1969 (3) TMI 30 - SC - Customs

Whether Customs duty was leviable on imports and exports by air? Whether a fraudulent evasion of the duty was punishable under Section 167(81)? Held that - We do not think it necessary to express any opinion on these questions having regard to our conclusion that a fraudulent evasion of the restriction imposed by Section 8(1) of the Foreign Exchange Regulation Act 1947 was punishable under Section 167(81). The Courts rightly held that there was a single general conspiracy embracing all the activities. Pedro had a share in the profits of the smuggling from Geneva. He got also a share of Yusuf s profits from the smuggling of the Middle East gold. Apparently Shuhaibar brothers and Lori had no share in the profits from the smuggling of the Geneva gold but they attached themselves to the general conspiracy originally devised by Yusuf and Pedro with knowledge of its scheme and purpose and took advantage of its existing organisation for obtaining finances from Kochra and Rabiyabai and for remittances of funds by Yusuf. Each conspirator profited from the general scheme and each one of them played his own part in the general conspiracy. The privilege was not properly claimed under Section 124. It is difficult to say that the other cable addresses and cables were communications to a public officer in official confidence. However we find that the other addresses and cables were required in connection with investigations unconnected with the present case and did not relate to any person or persons concerned in the offences for which the appellants were being tried. The other cables and cable addresses were not relevant to the defence and their non-disclosure has not occasioned any failure of justice. The defence did not produce any letter from Pedro or any other material indicating that he was willing to be examined on commission. Even his address was not given. The Court could not issue a roving commission to a Court or authority either in Switzerland or in United Kingdom or in Pakistan. The application was not made in good faith and was liable to be rejected on this ground alone. There was no affidavit from Ali nor was there any other material showing that his testimony was incorrect in any material particular. The Court has inherent power to recall a witness if it is satisfied that he is prepared to give evidence which is materially different from what he had given at the trial. In this case there was no material upon which the Court could be so satisfied. The learned Magistrate rightly disallowed the prayer for recalling Ali. Criminal Appeal No. 140 of 1966 is allowed and Maganlal Naranji Patel is acquitted of all the charges. Criminal Appeal No. 141 of 1966 is also allowed and N.B. Mukherjee is acquitted of all the charges.Criminal Appeal Nos. 139 of 1966 142 of 1966 143 of 1966 and 144 of 1966 are allowed in part and we direct that all the sentences passed on the appellants will run concurrently.

Issues Involved:
1. Whether the import of gold in contravention of Section 8(1) of the Foreign Exchange Regulation Act, 1947 was punishable under Section 167(81) of the Sea Customs Act, 1878.
2. Whether the prosecution established the general conspiracy laid in charge No. 1.
3. Whether the learned Magistrate wrongly allowed a claim of privilege in respect of the disclosure of certain addresses and cables and if so, with what effect.
4. Whether the Magistrate wrongly refused to issue a commission for the examination of Pedro Fernandez.
5. Whether the Magistrate wrongly refused to recall PW 50 Ali for cross-examination.

Detailed Analysis:

1. Punishability under Section 167(81) of the Sea Customs Act, 1878:
The court clarified that the import of gold in contravention of Section 8(1) of the Foreign Exchange Regulation Act, 1947, was indeed punishable under Section 167(81) of the Sea Customs Act, 1878. The notification dated August 25, 1948, under Section 8(1) restricted the bringing of gold into India without the Reserve Bank's permission. Section 23A of the Act created a fiction that the restriction was imposed under Section 19 of the Sea Customs Act, 1878, thus attracting all provisions of the Sea Customs Act, including Section 167(81). The court also noted that the statutory fiction did not limit the application of the notification to imports by sea and land only, thus covering imports by air as well.

2. Establishment of General Conspiracy:
The court found that there was a single general conspiracy to smuggle gold into India from foreign countries. The scheme involved multiple individuals and phases but was part of a unified effort to achieve a common illegal purpose. The court distinguished this from separate conspiracies, emphasizing that the continuous smuggling activities from Geneva and the Middle East were different phases of the same conspiracy. The court rejected the argument that there were separate conspiracies for gold smuggling from Geneva and the Middle East.

3. Claim of Privilege on Disclosure of Addresses and Cables:
The court found that the privilege claimed under Section 124 of the Evidence Act was not properly invoked. The other cable addresses and cables were not communications to a public officer in official confidence. However, since these addresses and cables were related to investigations unconnected with the present case and did not concern any of the accused, their non-disclosure did not result in a failure of justice.

4. Refusal to Issue Commission for Examination of Pedro Fernandez:
The court upheld the Magistrate's decision to reject the application for issuing a commission to examine Pedro Fernandez. The application lacked proper grounds and did not provide sufficient particulars, such as Pedro's willingness to be examined or his address. The court concluded that the application was not made in good faith and was rightly rejected.

5. Refusal to Recall PW 50 Ali for Cross-examination:
The court found no grounds for recalling PW 50 Ali for cross-examination. The defense's claim that Ali was repentant and wanted to admit to giving false evidence was unsupported by any affidavit or material. The court noted that it has the inherent power to recall a witness if satisfied that the witness's testimony would be materially different, but no such satisfaction was reached in this case.

Individual Cases:

Accused No. 8 Mohamed Hussain Umar Kochra:
The court found sufficient corroboration of Yusuf Merchant's testimony implicating Kochra. Evidence showed that Kochra's telegraphic address "Nazneen" was used for receiving cables related to gold smuggling. The court upheld Kochra's conviction.

Accused No. 12 Maganlal Naranji Patel:
The court found that PW 69 Mohamed Rafique, who testified against Maganlal, was an accomplice. Since Rafique's evidence could not be used to corroborate the testimonies of other accomplices, and there was no independent corroboration, the court acquitted Maganlal of all charges.

Accused No. 16 N.B. Mukherjee:
The court found no independent corroboration of the accomplice testimonies implicating Mukherjee. The letters and documents presented did not sufficiently connect Mukherjee to the crime. The court acquitted Mukherjee of all charges.

Accused No. 15 N.S. Rao:
The court found sufficient independent corroboration of Yusuf's testimony implicating Rao. The court upheld Rao's conviction.

Accused No. 14 Parasuram T. Kanel:
The court found sufficient independent corroboration of the accomplice evidence implicating Kanel. The court upheld Kanel's conviction.

Accused No. 6 Lakshmandas Chhaganlal Bhatia:
The court found sufficient corroboration of Yusuf's testimony implicating Lakshmandas. Evidence showed that Lakshmandas registered the telegraphic address "Subhat" for smuggling activities. The court upheld Lakshmandas's conviction.

Sentencing:
The court noted that while the sentences passed by the lower courts were legal, considering the prolonged trial and the fact that the ringleaders escaped punishment, it directed that all sentences should run concurrently.

Conclusion:
Criminal Appeal Nos. 140 of 1966 and 141 of 1966 were allowed, acquitting Maganlal Naranji Patel and N.B. Mukherjee of all charges. Criminal Appeal Nos. 139, 142, 143, and 144 of 1966 were allowed in part, directing that all sentences run concurrently while dismissing the appeals in other respects.

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