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2010 DIGILAW 4311 (MAD)

Chief Enforcement Officer v. N. P. Haroun Rasheed

2010-09-24

G.M.AKBAR ALI

body2010
JUDGMENT (1) THE appeal against the order of acquittal by the learned Additional Chief Judicial Magistrate, Medurai passed in CC No. 9 of 2002 dated 16-2-2003. (2) THE complainant is the appellant. A private complaint was filed by the appellant, who is the Chief Enforcement Officer of Enforcement Directorate, against the sole accused/respondent for the following alleged offences. The respondent was practising as a Chartered Accountant at Madurai having his Office at 12-A, Rathnasamy Nadar Road, Sekizhar Road, BB Kulam, Madurai. In 1990, one Syed Moosammil, S/o Abu Thahir met the respondent and informed him that he is employed at Saudi Arabia and proposed that he will collect money from the persons employed in Gulf countries who intend to send money to their families in India and he requested the appellant to receive the money in India and re-distribute to those persons on his instructions. The appellant agreed and between 1990 and 1996 the said Moosammil sent money to the respondent to be distributed to various persons and thereafter, one Kajali the brother-in-law of Moosammil, continued to engage the respondent for the illegal money transaction. (3) THE respondent had distributed more than Rs. 1.5 crores on the instruction of the said Moosammil and Kajili. On information, P.W. 1, Chief Enforcement Officer, Madurai, searched the official premises of the respondent. On 2-7-1997 on the strength of the search warrant found that the respondent was in possession of Rs. 9,00,000/-, for which, he had no accounts or explanation. THE enforcement officer also searched the residence of the respondent and seized one telephone index book and Apex Note Book and a brown colour eagle diary of 1996. THE respondent was requested to appear before the enforcement officer and on 2-9-1997 and again on 6-10-97 and again on 10-11-1997, he gave various statements under Sec. 40 of FERA (Foreign Exchange Regulation Act). THE 1st respondent confessed that he was doing the Hawala business and was receiving lakhs of rupees from Moosammil and Kajali and was distributing the same to various persons in India. He also confessed that only on 1-9-1997 he received Rs. 9,00,000/- from the said Kajali and was waiting for the instructions to distribute the same. (4) THE Enforcement Officer arrested the respondent and he also searched one Paris Tex and Paris Apparels where he has found nothing incriminating. He also confessed that only on 1-9-1997 he received Rs. 9,00,000/- from the said Kajali and was waiting for the instructions to distribute the same. (4) THE Enforcement Officer arrested the respondent and he also searched one Paris Tex and Paris Apparels where he has found nothing incriminating. The enforcement officer also enquired the owner and the employees of the public telephone booth from where the respondent used to make overseas phone calls and on examination of other witnesses and on seizure of various documents laid a private complaint before the learned Chief Judicial Magistrate for receipt and distribution of Rs. 1,66,00,000/- from the said Kajali without the permission of Reserve Bank of India in dealing with foreign exchange and thereby contravening the provisions of 9(1)(b) of FERA and during June 1997, receiving Rs. 1,57,00,000/- from the said Kajali and thereby contravening the provisions under Sec. 9(l)(d) of FERA which are punishable under Sec. 56(1) of FERA. (5) THE learned Chief Judicial Magistrate, who took up the case on file, framed charges against the respondents, who denied the same, and conducted the trial. THE Chief Enforcement Officer was examined as RW. 1 and the owner of the public telephone booth and his employee were examined as RWs. 2 and 4 and the officials of the Directorate was examined as P.W. 3. THE Notification, search warrant, the ceased documents and the statement of the respondents on various dates were produced as documents. THE respondent examined one witness to speak about the purchase of cardamom from the estate of the respondent for Rs. 9,00,000/- and has produced the documents for the said sales and purchase. (6) THE learned Chief Judicial Magistrate found that the respondent was in the custody of the Enforcement Officer Between 2-7- 1997 to 4-7-1997 and therefore, the statement recorded under Sec. 40 of the Act was not voluntary. THE trial Court also found that the statements were retracted and there are many discrepancies in the statement and the respondent has already explained the source of Rs. 9,00,000/- and the prosecution has failed to prove the Hawala transaction which runs to crores and therefore acquitted the respondents. Aggrived by which, the present appeal has been preferred. The point for consideration that arises in this appeal is whether the order of acquittal is sustainable and whether it needs interference. (7) MR. 9,00,000/- and the prosecution has failed to prove the Hawala transaction which runs to crores and therefore acquitted the respondents. Aggrived by which, the present appeal has been preferred. The point for consideration that arises in this appeal is whether the order of acquittal is sustainable and whether it needs interference. (7) MR. C. Aral Vadivel alias Sekar, the learned Special Prosecutor for Enforcement Directorate submitted that the respondent has given a confession statement under Sec. 40 of FERA which alone is enough to prove the case of the prosecution. The learned Special Public Prosecutor pointed out that merely because the confession is retracted it cannot be stated that the confession is involuntary. The learned PP submitted that the statement recorded under Sec. 40 cannot be equated with the statement recorded under Sec. 161 of Cr. P.C. by the police officers and once the confession statement is proved to be voluntary, a conviction can be passed on the sole basis of the confession. (8) THE learned Public Prosecutor pointed out that the retraction is an afterthought and the explanation for the source that it was the sale price of cardamom is unreliable. He relied on a decision reported in AIR 1958 SC 66 (Subramania Goundan v. THE State of Madras), wherein the Apex Court held as follows : "14. THE next question is whether there is corroboration of the confession since it has been retracted. A confession of a crime by a person, who has perpetrated it, is usually the outcome of penitence and remorse and in normal circumstances is the best evidence against the maker. THE question has very often arisen whether a retracted confession may form the basis of conviction if believed to be true and voluntarily made. For the purpose of arriving at this conclusion, the Court has to take into consideration not only the reasons given for making the confession or retracting it but the attending facts and circumstances surrounding the same. It may be remarked that there can be no absolute rule that a retracted confession cannot be acted upon unless the same is corroborated materially". The learned counsel also relied on AIR 1998 SC 16 : (1997 AIR SCW 3959) (C. Sampath Kumar v. Enforcement Officer, Enforcement Directorate), in which the Apex Court has held as follows : "5. It may be remarked that there can be no absolute rule that a retracted confession cannot be acted upon unless the same is corroborated materially". The learned counsel also relied on AIR 1998 SC 16 : (1997 AIR SCW 3959) (C. Sampath Kumar v. Enforcement Officer, Enforcement Directorate), in which the Apex Court has held as follows : "5. It is not denied that the statements of the appellant have been recorded by the respondent on 15th May 1996, 9th July, 1996 and 12th July, 1996. Learned counsel for the appellant did not dispute and rightly so that a person to whom summons are issued under Section 40 of FERA may be called upon to give his statement in writing and sign it and such a course is not prohibited either by the statute or the Constitution. In our opinion there is no presumption that such a statement is always "involuntary". (9) THE learned counsel also relied on a decision, reported in 2001 SCC Crl 1177 : ( AIR 2001 SC 2778 (State of Tamil Nadu v. Kutty alias Lakshmi Narasimhan), in which the Apex Court has held as follows : "13. It is not the law that once a confession is retracted the Court should presume that the confession is tainted. As a matter of practical knowledge, we can say that a non- retracted confession is a rarity in criminal cases. To retract from a confession is the right of the confessor and all the accused against whom confessions were produced by the prosecution have invariably adopted that right. It would be injudicious to jettison a judicial confession on the mere premise that its maker has retracted from it. THE Court has a duty to evaluate the evidence concerning the confession by looking at all aspects. THE twin test of a confession is to ascertain whether it was voluntary and true. Once those tests are found to be positive the next endeavour is to see whether there is any other reason which stands in the way of acting on it. Even for that, retraction of the confession is not a ground to throw the confession overboard. 14. We are unable to understand how a judicial confession would become bad by reason of the fact that articles belonging to the victims were recovered prior to the making of the confession. Even for that, retraction of the confession is not a ground to throw the confession overboard. 14. We are unable to understand how a judicial confession would become bad by reason of the fact that articles belonging to the victims were recovered prior to the making of the confession. That aspect, instead of vitiating the confession, could be a factor in favour of the voluntaries of the confession. When the culprit finds that the articles concealed by him are all disinterred, it is possible that he might feel that there is no use in concealing the facts any more. THEn he may desire to make a clean breast of everything to any person or authority." (10) THE learned counsel further relied on a decision reported in 2008 4 SCC 668 : ( AIR 2008 SC 1044 ) (Kanhaiyalal v. Union of India), in which the Apex Court has held as follows : "44. In addition to the above, in Raj Kumar Karwal v. Union of India, this Court held that officers of the Department of Revenue Intelligence who have been vested with powers of an officer in charge of a police station under Section 53 of the NDPS Act, 1985 are not "police officers" within the meaning of Section 25 of the Evidence Act. THErefore, a confessional statement recorded by such officer in the course of investigation of a person accused of an offence under the Act is admissible in evidence against him. It was also held that power conferred on officers under the NDPS Act in relation to arrest, search and seizure were similar to powers vested on officers under the Customs Act. Nothing new has been submitted which can persuade us to take a different view. 45. Considering the provisions of Section 67 of the NDPS Act and the views expressed by this Court in Raj Kumar Karwal case with which we agree, that an officer vested with the powers of an officer in charge of a police station under Section 53 of the above Act is not a "police officer" within the meaning of Section 25 of the Evidence Act, it is clear that a statement made under Section 67 of the NDPS Act is not the same as a statement made under Section 161 of the Code, unless made under threat or coercion. It is this vital difference, which allows a statement made under Section 67 of the NDPS Act to be used as a confession against the person making it and excludes it from the operation of Sections 24 to 27 of the Evidence Act". The learned counsel further relied on a decision reported in 2008 4 SCC 668 : ( AIR 2008 SC 1044 ) (Kanhaiyalal v. Union of India), in which the Apex Court has held as follows : "44. In addition to the above, in Raj Kumar Karwal v. Union of India, this Court held that officers of the Department of Revenue Intelligence who have been vested with powers of an officer in-charge of a police station under Section 53 of the NDPS Act, 1985 are not "police officers" within the meaning of Section 25 of the Evidence Act. Therefore, a confessional statement recorded by such officer in the course of investigation of a person accused of an offence under the Act is admissible in evidence against him. It was also held that power conferred on officers under the NDPS Act in relation to arrest, search and seizure were similar to powers vested on officers under the Customs Act. Nothing new has been submitted which can persuade us to take a different view. 45. Considering the provisions of Section 67 of the NDPS Act and the views expressed by this Court in Raj Kumar Karwal case with which we agree, that an officer vested with the powers of an officer in charge of a police station under Section 53 of the above Act is not a "police officer" within the meaning of Section 25 of the Evidence Act, it is clear that a statement made under Section 67 of the NDPS Act is not the same as a statement made under Section 161 of the Code, unless made under threat or coercion. It is this vital difference, which allows a statement made under section 67 of the NDPS Act to be used as a confession against the person making it and excludes it from the operation of Sections 24 to 27 of the Evidence Act". (11) MR. M. Ajmal Khan the learned counsel for the respondent/accused would submit that except the evidence of P.W. 1 and the alleged confession of the 1st respondent, there is no other corroborative evidence to prove the violation of FERA. (11) MR. M. Ajmal Khan the learned counsel for the respondent/accused would submit that except the evidence of P.W. 1 and the alleged confession of the 1st respondent, there is no other corroborative evidence to prove the violation of FERA. The learned counsel pointed out that the specific case of the prosecution is that a transaction of Hawala involved crores of rupees between 1990 and 1997, no witnesses were examined to prove the receipt and distribution except the owner and the employee of a public telephone booth. (12) THE learned counsel pointed out that the respondent was under the custody of enforcement officer and he has immediately retracted the confession and therefore, the confession cannot be relied upon. The learned counsel also pointed out that the respondent has proved the source for the possession of Rs. 9,00,000/- which was seized from the office of the respondent and the trial Court has rightly held that the prosecution has not proved the charges and this Court is not justified in interfering the acquittal. (13) THE learned counsel also relied on a decision reported in AIR 1953 SC 478 , (C. M. Narayan v. State of Travancore, Cochin) wherein, the Constitution Bench of the Apex Court has laid down the principles in the appeal against acquittal. THE Apex Court has held as follows : "THE High Court, even though it is hearing an appeal from an order of acquittal, has full powers to review the entire evidence on the record and reach its own conclusion that the acquittal order should be set aside. THE Apex Court has held as follows : "THE High Court, even though it is hearing an appeal from an order of acquittal, has full powers to review the entire evidence on the record and reach its own conclusion that the acquittal order should be set aside. In exercising these powers the High Court should and will always give proper weight and consideration to such matters as (1) the views of the Trial Court as to the credibility of witnesses; (2) Presumption of innocence in favour of the accused, a presumption certainly not weakened by the fact that he had been acquitted at the trial; (3) the right of the accused to the benefit of any doubt; and (4) the slowness of an appellate Court in disturbing a finding of fact arrived at by a Judge who had the advantage of seeing the witnesses." (14) IN AIR 1972 SC 2020 (Sohrab and another v. The State of Madhya Pradesh), the Apex Court has held as follows : "Though no limitation can be placed upon this power in exercising the power the High Court should and will always give proper weight and consideration to such matters as (1) the view of the trial Judge as to the credibility of the witnesses; (2) the presumption of innocence in favour of the accused, a presumption certainly not weakened by the fact that he has been acquitted at his trial; (3) the right of the accused to the benefit of any doubt; and (4) the slowness of an appellate Court in disturbing a finding of fact arrived at by a Judge who had the advantage of seeing the witnesses." The learned counsel further relied on a decision reported in AIR 1973 SC 2679 (Mohandas v. State of M. P.), wherein the Apex Court has held as follows : "It is well settled that the High Court in appeal under Section 417 of the Code of Criminal Procedure has full power to review at large the evidence on which the order of acquittal was founded and to reach the conclusion that upon the evidence the word of acquittal should be reversed. No limitation should be placed upon that power unless it be found expressly stated in the Code, but in exercising the power conferred by the Code and before reaching its conclusion upon fact the High Cout should give proper weight and consideration to such matters as (1) the view of the trial Judge as to the credibility of the witnesses; (2) the presumption of innocence in favour of the accused, a presumption certainly not weakened by the fact that he has been acquitted at his trial; (3) the right of the accused to the benefit of any doubt; and (4) the slowness of an appellate Court in disturbing a finding of fact arrived by a Judge who had the advantage of seeing the witnesses. We have been taken through the judgments of the trial Court and the High Court and we find that the judgment of the High Court is not vitiated by any such infirmity as may call for interference by this Court. (15) THE learned counsel also relied on a decision reported in AIR 1974 SC 286 (Bhim Singh v. State of Maharashtra), in which the Apex Court has held as follows : "THE appellate Court has power to review the entire evidence and to come to its own conclusion in an appeal against acquittal. In exercising this power the appellate Court, should not only consider every matter or record having a bearing on the questions of fact and the reasons given by the Court below in support of its order of acquittal but it must express its reasons in its judgment which led it to hold that the acquittal is not justified. THE appellate Court must bear in mind the fact that the trial Court had the benefit of seeing the witnesses in the witness box and the presumption of innocence is not weakended by the order of acquittal. THErefore, if two reasonable conclusions can be reached on the basis of the evidence on record, the appellate Court should not disturb the findings of the trial Court." (16) HE further relied on a decision reported in 2009 (10 SCC) 362 : (AIR 2010 SC (Supp) 432) Raj Narain Singh v. State of Uttar Pradesh and others), wherein the Apex Court has held as follows : "19. The same view has been reiterated by this Court in Ghurey Lal v. State of UP, SCC at P. 477 : (AIR 2009 SC (Supp) 1318) in which one of us (Hon'ble Dalveer Bhandari, J.) after discussing a number of authorities on this issue summarised the law as follows : (SCC para 69) "69. The following principles emerge from the cases above: 1. The appellate Court may review the evidence in appeals against acquittal under sections 378 and 386 of the Criminal Procedure Code, 1973. Its power of reviewing evidence is wide and the appellate Court can re-appreciate the entire evidence on record. It can review the trial Court's conclusion with respect to both facts and law. 2. The accused is presumed innocent until proved guilty. The accused possessed this presumption when he was before the trial Court. The trial Court's acquittal bolsters the presumption that he is innocent. 3. Due or proper weight and consideration must be given to the trial Court's decision. That is especially true when a witness, credibility is at issue. It is not enough for the High Court to take a different view of the evidence. There must also be substantial and compelling reasons for holding that the trial Court was wrong." Heard both sides and perused the materials available on record. (17) THE respondent was charged for two offences namely (1) between June 1997 and July 1997, the respondent was doing Hawala transaction and thereby contravened the provisions under Sec. 9(1)(b) of FERA (2) prior to June 1997 received and distributed Rs. 1,57,00,000/- on the instruction of one Kajal in Hawala transaction and thereby contravened Sec. 9(1)(d) of FERA and therefore, punishable under Sec. 56 (l)(i) of FERA. THE case of the prosecution rests only on the evidence of P. W. 1, the Chief Enforcement Officer, who searched, seized and obtained confession from the 1st respondent and also on the confession dated 2-7-1997. P. W. 1 has also seized one telephone index, a note book and a diary and 6 loose sheets containing some letters and serial numbers which have been later explained in the confession denoting receipt and disbursement of amounts. Apart from his evidence, there is nothing much worthy in the evidence of the owner and the employee of the telephone booth. P. W. 3 is one of the official witnesses who issued an opportunity notice under the provisions of FERA. Apart from his evidence, there is nothing much worthy in the evidence of the owner and the employee of the telephone booth. P. W. 3 is one of the official witnesses who issued an opportunity notice under the provisions of FERA. (18) ADMITTEDLY, the confession was retracted by the respondent. The respondent has also examined a defence witness and also produced bills and vouchers for the sale and purchase of cardamom from his estate to the tune of Rs.9,00,000/-. As stated earlier, the trial Court has disbelieved the confession as voluntary and has found no other evidence to prove both the charges. Sec. 40 of the FERA (old) Act. "40. Power to summon persons to give evidence and produce documents. (1) Any gazetted Officer of Enforcement shall have power to summon any, person whose attendance he considers necessary either to give evidence or to produce a document during the course of any investigation or proceeding under this Act. (2) A summons to produce documents may be for the production of certain specified documents or for the production of all documents of a certain description in the possession or under the control of the preson summoned. (3) All persons so summoned shall be bound to attend either in person or by authorized agents, as such officer may direct; and all persons so summoned shall be bound to state the truth upon any subject respecting which they are examined or make statements and produce such documents as may be required; Provided that the exemption under Sec. 132 of the Code of Civil Procedure, 1908(5 of 1908), shall be applicable to any requisition for attendance under this section. (4) Every such investigation or proceeding as aforesaid shall be deemed to be a judicial proceeding with the meaning of Secs. 193 and 228 of the Indian Penal Code (45 of 1860). (19) A statement made by a person summoned under Sec. 40 of FERA is presumed to be voluntary statement unless proved otherwise. (20) IT is well settled that the statement under Sec. 108 of the Customs Act, statement under Sec. 67 of NDPS Act and statement under Sec. 40 of FERA Act stand on the same footing. (19) A statement made by a person summoned under Sec. 40 of FERA is presumed to be voluntary statement unless proved otherwise. (20) IT is well settled that the statement under Sec. 108 of the Customs Act, statement under Sec. 67 of NDPS Act and statement under Sec. 40 of FERA Act stand on the same footing. However, a retracted confession has to be approached cautiously when there are evidence to show that the deponent was under the custody of the officer before whom, the statement was given, for a longer period and there is an element of compulsion. (21) P. W. 1 would admit that the respondent was examined on 2-7-1997 and again on 3-7-1997 and he was produced before the Magistrate only on 4-7-1997 for remanding judicial custody. P. W. 1 would state that he did not remember that the wife of the accused gave a telegram on the midnight of 2-7-1997 and as well as on 4-7-1997 alleging that the accused has been kept under illegal custody. (22) IN the confession, the respondent would generally state that he used to receive money from Mussammil and Kajali and disburse the same to different person. IN the notebook, there are some serial numbers and denominations, which are explained as every denomination relates to that much of lakhs of rupees'. The prosecution has added all the denominations and has found that the respondent has dealt with Rs. 1,57,00,000/- in the Hawala transaction. As rightly pointed out by the trial Court, the evidence of P. W. 1 that the respondent appeared on summon on 2-7-1997 and again appeared on 3-7-1997 on summons is unbelievable, as there is an admission that he was under the custody of P. W. 1 for two days (telegram was marked as Ex. R. 3). There is yet another mitigating factor that another two officers namely Natarajan and Gopal have proceeded to search the residences of Kajali and Musammool. P. W. 1 admitted that such search was made. The said two persons were not arrested, statements were not recorded and documents were not produced. (23) AS rightly pointed out by the trial Court, the persons mentioned Ex. P. ;9 was never examined by the investigating officer. Even as per the statement, the respondent would state that he would receive and disburse the money on behalf of Mussamiil and Kajali. (23) AS rightly pointed out by the trial Court, the persons mentioned Ex. P. ;9 was never examined by the investigating officer. Even as per the statement, the respondent would state that he would receive and disburse the money on behalf of Mussamiil and Kajali. Except that vague statement, there is nothing to prove the involvement of Rs. 1,57,00,000/-. (24) IT is well settled principle that the High Court in appeal against acquittal should give proper weight and consideration to such matters as 1. the views of the learned trial Judge as to the credibility of the witnesses 2. the presumption of innocence in favour of the accused 3. The right of the accused to the benefit of any doubt. P. W. 1 would admit that the respondents had retracted the statement as early as 6- 7-1977 and on 12-7-1997. He would admit that in the retraction statement dated 12- 7- 1997 he had explained about the source for seizure of Rs. 9,00,000/-. (25) THE prosecution had tried to prove that there was no such sale of cardamom to the traders. However, P. W. 1 has not seized relevant accounts from the traders for the year 1997. (26) ON the contrary, a defence witness was examined to show that there was a sale and purchase of cardamom. As stated earlier, the evidence would show that the respondent was under the continuous custody of P. W. 1 from 2-7-1997 until he was produced before the Magistrate on 4-7-1997. But, on the contrary, statements would show that the respondent appeared on summons on 2-7-1997, 3-7-1997 and on the other various days. This would go to show that there was an element of complusion for the respondent to make the statement dated 2-7-1997 and 3-7-1997 and the statements itself are not clear enough to show that he had dealt with Rs. 1,57,00,000/- in Hawala transaction and the respondents have produced acceptable source for Rs. 9,00,000/- which was seized on 2-7-1997. (27) FOR the reason stated above, I am not inclined to interfere the order of the acquittal passed by the learned Chief Judicial Magistrate. (28) IN the result the appeal is dismissed. Appeal dismissed.