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A. Shaud Ali v. Additional Collector Of Customs, Madurai
Judgment Summary — K. Gnanaprakasam, J.
Factual and Procedural Background
On 27-06-1986, the Customs Preventive Unit, Tuticorin, recovered precious stones from the petitioner’s house together with a chit mentioning A.C.M. Zubair. During interrogation the appellant (petitioner) gave a statement admitting that he had purchased the stones from Zubair, a Sri Lankan national. The appellant produced no customs duty paid receipt or other documents to show the licit origin of the goods. The Collector of Central Excise and Customs, Madurai (the assessing authority), after issuing a show cause notice, ordered confiscation of the goods and imposed penalties of Rs. 2,500 on the appellant and Rs. 2,500 on A.C.M. Zubair.
On appeal, the Tribunal modified the order: it permitted the appellant to redeem the stones on payment of Rs. 25,000 and reduced the penalty from Rs. 2,500 to Rs. 1,000. The appellant sought a reference to the High Court on two questions; the Tribunal (by a majority) referred the following questions to the High Court:
- Whether, in the facts and circumstances of the case, reliance can be placed on the statement of the appellant?
- Whether, in the facts and circumstances of the case, the evidence cited against the appellant could be taken to be sufficient to raise a presumption in favour of the department for the purpose of confiscation of the goods?
Legal Issues Presented
- Whether, in the facts and circumstances of the case, reliance can be placed on the statement of the appellant?
- Whether, in the facts and circumstances of the case, the evidence cited against the appellant could be taken to be sufficient to raise a presumption in favour of the department for the purpose of confiscation of the goods?
Arguments of the Parties
Appellant's Arguments
- The appellant was arrested on 27-06-1986 and released only on 30-06-1986; a statement recorded on 28-06-1986 while he was in custody was not voluntary but obtained by threat and coercion (duress) and is therefore inadmissible.
- Supporting facts for involuntariness: telegrams sent by the appellant's wife to the Additional Chief Judicial Magistrate (South), Madurai (28-06-1986) and a telegram by the appellant after release (30-06-1986); treatment taken by the appellant on 01-07-1986 in a Government Hospital and production of an accident register documenting injuries allegedly inflicted while in custody.
- Reliance on precedent: Nathu v. State of U.P. (AIR 1956 SC 56) — emphasizing that prolonged custody immediately preceding a confession can render it involuntary unless properly explained.
- Reliance on Roshan Beevi v. Joint Secretary to Government of Tamil Nadu (1984 Crl. L.J. 134) — addressing confessions in enquiries under Sections 107 & 108 of the Customs Act and stating that such confessions before Customs Officers are admissible and not hit by Sections 25 or 26 of the Evidence Act.
- Reliance on A. Abdullah v. The Foreign Exchange Regulation Appellate Board (1996 Crl. L.J. 4378) — stressing that immediate retraction together with injury records can render a confession involuntary and untrustworthy.
- Reliance on State of Andhra Pradesh v. Gangula Satya Murthy (1997 SCC (Cri) 325) — explaining that confessions made while under custodial surveillance (broadly construed) are barred by Sections 25/26 Evidence Act.
- Substantive defence on merits: the stones are permissible imports, the appellant had no evidence showing smuggling, and the department bears the burden (citing Section 123 of the Customs Act); the seized goods were not notified goods (e.g., not gold or other notified items), so confiscation and penalties lack basis.
Respondent/Revenue's Arguments
- The appellant’s statement was voluntary: he admitted the goods were smuggled and no coercion or ill-treatment occurred.
- The appellant was ordered released the next day but could not furnish sureties until 30-06-1986; the respondent denies knowledge of any treatment or injury claims.
- Alleged telegrams were not communicated to the respondents at the relevant time; no prompt retraction or intimation was given by the appellant after release — the appellant first raised the contention only in his reply to the show cause notice dated 17-12-1986 (via advocate on 03-02-1987), making the retraction belated and an afterthought.
- On the question of smuggling, the department contends the appellant failed to discharge the burden to show lawful import and possession; absence of valid customs receipts undermines the appellant’s claim.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Nathu v. State of U.P., AIR 1956 SC 56 | Prolonged custody immediately before a confession may render it involuntary unless properly explained. | The appellant relied on this principle to challenge voluntariness. The court considered the contention but concluded, on the facts before it, that the appellant did not establish that the statement was extracted under threat while in custody; the court found the confession voluntary and acceptable. |
| Roshan Beevi v. Joint Secretary to Government of Tamil Nadu, 1984 Crl. L.J. 134 | In proceedings under Sections 107 & 108 of the Customs Act, a person is not an accused for purposes of Sections 25/26 Evidence Act; confessions before Customs Officers under those sections are admissible. | The appellant relied on this authority. The court noted the precedent but ultimately accepted the appellant’s recorded confession as voluntary; the court’s ultimate conclusion favoured the department on the admissibility and weight of the statement in this case. |
| A. Abdullah v. The Foreign Exchange Regulation Appellate Board, 1996 Crl. L.J. 4378 | Immediate retraction together with injury records and other features may show a confession was not voluntary; absence of affidavits by officers alleged to have ill-treated the confessor is material. | The appellant invoked this decision. The court considered the points (retraction, injury register, allegations of ill-treatment) but found that the appellant failed to prove coercion; the court accepted the confession as voluntary. |
| State of Andhra Pradesh v. Gangula Satya Murthy, 1997 SCC (Cri) 325 | Confessions made to police officers are inadmissible under Section 25; Section 26 extends the prohibition to confessions to other persons if the confessor was in police custody or custodial surveillance in a pragmatic sense. | The appellant relied on this reasoning to argue that the statement was barred by Sections 25/26. The court considered the custody/surveillance point but concluded that the appellant did not establish that the confession was made under such prohibited circumstances; the statement was treated as voluntary. |
Court's Reasoning and Analysis
The court proceeded by applying the factual record to the legal contentions raised by the parties and authorities cited:
- The court acknowledged that the seized stones were goods permissible to import but emphasized the appellant had produced no customs duty paid receipt or valid documents to prove licit origin.
- It examined the appellant’s confession in which he admitted the stones belonged to Zubair (a Sri Lankan) and that he had entrusted the stones for sale. The court treated the confession as central to the department’s case.
- The court noted that Zubair disowned the stones in his reply dated 15-01-1987 to the show cause notice. The court viewed Zubair’s disavowal as inconsistent with the appellant’s explanation that he merely held the stones for sale on behalf of Zubair; the appellant did not explain Zubair’s reply.
- The court considered the appellant’s allegations of coercion: telegrams, alleged injuries and the accident register, and the timing of arrest, custody and release. It also considered the authorities cited concerning voluntariness and custodial confessions (including Sections 25/26 Evidence Act and Sections 107/108 Customs Act in the precedents).
- On balance, the court found that the appellant had not made out a case that the confession was extracted by threat or while in custody; the court characterized the statement and confession as voluntary and acceptable.
- Regarding the presumption of smuggling and the burden under Section 123 of the Customs Act, the court observed that the appellant had not produced material to infer the stones were not smuggled; combined with the voluntary confession and the lack of proof of lawful import, the court found there was sufficient basis to support the department’s case.
- Accordingly, the court answered the referred questions against the appellant and in favour of the Revenue.
Holding and Implications
Holding: Both questions were answered in favour of the Revenue and against the appellant.
Implications:
- Direct effect on the parties: The High Court ruled that the appellant’s confession was voluntary and that the evidence justified the department’s presumption for confiscation; this outcome goes against the appellant on the issues referred by the Tribunal.
- The opinion does not record the imposition of any new or broader legal principle beyond its application to the facts; it resolves the referred factual-legal questions against the appellant based on the record before the court. The text does not state that a new precedent was laid down.
K. Gnanaprakasam, J.:— The Customs Preventive Unit, Tuticorin, on information, recovered precious stones from the house of the petitioner on 27-6-1986 along with a chit containing the name of one A.C.M Zubair. On interrogation, the appellant gave a statement, confessing that he had purchased the said stones from Zubair, who is admittedly a Sri Lankan national. As the petitioner was not having any customs duty paid receipt nor any valid document to prove the licit nature of the goods and after show cause notice, the Collector of Central Excise and Customs, Madurai, who is the assessing authority passed an order confiscating the goods and also imposed a penalty of Rs. 2500/- to the appellant and Rs. 2500/- to A.C.M Zubair.
2. On appeal to the Tribunal, the order was modified and the appellant was permitted to redeem the stones on payment of Rs. 25,000/- and also reduced the penalty from Rs. 2500/- to Rs. 1000/-. The petitioner applied to the Tribunal to refer the following questions to the High Court. The Tribunal, by a majority has made the reference. The questions referred are:—
(1) Whether in the facts and circumstances of the case, reliance can be placed on the statement of the appellant?
(2) Whether in the facts and circumstances of the case, the evidence cited against the appellant could be taken to be sufficient to raise a presumption in favour of the department for the purpose of confiscation of the goods?
3. Thiru V. Sathish Sundhar, learned Advocate for the appellant has submitted that the appellant was arrested on 27-6-1986 and he was released only on 30-06-1986. While the appellant was in custody a statement was obtained from him on 28-6-1986, wherein he has admitted that the stones seized were smuggled to India through one Zubair and he had entrusted the same to him for sale. According to the appellant, the said statement is not a voluntary statement and the same was obtained by threat and coersion, while he was under custody i.e duress and the same is inadmissible. It is also pointed out that the appellant's wife gave a telegram to the Additional Chief Judicial Magistrate (South) Madurai on 28-6-1986 and the appellant also gave a telegram after his release on 30-6-1986 and the appellant also took treatment on 1-7-1986 in Government Hospital for the injuries said to have been inflicted while he was in custody and also produced a copy of the accident register to show the injuries said to have been caused on the body of the appellant. Pointing out all these factors, it is argued that while the appellant was in the custody of the respondent, he was forced to give such a statement. As the statement was not a voluntary one, the same could not be taken into consideration and the same is inadmissible. Learned Counsel for the appellant also relied upon the judgment reported in Nathu v. State of U.P, (AIR 1956 SC 56) wherein it was observed—
“It appears to us that the prolonged custody immediately preceding the making of the confession is sufficient; unless it is properly explained to stamp exhibit p.15, as involuntary. P.W 33 made no attempt to explain this unusual circumstance. It is true that with reference to this matter the appellant made various suggestions in the cross-examination of-P.W 33, such as that he was given bhang and liquor, or shown pictures, or promised to be made an approver, and they have been rejected and rightly as unfounded.”.
4. The case of Roshan Beevi v. Joint Secretary to Government of Tamil Nadu (1984 Crl. L.J 134) was also relied upon by the appellant. That case deals with the confession statement made by a person in other equiry under Sections 107 & 108 of the Customs Act. It is observed—
“In a proceeding under the provisions of the Customs Act, when any person is required or summoned for an enquiry under Section 107 or Section 108, that person is not an accused person and the officer summoning that person is not a police officer. Any confession made by a person summoned under Section 107 or Section 108 before the Customs Officer is admissible in law since it is not hit either by Sec. 25 or Sec. 26 of the Evidence Act.”
5. Further reliance is made in respect of the case of A. Abdullah v. The Foreign Exchange Regulation Appellate Board (1996 Crl. L.J 4378) wherein a Division Bench of this Court held:—
“In the light of the immediate retraction of the said statement and in the light of the above said accident register and injury report and other features of the case, it would be indeed erroneous in law, to hold that the above said confessional statement was voluntary and true. It is also significant to note that the Enforcement Officer and three other officers with him, against whom serious allegations have been made by the appellant about the ill-treatment meted out by them to him in extracting the said confessional statement, have not even come forward to at least file an affidavit stating that what has been alleged in the retracted statement of 25-1-1985, in all details, are not true.”
6. Further reliance is also made in the case of State of Andhra Pradesh v. Gangula Satya Murthy [1997 SCC (Cri) 325] wherein in paragraph 19, the Apex Court held:—
“It is true any confession made to a police officer is inadmissible under Section 25 of the Act and that ban is further stretched through Section 26 to the confession made to any other person also if the confessor was then in police custody. Such custody need not necessarily be post-arrest custody. The word ‘custody’ used in Section 26 is to be understood in a pragmatic sense. If any accused is within the keen of surveillance of the police during which his movements are restricted then it can be regarded as custodial surveillance, for the purpose of the section. If he makes any confession during that period to any person be he not a police officer, such confession would also be hedged within the banned contours outlined in Section 26 of the Evidence Act.”
7. On the contrary, learned Advocate for the Revenue has submitted that in the statement of the appellant he has voluntary confessed that the goods were smuggled into India and that therefore the said statement cannot be assailed. The appellant was neither ill treated nor was the statement obtained under threat and force. The respondent also pointed out that the appellant was ordered to be released on the next day of the incident, but, he was not able to offer sureties immediately and offered sureties only on 30-6-1986 and on that day, he was released. The respondent is not aware of any treatment said to have been taken by him for the alleged injuries. Though the telegrams were alleged to have been sent to the Additional Chief Judicial Magistrate (South) Madurai by the appellant's wife and by the appellant, such intimation was not given to the respondents. Even, after the release on 30-6-1986, the appellant had not chosen to send any letter/notice retracting the statement given by him and also about the treatment taken by him. The appellant came forward with this story only in the reply notice sent by him through his Advocate on 3-2-1987 to the show cause notice of the respondent dated 17-12-1986. As such the argument of the appellant that his statement is made inadmissible has got to be rejected as the retraction and reply notice were belated and an after thought and there is no truth in the said statement.
8. The learned Advocate for the appellant next submitted that the stones seized from the appellant are not smuggled goods and there is no evidence to establish the same. It is further submitted that these goods are permissible goods to be imported and that therefore there can be no presumption on the part of the department to hold that these goods are smuggled goods and the burden is upon the department to show that these goods are smuggled goods.
9. Learned Advocate for the appellant has further submitted that the department has failed to discharge the burden cast upon it as provided under Section 123 of the Customs Act as the goods seized are not gold or any other goods notified by the Central Government and in the absence of any such notification the order passed by the assessing authority and confirmed by the Tribunal are without any basis and they are liable to be set aside.
10. No doubt, it is true that the stones, which were seized from the appellant's house, are the goods permissible to be imported, but the appellant had not shown any valid receipt for having imported the said precious stones. The appellant, in his statement, has confessed that one Zubair a Sri Lankan is the owner of these goods and he had entrusted them to him to sell the same and he acted for and on behalf of Zubair. But, the said contention of the appellant is false, as Zubair had disowned the stones seized from the appellant in his reply on 15-1-1987 to the show cause notice issued by the respondent. On the face of the reply given by the Zubair, it is very difficult to accept the explanation offered by the appellant that the stones were entrusted to him for sale and in such situation, he was holding the same and therefore, he had not committed any offence. If that be so, there is no necessity for Zubair to give such a reply and the appellant has not chosen to give any explanation for such a reply by Zubair. It is argued that Zubair came forward with a statement to extricate himself from the offence. But, the appellant in his reply to the show cause notice had stated—
“My client submits that the documents available on record do not also disclose that the stones in question are smuggled one. The goods are not notified goods under the Act and as stated supra, my client has come into possession of the same in his regular business transactions”.
11. But, however, he also does not claim ownership to the goods seized and thereby making a dual stand of his possession of the goods seized. Considering the issue in the light of the facts and events set forth above, the appellant has not made out a case that the statement given by him was extracted under threat, while he was in custody and as such, the statement given by him and the confession made thereon are voluntary and acceptable. As the appellant has also not produced any material to draw an inference that the goods seized are not smuggled into India, we find it difficult to accept the contentions of the appellant.
12. In the result, both the questions are answered in favour of the Revenue and against the appellant.
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