JUDGMENT

1. Two hundred gold biscuits were disinterred from the residential compound of the respondent when a team of customs officers conducted raid on 6-12-1980. The biscuits had marks to indicate that they were of foreign origin. The total value of them exceeded rupees forty lakhs, as per the price prevailed then. The respondent was prosecuted for the offences under Sec. 135(1) of the Customs Act, 1962 (for short the Customs Act) and Secs. 85(1)(a) and 86 of the Gold Control Act, 1968. The trial court acquitted him mainly on the ground that the prosecution did not prove that the contraband gold articles were in the conscious possession of the respondent. This appeal is by the Assistant Collector of Central Excise, who filed the complaint in the lower court. The respondent (the accused in this case) is the Managing partner of a firm dealing in stationary articles. His residence is on St. Vincent's Cross Road, Ernakulam. The officers of the Central Excise and the Customs Department got secret information that smuggled gold articles were hidden in the residential compound of the accused. P.W 2, Superintendent of Customs (preventive and Intelligence Unit), Cochin, accompanied by a team of officers of the Customs Department conducted a search of the house and premises of the accused on 6-12-1980. A box made of teak-wood was disinterred from the courtyard. The box contained two hundred gold biscuits wrapped up in two bundles. Those articles were assayed by a gold-smith. Samples of them were got examined in the Mint. The result of such examinations revealed that the gold in question had twentyfour caret purity. Ext. P3 mahazar was drawn up by PW 2 for seizure of the gold biscuits along with the wooden box and the wrapper. Ext. P4 is the statement given by the accused (under his handwriting and signature), as per Sec. 108 of the Customs Act.

2. The accused did not dispute the fact that the gold biscuits were unearthed from his courtyand and that all such gold biscuits are smuggled good within the purview of the Customs Act, and that they are “primary gold” within the meaning of the Gold Control Act. Nor has he disputed the prosecution, case that the courtyard from which they were unearthed was in his possession. According to him, he never knew that such a wooden box with gold in it had ever been interred in his compound. He suggested that they would have been buried in his compound by P.W 3 who had deep involvement in smuggling activities and who had free access to this property. Accused strongly repudiated the statements attributed to him in Ext. P4 statement. He contended that he was compelled to write down those statements under threat and coercion. According to him, the statement contained in Ext. P4 does not represent true facts.

3. Learned Magistrate accepted the accused's version and found that he had no conscious possession of the gold articles, albeit its recovery from his own courtyard. The lower court, expressed strong suspicion on the conduct of P.W 3 and agreed with the defence suggestion that P.W 3 would have buried the wooden box with the contraband gold in the place wherefrom it was disinterred. No reliance was placed on Ext. P4 statement, as the court below was of the view that it was not a voluntary statement given by the accused. For those and other reasons learned Magistrate acquitted the accused.

4. Sri. K. Prabhakaran, Additional Central Government standing counsel assailed every one of those findings and contended that when once possession of the property, wherefrom the contrabands were unearthed, stands proved or admitted, a presumption can be drawn that the person concerned was in conscious possession of those articles. According to the learned counsel, Ext. P4 statement having been recorded under a statutory provision, should not have been sidelined. The suspicion expressed by the trial court about its concoction is unwarranted and unsupported by any circumstance whatsoever, contended the counsel.

5. Sec. 138A of the Customs Act and Sec. 98B of the Gold Control Act are identically worded. Those provisions were inserted in the respective parent statute by Act 36 of 1973. They read thus:

“(1) In any prosecution for an offence under this Act which requires a culpable mental state on the part of the accused, the Court shall presume the existence of such mental stage but it shall be a defence for the accused to prove the fact that he had no such mental state with respect to the act charged as an offence in that prosecution.

Explanation.—In this section, “culpable mental state” includes intention, motive, knowledge of a fact and belief in, or reason to believe a fact.

(2) For the purposes of this section, fact is said to be proved only when the Court believes it to exist beyond reasonable doubt and not merely when its existence is established by a preponderance of probability”.

6. Can the presumption envisaged in the aforesaid provisions be stretched to the point that the person from whose property the contrabands were recovered, knowingly possessed them? The presumption is evidently in favour of culpable mental state which is required to constitute the offence. It arises only in cases where a culpable mental state is required to constitute the offence. Though culpable mental state includes knowledge “of a fact”, that should be what is required to make up the offence. Sec. 135 of the customs Act, which is the penal provision, envisages a particular knowledge to constitute the offence. If any person acquires possession of any goods “which he knows or has reason to believe are liable to confiscation”, such acts shall be punishable with the punishment prescribed therein. So the “knowledge” must be that the goods in his possession “are liable to confiscation”. It does not take in the knowledge that they were hidden in a particular place or even the belief that he is in possession of the aforesaid goods. If goods are found in the premises belonging to or in the possession of the person concerned, there cannot be a presumption that he is in possession of the goods knowingly or intentionally. Possession contemplated in the Section is, no doubt, conscious possession and the question whether the person concerned has conscious possession is a matter which the prosecution has to establish in each case. The presumption envisaged in Sec. 138A of the Customs Act would thus be of no help in such context. Of course, in deciding question whether the person from whose property the contraband goods were recovered had conscious possession, the court is entitled to draw inferences from attending circumstances including broad probabilities. In some cases, even the very fact of possession of the place of concealment would help the court in drafting inference regarding the mental state of the person in possession of that place, is situations in those cases would justify such inference. The decisions in J.A Naidu v. State of Maharashtra ((1980) 1 SCC 206 : AIR 1979 S.C 1537) and State of Maharashtra v. Natwarlal ((1980) 4 SCC 669 : AIR 1980 S.C 593) support the legal possition that unless consious possession of the contraband goods is established prosecution cannot succeed in cases where possession of contraband would amount to offence. Learned counsel for the accused, in support of his contention that mere recovery of contraband goods from the property of the accused is nor sufficient to establish consious possession, has cited the decision in Chaganraju v. State of A.P ((1979) 4 SCC 481 : AIR 1980 S.C 477). Learned Magistrate has also relied on the said decision. But the facts in the said decision are so peculiar that the conclusion arrived at in that case is of no help in this case. Customs authorities found out contraband goods while digging the property of the accused in that case. Even when the articles were dugout, the accused strongly disowned having anything to do with them, and a few hours later another person, who was interrogated by the officers, admitted that, the contrabands were buried by him in the same place. The person who owned the responsibility was later convicted by the criminal court for the offence charged. It was in such circumstances that the Supreme Court concluded that the accused cannot be found quality off the offence merely on the strength of recovery of such goods from his property.

7. The facts here are different. The spot wherefrom the wooden box was disinterred is only two feet north of the northern wall of the “prayer room” of the accused's house. The prayer room has a spacious window on the northern wall. The “dining hall” adjoins the prayer room. The dining hall also has a spacious window on the northern wall. The main bed room adjoins the prayer room on the west. These features have been gathered from Ext. P15 plan of the building. It is not disputed by the accused that the building was constructed exactly in consonance with that plan. These are broad aspects which cannot be ignored in determining the question of conscious possession of the goods concerned. It does not stand to reason that any person other than the accused would have chosen the aforesaid spot to hide such enormously valuable gold articles from the sight and knowledge of all others. If an outsider had to conceal such valuables, he would never have selected such a spot which is so easily visible to the inmates of the house, particularly those who daily (if not frequently) use the prayer room and the main bed room situated very close to the said spot. An outsider who wants to avoid his own house or his own property to conceal such costly valuables would not in all probabilities select this particular spot unless he takes the accused also in strict confidences. This is because care must then be taken to protect the spot from being trampled upon by the inmates of the house or the servants or even the labourer, who may be employed to do some work in the property. The depth in which the wooden box was buried was relatively shallow and hence it was vulnerable to exposure in slight disturbance of the surface mud. Any spade work, either for gardening or for planting seedlings or any other similar activities may expose the wooden box, unless special care is taken in such activities. An tousider without the active connivance of the occupant of the house, would not even take a chance to conceal such costly valuables at this spot. An outsider may do it only if he has the assurance and confidence that the occupant of the house would safeguard the spot.

8. Learned Magistrate critically examined the testimony of P.W 3 and expressed suspicion that the contraband gold might probably have been concealed by P.W 3. Learned counsel for the accused spared no effort to highlight the possibility of P.W 3 giving information to the customs authorities regarding the spot of concealment. No doubt, a reading of his evidence shows that P.W 3 would have had smuggling activities in the past and that his association with the accused was so intimate that he could have had easy access to the compound. P.W 3 admitted that the wooden box was made by a carpenter (P.W 4) as per his orders. P.W 3 has said that it was at the behest of the accused that he placed the order for making the wooden box a though he got another box made by the same carpenter for his own use. Learned Magistrate expressed suspicion over the non-production of the other box which P.W 3 made for himself. The evidence is to the effect that the customs authorities had taken the other box into custody from P.W 3. But its non-production in this case has no consequence at all, nor would it help the determination of the crucial question involved in this case. That aspect and the remaining evidence of P.W 3 would, at the most, indicate that he too would have been an associate of the accused and that he too would have had some role in cancelling the gold involved in this case. But it is the hight of improbability to assume that P.W 3 would have buried the articles in the place wherefrom they were disinterred without the consent of the accused. If not without the active participation of the accused. On broad probabilities it is illogical to assume that if P.W 3 had been the owner of the gold, he himself would have given information to the customs authorities about the place of concealment and betray his own secret possession of enormously precious wealth. If P.W 3 had passed any such information to the officials, the least which could then be inferred is that the valuable did not belong to him. The lower court failed to consider this broad probability when it accepted the defence contention that P.W 3 would have leaked the information to the officials after having concealed it in the courtyard of the accused.

9. The most important item of evidence relied on by the prosecution is the statement of the accused in Ext. P4. It is a statement recorded as per statutory provision because Sec. 108 of the Customs Act empowers any gazetted officer of the Customs to summon any person whose attendance he considers necessary to give evidence. Sub-section (3) says “all persons so summoned shall be bound to attend either in person or by an authorised agent, as such officer may direct and all persons so summoned shall be bound to state the truth upon any subject respecting which they are examined or make statements and produce such documents and other things as may be required”. Every person summoned under Sec. 108 is thus bound to state the truth. Ext. P4 shows that the accused was infromed by P.W 2 of his statutory duty to speak the truth. If the accused had declined to speak the truth, that would have exposed him to criminal prosecution for the offence under Sec. 193 of the Indian Penal Code. Learned Magistrate did not act on Ext. P4 statement as it appeared to the court that “P.W 2 obtained Ext. P4 statement from him by coercion, threat and inducement and after prolonged illegal detention”. The statement contained in Ext. P4 is full of admissions that the accused acquired those gold biscuits from a smuggler about ten years ago and P.W 3 being his best friend, helped him to get a wooden box made and that the gold articles were buried in the residential compound where he resided earlier and they were removed later to the present compound after completing the construction of the new house. The additional Central Government standing counsel contended that Sec. 24 of the Evidence Act cannot be invoked for jettisoning Ext. P4. It was argued that the person who made the confession in Ext. P4 was not “an accused person” at the time of making the confession and hence Sec. 24 of the Evidence Act is not applicable. His argument needs scrutiny.

10. In P. Rustomji v. State of Maharashtra ((1971) 1 SCC 847 : AIR 1971 S.C 1087) there is an observation like this: “It is dear that when an inquiry is being conducted under section 108 of the Act (Customs Act), and a statement is given by a person against whom the inquiry is being held it ‘is not a statement made by a person accused of an offence and the person who gives the statement does not stand in the character of an accused person’. Therefore the first essential fact to be established, to attract Section 24, referred to above is lacking in this case as the appellant was not an ‘accused person’. “Is it necessary that the maker of the confession should have been formally arraigned as an accused at the time of making the confession for attracting Sec. 24? The expression used in Sec. 24 is “an accused person” whereas the expression used in Secs. 25 and 27 is “a person accused of any offence”. Statements recorded under Sec. 108 of the Customs Act were impugned in some cases as offending Sec. 25 of the Evidence Act and Article 20(3) of the Constitution of India. Constitution affords protection to accused persons against testimonial compulsion through Article 20(3). The expression used in the Article is “person accused of any offence”. The challenges were repelled by the Supreme Court on the twin ground that customs officer is not a police officer and the person whose statement is recorded during enquiry is not “a person accused of any offence”, although that person becomes an accused subsequently. (Vide Remesh Chandra v. State of W.B, AIR 1970 S.C 940 and Veera Ibrahim v. State Of Maharashtra, (1976) 2 SCC 302 : AIR 1976 S.C 1167). As early as 1960 a constitution bench of the Supreme Court in State Of Uttar Pradesh v. Deoman Upadhyaya (AIR 1960 S.C 1125) has held as follows?

“The expression, “accused person” in S. 24 and the expression “a person accused of any offence” in S. 25 have the same connotation, and describe the person against whom evidence is sought to be led in a criminal proceeding. The expression, “accused of any offence” in S. 27, as in S. 25, is also descriptive of the person concerned against whom evidence relating to information alleged to be given by him is made provable by S. 27 of the Evidence Act. It does not predicate a formal accusation against him at the time of making the statement sought to be proved as a condition of its applicability”.

11. The ratio in the said decision remains unaltered till now since another larger bench or a constitution bench of the Supreme Court has not adopted a different view. In Veera Ibrahim v. State Of Maharashtra ((1976) 2 SCC 302 : AIR 1976 S.C 1167) the court enumerated six conditions for the application of Sec. 24 of the Evidence Act and it was taken for granted that the maker of the confession was not an accused at the time of making the confession, but that was not counted as a factor sufficient to exclude the application of the section. In Sevantilal v. State of Maharashtra ((1979) 2 SCC 58 : AIR 1979 S.C 705) the Supreme Court excluded a statement recorded under Sec. 108 of the Customs Act on the ground that it offended Sec. 24 of the Evidence Act. The maker of the statement in that case was arrayed as an accused only subsequently, but that was not used as a ground to exclude the application of S. 24.

12. The position emerges out of the above discussion is that it is not necessary that the maker of the confession should have been an accused at the time when the confession is made. It is enough that he becomes an accused subsequently and the court can consider whether the confession is vitiated or account of the other factors laid down therein.

13. The confession does not become vitiated merely because the same was extracted by inducement, threat or promise, eg:— If a person induced to speak the truth, that may persuade him to make a true confession. Similarly, if a person exerts threat that if the statement turns out to be untrue, the maker thereof would be made liable for perjury. Such a threat is insufficient to exclude the statement from the range of admissibility because there is nothing wrong in informing or reminding a person of his statutory obligation to speak the truth and also of the consequences of his not doing so. A promise that no prosecution would be launched against the maker of the confession for perjury is also insufficient to sideline the confession Sec. 24 will continue to remain out of reach unless such inducement or threat or promise is sufficient to afford grounds to suppose that he would be a gainer by making the confession.

14. In the present case the trial court did not consider the aforesaid important aspect even though the statement in Ext. P4 was found to have been extracted through compulsion. Neither P.W 2 nor P.W 5 has stated that the accused was given any impression that by making the statement he would get some advantage. On the other hand Ext. P4 itself contains a recital that P.W 2 told him in advance of the consequences of such a statement and also that the statement would eventually be used against the maker. The accused is a businessman in Cochin. He has studied up to S.S.L.C Ext. P4 was written in his own handwriting. Absolutely nothing has been elicited from any of the witnessess that the accused had at any time supposed that by making the statement he would score any advantage. In P. Rustomji v. State of Maharashtra ((1971) 1 SCC 847 : AIR 1971 S.C 1087) the Supreme Court has observed thus: “It is not every threat inducement or promise even emanating from the person in authority that is hit by Section 24 of the Evidence Act. In order to attract the bar, it has to be such an inducement, threat or promise, which should lead the accused to suppose that by making it he would gain any advantage or avoid any evil of temporal nature in reference to the proceedings against him. In the case before us what is it that the appellant has been told? He has been told that the law requires him to tell the truth and if he does not tell the truth, he may be procsecuted under Section 193 I.P.C for giving false evidence. This, we have held, does not constitute a threat under Sec. 24 of the Evidence Act.”

15. What is next to be considered is whether the fact stated by the accused in Ext. P4 could have been true. The trial court was not inclined to hold that the statement would be the truth regarding the acquisition and concealment of the contraband gold. The following is the main reasoning of the learned Magistrate for reaching the said conclusion. “It is difficult to believe that the accused who disowned the presence of any contraband gold with him on 6-12-1980 when questioned on 7-12-1980 admitted that he is the owner of the gold biscuits seized under Ext. P3”. The aforesaid reasoning is made on the premise that the accused told P.W 2 just before the commencement of the raid that he was not in possession of smuggled goods, but after unearthing the gold articles from his courtyard, the accused, when interrogated again, admitted that the same was buried by him. Is it so improbable that a person who adopted a different stand earlier has changed it subsequently especially when he was confronted with the fact of disinterment of such large quantity of gold biscuits from his own courtyard? A denial made by him earlier is no guarantee for the truth of the first stand as it happens quite often that the concealer can express ignorance at a time when the contraband remains undisturbed in the hidden place. But the position changes drastically when the very same person is asked to account for the smuggled goods unearthed either from his house or from his courtyard. He would then be drawn to a very weak position and is veritably cornered by the subsequent developments. I do not find anything improbable in the changed stand adopted by the accused subsequently when he was confronted with the contraband articles taken out from his courtyard and that too in his presence.

16. There is yet another circumstance which ensures confidence about the truth of the statement contained in Ext. P4. The stand of the accused is that he disowned the statement recorded in Ext. P4 for the first time on 15-12-1980. The statement was recorded and signed by him on 7-12-1980. He was released on bail by the court on 7-12-1980 itself. What would have been the normal conduct of a person placed in the position of the accused when he became a free man by evening of 7-12-1980? If he was made to write untrue statements implicating him in a substantial way, I have no doubt that the first thing which he would, in all probabilities, have done was to inform the court or atleast the higher officials in the Customs Department about what happened. Accused is not an uneducated or helpless person. His business place is situate in a commercially important area very near to Broadway, Ernakulam. He has other partners in his business enterprise and there are employees working under him. Why did he not raise a little finger until 15-12-1980 against the serious offence committed against him by P.W 2?. He made a feeble attempt to explain away this conduct by saying that he waited till a statement from his wife was recorded, as the customs authorities threatned that they would make his wife a co-accused. If that be so, it is all the more important that the accused should have complained to the court or the higher officials of the Customs Department immediately after he became a free man. It is admitted that the statement of his wife was recorded on 12-12-1980. Yet the accused waited till 15-12-1980 to register his complaint for the first time against the action of P.W 2. It is unfortunate that the trial Magistrate expressed satisfaction of the explanation offered by the accused for not complaining against P.W 2 till 15-12-1980. In my view the learned Magistrate has gone wholly wrong in treating the aforesaid excuse of the accused as satisfactory explanation for the delay in retracting from the confession.

17. Ext. P4 statement contains vivid details regarding the acquision of the gold biscuits, the different modes adopted by him to conceal them from time to time and other connected matters. I do not for a moment believe that the narration of the events made mention of in Ext. P4 could be a fiction concocted by P.W 2 and his associates to falsely implicat this accused. After all, what is the interest of P.W 2 and all the other officials of the Customs Department who were involved in this raid to concoct false case against this accused? If they had reasons to believe that the gold biscuits were actually buried not by the accused, but by P.W 3, why should the customs authorities protect P.W 3 and turn against the innocent man? If they could concoct a confession as Ext. P4, why they could not concoct a statement implicating P.W 3, if as a matter of fact, they came to know that it was P.W 3 who had concealed these articles. For all these reasons, the irresistable conclusion which can be drawn is that Ext. P4 contains only the true version revealed by the accused when interrogated by the customs officials subsequent to the exposure of the gold articles. The trial court failed to advert to these broad circumstances discussed above. Though the learned Magistrate had reasons for not relying on the testimony of P.W 3, that is no justification to delink the accused completely from the possession of the contraband gold recovered from his residential courtyard. Even strong suspicion of P.W 3's complicity is not sufficient to extricate the accused from possession of the contraband gold biscuits. For the aforesaid reasons, there is no escape from finding that the accused is guilty of concealing the smuggled goods and for possessing primary gold.

18. In the result, I allow this appeal and set aside the order of acquittal. I find the accused guilty of the offence under Sec. 135(1)(b)(i) of the Customs Act and also the offence under Sec. 85(1)(ii)(a) of the Gold Control Act and convict him thereunder. He is sentenced to undergo rigorous imprisonment for a period of one year for the first count and rigorous imprisonment for a period of six months for the second count. Sentences are directed to run concurrently. The trial court is difected to adopt steps to take the accused into custody so as to enable him to undergo the period of imprisonment.