2021 (6) TMI 586 - HC - Customs

Smuggling - Gold - Electronic goods - baggage rules - specific contention of petitioners is that they wanted to declare the goods before Customs Authority but before they could do so, they were intercepted and apprehended - HELD THAT - The petitioners could have established their defence only by producing the CCTV footage. They have been denied access to this vital piece of evidence. The best evidence was very much available and it was allowed to vanish. The airport authority is a limb of the State. DRI cannot wash away its hands by taking the plea that they have not installed the CCTV and that it is not in their control. When a huge smuggling attempt was busted and when two of the arrested from whom recoveries were made wrote to the Additional Director General, DRI, Chennai that if he verifies the contents of the CCTV footage, their stand will be vindicated, then it was the bounden duty of DRI to have secured the CCTV footage. Since this was not done, adverse inference must necessarily be drawn against them. Where the fundamental right of the noticees to fair adjudication has been violated, adjudication proceedings cannot be allowed to continue for the purpose of determining their guilt - the petitioners' defence has been prejudiced because of the non-production of CCTV footage, the adjudication proceedings initiated against them can be allowed to continue only for the limited purpose of determining whether the goods in question can be allowed to be re-exported or whether they can be cleared on payment of applicable duties. The petitioners are permitted to apply to the jurisdictional passport authority for issuance of duplicate passport and subject to fulfilment of the usual formalities, the jurisdictional passport authority is directed to issue duplicate passport to the petitioners without delay. Petition disposed off.

Issues Involved:
1. Right to fair adjudication and access to evidence.
2. Legality of seizure and treatment of petitioners.
3. Admissibility of evidence and procedural fairness.
4. Interpretation of customs regulations regarding gold and electronic goods.
5. Continuation of adjudication proceedings and potential outcomes.
6. Issuance of duplicate passports amidst pending criminal cases.

Detailed Analysis:

1. Right to Fair Adjudication and Access to Evidence:
The court emphasized that a constitutionally governed democratic state must uphold the rule of law and ensure fair adjudication. The petitioners argued that their right to fair adjudication was infringed as they were denied access to CCTV footage, which was crucial for their defense. The court noted, "Denial of access to such documents may result in prejudice to the noticee in properly defending his or her case."

2. Legality of Seizure and Treatment of Petitioners:
The petitioners claimed they intended to declare the gold and electronic goods but were intercepted and subjected to indignities, including invasive searches. The Directorate of Revenue Intelligence (DRI) countered that the petitioners were intercepted while attempting to smuggle goods without declaring them. The court observed that the exact spot of interception was crucial and stated, "The petitioners could have established their defense only by producing the CCTV footage."

3. Admissibility of Evidence and Procedural Fairness:
The court acknowledged that illegally procured evidence might still be admissible if relevant but emphasized the importance of fair trial principles. It was noted that the petitioners' request for CCTV footage was denied, and the footage was subsequently erased. The court drew an adverse inference against the DRI for not securing the footage, referencing the Supreme Court's observation in Tomaso Bruno and another vs. State of Uttar Pradesh: "If a party in possession of best evidence which will throw light in controversy withholds it, the court can draw an adverse inference against him."

4. Interpretation of Customs Regulations Regarding Gold and Electronic Goods:
The court clarified that gold is not a prohibited item but falls under the regulated/restricted category, and electronic goods are not prohibited. The petitioners did not meet the criteria for eligible passengers under customs notifications as they had not stayed abroad for six months. The court referenced the Division Bench's interpretation in Malabar Diamond Gallery P.Ltd vs. Addl.Dir.General, Directorate of Revenue Intelligence, Chennai, which held that non-compliance with import conditions could lead to confiscation of goods.

5. Continuation of Adjudication Proceedings and Potential Outcomes:
The court allowed the adjudication proceedings to continue only for determining whether the goods could be re-exported or cleared upon payment of applicable duties. The court instructed the concerned authority to pass final orders within four weeks, ensuring the petitioners' participation through video conferencing or in person.

6. Issuance of Duplicate Passports Amidst Pending Criminal Cases:
The petitioners claimed their passports were not returned. The DRI denied seizing the passports. The court permitted the petitioners to apply for duplicate passports, noting that the pendency of a criminal case at the FIR stage is not a ground for denying passport issuance. The jurisdictional passport authority was directed to issue duplicate passports without delay.

Conclusion:
The court concluded that the petitioners' right to fair adjudication was compromised due to the non-production of CCTV footage, and hence, the adjudication proceedings could only continue for limited purposes. The court also facilitated the issuance of duplicate passports to the petitioners, ensuring procedural fairness and adherence to legal principles. The writ petitions were disposed of accordingly, with no costs, and the connected miscellaneous petition was closed.

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