1961 (8) TMI 64 - HC - Indian Laws

Summary

Issues Involved:
1. Conviction under Section 167(81) of the Sea Customs Act.
2. Credibility of the prosecution's evidence.
3. Non-production of the first General Diary (G.D.) entry.
4. Explanation for possession of a large sum of money.
5. Interpretation of Section 167(81) of the Sea Customs Act.
6. Applicability of the presumption under Section 178A of the Sea Customs Act.
7. Definition and proof of "smuggled goods."
8. Requirement of mens rea under Section 167(81) of the Sea Customs Act.
9. Sufficiency of evidence to convict for smuggling.

Detailed Analysis:

1. Conviction under Section 167(81) of the Sea Customs Act:
The appellants, Sitaram Agarwalla and Wang Chih Kaw, were convicted under Section 167(81) of the Sea Customs Act. Sitaram Agarwalla was fined Rs. 2000 and sentenced to six months of rigorous imprisonment in default, while Wang Chih Kaw was sentenced to three months of rigorous imprisonment and fined Rs. 1000, with an additional three months in default.

2. Credibility of the prosecution's evidence:
The prosecution's case was based on the testimony of constable Ram Sevak Ojha, who followed the accused and witnessed their activities. The constable's evidence was partially corroborated by three young men who helped in apprehending the accused. Despite minor discrepancies, the court found no reason to disbelieve the constable's account.

3. Non-production of the first General Diary (G.D.) entry:
The defense argued that the non-production of the first G.D. entry should lead to an adverse inference against the prosecution. However, the court held that despite this non-production, the evidence of the constable, corroborated by the later G.D. entry and the young men's testimonies, was credible.

4. Explanation for possession of a large sum of money:
Sitaram Agarwalla attempted to explain the possession of Rs. 49,320 through the testimonies of his maternal uncle and father-in-law. The court found these explanations unconvincing and inferred that the money was intended for purchasing smuggled gold.

5. Interpretation of Section 167(81) of the Sea Customs Act:
The court examined whether merely attempting to purchase smuggled gold constituted "dealing with" smuggled goods under Section 167(81). It concluded that an uncompleted purchase attempt did not fall within the scope of the section, as the appellant did not gain control over the smuggled gold.

6. Applicability of the presumption under Section 178A of the Sea Customs Act:
The court noted that the presumption under Section 178A, which shifts the burden of proof to the person in possession of smuggled goods, did not apply because the gold was seized by police officers, not customs officers.

7. Definition and proof of "smuggled goods":
The term "smuggled goods" was interpreted as goods imported clandestinely to evade customs duty or legal restrictions. The evidence showed that the gold bars had Chinese inscriptions and were possessed by a Chinese individual who did not have a permit for their import, indicating they were smuggled.

8. Requirement of mens rea under Section 167(81) of the Sea Customs Act:
The court emphasized that Section 167(81) required proof of intent to defraud the government or evade restrictions. It held that mere possession of smuggled goods, without evidence of involvement in their import, did not meet this requirement.

9. Sufficiency of evidence to convict for smuggling:
The court found insufficient evidence to prove that Wang Chih Kaw actively participated in smuggling the gold. The evidence only showed possession and an attempt to sell the gold surreptitiously, which was not enough to establish the required mens rea.

Conclusion:
Both appeals were allowed, and the convictions under Section 167(81) of the Sea Customs Act were set aside. The fines paid were ordered to be refunded, and the money seized from Sitaram Agarwalla was to be returned unless otherwise ordered by a competent court.