W.P.(Crl.) 782/2008 Page 1 of 49 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(CRL.) 782/2008 Reserved on : 13th August, 2008 Date of Decision : 5th September,2008 POOJA BATRA ..… Petitioner Through: Mr.Pradeep Jain and Mr.A.Samad, Advocates. Versus UNION OF INDIA & ORS. …… Respondents Through: Mr.Satish Aggarwala and Ms.PoojaBhaskar, Advocates. CORAM : HON’BLE MR. JUSTICE VIKRAMAJIT SEN, J HON’BLE MR. JUSTICE V.K.SHALI, J 1. Whether reporters of local papers may be allowed to see the judgment? Yes 2. To be referred to the Reporter or not? Yes 3. Whether the judgment should be reported in the Digest? Yes J U D G M E N T V.K. SHALI, J: 1. Ms.Pooja Batra, petitioner has filed the present writ petition for quashing the detention order bearing F.No.673/06/2007-CUS/VIII dated 5th December, 2007 issued by Joint Secretary (COFEPOSA), Ministry of Finance, Department of Revenue against her husband Deepak Kumar @ Deepak Batra S/o Sh. Om Prakash (hereinafter referred as the detenu), R/o 1431, W.P.(Crl.) 782/2008 Page 2 of 49 Gopal Street, Sangat Rashan, Paharganj, New Delhi under Section 3 of the Conservation of Foreign Exchange and Preservation of Smuggling Act, 1974. The detenu was detained in pursuance to the said detention order on 22nd May, 2008. 2. Briefly stated the facts of the case as given in the petition are that the detenu purported to have represented himself as a proprietor of a concern styled as M/s Om Prakash Deepak Kumar, 1074-75, Room No.23, Jyoti Market, Gandhi Gali, Fatehpuri, Delhi-110006. He filed a bill of entry bearing No.589144 dated 25th April, 2007 for clearance of the consignment at I.C.D., Tughlakabad, New Delhi through their clearing agent CHA M/s P.P.Dutta, Wg. Cdr. (Retd.) for the clearance of 1041 cartons containing “Telescopic Channels” of 10”, 12”, 14”, 16” and 18” and “Soft Scrubber” collectively valued at Rs.3,06,045.51 (Rupees Three Lacs Six Thousand Forty Five and Fifty One Paise). On the aforesaid valuation, a duty amount payable was Rs.1,04,201/-(Rupees One Lac Four Thousand Two Hundred One). It is alleged that the clearing agent, M/s P.P.Dutta sent a letter to the Deputy Commissioner of Customs, ICD, Tughlakabad, New Delhi wherein it expressed its inability to clear the shipment due to some problem and accordingly issued NOC in favour of the detenu. On 15th June, 2007, the clearing W.P.(Crl.) 782/2008 Page 3 of 49 agent along with a covering letter sent original bill of entry invoice, packing list, Bill of lading, Certificate of origin and NOC to the detenu. On receipt of the aforesaid documents, the detenu Deepak Kumar himself appeared before the Customs Authorities, ICD Tughlakabad, New Delhi on 3rd August, 2007 represented himself to be the proprietor of M/s Om Prakash Deepak Kumar and requested for clearance of the aforesaid bill of entry on the ground that the clearing agent was not coming forward to clear the consignment. The statement of the detenu Deepak Kumar was recorded under Section 108 of the Customs Act which he alleges to have been obtained under duress and coercion. Thereafter, the consignment was opened and it was found to contain goods other than the ones which were declared to the tune of value of Rs.3,06,045.51/- (Rupees Three Lacs Six Thousand Forty Five and Fifty One Paise). Accordingly, his statement was again recorded on 4th August, 2007. In both the statements, the detenu had represented himself as to be the proprietor of M/s Om Prakash Deepak Kumar having its office at 1074-75, Room No.23, Jyoti Market, Gandhi Gali, Fatehpuri, Delhi-06 having IEC Code No.050602341 dated 25th July, 2006 which was purported to have been issued by the Director General of Foreign Trade, Govt. of India. The detenu had also W.P.(Crl.) 782/2008 Page 4 of 49 represented that he had now shifted his business to 1431, Gopal Street, Sangat Rashan, Paharganj, New Delhi. Since it was a case of under valuation and mis-declaration, the detenu was arrested and produced before the learned ACMM, Patiala House Courts, New Delhi on 4th August, 2007 who had remanded him to the judicial custody. The detenu filed a bail application on 6th August, 2007 before the learned ACMM, New Delhi and in the said application, he made a mention that his confession/statement which was purported to have been recorded by the Customs Authority was obtained under duress/coercion. The said application for grant of bail of the detenu was rejected on 14th August, 2007 after obtaining reply from the Customs authorities. On 16th August, 2007, a fresh bail application was filed before the Learned Additional Sessions Judge, New Delhi which was also rejected on 17th August, 2007. On 18th August, 2007, a third application for bail was filed before the High Court which was allowed on 30th August, 2007 on the ground that the detenu had been in custody for 27 days and he had already paid a customs duty to the tune of Rs. 25,00,000/- (Rupees Twenty Five Lacs) and was prepared to pay the penalty on account of the mis-declared imported goods. Thereafter, a detention order is purported to have been passed on 5th W.P.(Crl.) 782/2008 Page 5 of 49 December, 2007 against the detenu which he allegedly learnt only on 22nd May, 2008 and whereafter he immediately surrendered before the ACMM, New Delhi and he is in custody since then. He represented to the Secretary, Govt. of India on 13th June, 2008 through Jail Superintendent which representation was rejected by the Special Secretary, Govt. of India on 1st July, 2008 and communicated to him on 2nd July, 2008 belatedly. Similarly, the Advisory Board also rejected the case of the detenu on 23rd July, 2008 and thereby now he was constrained to file the present petition as averred by him. 3. So far as the respondents are concerned, they have filed their detailed counter affidavit and contested the claim of the petitioner on certain factual aspects apart from legal propositions. The case of the respondent-sponsoring Authority is that on 25th April, 2007 after filing the bill entry No.589144 dated 25th April, 2007 before the Deputy Commissioner of Customs (Import Shed), Tughlakabad, New Delhi through clearing agent Wg. Cdr., P.P.Dutta, the detenu or his clearing agent did not appear for clearing the goods till 23rd July, 2008. The consignment was declared to contain 1041 cartons containing “Telescopic Channels” of 10”, 12”, 14”, 16” and 18” and “Soft Scrubber” collectively valued at Rs.3,06,045.51 W.P.(Crl.) 782/2008 Page 6 of 49 (Rupees Three Lacs Six Thousand Forty Five and Fifty One Paise) of which a duty amount of Rs.1,04,201/- (Rupees One Lac Four Thousand Two Hundred and One) was payable. Since the sponsoring authority had intelligence reports that the importer is attempting to get imported goods cleared by mis-declaring the description, quantity and value accordingly, surveillance was kept on the consignment in this regard. Simultaneously Manager (CONCOR) ICD, Tughlakabad, New Delhi was requested, not to clear the aforesaid consignment without the written permission of the Deputy Commissioner of Customs (Import Shed), ICD, Tughlakabad, New Delhi. Till 23rd July, 2008, nobody came forward to get the goods cleared. Since the clearing agent M/s P.P.Datta, Wg. Cdr. (Retd.) had got suspicious about the contents of the consignment on account of the fact that the detenu had approached and stated him that at no cost the consignment should be checked, he withdrew his authority to get the goods cleared and returned the papers to the detenu. On 3rd August, 2007, the detenu appeared before the concerned official in the Import Shed and gave a letter dated 2nd August, 2007 on the letter head of M/s Om Prakash Deepak Kumar requesting the Deputy Commissioner of Customs (Import Shed), ICD Tughlakabad, New Delhi that the aforesaid consignment be W.P.(Crl.) 782/2008 Page 7 of 49 cleared. It was also represented that the clearing agent was not coming forward to get the goods cleared and therefore he had to come himself. Since there was an intelligence report regarding the mis- declaration under violation about the quantity and the quality, the Deputy Commissioner had written that the entire 100% of the consignment has to be checked which was done on 3rd August, 2007. Pursuant to this, on 4th August, 2007 when the detenu had appeared again, his statement under Section 108 of the Customs Act were recorded where he had owned the concern styled as M/s Om Prakash Deepak Kumar and he had also owned the import on the aforesaid consignment, although he had disputed the factum of other eight prior consignments having been got cleared by him. The consignment was found to contain carton boxes / packages numbering 1118 as against 1041 and which were more than what was claimed under the bill of entry No.589144 dated 25th April, 2007. The consignment was found to contain 441 cartons as containing Telescopic Channels instead of 700 cartons as declared. As against the declared 341 carton boxes containing Soft Scrubber only 54 were found to contain Soft Scrubber. On opening of these carton boxes of identical marking said to contain soft scrubber, it is found that different types of goods were kept concealed in these cartons. It was W.P.(Crl.) 782/2008 Page 8 of 49 found that 200 similar carton boxes contained shoes of Adidas, Nike, Air brands and 67 similar carton boxes were found containing cigarettes packets of „Marlboro‟ brand, 56 white small boxes were found containing ignition plugs of „Mico Bosch‟ brand and similar 300 cartons were found containing AAAR03 NISHICA of brand battery cells. Inquiries by the respondents also revealed that ignition plugs of „Mico Bosch‟ were found to be spurious and similarly „Marlboro‟ cigarettes were found to be not containing statutory warning and therefore, it being spurious could also be not ruled out. It was found by the respondents, apart from the declared goods in 495 cartons collectively valued at Rs.2,03,220/- (Rupees Two Lacs Three Thousand Two Hundred and Twenty) of different types of un-declared goods collectively valued at Rs.85,04,000/- (Rupees Eighty Five Lacs Four Thousand) contained in 623 cartons were concealed with the declared goods. The duty involved on the said goods contained in 1118 carton boxes and collectively valued at Rs.87,07,200/- (Rupees Eighty Seven Lacs Seven Thousand and Two Hundred) worked out to be Rs.30,00,000/- (Rupees Thirty Lacs) approximately. Accordingly, a Panchnama dated 3rd August, 2007 was prepared and goods were confiscated along with their W.P.(Crl.) 782/2008 Page 9 of 49 packaging material under Section 110 of the Customs Act, 1962 on the reasonable ground that the same were being smuggled. 4. The premises of the concern M/s Om Prakash Deepak Kumar at the address 1074-75, Room No.23, Jyoti Market, Gandhi Gali, Fatehpuri, Delhi were searched but nothing offending was recovered. The said premises were found to be in possession of one person Deepak Kumar Aggarwal who claimed himself to be the proprietor of the aforesaid concern as well as of the IEC Code issued by the Director General of Foreign Trade in which his PAN number was given. He further stated in his statement that he never imported any goods from China as was purported to have been done in the present case or in the earlier eight consignments. He further stated that he only deals in dry fruits which he imports from Iran, Afghanistan, Indonesia and USA etc. 5. The detenu was enlarged on bail by the High Court. On 29th October, 2007, sponsoring Authority after completing investigation sponsored the case of the petitioner for passing detention order to the COFEPOSA department, which after examining the matter in detail passed the impugned detention order dated 5th December, 2007. The case of the respondent is that the detention order was passed to prevent the detenu from W.P.(Crl.) 782/2008 Page 10 of 49 indulging in smuggling activity on account of the fact that prior to the consignment in question, the detenu had imported eight other consignments wherein he had also imported the goods after clearance of the Customs Authorities. It was the case of the respondents that although the said eight consignments were cleared and nothing offending was detected but this was on account of the fact that only 5 to 10% of the checking was done in respect of the said goods while as in the instant case 100% checking was done which revealed that it was a case of not only mis-declaration with regard to the quality and the quantity and description of the goods but the detenu was indulging in smuggling activity within the definition of Section 2(39) of The Customs Act. The impugned detention order which was served on him on 22nd May, 2008 as the detenu was alleged to be avoiding the service of the order during the interregnum period. 6. We have heard the learned counsel for the parties and perused the records. Learned counsel for the detenu has in essence raised five submissions essentially with a view to attack the detention order dated 5.12.2007:- (i) Documents in respect of which enquiry is pending cannot form the basis of subjective satisfaction. W.P.(Crl.) 782/2008 Page 11 of 49 a) The first submission of the learned counsel for the detenu was that he had admittedly appeared before the Deputy Commissioner of Customs requesting him to clear the consignment under the bill of entry No. 589144 since the clearing agent was not coming forward to clear the said consignment. In respect of the said bill of entry, goods which were sought to be cleared allegedly consisted of Telescopic Channels of 10‟‟, 12‟‟, 14‟‟, 16‟‟, and 18‟‟ and Soft Scrubber collectively valued at Rs.3,06,045.51 (Rupees Three Lacs Six Thousand Forty Five and Fifty One Paise) on which duty payable was stated to be Rs.1,04,201/ (Rupees One Lac Four Thousand Two Hundred and One)-. The aforesaid consignment was allegedly under DRI surveillance and on checking the same it was found to be containing undeclared imported goods, the value of which is stated by the respondents is Rs.85,04,000/- (Rupees Eighty Five Lacs Four Thousand) on which the duty of Rs.30,00,000/- (Rupees Thirty Lacs) or so was allegedly leviable. The detenu‟s case was that he has already secured the interest of the revenue inasmuch as he was enlarged on bail by the High Court in respect of alleged offence under section 135 of the Customs Act on the ground that he has deposited Rs.25,00,000/- (Rupees Twenty Five Lacs) as customs duty on undeclared goods and W.P.(Crl.) 782/2008 Page 12 of 49 further was prepared to pay the penalty. Further so far as the eight other consignments, which are purported to have been allegedly imported earlier by the detenu, they are subject matter of enquiry by the DRI on the request of Commissioner of Customs ICD, Tughlakabad, New Delhi. This enquiry is sought to be made at the port of exports with regard to the details of payment, the value of goods declared at the port of exports etc., and therefore the respondents had not conclusively established the ownership of these eight consignments qua the detenu and therefore, it could not be form the basis of passing of the detention order. This leaves the department only with one consignment in respect of which the customs duty has already been paid and he will face prosecution under Section 135 of the Customs Act and one incident cannot form the basis of passing the detention order. The learned counsel for the detenu has placed reliance on case titled Chowdarapu Raghunandan v. State of Tamil Nadu AIR 2002 Supreme Court 1460. In this particular case, the baggage which was containing the contraband goods, on the basis of which the detention order was passed, was alleged to be belonging to the detenu. In that case, the detenu had disowned the ownership of the said baggage and it was prima facie shown that the baggage was having no tags which would W.P.(Crl.) 782/2008 Page 13 of 49 indicate that the baggage was belonging to the detenu in the said case. Further, the petitioner was an Engineering student in that case. It was, under these circumstances that the Supreme Court had observed that keeping in view that there was no past conduct on the part of the detenu of being involved in any anti-social activities except that he had visited the foreign countries once or twice, the baggages containing contraband goods did not belong to the detenu and the investigation was still pending. Therefore it could not be concluded that baggage belonged to the detenu and the passing of the detention order was without any application of mind and on inchoate material. b) As against this, the documents which are declaration forms and are placed at pages 278 to 293 of the paper book are submitted to the Customs Authorities by the detenu himself duly signed seeking clearance of the goods on eight different occasions. It was purported to be containing the goods described in such declaration forms such as steel wool scrubber & hinges etc. imported from China. It was further contended by Mr. Aggarwala, learned counsel for the Respondents that although in eight these transactions goods were cleared that does not mean that the consignments in these eight cases were not violating the provisions of the Customs Act, 1962 inasmuch as W.P.(Crl.) 782/2008 Page 14 of 49 in these eight transactions only a sample inspection of 5 to 10 % of goods was carried out. While as, in the ninth transaction, the consignment was examined 100% there was information received from the Department of Revenue Intelligence that there is a mis-declaration both with regard to the quality and the quantity of the goods in the said consignment which was found to be correct. The ownership of the consignment either in respect of the earlier eight transactions or the ninth one on the basis of which the detention order was passed was established by preponderance of probabilities to be owned by the detenu. This is reflected from the statements of the clearing agent Mr.Dutta and his nominee recorded under Section 108 of the Customs Act where they have stated that it was Deepak Kumar, the detenu who had come to them since early 2006 and got the goods /consignments cleared which were imported from China. They have also stated that on ninth occasion when the consignment had come, the detenu had very emphatically impressed on them that the consignment ought not to be permitted to be checked by Customs Authorities and at any cost (emphasis added), which clearly showed his guilty mind. Therefore, merely on account of the fact that letter is purported to have been written by the Customs Authorities to the DRI requesting them to get the W.P.(Crl.) 782/2008 Page 15 of 49 further details from the port of exports with regard to the payment, description of goods declared, there would not in any way make the ownership of the goods qua the detenu either in respect of ninth or even the earlier eight consignments as doubtful. c) Further, if the signatures on these declaration forms are compared in exercise of powers conferred on the Court under Section 73 of The Indian Evidence Act, 1872 with the signatures appearing on the declaration form submitted for the ninth transaction, it will clearly show that both these sets of documents have been signed by the same person only. The detenu went to the Customs Authorities not only for the clearance of the goods but he owned them in a statement recorded under Section 108 of The Customs Act, on 3rd August, 2007 and 4th August, 2007 on which date he was put under arrest. d) Therefore, the ratio of the judgment relied upon by the petitioner in Chowdarapu Raghunandan v. State of Tamil Nadu -case (supra) is not applicable to the facts of the present case as the said judgment is totally distinguishable. Accordingly, we hold that there is no merit in the first contention of the learned counsel for the detenue that the documents which are forming part of enquiry have been made as the basis of W.P.(Crl.) 782/2008 Page 16 of 49 passing of detention order wrongly or that the detention order is passed without any application of mind. On the contrary, the ninth consignment is owned by the detenu while as the other eight are by preponderance of probabilities established to be belonging to him only. (ii) Non- application of mind in passing Detention Order a) It was next contended by Sh. Jain, learned counsel for the detenu that the detention order has been passed by the detaining authority without any application of mind. In order to drive this point home, the learned counsel drew our attention to the detention order and read out various portions of paras like para 5, 9 & 13 etc. wherein it has been mentioned that the detenu namely Deepak Kumar @ Deepak Batra is the proprietor of M/s Om Prakash Deepak Kumar, 1074-75, Room No. 23, Jyoti Market, Gandhi Gali, Fatehpuri, Delhi-6 while as the case of the respondents is that the detenu is not the proprietor of the said concern and therefore there is a total non-application of mind on the part of the detaining authority as on the one hand they are saying that the detenu is the proprietor, on the other hand, they are stating that the IEC Code and PAN number did not belong to him. The said Code was also not issued on his PAN number and W.P.(Crl.) 782/2008 Page 17 of 49 he was not the owner of the proprietary concern. Therefore, it is a case of non-application of mind. b) As against this, Mr. Aggarwala, learned counsel for the Respondents contended that what has been stated in the detention order are the facts on the basis of which, grounds or the reasons thereof for the detention of the detenu has been passed and therefore, it could be said that there was any non-application rather a perusal of the detention order shows the application of mind. c) Admittedly, there is a concern by the name of M/s Om Prakash Deepak Kumar having its office at 1074-75, Room No. 23, Jyoti Market, Gandhi Gali, Fatehpuri, Delhi-6 while as detenu‟s residential address is 1431, Gopal Street, Sangat Rashan, Paharganj, New Delhi. The detenu represented himself as the proprietor of the concern namely M/s Om Prakash Deepak Kumar and claimed himself to be the owner of the ICD number in question and imported the goods from China which were mis-declared with regard to the description as well as the quantity. As against this, enquiries had revealed that it was not the detenu Deepak Kumar alias Deepak Batra, husband of the petitioner who was the proprietor but it was one Deepak Kumar Aggarwal who was the proprietor and in fact the detenu was W.P.(Crl.) 782/2008 Page 18 of 49 misusing the name of the said concern to his own benefit without the knowledge of the original proprietor. As a matter of fact, the detenu was indulging in criminal acts by making false declaration before public servants by impersonating and committing offences of cheating forging documents and using forged documents as genuine to claim himself to be the proprietor of the said concern. These facts have been given in ex tenso in the detention order. By no stretch of imagination the reference to the same can be construed to be as the basis for non-application of mind. We don‟t find any merit in the submission of the learned counsel for the detenu that the detention order has been passed without any application of mind. On the contrary, we are of the considered opinion that a detention order which is running into almost 21 pages giving each important fact and circumstance as well as the reasons in detail which has prompted the Joint Secretary to Government of India to pass the detention order. The sum and substance which has necessitated passing of the detention order is on account of the fact that there is a proprietary concern by the name of M/s Om Prakash Deepak Kumar having its office at 1074-75, Room No. 23, Jyoti Market,