
The High Court dismissed the Criminal Revision Petitions, affirming the trial court's decision to proceed with the charges under Sections 132 and 135 of the Customs Act. The court highlighted that the trial court's findings were based on a prima facie assessment of the evidence, and the issues raised by the petitioners would be considered during the trial. The court also directed the trial court to address the issue of sanction for prosecution under Section 132 during the framing of charges.