Allowed

FPA-FE-639/AHD/2005 of Shri Farooq Abdul Gaffar Mithawala v/s The Special Director Directorate of Enforcement, Ahmedabad

ATFP22 May 2018FPA-FE-639/AHD/2005

Case brief

AI extract

What is this about?

Thisappealagainst animpugnedorderoftheSpecialDirector,EDdisposingofaFRPAcasebasedonafacsimilemessagecontraprobationofidentityThebenchheldthattheinvestigatingagencyfailedtoproveallegedtheyweresamedifferentpeopleaddressandresidenceTheappealwasallowedwithoutjudgmentonmerit

What did the court decide?

The appeal was allowed on the ground that the appellant was wrongly implicated as the evidence failed to prove identity with the named offender, Farooque Memon.

FPA-FE-639/AHD/2005 of Shri Farooq Abdul Gaffar Mithawala v/s The… — Money Laundering | ATFP (2018)

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APPELLATE TRIBUNAL FOR SAFEMA, FEMA, PMLA, NDPS, PBPT ACT AT NEW DELHI

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DATE OF DECISION: 22.05.2018

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FPA-FE-639/AHD/2005

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Shri Farooq Abdul Gaffar Mithawala … Appellant

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Versus

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The Special Director Directorate of Enforcement, Ahmedabad … Respondent

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Advocates/Authorized Representatives who appeared

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For the appellant	: Shri N.M. Kapadia, Advocate
For the respondent	: Shri Prashant Pandey, Legal Consultant
CORAM
SMT. ANANYA RAY	: MEMBER

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JUDGEMENT

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FPA-FE-639/AHD/2005

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A show cause notice no. T4/38-B/95-SCN dated 31.05.1995 was issued to one Shri Farooque Abdul Gaffar Mithawala for contravention of Section 9 (1) (b) of FERA. The charge was that Shri Mithawala during the years 1992 to 1994 received payment in India totalling to Rs. 25,00,000/- from unknown persons as a part of foreign exchange remittance from Dubai, although he is not an authorised dealer in foreign exchange in India. The adjudicating authority has substantiated this charge relying on some fax message received from DIG Police (Operations) Gujarat State, Ahmedabad and statements of Shri Usman Gani Noor Mohammad Merchant @

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FPA-FE-639/AHD/2005

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Page 1 of 5

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Munna Abdulla where the adjudicating authority states that these documents reveal the name of the noticee Shri Farooque Memon Navsari appearing on pages 22, 23 & 24 of the fax message. The details of the same are as under:

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The appellant has filed this appeal against the impugned order of the Special Director, ED dated 23.07.2002 mainly on the ground that ED had booked a case against them on a wrong presumption and was a case of mistaken identity. The fax message which the adjudicating authority has relied upon talks about one Shri Farooque Memon of Navsari, Gujarat whereas the case has been booked against Shri Farooque Abdulla Mithawala of Dungari, Gujarat i.e. the appellants. That the appellant is not Farooque Memon of Navsari, neither do they have any relation with the said person. The case, if any, should have been booked against Shri Farooque Memon and that they (the appellants) are entirely innocent. They further stated that the ED officials are not able to provide any evidence to show that the appellants have an alias as Farooque Memon or that they are one and the same person but in the process have wrongly implicated them and have harassed him.

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FPA-FE-639/AHD/2005

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Page 2 of 5

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The appellant drew attention to his bail order, application for which was moved in the court of Additional Chief Metropolitan Magistrate at Ahmedabad after he was arrested by the ED, Ahmedabad wherein the Hon‟ble Court had asked in writing from the prosecution “regarding the clarification of identification of Farooque Memon in writing. That clarification was not made……. in that circumstance Farooque Abdul Gaffar Mithawala and Farooque Memon is a same person such difference if prosecution side not able to show then to keep the applicant/accused in judicial custody……. in my view it is not just and proper to keep the accused/applicant in a judicial custody. Hon‟ble Court from 10.10.1994 till today given sufficient time. In spite of that prosecution side fails to prove the difference (between) Farooque Abdul Gaffar Mithawala and Memon. Looking to this position as per my views…… complainant side not establish any written evidence or any connection……. In my opinion there is no any strong prima facie case against the accused Farooque Abdul Gaffar Mithawala…… and it is very much clear that against the accused there is no case against him under the provisions of FERA. In that circumstances, to keep accused in a judicial custody is not just and proper and if he released on bail it is just and proper…..”

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The respondent reiterated the arguments as in the order in original. They stated that the panchas had identified the appellant as Mithawala although the raid was conducted in the house of Memons as per the Panchanma dated 16.09.1994. That there was no doubt that the hawala transactions have been done by Farooque Memon. That the statement given by the main accused Shri Usman Gani Noor Mohd. Merchant @ Munna Abdulla implicates the appellant FPA-FE-639/AHD/2005 Page 3 of 5

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and he has not contradicted or disputed the said statement of Shri Usmani. Moreover, the conduct of the appellant has been very evasive in that he refused to give any statement deliberately. They relied on the judgment of the Supreme Court in the case of Naresh J. Sukhwani vs. Union of India dated 06.11.1995 [1996 AIR 522].

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During the hearing, both the appellants and respondents reiterated their above submissions.

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I have carefully considered the case and also gone through the documents on record. The Panchnama dated 16.09.1994 does not mention either Farooque Mithawala or Farooque Memon. Hence, it cannot be treated as a piece of evidence in the present case. The voters‟ list produced by the appellant and available on record shows Shri Farooque Bhai Abdul Bhai Mithawala is resident of House No. 150/7 village Dungari, Taluka Valsad, whereas the voters‟ list of Farooque Bhai Memon shows the address as house No. 3/15 village Navsari, District Valsad. This voters‟ list do show that they are two different people residing in two different addresses. Moreover, the adjudicating authority has intermittently used the name of Farooque Mithawala and Farooque Memon or Farooque Mithawala @ Memon without giving any clarification as to who the real person is or the identity of the actual offender. It appears that no effort has been made either by the investigating agency or the adjudicating authority to establish the identity of the actual offender. The statement of Mr. Usman Ghani relied upon does not implicate Farooque Mithawala. It implicates Farooque Memon but nowhere throws any light as to whether Farooque Memon and Farooque Mithawala are one and the same person. The documents seized from Shri Usmani contains details of remittance into India for an amount of Rs. 7,01,89,050 FPA-FE-639/AHD/2005 Page 4 of 5

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otherwise than through an authorised dealer in foreign exchange. In the follow up action of the ED, statements of many of these persons who have purportedly received payments in India have been recorded. The impugned order lists twenty such recipients. But the name of Farooque Mithawala does not figure in the said list. Hence, even from their own investigation there is nothing to prove that Farooque Mithawala was the person who was involved in the entire hawala trade. The fax message as quoted at para 1 supra also deals with Farooque Memon of Navsari and not Farooque Mithawala of Dungari. The judgment quoted by the respondent as at para 4 supra is as on entirely different facts and hence has no relevance to the present case.

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The limited question before me is the identity of the offender. Based on the discussions above, it is clear that ED has not been able to prove that the appellant and Shri Farooque Memon, who seems to be the offender, are one and the same person. This is strengthened by the order of the Additional Chief Metropolitan Magistrate at Ahmedabad in the bail application. I find that all evidences on record point that Shri Farooque Mithawala and Shri Farooque Memon are two different people and, without passing any judgment on the merits of the case with regard to Farooque Memon, I hold that Shri Farooque Mithawala the appellant has been wrongly implicated. I accordingly allow the appeal.

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(Ananya Ray) Member

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New Delhi, 22^nd , May, 2018 „A‟

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FPA-FE-639/AHD/2005

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FPA-FE-639/AHD/2005 of Shri Farooq Abdul Gaffar Mithawala v/s The Special Director Directorate of Enforcement, Ahmedabad

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FPA-FE-639/AHD/2005 of Shri Farooq Abdul Gaffar Mithawala v/s The Special Director Directorate of Enforcement, Ahmedabad

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