1 IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL CIVIL CIVIL APPELLATE APPELLATE APPELLATE JURISDICTION JURISDICTION JURISDICTION CIVIL CIVIL CIVIL APPLICATION APPLICATION APPLICATION NO. 6085 OF 2007 NO. 6085 OF 2007 NO. 6085 OF 2007 inin in FERA FERA FERA APPEAL APPEAL APPEAL NO.85 OF 2007 NO.85 OF 2007 NO.85 OF 2007 Vinod Vinod Vinod Solanki Solanki Solanki ...... Plaintiff Plaintiff Plaintiff vs vs vs Union Union Union of India & ors of India & ors of India & ors ...... Defendants Defendants Defendants Mr.Vikram Mr.Vikram Mr.Vikram Nankani Nankani Nankani with Mr.Khokhawala i.b Nankani with Mr.Khokhawala i.b Nankani with Mr.Khokhawala i.b Nankani & Associates Associates Associates for Appellant for Appellant for Appellant Mr.A.S.Rao Mr.A.S.Rao Mr.A.S.Rao with with with Mr.H.V.Mehta for Respondents Mr.H.V.Mehta for Respondents Mr.H.V.Mehta for Respondents CORAM CORAM CORAM : : : F.I.REBELLO AND F.I.REBELLO AND F.I.REBELLO AND R.S.MOHITE, R.S.MOHITE, R.S.MOHITE, JJ JJ JJ DATED DATED DATED : : : 30TH NOVEMBER, 2007 30TH NOVEMBER, 2007 30TH NOVEMBER, 2007 JUDGMENT JUDGMENT JUDGMENT (Per (Per (Per F.I.Rebello, J) F.I.Rebello, J) F.I.Rebello, J) 1.1.1. The appellant had preferred an appeal being The appellant had preferred an appeal being The appellant had preferred an appeal being Appeal Appeal Appeal No.160 No.160 No.160 of 1996 before the Appellate Tribunal of 1996 before the Appellate Tribunal of 1996 before the Appellate Tribunal for for for Foreign Foreign Foreign Exchange. That appeal was dismissed by Exchange. That appeal was dismissed by Exchange. That appeal was dismissed by an an an order dated 16th July, 2007. The appellant has order dated 16th July, 2007. The appellant has order dated 16th July, 2007. The appellant has preferred preferred preferred the present appeal against the said the present appeal against the said the present appeal against the said order. order. order. 2.2.2. By an order dated 19th March, 1006 the By an order dated 19th March, 1006 the By an order dated 19th March, 1006 the Adjudicating Adjudicating Adjudicating Officer Officer Officer imposed a consolidated penalty imposed a consolidated penalty imposed a consolidated penalty of of of Rs.10,00,000/- against the appellants for Rs.10,00,000/- against the appellants for Rs.10,00,000/- against the appellants for contravening contravening contravening the provisions of section 8 (3) of the provisions of section 8 (3) of the provisions of section 8 (3) of FERA FERA FERA to the extent of US dollars 34,230 for his to the extent of US dollars 34,230 for his to the extent of US dollars 34,230 for his failure failure failure to utilise the said foreign exchange for to utilise the said foreign exchange for to utilise the said foreign exchange for the the the purpose it was released to him and further purpose it was released to him and further purpose it was released to him and further under under under section 9 (1) (a) of the FERA for the same section 9 (1) (a) of the FERA for the same section 9 (1) (a) of the FERA for the same amount amount amount being remitted outside India without the being remitted outside India without the being remitted outside India without the permission permission permission of the Reserve Bank of India. of the Reserve Bank of India. of the Reserve Bank of India. 2 3.3.3. A search was carried out in the premises of the A search was carried out in the premises of the A search was carried out in the premises of the appellant appellant appellant which resulted in the seizure of which resulted in the seizure of which resulted in the seizure of incriminating incriminating incriminating documents and Indian currency to the documents and Indian currency to the documents and Indian currency to the tune tune tune of Rs.2,65,000/. His statement was recorded. of Rs.2,65,000/. His statement was recorded. of Rs.2,65,000/. His statement was recorded. In In In the statement, various facts were set out. the statement, various facts were set out. the statement, various facts were set out. Before Before Before the tribunal, it was contended that the the tribunal, it was contended that the the tribunal, it was contended that the provisions provisions provisions of section 8 (3) was not attracted and of section 8 (3) was not attracted and of section 8 (3) was not attracted and atatat the highest it would be a case whether section the highest it would be a case whether section the highest it would be a case whether section 48 48 48 of of of FERA would be applicable. It was further set FERA would be applicable. It was further set FERA would be applicable. It was further set out out out that that that the retracted confessional statement which the retracted confessional statement which the retracted confessional statement which was was was retracted on the first available opportunity retracted on the first available opportunity retracted on the first available opportunity was was was relied upon. The said statement was not relied upon. The said statement was not relied upon. The said statement was not corroborated corroborated corroborated in material particulars. Hence, the in material particulars. Hence, the in material particulars. Hence, the impugned impugned impugned order was liable to be set aside. It was order was liable to be set aside. It was order was liable to be set aside. It was further further further submitted that there was no evidence to submitted that there was no evidence to submitted that there was no evidence to prove prove prove that the foreign exchange was remitted to that the foreign exchange was remitted to that the foreign exchange was remitted to Hongkong Hongkong Hongkong and no charge was proved against the and no charge was proved against the and no charge was proved against the appellant appellant appellant under section 9 (1) (a) under section 9 (1) (a) under section 9 (1) (a). 4.4.4. On the other hand, on behalf of the revenue it On the other hand, on behalf of the revenue it On the other hand, on behalf of the revenue it was was was contended contended contended that the foreign exchange is acquired that the foreign exchange is acquired that the foreign exchange is acquired by by by the appellant on the basis of forged documents the appellant on the basis of forged documents the appellant on the basis of forged documents and and and that an offence under section 8 (3) and 9 (1) that an offence under section 8 (3) and 9 (1) that an offence under section 8 (3) and 9 (1) (a) (a) (a) of FERA were fully proved. It was contended of FERA were fully proved. It was contended of FERA were fully proved. It was contended that that that there was sufficient material to prove the there was sufficient material to prove the there was sufficient material to prove the allegations allegations allegations against the appellant. against the appellant. against the appellant. 5.5.5. After hearing the counsel for the parties, After hearing the counsel for the parties, After hearing the counsel for the parties, contention contention contention urged that the show cause notice was urged that the show cause notice was urged that the show cause notice was vague vague vague based on the judgment cited were rejected as based on the judgment cited were rejected as based on the judgment cited were rejected as 3 opportunity opportunity opportunity was given to the appellant. A finding was given to the appellant. A finding was given to the appellant. A finding was was was recorded recorded recorded that the foreign exchange was acquired that the foreign exchange was acquired that the foreign exchange was acquired on on on the basis of forged documents and the same were the basis of forged documents and the same were the basis of forged documents and the same were transferred transferred transferred through Standard Chartered Bank, Asian through Standard Chartered Bank, Asian through Standard Chartered Bank, Asian House House House VI VI VI Branch and American E.Bank Central Branch, Branch and American E.Bank Central Branch, Branch and American E.Bank Central Branch, Hongkong Hongkong Hongkong maintained by foreign nationals and he maintained by foreign nationals and he maintained by foreign nationals and he failed failed failed to import any rough diamonds for which to import any rough diamonds for which to import any rough diamonds for which purpose purpose purpose the same was acquired. It was also noted the same was acquired. It was also noted the same was acquired. It was also noted that that that though the confessional statements were though the confessional statements were though the confessional statements were retracted, retracted, retracted, the retraction would not bar the the retraction would not bar the the retraction would not bar the confessional confessional confessional statements which was considered. The statements which was considered. The statements which was considered. The tribunal tribunal tribunal held that there was no material produced held that there was no material produced held that there was no material produced toto to show that the statements were recorded under show that the statements were recorded under show that the statements were recorded under threat threat threat and coercion. Reliance was placed on the and coercion. Reliance was placed on the and coercion. Reliance was placed on the judgment judgment judgment of of of the Supreme Court in KTMS Mohd vs Union the Supreme Court in KTMS Mohd vs Union the Supreme Court in KTMS Mohd vs Union of of of India 1992 SCC 178 and consequent to the India 1992 SCC 178 and consequent to the India 1992 SCC 178 and consequent to the judgment judgment judgment the tribunal also noted that along with the tribunal also noted that along with the tribunal also noted that along with the the the confessional statement there was documentary confessional statement there was documentary confessional statement there was documentary evidence evidence evidence coupled with attendant ciricumstantial coupled with attendant ciricumstantial coupled with attendant ciricumstantial evidence evidence evidence on record to demonstrate and prove the on record to demonstrate and prove the on record to demonstrate and prove the charges charges charges against the appellant. It further noted against the appellant. It further noted against the appellant. It further noted that that that the alleged facts relating to the said the alleged facts relating to the said the alleged facts relating to the said clandestine clandestine clandestine dealings being in the special or dealings being in the special or dealings being in the special or peculiar peculiar peculiar knowledge of the appellant and could have knowledge of the appellant and could have knowledge of the appellant and could have been been been explained by him only. Considering the explained by him only. Considering the explained by him only. Considering the judgment judgment judgment in Collector of Customs,Madra & ors in Collector of Customs,Madra & ors in Collector of Customs,Madra & ors v.D.Bhoormul v.D.Bhoormul v.D.Bhoormul AIR 1974 SC 859 the confessional AIR 1974 SC 859 the confessional AIR 1974 SC 859 the confessional statement statement statement was relied upon. The learned tribunal was relied upon. The learned tribunal was relied upon. The learned tribunal also also also held that the appellant had not been able to held that the appellant had not been able to held that the appellant had not been able to discharge discharge discharge the burden. the burden. the burden. 4 6.6.6. For the aforesaid reasons, the tribunal held For the aforesaid reasons, the tribunal held For the aforesaid reasons, the tribunal held that that that there was no material in the appeal and there was no material in the appeal and there was no material in the appeal and accordingly accordingly accordingly dismissed the same. dismissed the same. dismissed the same. 7.7.7. We have considered the contentions. We are in We have considered the contentions. We are in We have considered the contentions. We are in agreement agreement agreement with the learned tribunal that the mere with the learned tribunal that the mere with the learned tribunal that the mere bald bald bald statement that the confessional statements statement that the confessional statements statement that the confessional statements were were were recorded under coercion and durress by itself recorded under coercion and durress by itself recorded under coercion and durress by itself isisis not sufficient to discard the said confession. not sufficient to discard the said confession. not sufficient to discard the said confession. The The The burden is on the person retracting the burden is on the person retracting the burden is on the person retracting the confessional confessional confessional statement to lead some evidence as to statement to lead some evidence as to statement to lead some evidence as to why why why the confessional statement has to be rejected. the confessional statement has to be rejected. the confessional statement has to be rejected. No No No evidence on that count was led. Coupled with evidence on that count was led. Coupled with evidence on that count was led. Coupled with the the the confessional statement wherein some facts were confessional statement wherein some facts were confessional statement wherein some facts were recorded recorded recorded which which which was personal to the appellant alone was personal to the appellant alone was personal to the appellant alone, there there there were were were other deocumentary evidence coupled with other deocumentary evidence coupled with other deocumentary evidence coupled with the the the attendant circumstantial as noted by the attendant circumstantial as noted by the attendant circumstantial as noted by the tribunal tribunal tribunal to demonstrate and prove the charges to demonstrate and prove the charges to demonstrate and prove the charges against against against the appellant. In other words, there was the appellant. In other words, there was the appellant. In other words, there was material material material to support the confessional statement, to support the confessional statement, to support the confessional statement, which which which was relied upon to hold that the appellant was relied upon to hold that the appellant was relied upon to hold that the appellant guilty. guilty. guilty. The The The tribunal also concurred with the finding tribunal also concurred with the finding tribunal also concurred with the finding that that that the foreign exchange was obtained on forged the foreign exchange was obtained on forged the foreign exchange was obtained on forged import import import documents and the same was remitted abroad documents and the same was remitted abroad documents and the same was remitted abroad toto to foreign nationals. We have no reasons to differ foreign nationals. We have no reasons to differ foreign nationals. We have no reasons to differ or or or take a different view. take a different view. take a different view. 8.8.8. In our opinion, these are purely findings of In our opinion, these are purely findings of In our opinion, these are purely findings of 5 fact. fact. fact. We do not find any perversity in the said We do not find any perversity in the said We do not find any perversity in the said findings findings findings and consequently, in our opinion there is and consequently, in our opinion there is and consequently, in our opinion there is no no no merit in this appeal which is accordingly merit in this appeal which is accordingly merit in this appeal which is accordingly dismissed. dismissed. dismissed. (F.I.Rebello, (F.I.Rebello, (F.I.Rebello, J) J) J) (R.S.Mohite, (R.S.Mohite, (R.S.Mohite, J) J) J)