2024 (6) TMI 637 - HC - Customs

Application for pre-arrest bail - clandestine removal of goods from a public bonded warehouse - Section 135 of the Customs Act, 1962 - HELD THAT - Prima facie, there is ample material to show the complicity of the applicant. It is true, at this stage the material against the applicant is primarily in the form of the statements of the co-accused. It is also true that the statements recorded under section 108, cannot be taken as a gospel truth and accepted at par without corroboration. However, the stage of the proceeding cannot be lost site of. At this stage, the Investigating Agency may take lead from the statements of the co-accused. In the case at hand, the statements of the co-accused, recorded under section 108, are clear, categorical, and, prima facie, incriminate the applicant as the person who floated and executed the plan to defraud the revenue. In the case at hand, there is a very strong prima facie case against the applicant. It is a case of economic offence which has the propensity to affect the economic fabric of the society. Proper investigation is, therefore, necessary to unearth the fraud, unmask the identity of the persons who are privy to the fraud and evasion of customs duty and have the trail of clandestinely removed goods. In the case at hand, having regard to the material pressed into service against the applicant, which prima facie indicates that the applicant is the key conspirator, the grant of bail to the applicant will prejudicially affect the purpose of effective investigation. Application dismissed.

Issues involved: Application for pre-arrest bail in connection with an offence u/s 135 of the Customs Act, 1962 based on alleged clandestine removal of goods from a public bonded warehouse.

Summary:
1. The Directorate of Revenue Intelligence (DRI) received intelligence about goods being clandestinely removed from a public warehouse, leading to an investigation revealing the removal of Areca Nuts / Betel Nuts worth Rs. 56,77,03,316 from Akshay Logistics Warehouse.

2. The applicant was alleged to be the mastermind behind the conspiracy, as per statements of co-accused recorded u/s 108 of the Act. The applicant approached the Court seeking pre-arrest bail after the rejection of the application by the Additional Sessions Judge.

3. The applicant's counsel argued that the complicity cannot be sustained solely based on the co-accused statements and emphasized the lack of material evidence against the applicant. Previous court decisions granting pre-arrest bail in similar cases were cited to support the application.

4. The Respondent, representing DRI, contended that the applicant was the key conspirator in the scheme to evade customs duty and that custodial interrogation was necessary to establish the full extent of involvement.

5. The Court analyzed the statements of the co-accused, which implicated the applicant as the central figure in the plan to defraud the revenue. Prima facie evidence suggested the applicant's involvement in the conspiracy to remove goods from the warehouse without payment of customs duty.

6. Considering the strong prima facie case against the applicant in an economic offence, the Court refused to grant pre-arrest bail, emphasizing the need for effective investigation to uncover the fraud and identify all involved parties.

7. Citing previous legal precedents and the potential impact of anticipatory bail on investigations, the Court concluded that granting bail to the applicant could hinder the investigative process and therefore rejected the application for pre-arrest bail.

Judgment: The application for pre-arrest bail was rejected, and the interim protection granted earlier was vacated. The Court clarified that its observations were solely for bail determination and should not influence the trial court's decision on the guilt of the applicant.

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