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TMI Blog1984 (5) TMI 252X X X X Extracts X X X X X X X X Extracts X X X X ..... o the Customs counter for baggage examination and was holding a black rexine handbag. Cursory examination-disclosed concealment of foreign exchange in the brief case held by the 1st appellant. Panchas were called and both of them denied having any Indian currency, foreign currency, gold, silver, diamonds or narcotics concealed in their baggage or on their persons and stated that they had no checked-in-pieces of baggage. The black brief case on examination was found to contain medicines and vitamin tablets and used personal effects of the 1st appellant along with a mirror. The frame of the mirror was found to contain a white paper envelope concealed between the cardboard packing and the mirror. This envelope was found to contain 2000 Swiss Francs (equivalent to ₹ 8,700) and 20000 Deutsche Marks (equivalent to ₹ 76,000). There after, the black brief case was emptied and 10 brown paper packets were revealed from the cavities on each of the 4 sides into which they had been glued. From these packets, the following foreign currencies were recovered : 1. 2300 Deutsche Marks 2. 10500 Deutsche Marks and 3. 85000 Deutsche Marks collectively equivalent to ₹ 3,71,640 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot himself cleared through the Customs. While there was some suspicion against appellant No. 2 regarding his residing in Saudi Arabia and getting continuous correspondence from there, there was nothing specifically on record. He found the possibility of passive collaboration by appellant No. 2 but found the main conspirator to be appellant No. 1. While holding both liable for action under Section 114, the Additional Collector imposed a penalty of ₹ 1 lakh on appellant No. 1 and ₹ 10,000 on appellant No. 2. He exonerated Shri Anil Meghraj Gehi, son of appellant No. 1 and Mrs. Bhagibai J. Ahuja, whose air ticket had been recovered from the residence of appellant No. 1. 3. The following grounds of appeal have been urged on behalf of appellant No. 1 :- (1) The Additional Collector erred in imposing a penalty of ₹ 1 lakh under Section 114. (2) The show cause notice is vague and does not clearly indicate the offence. (3) Foreign currencies are not goods for the purposes of the Customs Act. (4) The Additional Collector erred in holding that the prohibition under Section 13(2) FERA 1973 read with Notification dated 1-1-1974 is prohibition deemed to have bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng to him. He later on contradicted himself by saying that the brief case belonged to a third party. (7) According to the Additional Collector, a third party travelled in the car from the house to the airport and was known neither to the appellant No. 1 nor to Anil Gehi. (8) It is a fundamental principle of jurisprudence that the evidence of a co-accused is not legal evidence, unless corroborated by independent evidence. (9) Shri Gehi admitted possession and carriage of the bag but no contraband was seized from appellant No. 2, whose statement was also accepted, and yet he was adjudged guilty on certain facts regarding alleged activities in Saudi Arabia, which were never disclosed to him for an opportunity to explain. One solitary document could not have led to the conclusion that he was in the habit of carrying on illegal activities. It was not referred to in the show cause notice and ought not to have been used. It was not disputed that the appellant No. 1 had weak eyesight, two toes cut and could not walk properly which proved the personal assistance of Appellant No. 2 who had no reason to doubt that he intended mischief behind his back. (10) It was true that he was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... answered is : whose brief case it was. It does not belong to appellant No. 1 and there is no evidence to show recovery from him. The only basis is the statements of the two co-accused and both contain contradictions. The Collector has drawn certain unwarranted inferences because of minor inconsistencies in the statement of appellant No. 1. He can account for these inconsistencies such as travelling by taxi, but he all along denied ownership of the brief case Counsel also pointed out that appellant No. 2 had written a letter retracting his statement given to the Customs showing that he is untruthful. While some incriminating documents were recovered from his residence, no such recovery was made from the residence of appellant No. 1. In fact, the incriminating letter, which was not made known, was the cause of the High Court releasing his client from preventive detention. He has not been proved to be the main conspirator. He is suffering from Diabetes and other complaints and has been brocken physically and financially. To make him a villain is incredible and the real villain is appellant No. 2. The appellant is also facing action under the Foreign Exchange Regulation Act as well as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rajagopal stated that even if possession of the brief case was fixed on appellant No. 1, there was no conscious possession of the incriminating currency. As regards each of them holding one bag, this is all that is permitted by the Customs and one person cannot carry two handbags. Why he was going abroad is a matter of speculation and it is not established that it was for smuggling. Shri Patel stated that there was no other evidence to show that appellant No. 2 was not accompanying appellant No. 1, only for the purpose of assisting him, since he was sickly and handicapped. 8. The main challenge is the legal one. Section 11, it is contended, confers certain powers on the Central Government to issue prohibitions or restrictions in regard to specified matters which, inter alia, include safeguarding foreign exchange. This section requires issue of a notification and no such notification exists. Consequently, the attempt to export foreign currency does not come within the ambit of the Customs Act. Likewise, under Section 13(1) of the FERA, the Central Govt, has not issued any notification. It is the Reserve Bank which has done so, under Section 13(2). Thus the deeming provision of s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evidence of his co-accused, corroborated in essence by the testimony of his own son and the circumstantial evidence as argued by learned SDR, put the charges against him beyond doubt. The explanation by Counsel for Appellant No. 2 that his letter retracting his statements under Section 108 was of a protective nature, anticipating that action of detention under COFEPOSA would be taken against him, is not also implausible. The only matter to be decided is whether there was in fact a conspiracy between the two appellants, so that they equally share the guilt, or whether appellant No. 2 was only an abettor. There is not a shred of evidence to implicate Appellant No. 2 in regard to direct knowledge, possession, custody, etc. of the incriminating foreign currency except uncorroborated allegations by appellant No. 1. Even in regard to abetment, therefore, whereas there may be serious doubt and suspicion, these cannot substitute for evidence. The alleged letter from Saudi Arabia was neither used in evidence in the proceedings nor produced before us. The disparity in financial status of the two appellants also goes to support the plea of appellant No. 2 that he was going abroad to physical ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sub-section (1) of Section 19 shall be deemed to have been imposed under Section 11 of the Customs Act, 1962 (52 of 1962) and all the provisions of that Act shall have effect accordingly . 16. The head note of this section reads Application of the Customs Act, 1962 . The plain reading of this section makes it clear that the restrictions imposed under Section 13, clause (a) of sub-section (1) of Section 18 and clause (a) of sub-section (1) of Section 19 shall be deemed to have been imposed under Section 11 of the Customs Act. This section confers jurisdiction on the Customs Authorities to deal with the contraventions of Sections 13, 18(1) (a) and 19(1) (a) of the FERA. Since the Customs Authorities have been given exclusive jurisdiction to deal with the contraventions of Sections 13, 18(1) (a) and 19(1) (a) the Officers of the Enforcement Directorate will have no jurisdiction to deal with the contraventions of the aforesaid sections. Investigation, adjudication and prosecution in respect of contraventions of the aforesaid section can be handled only by Customs Department and the same shall have to be done under the provisions of the Customs Act. By reasons of the provision cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ertain currency and bullion . All the restrictions on import and export of certain currency and bullion whether imposed by the Central Government or by the Reserve Bank shall have to be deemed to be the restriction imposed under Section 11 of the Customs Act by reason of the provisions of Section 67 of the FERA. I, therefore, reject this contention of Shri Rajagopal. 18. The contention of Shri Rajagopal that penal provisions of Section 113 of the Customs Act are not applicable to deemed offences under the FERA has also no legs to stand. I have already pointed out the effect of Section 67 of the FERA. It had the effect of making applicable all other provisions of the Customs Act to deal with the contraventions of Sections 13, 18(1) (a) and 19 (1) (a) of the FERA. It may be stated here that the present appeal itself is under the Customs Act and not under the FERA. 19. Considering all aspects I hold that the legal contentions raised by Shri Rajagopal are not sound and the same are rejected. 20. In the result and also for the reasons stated by my learned brother Shri D Souza I dismiss appeal No. 255 of 1983 filed by Shri Meghraj Gordh-andas Gehi and allow appeal No. 664 of 198 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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