2024 (12) TMI 1324 - HC - Customs

Cancellation of bail application - smuggling of high value goods such as precious metal, restricted items or prohibited items or goods notified under Section 123 of the Customs Act, 1962 - It is contended that the Court below misconstrued the circular No.13/2022 dated 16.08.2022 and enlarged the respondents on bail - HELD THAT - This fact is not denied that complaint has yet not been filed against the respondents for prosecuting them under Section 135 (2) (a) (b) of the Customs Act. It is not desirable to express anything on the merits of the case. The respondents have not breached any conditions incorporated in the bail order, the maximum punishment awarded under the Customs Act 7 years. Therefore, considering the above aspects, this Court is not inclined to entertain the application filed by the Union of India. These instant bail cancellation applications are hereby dismissed.

1. ISSUES PRESENTED and CONSIDERED

The legal judgment primarily revolves around the following core issues:

Whether the bail granted to the accused-respondents under Section 135(1)(a)(b) of the Customs Act should be canceled under Section 439(2) of the Cr.P.C.
Whether the lower court erred in interpreting circular No.13/2022 dated 16.08.2022, particularly Clause 2.3(b), and granting bail to the respondents.
Whether the evidence presented, including the value of the seized gold and the statements under Section 108 of the Customs Act, justify the arrest and denial of bail.
Whether the absence of a filed complaint against the respondents impacts the decision to cancel bail.

2. ISSUE-WISE DETAILED ANALYSIS

Issue 1: Bail Cancellation under Section 439(2) of Cr.P.C.

Relevant Legal Framework and Precedents: Section 439(2) of the Cr.P.C. allows for the cancellation of bail if certain conditions are met. The Customs Act, particularly Section 135(1)(a)(b), outlines offenses related to smuggling.
Court's Interpretation and Reasoning: The court considered whether the conditions for bail cancellation were met, focusing on whether the respondents breached any bail conditions or if there was a substantial reason to revoke bail.
Key Evidence and Findings: The court noted that no complaint had been filed against the respondents, and they had not breached any conditions of their bail.
Application of Law to Facts: The court applied the principles of bail cancellation, noting the absence of a filed complaint and the respondents' compliance with bail conditions.
Treatment of Competing Arguments: The petitioners argued for bail cancellation based on the severity of the offense and the alleged smuggling activities. The respondents countered that no complaint was filed, and they complied with bail conditions.
Conclusions: The court concluded that the conditions for bail cancellation were not met and dismissed the application for bail cancellation.

Issue 2: Interpretation of Circular No.13/2022 and Clause 2.3(b)

Relevant Legal Framework and Precedents: Circular No.13/2022 outlines guidelines for arrest in smuggling cases, particularly Clause 2.3(b), which pertains to high-value smuggling cases.
Court's Interpretation and Reasoning: The court examined whether the lower court correctly applied the circular's provisions, especially regarding the value of the seized gold.
Key Evidence and Findings: The market value of the seized gold was Rs. 1,31,10,350/-, which the petitioners argued fell under Clause 2.3(b).
Application of Law to Facts: The court considered whether the circular's provisions were applicable, given the value of the gold and the nature of the offense.
Treatment of Competing Arguments: The petitioners claimed the lower court misapplied the circular, while the respondents argued the circular did not mandate arrest in their case.
Conclusions: The court did not find sufficient grounds to overturn the lower court's interpretation of the circular.

Issue 3: Evidence Justifying Arrest and Bail Denial

Relevant Legal Framework and Precedents: Section 108 of the Customs Act allows for statements to be recorded, which can be used as evidence in smuggling cases.
Court's Interpretation and Reasoning: The court assessed the reliability and corroboration of statements made under Section 108 and the evidence of communication between the accused.
Key Evidence and Findings: Statements indicated the roles of the respondents in smuggling activities, but no gold was found with some respondents.
Application of Law to Facts: The court evaluated whether the evidence presented was sufficient to justify arrest and bail denial.
Treatment of Competing Arguments: The petitioners emphasized the corroborated statements, while the respondents highlighted the lack of physical evidence against some accused.
Conclusions: The court found the evidence insufficient to warrant bail cancellation, given the lack of a formal complaint and the respondents' compliance with bail conditions.

Issue 4: Impact of Absence of Filed Complaint

Relevant Legal Framework and Precedents: The absence of a filed complaint can affect bail considerations and the urgency of legal proceedings.
Court's Interpretation and Reasoning: The court noted the absence of a complaint as a significant factor in its decision not to cancel bail.
Key Evidence and Findings: The court acknowledged that no complaint had been filed against the respondents.
Application of Law to Facts: The court applied the principle that the absence of a complaint diminishes the justification for immediate bail cancellation.
Treatment of Competing Arguments: The petitioners argued that the seriousness of the offense warranted bail cancellation, while the respondents emphasized the lack of a formal complaint.
Conclusions: The court concluded that the absence of a complaint weighed against bail cancellation.

3. SIGNIFICANT HOLDINGS

Preserve Verbatim Quotes of Crucial Legal Reasoning: "The respondents have not breached any conditions incorporated in the bail order, the maximum punishment awarded under the Customs Act is 7 years."
Core Principles Established: The absence of a filed complaint and compliance with bail conditions are critical factors against bail cancellation.
Final Determinations on Each Issue: The court dismissed the bail cancellation applications, upholding the lower court's decision to grant bail.