2016 (4) TMI 607 - AT - Customs

Whether guilty of fraud - Export of red sander, prohibited goods - Mis-declaration as gypsum board - Held that - evidence gathered under section 108 of the Customs Act, 1962 is not from an accused or accused person. The words accused or accused person is used only in a generic sense in law. Recording of the proceeding by customs being pre-accusation stage that is not extracted from an accused. Therefore, customs officer is not a police officer as is defined under Evidence Act and Code of Criminal Procedure. Accordingly, appellant s plea that the exculpatory statement of the appellant has credence in evidences does not sound well when he had pre-meditated design to commit fraud against Revenue. The statement made by Alexander inculpating the appellant could be used against him as substantive evidence following the ratio laid down by the Hon ble Supreme Court in the case of Naresh J Sukhawani Vs. Union of India 1995 (11) TMI 106 - SUPREME COURT OF INDIA . The 108 statement resulted in confiscation of the red sanders discovered from the cavity on the gypsum boards was sufficient a proof which could be instrumental to trace the appellant. It is also settled principle of law that even if the confession is retracted the time within which such retraction has been made and the veracity of the retraction play a vital role for believability thereof. Confession binds the author and against whom the deposition has been made. The contravention of law and the offence committed in the organized manner was under absolute secrecy which was proved from the discovery of red sander from the cavity made in the gypsum board to hide the same. If the appellant is granted any leniency, that shall be bonus to smuggling. So also unchecked smuggling when upsets the economy, appellant fails to deserve any leniency. All these can be said following the principles of law laid down in the case of KI Pahavunny Vs. Assistant Collector (HQ), CX, Collectorate of Cochin 1997 (2) TMI 97 - SUPREME COURT OF INDIA . The evidence on record having probative value it is the objective evaluation thereof applying relevant test, finding has been reached. There is neither any surmise nor suspicion that can be attributed to investigation. They made their story very successful. No fancible reason has been assigned by them. The issue germane from the root of the matter and has been well tested by the investigation. Reason being soul of the law they have tried to establish the truth of the clandestine deal by a detailed investigation. Man may be prone to speak falsehood but circumstantial evidence will not. Falsity are routed from man s proclivity. Flattering when it is tested on the anvil of the circumstantial evidence, truth trans and scanning evidence going through the reasoning of the learned adjudicating authority it imbibes a feeling that investigation result is not false. Therefore, evidence gathered by Revenue unambiguously proved that the appellant was contributory to the fraud committed against customs. It is established principle of law that fraud and justice are sworn enemies. The smuggling racket perpetuated smuggling for many years in the past as is revealed from their conduct. - Decided against the appellant

Issues Involved:
1. Validity of the retracted confessions.
2. Involvement of the appellant in the attempted export of prohibited goods (red sanders).
3. Credibility and corroboration of the co-accused’s statements.
4. Application of legal principles and precedents.

Detailed Analysis:

1. Validity of the retracted confessions:
The Hon’ble High Court of Madras remanded the case to the Tribunal, directing it to consider the factual aspects and recent decisions of the Apex Court. The High Court emphasized that the appellate authority had not considered the retracted confessions and thus the previous order was not factually and legally sustainable. The Tribunal was instructed to evaluate the evidentiary value of the co-accused’s statements and the appellant’s exculpatory statements.

2. Involvement of the appellant in the attempted export of prohibited goods (red sanders):
The investigation revealed that John Alexander, proprietor of M/s Freedom Impex, attempted to export red sanders concealed in gypsum boards to Malaysia. The appellant, Manivannan, was alleged to have supplied these red sanders. The investigation found that 1500 pieces of red sanders were hidden in 94 packages of gypsum boards and were seized by the Customs officers. The adjudicating authority found that the appellant was involved in the smuggling of red sanders and imposed penalties under Section 114 of the Customs Act, 1962.

3. Credibility and corroboration of the co-accused’s statements:
The appellant argued that the statements of John Alexander were made under duress and lacked corroboration. The Tribunal noted that John Alexander’s statements were consistent and corroborated by other evidence, such as the seizure of red sanders and the appellant’s involvement in arranging the export. The Tribunal emphasized that the statements were recorded in the presence of independent witnesses and were not retracted before the Magistrate, thus holding credibility.

4. Application of legal principles and precedents:
The Tribunal considered various legal precedents cited by the appellant, including the need for corroboration of accomplice evidence and the credibility of statements recorded under duress. However, the Tribunal found that the circumstantial evidence and the consistent statements of John Alexander provided sufficient corroboration. The Tribunal referenced several judgments, including Naresh J. Sukhawani Vs. Union of India, to support the admissibility of the statements and the credibility of the evidence gathered under Section 108 of the Customs Act, 1962.

Conclusion:
The Tribunal concluded that the appellant’s involvement in the smuggling of red sanders was established through credible and corroborative evidence. The statements of John Alexander, corroborated by the seizure of red sanders and other circumstantial evidence, proved the appellant’s complicity. The Tribunal dismissed the appeal, upholding the penalties imposed under Section 114 of the Customs Act, 1962, for the attempted export of prohibited goods. The judgment emphasized that fraud and justice are sworn enemies and that leniency in such cases would be detrimental to the enforcement of customs laws.

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