Dismissed

Kantilal M.Jhala v. Union of India

Bombay HC5 Oct 2007FERA/44/2007

Case brief

AI extract

What is this about?

The Court dismissed the appeal against the Appellate Tribunal's order imposing a penalty on the appellant under the Foreign Exchange Regulation Act. The Court held that the Tribunal was justified in relying on the appellant's retracted confessional statement corroborated by seized documents, and no substantial question of law arose.

What did the court decide?

The appellant's appeal is dismissed with no order as to costs.

Kantilal M.Jhala Vs Union of India — Banking and Recovery | Bombay HC (2007)

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 IN THE HIGH COURT OF JUDICATURE AT BOMBAY
 CIVIL APPELLATE JURISDICTION

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 FERA APPEAL NO.44 OF 2007

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 Kantilal M. Jhala,
 Flat No.15, 3rd Floor,
 5-A, Majithia Nagar,
 S.V. Road, Kandivli (W),
 Mumbai - 400 067 ..Appellant

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 V/s.

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 1. Union of India,
 Through the Director,
 Enforcement Directorate,
 Govt. of India, 6th Floor,
 Lok Nayak Bhavan,
 Khan Market,
 New Delhi 110 003.

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 2. The Special Director,
 Enforcement Directorate,
 Govt. of India, 6th Floor,
 Lok Nayak Bhavan,
 Khan Market,
 New Delhi 110 003. ..Respondents

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 Mr.A.S. Rao with Mr.B. Seshagopalan for the
 appellant.

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 Mr.A.J. Rana, senior counsel with Mrs.S.V.
 Bharucha for Union of India.

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CORAM : F.I. REBELLO &
 J.P. DEVADHAR, JJ.

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DATED : 5TH OCTOBER, 2007.

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ORAL JUDGMENT : (Per J.P. Devadhar, J.)

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 1. The appellant has filed this appeal against

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 the order of the Appellate Tribunal for Foreign
 Exchange dated 1st May, 2007 stating that the
 following questions of law arise out of the said
 order of the Tribunal.

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 1. Whether presumption under Section 72 of
 FERA, 1973 is available against the
 Appellant from the documents seized from the
 third party when the third party’s statement
 have neither been relied nor supplied ?

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 2. Whether the Tribunal has to follow the
 consistent binding precedents of the Hon’ble
 High Court, larger and co-ordinate bench of
 the same Tribunal which held that
 presumption under Section 72 is not
 available from the third party documents and
 when the third party was not made
 co-noticee ?

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 3. Whether the Tribunal is required to pass
 the order without any unreasonable and
 unexplained delay once the oral submissions/
 written submissions were made/submitted from
 the day of final hearing ?

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 4. Whether non supply of copy of statement
 of third party having already been decided
 to supply the same and whether concluding
 hearing by the Respondent No.2 would a
 proceeding in violation of principle of
 Natural Justice ?

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 5. Whether non consideration of all
 submissions on merit and binding judgments
 in ;the impugned orders would render the
 order as non speaking order, non reasoned
 order and non application of mind as held by
 the Apex Court and various courts ?

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 6. Whether non providing of cross
 examination of the; third party from whose
 premises certain alleged documents were
 recovered and whose statements were not
 relied on and supplied to the Appellant
 would render the impugned order as having
 been passed in violation of principle of
 natural justice ?

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 7. Whether the alleged confessional
 statement retracted in detail immediately
 before the Magistrate would require the
 Tribunal to assess the validity of the
 confessional as true and voluntary ?

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 8. Whether the Tribunal is required to
 consider the specific submissions made in
 the written submissions that the name and
 telephone number of the Appellant in the
 alleged documents seized from the third

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 party and give a categorical finding after
 calling for the original documents and
 satisfying the same ?

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 9. Whether the Tribunal is required to take
 into consideration of the ingredients of the
 provisions of FERA, 1973 and the
 contemporaneous documentary evidence
 submitted by the Appellant so as to come to
 the conclusion that the offence was proved ?

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 10. Whether the Tribunal is required to
 follow the precedents and non following
 would render the order having been passed in
 total disregard to the higher wisdom and
 whether the same would be judicial
 indiscipline ?

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 2. In this case, there was a search at the
 premises of Shri Punjabhai H. Shah and others on
 17th December, 1991 wherein certain incriminating
 documents were seized. Subsequently, there was a
 search at the residential premises and the locker
 belonging to the appellant on 29th January, 1992.
 During the course of search carried on by the
 Enforcement Officers, Indian Currency amounting to
 Rs.10,30,000/- and Rs.4,50,000/- respectively were
 recovered from the appellant along with certain
 documents. In his statement recorded under Section
 40 of the Foreign Exchange Regulation Act, 1973, the
 appellant inter alia stated as under :

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 "Regarding Rs.totaling 14,80,000/- seized
 from my residence and lockers, I have to
 state that out of this Rs.30,000/- belong to
 me that is my business money. Regarding
 remaining Rs.14,50,000/- I have to state as
 under :

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 I have got a close relative of my wife at
 Nairobi. His name is Mr.Jayesh Pattni, p.o.

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 Box 39233, Nairobi, Tel.751320. He is doing
 jewellary business there. Some time in May,
 1991 he informed me that he would be sending
 money to me in India through persons in
 India and I should keep with me until either
 he or his person would visit India and
 collect the same from me. He further
 informed that this money will be required by
 him in purchasing some spare parts and
 machinery for making ornaments. As he is
 close relative of my wife, I agreed to
 receive the money from him in India.
 Accordingly, I received total sum of
 Rs.27,00,000/- from June, 1991 to December,
 1991 and out of this I paid Rs.7,50,000/- to
 said Jayesh Pattni when he visited me in
 July, 1991 and Rs.5,00,000/- to one
 Mr.Pamabhai or Mr.Kanabhai of Nairobi when
 he visited me in July, 1991. All the
 payments were received by me in cash at my
 residence from some unknown persons. Before
 receiving the payments, I was informed each
 time by Mr.Jayesh Pattni from Nairobi at my
 telephone No.6826025 installed at my
 residence that he had arranged the payments,
 and some person in the name of Babybhai
 would make the payments. Before receiving
 the payments, I was also receiving call from
 one person stating his name as Babybhai that
 he had received the message from Kenya to
 make the payments to me."

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 3. The aforesaid statement was retracted by the
 Appellant on 30th January, 1992. However, on the
 basis of the confessional statement, the
 adjudicating authority passed an order on 28th
 January, 1994 imposing penalty of Rs.3,50,000/- for
 contravention of Section 9(1)(b) of FERA, 1973 and
 Rs.1,00,000/- for contravention of Section 9(1)(a)
 of FERA, 1973. Further, the adjudicating authority
 confiscated the seized amount of Rs.14,50,000/-
 under the provisions of Section 63 of FERA and
 balance amount of Rs.30,000/- was directed to be

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 appropriated towards the recovery of penalty levied
 on the appellant. On appeal filed by the appellant,
 the appellate Tribunal dismissed the appeal inter
 alia on the ground that the confessional statement
 made by the appellant has been sufficiently
 corroborated by the documents seized from
 Mr.Punjabhai. Challenging the aforesaid order,
 present Appeal is filed.

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 4. Mr.Rao, learned counsel appearing on behalf
 of the appellant submitted that in Fera Appeal No.26
 of 2007 similar questions raised by the appellant
 therein has been admitted by this Court on 19th
 June, 2007. He submitted that in the present case
 neither the documents seized from Punjabhai have
 been proved nor any opportunity was given to the
 appellant to cross examine the Officers who had
 recorded the confessional statement of the
 appellant. Accordingly, Mr.Rao submitted that the
 appellate Tribunal could not have drawn presumption
 against the appellant based on the document which
 were not proved in accordance with law. Moreover,
 by not offering the officers who had recorded the
 statement, the A.O. violated the principles of
 natural justice. Hence, the impugned order is
 liable to be quashed and set aside.

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 5. There is no merit in the above contention

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 because, firstly, the admission of Fera Appeal No.26
 of 2007 has no relevance because, in the present
 case the authorities below have placed reliance on
 the confessional statement and not on the documents
 seized from Punjabhai.

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 6. In the present case, reference to the
 documents seized from Punjabhai have been made only
 to show the genuineness of the confessional
 statement made by the appellant. Therefore, the
 Tribunal was justified in comfirming penalty imposed
 upon the appellant which is based upon the
 confessional statement of the appellant.

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 7. The Apex Court in the case Hazari Singh V/s.
 Union of India reported in 110 E.L.T. 406 and in
 the case of Surjeet Singh Chhabra V/s. Union of
 India & Others reported in 1997 (1) S.C.C. 508, the
 Apex Court has held that the confessional statement
 made before the Customs Officer though retracted is
 an admission and binding on the person.

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 8. In this view of the matter, in the facts of
 the present case, where the confessional statement
 is corroborated by the seized documents, findings
 recorded by the Tribunal cannot be faulted.

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 9. Accordingly, in our opinion no substantial
 question of law arises in this appeal. Hence, the

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 appeal is dismissed with no order as to costs.

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 (F.I. REBELLO, J.)

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 (J.P. DEVADHAR, J.)

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 IN THE HIGH COURT OF JUDICATURE AT BOMBAY

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 CIVIL APPELLATE JURISDICTION

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 FERA APPEAL NO.44 OF 2007

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 Date of decision : 5TH OCTOBER, 2007.

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 For Approval and signature

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The Hon’ble Justice Mr.F.I.REBELLO

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AND

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The Hon’ble Mr. Justice J.P.DEVADHAR

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 1) Whether to be referred to the )
 Reporter or not? )

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 2) Whether the Reporters of the )
 Local papers may be allowed )
 to see the Judgment/Order? )

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 ******

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 Transcribed by : A.G. Kulkarni,
 P.A. to J.P. Devadhar, J.

Kantilal M.Jhala v. Union of India

Case brief

What is this about?

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Kantilal M.Jhala v. Union of India

Case brief

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