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Issues Involved:
1. Jurisdiction of the Magistrate under Section 437 of the Code of Criminal Procedure. 2. Allegations of forged vouchers and bogus transactions. 3. Necessity of custody for investigation. 4. Apprehension of tampering with evidence. 5. Conditions for granting bail. Detailed Analysis: 1. Jurisdiction of the Magistrate under Section 437 of the Code of Criminal Procedure: The court examined whether the Magistrate had jurisdiction to entertain bail applications under Section 437 of the Code of Criminal Procedure, particularly for offenses punishable with imprisonment for life or for a lesser term. The petitioners argued that the Magistrate could entertain bail applications since none of the offenses were punishable with death. The Magistrate, however, had rejected the bail applications, believing he lacked jurisdiction due to the terminology used in Section 437. The court noted the need for serious examination and consideration of this interpretation, but since the petitioners were being granted bail by the High Court, the issue became more academic and was not conclusively decided in this proceeding. 2. Allegations of Forged Vouchers and Bogus Transactions: The petitioners, who run jewelry shops, were accused of creating false vouchers to show that gold ornaments were purchased from fictitious customers. The Department alleged that these vouchers were forged to camouflage the actual sources of gold. Summons issued to the purported customers revealed that many addresses were either incomplete or the persons were non-existent. The Department argued that the vouchers were bogus, and the transactions were fabricated to cover up the true sources of gold. 3. Necessity of Custody for Investigation: The Department contended that the custody of the petitioners was necessary to investigate the alleged conspiracy and to tap the sources from where the gold was obtained. They argued that without contacting the purported customers in flesh and blood, the investigation would remain incomplete. However, the court found that the Department had already had sufficient time to investigate and had not made significant progress. The court noted that the registers and documents had been in the Department's possession since September 1988, and further custody of the petitioners was not justified. 4. Apprehension of Tampering with Evidence: The Department expressed concerns that the petitioners might tamper with evidence if released on bail. However, the court found these allegations to be vague and unsubstantiated. The court reasoned that if the persons mentioned in the vouchers were non-existent, there would be no question of tampering with such evidence. Moreover, the court noted that the documents were already in the Department's possession, reducing the risk of tampering. The court also observed that even if some persons had been contacted and had not supported the defense, this indicated that there was no tampering. 5. Conditions for Granting Bail: The court decided to grant bail to the petitioners, emphasizing that this decision did not undermine the seriousness of the allegations. The court imposed conditions to protect the Department's interests: - Each petitioner was required to present themselves before the Gold Control Officer daily for two weeks and thereafter as required. - The petitioners were not allowed to leave the metropolis for one month without prior permission. - The petitioners were prohibited from tampering with evidence. - The Department was given the liberty to seek cancellation of bail if it was abused. Conclusion: The court allowed the petitions and granted bail to the petitioners, each in the sum of Rs. 1,00,000/- with one surety for the like amount, or two sureties of Rs. 50,000/- each. The court emphasized that the observations made were restricted to the bail application and did not reflect on the merits of the case, which would be decided at trial.
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