Case: Devchand Kalyan Tandel Vs. State of Gujarat and Another

3. On the basis of a complaint filed by the Customs authorities both these appellants stood charged with having committed the offences under Section 135(1)(a) of the Customs Act, 1962 (hereinafter referred to as the Act) on the allegation that on the date of occurrence they were found to be carrying silver without any transport voucher within the specified area which is duly notified under SectionK of the Act. The appellants denied their complicity and pleaded not guilty. The learned Additional Chief Judicial Magistrate convicted the appellants under Section 135 of the Act and sentenced them to undergo six months rigorous imprisonment and to pay a fine of Rs. 4000, in default, to undergo further rigorous imprisonment of three months. Against the aforesaid conviction and sentence of the learned Additional Chief Judicial Magistrate the appellants preferred appeals to the Court of Session and the State also preferred appeal for enhancement of sentence in the High Court. The Customs authorities who were the complainant also invoked the revisional jurisdiction of the High Court being aggrieved by the inadequacy of the sentence. After admission of the States appeal in the High Court, the appeals preferred by thes were ordered to be transferred and accordingly all the appeals and revision were heard together and were disposed of by a common judgment. The High Court dismissed the appeals filed by thes and allowed the States appeal and enhanced the sentence of rigorous imprisonment to two years and fine of Rs. 4000 so far as Accused 2 is concerned and enhanced the sentence of rigorous imprisonment for two years and fine of Rs. 40, 000 and in default further rigorous imprisonment for three months so far as Accused 3 is concerned. Thus the present appeals by special leave4. The prosecution case in a nutshell is that the Customs authorities had received secret information that certain contraband goods were likely to pass through National Highway No. 8. The authorities, therefore, kept watch during the early hours of3 around the Bhilad Customs. At about 8.30 a.m. a Fiat car bearing R.T.O. Registration No. GJN 5953 came from Vapi side and proceeded towards Bombay side. The car was intercepted by the vigilance squad of the Customs Department but nothing objectionable was found therefrom. The vehicle was allowed to pass. Thed Kalyan Tandel, who was Accused 2, was one of the occupants in the said Fiat car. The Customs authorities thereafter suspected some foul play and then divided themselves in two groups, one group was sent on the way to Umbergaon and the other group was sent on the way to Sarigam. The further prosecution case is that while the second group was on its vigil, an Ambassador car was found coming from Sanjan. When the vehicle was signalled to stop, it ignored the signal and proceeded straight towards Bhilad Railway Station and from there it took a turn towards the underground bridge. The vigilance party chased the said car and when they found that the car was about to reach the National Highway, they took resort to firing and on hearing the sound of firing, the car stopped. The said Ambassador car bore R.T.O. Registration No. MRH 5042. The car was brought to the Customs Office at Bulsar and in presence of two witnesses a search was conducted. On search, ten silver ingots worth more than Rs. 1, 90, 000, weighing 293.300 kilograms were recovered from a secret cabinet in the hind portion of the car.d and the other accused who is not an appellant namely Ishwarbhai Gopalbhai Tandel were found to be in the car and made their statements under Section 108 of the Act. After completion of investigation a complaint was filed in the Court of the learned Additional Chief Judicial Magistrate, Valsad which was registered as Criminal Case No. 60 of 1980. Thes stood charged under Section 135(1) of the Act. The accused persons pleaded not guilty to the charge and were accordingly tried. After the prosecution led evidence to establish the charge against thed by the accused persons. The statements of the accused persons were also recorded under Section 313 of the CrPC and Accused 2d also examined witnesses in defence. The plea ofd is that while he was proceeding in the Fiat car after crossing the Customs, the car had a breakdown and he was therefore looking for a lift, so that he could get a mechanic and at that point of time an Ambassador car was found coming. He, therefore, raised his hand requesting the car to stop and Accused 1 who was driving the Ambassador car stopped the same and gave lift and accordingly he did not know about the alleged transportation of silver ingots in that secret chamber of the Ambassador car. Accused 3 though admitted to have purchased the silver ingots from one Pratapsingh Dhorda of Pratap and Company but he took the plea that he had sold the same to his brothers and therefore he has no role in the transportation of the silver ingots by the offending Ambassador car. The learned trying Magistrate on consideration of oral and documentary evidence led before him discarded the plea of the accused persons and came to hold that the prosecution has been able to establish the charge beyond reasonable doubt. Accordingly he convicted thes and sentenced them as already stated. The High Court reconsidered the entire evidence and by the impugned judgment affirmed the conviction passed by the learned trying Magistrate and enhanced the sentence as already stated. Both the trying Magistrate as well as the High Court not only relied upon the evidence led by the prosecution but also relied upon the statutory presumption under SectionA of the Act and held that the accused failed to discharge the burden which lay on them

Court's reasoning:
We are of the considered opinion that the said plea ofd has rightly been rejected. In our view there has neither been any perversity in the matter of appreciation of evidence nor any important piece of evidence has been ignored by the courts below. It is well settled that this Court usually does not reappreciate the evidence and no justifiable reasons have been advanced for taking a different path. Accordingly, the first contention of Mr K. Madhava Reddy must be rejectedOn a scrutiny of the provisions of the Act particularly SectionA thereof and the object for which the aforesaid provision was inserted into the statute by Act No. 36 of 1973 it is difficult for us to accept the contention of Mr K. Madhava Reddy. It is no doubt true that in a charge for violation of the provisions of Section 135(1)(a) it is required for the prosecution to establish that the accused have fraudulently evaded or attempted to evade any duty chargeable on the goods or have violated the prohibition imposed under the Act in respect of the goods. But if the prosecution establishes the aforesaid facts then there is no necessity of attracting the statutory presumption under SectionA and without such presumption an accused can be convicted under Section 135(1)(a). But the legislature having found it difficult to establish the necessary ingredients of such evasion of duty or prohibitions and the economic offences having grown in proportion beyond the control, came forward with the presumption available under SectionA of the Act. The main object of SectionA is to raise a presumption as to the culpable mental state on the part of the accused when he is prosecuted in a court of law. In other words, if a recovery is made from the accused of any prohibited goods within the notified area then the statutory presumption would arise that he was knowingly concerned in the fraudulent evasion or attempted evasion of any duty chargeable on the goods in question. In the case of Bhanabhai Khalpabhai v. Collector of Customs this Court has held that in view of SectionA a presumption has to be drawn in respect of the existence of the alleged mental state. An option has been given to the accused to prove by way of defence the fact, that he did not have any such mental state with respect to the act charged which is an offence. The question, therefore, arises as to whether in the proved facts and circumstances the courts below were justified in taking recourse to the statutory presumption under SectionA of the Act. The answer must be in the affirmative. The fact that the accused was found to be inside the vehicle from which the silver ingots were recovered; the fact that the vehicle did not stop even though Customs authorities signalled for stopping; the fact that the two courts below disbelieved the plea ofd about the breakdown of his Fiat car and his taking an innocent lift by the Ambassador car from the secret pocket of which the silver ingots were recovered; and that the place from where the recovery was made is undoubtedly a place within the notified area under SectionK of the Act and further that there was no transport voucher as required under SectionK of the Act, unhesitatingly point towards the complicity of thed in the commission of offence under Section 135(1) and the presumption under SectionA having been rightly attracted. The burden lay on thet to establish that either he did not know about the fact of silver ingots being transported in the vehicle or that he was in no way connected with the same. Butd has utterly failed to discharge the said burden. In our considered opinion the conviction must be held to be well founded and the sentence passed thereunder is wholly justified11. So far as the third submission of Mr K. Madhava Reddy is concerned it is no doubt true that sufficient time has elapsed between the date of occurrence and the date of judgment and further the accused persons have served their sentences for a major part but yet we do not think that in such economic offences the courts should take any lenient view in the matter. Smuggling has become a threat to the effective fulfilment of the objectives of foreign trade control. The extent of the leakage of revenue that takes place through the process of tax evasion cannot be estimated. It has got serious deleterious effect on legitimate trade. Taxation Enquiry Commission had suggested that stringent measures both legal and administrative should be adopted to minimise the scope of the evil. For the purpose of achieving the desired objective Parliament came forward with insertion of Section. Question of taking a lenient view of the matter, therefore, does not arise. In view ofe smuggling activities in the border area ande evasion of duty the country has faced severe economic imbalance. Notwithstanding stringent legislation having been made it has not been possible to eradicate the evil. Any leniency therefore in economic offences will send a wrong signal. In this view of the matter, we are unable to accept the last contention of Mr K. Madhava Reddy, the learned Senior Counsel for the appellants12. So far as Jayantilal is concerned the prosecution has been able to establish that the ten silver ingots hold the mark of Narandas Manordas andl had purchased the said silver ingots from the refinery of Narandas Manordas. The accused admitted the aforesaid fact and it was proved beyond reasonable doubt that he was the last purchaser of the said silver ingots. His plea that he converted the ingots into pieces and sold the same to his brothers under Exhibits 18 to 72 has not been accepted either by the trying Magistrate or by the High Court. On elaborate discussion of the evidence on record the two courts below have affirmed that Accused 3 was the owner of the seized silver ingots which was meant for transportation and illegal export and he was involved in committing the offence in question. No convincing argument has been advanced on his behalf to interfere with the findings and conclusions arrived at by the courts below and consequently no case warranting interference by this Court has been made out