1987 (1) TMI 105 - HC - Customs

Summary

Issues Involved:
1. Legality of the issuance of process against accused No. 7.
2. Sufficiency of evidence against accused No. 7.
3. Application of legal principles regarding criminal conspiracy and culpable mental state.
4. Admissibility and impact of retracted statements under Section 108 of the Customs Act and Section 40 of FERA.
5. Role and liability of an employee in a criminal conspiracy.

Issue-wise Detailed Analysis:

1. Legality of the Issuance of Process Against Accused No. 7:
The learned Magistrate issued a process against all accused based on a prima facie case. Accused No. 7 challenged this order invoking Section 482 of the Code of Criminal Procedure and Article 227 of the Constitution of India, seeking to quash the order and proceedings. The High Court scrutinized the Magistrate's order and found a lack of proper application of mind and inadequate material to support the issuance of process against accused No. 7. The Court emphasized that the order was recorded without sufficient grounds, making it vulnerable and deserving of being set aside.

2. Sufficiency of Evidence Against Accused No. 7:
The prosecution's case against accused No. 7 relied heavily on statements recorded under Section 108 of the Customs Act and Section 40 of FERA, which were retracted. The High Court noted that these statements, even if taken at face value, did not establish accused No. 7's involvement in the conspiracy to export foreign exchange. The Court highlighted that accused No. 7's actions were limited to guarding a suitcase and attending phone calls, which were typical duties of an employee. There was no material to suggest that accused No. 7 had knowledge of or participated in the main conspiracy to export foreign exchange.

3. Application of Legal Principles Regarding Criminal Conspiracy and Culpable Mental State:
The Court reiterated the principles of criminal conspiracy, emphasizing that a common design and intention must be evident among all conspirators. It was found that accused No. 7 was not aware of the common purpose or design to export foreign exchange. The Court also addressed the presumption of culpable mental state under Section 138A of the Customs Act, concluding that such a presumption could not be extended to establish accused No. 7's involvement in the conspiracy to export foreign exchange without tangible material evidence.

4. Admissibility and Impact of Retracted Statements Under Section 108 of the Customs Act and Section 40 of FERA:
The Court acknowledged the admissibility of statements recorded under Section 108 of the Customs Act and Section 40 of FERA but noted that their evidentiary value diminishes when retracted. The statements of co-accused and accused No. 7, even if considered, did not implicate accused No. 7 in the main conspiracy. The Court emphasized that retracted statements require corroboration, which was missing in this case, making them insufficient to proceed against accused No. 7.

5. Role and Liability of an Employee in a Criminal Conspiracy:
Accused No. 7 was an employee of the travel agency associated with accused Nos. 1 and 4. The Court found that his actions were limited to his role as an employee and did not extend to participating in the conspiracy. The Court noted that accused No. 7's duties of guarding a suitcase and attending phone calls did not imply knowledge or involvement in the conspiracy to export foreign exchange. The Court concluded that accused No. 7's role did not elevate him to a conspirator, and his involvement was restricted to the duties assigned by his employer.

Conclusion:
The High Court quashed the proceedings against accused No. 7, setting aside the order of issuance of process. The Court found that there were no sufficient grounds to proceed against accused No. 7, as the evidence did not establish his involvement in the conspiracy to export foreign exchange. The Court emphasized the need for tangible material evidence and proper application of legal principles in issuing process and proceeding with criminal charges.