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TMI Blog2023 (9) TMI 1561X X X X Extracts X X X X X X X X Extracts X X X X ..... ents etc., the officers of the Directorate of Enforcement exercise the same powers which are conferred on Income-tax authorities under the Income-tax Act, 1961. The above legal position, in our view, creates a strong presumption in favour of the respondent Directorate's case which is built on the foundation of documents seized during search and seizure operation. The appellant on the other hand, has not placed any material before us to rebut the documentary evidence gathered during the search operation. It is also extremely significant to note in the instant case that in his subsequent statement recorded 11 days after the original statement, he not only confirmed as true the contents of his earlier statement dated 10/01/2003, but also explained certain other seized documents and explained the modus operandi adopted for receipt of money from abroad and its distribution to the ultimate beneficiaries in India. In his statement the appellant admitted that he had noted down the details of the beneficiaries on pieces of paper which he had later destroyed. However, some sheets of paper were retained which contained details of amounts, dates, names etc.. The names and telephone numbers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his statement on oath recorded on 10/01/2003, the appellant admitted that his brother-in-law Mr. Imtiyaz Ahmed who lives in Dubai and whose phone number in Dubai is 2286263 had in a telephone conversation sometime in August-September, 2002 informed him that he (Imtiyaz) was doing the garment business and business of collecting UAE Dirhams from NRIs in Dubai and sending the money in Indian Rupees to their relatives in India, and that if the appellant assists him by receiving the amounts in Indian Rupees in India and distributing the same to various persons in India as per his instructions, he (Imtiyaz) would pay the appellant a commission of Rs. 150 per Rs. 1,00,000 received and distributed by him. The appellant also admitted in the aforesaid statement on oath that in view of the critical financial position he was in, he agreed to assist Mr. Imtiyaz in the said business. 3. After a month, i.e., sometime in October, 2002 his brother-in-law (Imtiyaz) spoke to him again from Dubai at his residential phone number 573528, and informed him that he would be arranging to send various amounts in Indian Rupees in the appellant's name and that some persons in India would contact him and d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re in the handwriting of his wife, Mrs. Afroz Begum, and she has written the same as dictated by him. That Sheet No. 12 contains the names and phone numbers of some of the persons to whom he has made payments as per the instructions of Mr. Imtiyaz of Dubai. That the figures found in the documents were written in short, e.g., in Sheet No. 2, Rs. 2,00,000 had been written as Rs. 200. That he had received payments totaling in all to Rs. 2,69,82,000/-as per the instructions of Mr. Imtiyaz and made payments totaling in all to Rs. 2,69,36,000/-. The difference of Rs. 46,000/- was utilized by him. 6. A further statement of the appellant was also recorded on 21/01/2003 wherein the appellant confirmed as true whatever he had stated in his earlier statement dated 10/01/2003 and also explained certain other seized documents and explained the modus operandi adopted for receipt of money from abroad and distribution thereof in cash to the ultimate beneficiaries in India. He admitted that as instructed by Imtiyaz of Dubai he had noted down the telephone numbers and names of the persons to whom he had delivered the amount at Sheet No. 12. As per the same, he had recently made a total payment of Rs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ident outside India, and his actual residential status had not been ascertained. Accordingly, the appellant prayed before the Special Director that the proceedings against him may be dropped. 10. Having considered the material before him and contentions raised by the appellant, the learned Special Director observed that the statements relied upon by the Directorate were supported by the documents recovered from the residence of the appellant. He also pointed out that some of the recipients whose names figured on the seized documents were examined on the basis of the information obtained from the Mangalore telephone authorities and they had admitted to having received the payments under instructions from abroad. The order of the learned Special Director, on pages 18 and 19, provides a detailed table containing the names and addresses of 14 of the recipients whose corroborative statements were recorded, the nature of investigation carried out, and the details of the amount, the date/period during which the same had been paid to the recipients and the corresponding documentary evidence. The learned Special Director has further noted that the second statement of the appellant, which wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecorded that it appears that in the present appeal and in two other appeals (unrelated to the present case), a draft order was proposed by the Chairperson Shri O.P. Nahar and a dissenting opinion was given by the Member. Having considered the facts on record, she was of the view that it would be appropriate to constitute a full bench of the Tribunal to decide the matters. It appears that at this stage the appellant carried the matter to the Hon'ble High Court by way of a writ. The Hon'ble Delhi High Court finally disposed of the matter vide its order dated 9th August 2019, wherein it has observed as below: 5. A plain reading of the order dated 26-8-2009 passed by the Chairperson indicates that it is a detailed order. The certified copy of the said order, which is placed on record, also indicates that the said order was signed, although the signatures of the Chairperson have been masked. Similarly the certified copy of the order dated 5-1-2010 passed by the learned member of the Tribunal also indicates that the same was signed. More importantly, the petitioner had obtained certified copies of the said orders, which form a part of the record. 6. In view of the above, it is di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to inspect the record and, thereafter, apply for certified copies of the same. Directions were also issued to the registry to facilitate for inspection of the case record in the presence of the Registrar on a date to be fixed by him. 16. The case was finally heard on 3rd August 2023. At the outset, the learned counsel for the Appellant submitted that the records are in an illegible condition. With regard to retraction his statements by the appellant, he has submitted that the response filed by the Appellant before the Adjudicating Authority amounts to a retraction. Regardless of this, he submits that the basic facts to establish the charge were not present in the case. The entire case rests on the premise that money has come from abroad. However, neither the existence nor the whereabouts of Imtiyaz who is alleged to be the sender have been verified. Neither his location nor the telephone number which is claimed to have been his number were verified. The ultimate beneficiaries of the amounts never knew any Imtiyaz. Moreover, the said ultimate beneficiaries of the remittances, were also not proceeded against. He submits that the relevant provision of FEMA,1999, namely, section 3(c), ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icle or thing are or is found in the possession or control of any person in the course of a search, it may be presumed (i) that such books of account, other documents, money, bullion, jewellery or other valuable article or thing belong or belongs to such person; (ii) that the contents of such books of account and other documents are true; and (iii) that the signature and every other part of such books of account and other documents which purport to be in the handwriting of any particular person or which may reasonably be assumed to have been signed by, or to be in the handwriting of, any particular person, are in that person's handwriting, and in the case of a document stamped, executed or attested, that it was duly stamped and executed or attested by the person by whom it purports to have been so executed or attested. By virtue of section 37(3) of FEMA, 1999, in the matter of search and seizure, issue of summonses and recording or statements etc., the officers of the Directorate of Enforcement exercise the same powers which are conferred on Income-tax authorities under the Income-tax Act, 1961. The above legal position, in our view, creates a strong presumption in favour of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... kh had been made and whose telephone number was 212318. 23. Based on the information gathered from the sheets of paper and from the further explanation the directorate located 14 of the recipients and recorded their statements. They too confirmed receipt of amounts on instructions from abroad. 24. It is also very significant to note that the appellant admitted that entries in the sheets of paper were in the handwriting of his wife, a fact which has not been denied by either the appellant or his wife. 25. As against the volume of evidence marshalled and brought on record by the respondent Directorate as discussed in detail above, the respondent's challenge against the impugned order imposing penalty rests solely on the so-called retraction of his earlier statements, and the fact that the identity and phone number of the appellant's brother-in-law, Imtiyaz, had not been independently verified by the Directorate. Even a copy of the said retraction could not be produced by the learned counsel for the appellant despite being provided with ample opportunity to do so, and even after being afforded the opportunity to inspect the original records of the case obtained from the respon ..... X X X X Extracts X X X X X X X X Extracts X X X X
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