Anil Jindal vs Union Of India (Uoi) And Ors.
2002 Latest Caselaw 1439 Del

JUDGMENT

Usha Mehra, J.

1. Petitioner was apprehended by the Special Intelligence and Investigation Branch (SIIB) of the Custom Department for over-invoicing the export value and misdeclaration of the description of the items.

2. Brief facts for purposes of deciding this writ are that petitioner and his companions declared "Brick Powder" as "Magnesite Ramming Mass" (in short MRM). The petitioner in connivance with others did this in order to avail higher Duty Exemption Pass Book (in short DEPB) credit. The prevalent price of most commonly used MGM was approximately Rs. 12/- per Kg. The Government of India in its Export Import Policy announced DEPB Scheme by virtue of which the exporter becomes eligible to claim credit at a specified percentage of F.O.B. Value of exports made in freely 'convertible currency'.

3. M/s Vikas Trading Corporation exported different consignments on different dates to M/s Fairdeal Building Chemicals, Sharjah, U.A.E. declaring the goods as Magnesite Ramming Mass/Magnesite Chrome Magnesia Ramming Mass under claim for the benefit of DEPB Scheme through the authorised custom house agent Mr. Deepak Sharma. Mr. Joginder Batra was the proprietor of M/s Vikas Trading Corporation.

4. That these exports were allowed on provisional basis subject to Chemical testing. The consignment was cleared at Dubai at a lower price than value declared on the shipping bill. After getting suspicious the Department forwarded the sample available with them drawn at the time of allowing of export for testing. The test report revealed that the sample was in the form of greyish brown coarse powder and hard gritty material. It composed of Magnesium Oxide together with oxides of Aluminium, Calcium, Iron & Silicious Matter.

5. Statement of Mr. Deepak Sharma was recorded wherein he deposed about the involvement of M/s Vikas Trading Corporation and M/s Rahul Traders. Petitioner who is the proprietor of M/s Rahul Traders, his statement under Section 108 of the Customs Act, 1962 was also recorded. He admitted having issued for bills of Ramming Mass amounting to Rs. 1,51,20,000/- to M/s Vikas Trading Corporation. He further stated that he had not supplied any goods to M/s Vikas Trading Corporation but raised bills. That M/s Rahul Traders was formed by him for the purpose of raising bills and supplying the same to M/s Vikas Trading Corporation in consideration 1% commission to be received by him in lieu of the bills raised. Mr. J.K. Batra proprietor of M/s Vikas Trading Corporation admitted the involvement of the petitioner herein and the amount paid to him as commission for obtaining those bills.

6. On the basis of the above material, the detaining authority came to the conclusion that activities of the petitioner herein amounted to smuggling under Section 2(39) of the Customs Act, 1962 as adopted in the Conservation of Foreign Exchange and prevention of Smuggling Activities Act, 1974 (hereinafter referred to as the COFEPOSA) via Section 2(e) thereof as his acts or omissions including application of fraudulent practice have rendered the goods involved liable to confiscation under Section 113 of the Customs Act, 1962. Keeping in view the potentiality and propensity to indulge in prejudicial activities in future and in order to prevent him from indulging in such prejudicial activities the detention order under COFEPOSA was passed against the petitioner.

7. Ms. Sangita Bhayana appearing for the petitioner has assailed this order primarily on the grounds that; (1) the role assigned to the petitioner by the respondent does not amount to an act of smuggling. At best it can amount to abetting the offence committed by M/s Vikas Trading Corporation. The petitioner never participated actually or physically in the smuggling of the goods. It is not the case of the respondent herein that the petitioner transported the goods to the foreign buyer nor shipped any goods which were liable to be confiscated. Therefore, there was no question of petitioner indulging in smuggling nor the order could be passed against the petitioner in order to prevent him from smuggling goods in future. This according to counsel for the petitioner indicates non application of mind on the part of the detaining authority. (2) Secondly there is unexplained delay in passing the detention order. (3) There is delay in execution of the said order on the petitioner; and finally (4) Illegible documents were supplied to him.

8. To understand whether the act of the petitioner in raising bills for M/s Vikas Trading Corporation amounted to smuggling or abetment, we may have a glance at Sections 2(39) of the Customs Act, 1962 and Section 2(e) of COFEPOSA which are reproduced as under :-

Section 2(39) of the Customs Act, 1962 "Smuggling", in relation to any goods, means any act or omission which will render such goods liable to confiscation under Section 111 or Section 113;

Section 2(e) of the COFEPOSA

"smuggling" has the same meaning as in Clause (3) of Section 2 of the Customs Act, 1962 and all its grammatical variations and cognate expressions shall be construed accordingly.

9. By virtue of Section 2(e) of the COFEPOSA the provisions of Section 2(39) of the Customs Act, 1962 has been made applicable.

10. Sections 111 and 113 of the Customs Act deal with confiscation of improperly imported goods and confiscation of goods attempted to be improperly exported respectively. Therefore in order to cover the case of the petitioner in the definition of "smuggling" the authority had to prove that in relation to the goods liable to the confiscated under Section 113 of the Customs Act, 1962, the petitioner was involved in the actual exporting of the goods. From the reading of the grounds of detention dated 7th November, 2001 we find that it is not the case of the respondent that the goods were actually exported by the petitioner. It is an admitted case of the respondent that six consignments were exported by M/s Vikas Trading Corporation. These were exported through the custom House Agent Mr. Deepak Sharma. They were to be received at Sharjah, UAE by M/s Fairdeal Building Chemicals. The only role assigned to the petitioner is that he being proprietor of M/s Rahul Traders used to issue fake bills to M/s Vikas Trading Corporation. That the amount received from the buyer was transferred through the accounts of M/s Rahul Traders. The said amount was subsequently withdrawn as cash from the accounts of M/s Rahul Traders. In order to attract the provisions of Section 2(39) of the Customs Act, 1962 the case must fall under Section 113 of the Customs Act, 1962 which deals with the confiscation of goods attempted to be improperly exported. The said Section 113 of the Customs Act, 1962 reads as follows:-

113. Confiscation of goods attempted to be improperly exported etc. - The following export goods shall be liable to confiscation:-

(a) any goods attempted to be exported by sea or air from any place other than a customs port or a customs airport appointed for the loading of such goods;

(b) any goods attempted or to be exported by land or inland water through any route other than a route specified in a notification issued under Clause (c) of Section 7 for the export of such goods;

(c) any dutiable or prohibited goods brought near land frontier or the coast of India or near any bay, gulf, creek or tidal river for the purpose of being exported from a place other than a land customs station or a customs port appointed for the loading of such goods;

(d) any goods attempted to be exported or brought within the limits of any customs area for the purpose of being exported, contrary to any prohibition imposed by or under this Act or any other law for the time being in force;

(e) any dutiable or prohibited goods found concealed in a package which is brought with the limits of a customs area for the purpose of exportation;

(f) any dutiable or prohibited goods which are loaded or attempted to be loaded in contravention of the provisions of Section 33 or Section 34;

(g) any dutiable or prohibited goods loaded or attempted to be loaded on any conveyance, or water-borne, or attempted to be water-borne for being loaded on any vessel, the eventual destination of which is a place outside India, without the permission of the proper officer;

(h) any dutiable or prohibited goods which are not included or are in excess of those included in the entry made under this Act, or in the case of baggage in the declaration made under Section 77;

(i) any dutiable or prohibited goods [or goods entered for exportation n under claim for drawback] which do not correspond in any material particular with the entry made under this Act or in the case of baggage with the declaration made under Section 77 in respect thereof;

[(ii) any goods entered for exportation under claim for drawback which do not correspondent in any material particular with any information furnished by the exporter or manufacturer under this Act in relation to the fixation of rate of drawback under Section 75;]

(j) any goods on which import duty has not been paid and which are entered for exportation under a claim for drawback under Section 74;

(k) any goods cleared for exportation under a claim for drawback which are not loaded for exportation on account of any willful act, negligence or default of the exporter; his agent or employee, or which after having been loaded for exportation are unloaded without the permission of the proper officer;

[(l) any specified goods in relation to which any provisions of Chapter IV B or of any rule made under this Act for carrying out the purposes of that Chapter have been contravened.]

11. From the narration of admitted facts it cannot be said that the petitioner exported or attempted to export improperly the goods which were liable to be confiscated or prohibited, therefore, provision of Section 113 of the Customs Act, 1962 do not get attracted.

12. So far as offence of abetment is concerned that is covered under Section 114 of the customs Act, 1962 which provides penalty for attempt to export goods improperly. It is Section 114 of the Customs Act, 1962 which provides that any person who in relation to any goods, does or omits to do any act which act or omission would render such goods liable to confiscation under Section 113, or abets the doing or omission of such an act, shall be liable. But the word "abetment" is conspicuously absent under Section 113 of the Customs Act. Therefore, the question of abetment by no stretch of imagination will be covered under Section 2(39) nor it would be covered under Section 2(e) of the COFEPOSA or Section 113 of the Customs Act. The allegation in the ground of detention and the impugned order are not that petitioner abetted the offence. The case of the respondent is clearly of smuggling. Therefore, we find substance in the contention of Ms. Sangita Bhayana that there was non application of mind of the authority when the impugned detention order was passed indicating that the petitioner has to be prevented from smuggling the goods in future. It is nobody's case that the petitioner smuggled the goods or that there was any apprehension that he would smuggle in future also. "Abetment" has been defined under Section 107 of the Indian Penal Code which is reproduced as under:-

107. Abetment of a thing - A person abets the doing of a thing, who

First - Instigates any person to do that thing; or

Secondly - Engages with one or more other person or persons in any conspiracy for the doing of that thing, if an act or illegal omission takes place in pursuance of that conspiracy, and in order to the doing of that thing; or

Thirdly - Intentionally aids, by any act or illegal omission, the doing of that thing.

Explanation 1 - A person who by willful misrepresentation, or by willful concealment of a material fact which he is doing to disclose, voluntarily causes or procures, or attempts to cause or procure, a thing to be done, is said to instigate the doing of that thing.

Explanation 2. - Whoever, either prior to or at the time of the commission of an act, does anything in order to facilitate the commission of that act, and thereby facilitate the commission thereof, is said to aid the doing of that act.

13. Clause Thirdly of Section 107 of the Indian Penal Code deals with Intentional aids, by any act or illegal omission, the doing of that thing. Explanation-1 also indicates in what manner a person can abet or instigate the doing of that thing. Similarly Explanation-2 deals with abetment and how the commission of the act which facilitate the commission of that act would constitute abetment. Therefore, Ms. Sangita Bhayana, counsel for the petitioner rightly contended that the act of the petitioner at best can fall in the definition of abetment but by no stretch of imagination can be called smuggling.

14. Issuing of fake bills in favor of M/s Vikas Trading Corporation to facilitate it to misdeclare the description of the articles to be exported is covered under Explanation-2 of Section 107 of the Indian Penal Code. It would amount to abetment and not smuggling. It was M/s Vikas Trading Corporation that had exported six consignments and availed the DEPB Scheme by over invoicing the bill value of the goods and by misdeclaration of the description of the items. The respondent has not set up the case in the ground of detention that the petitioner indulged in actual export of the goods. The remittance from abroad as per record available were withdrawn by Mr. J.K. Batra, proprietor of M/s Vikas Trading Corporation and another person Mr. Amrit Manchanda. Delhi High Court in the case of Smt. Sunita Sharma v. The Administrator, Delhi Admn. and Anr. reported in 17 (1980) Delhi Law Times 525 in similar circumstances observed that when the grounds of detention are at variance to the order of detention this exhibits non application of mind and, therefore, detention stands vitiated. In that case also in the detention order case set up was that the detenu indulged in smuggling of goods namely watches, whereas in the ground of detention no case of smuggling or abetment or of engaging in the smuggling goods was made out. The Bench observed that:-

"The grounds clearly do not even allege that the detenu was responsible for the illegal importation of the goods into India. In our view there appears to be non-application of the mind on the part of the Competent Authority who ordered the detention on the serious charge of smuggling of watches without the ground disclosing any material on record justifying such a suspicion."

15. In the present case also grounds of detention do not indicate that the petitioner actually exported goods which were liable to be confiscated under Section 113 of the Customs Act, 1962 or attempting to export improperly the banned or the goods which were liable to be confiscated. Therefore, there is a clear variance in the order of detention and the ground of detention. Hence the order of detention cannot be sustained. The same stands vitiated on this short ground.

16. Beside the above Ms. Sangita Bhayana took the plea that the order of detention suffers from delay. There has been a delay of one year and four months in passing the impugned detention order. Incident is of January and February, 1999. The information of the same was received as per the respondent's own showing in July, 2000 by the Special Intelligence and Investigation Branch, New Custom House, New Delhi, whereas order of detention was passed on 7th November, 2001. This long delay remained un-explained on the record. The respondent in its counter affidavit admitted that the information was received by the Custom Authorities about the smuggling in July, 2000 whereas proposal for detention of the petitioner was sent to the Sponsoring Authority on 13th June, 2001. No explanation whatsoever has been rendered as to what steps were taken between July, 2000 to June, 2001. The delay in passing of the order of detention has in fact remained un-explained. Supreme Court in the case of SK. Serajul v. State of West Bengal in similar circumstances quashed the detention order which was passed after about 7 months. Similarly in the case of Pradeep Nilkanth Paturkar v. Shri S. Ramamurthy and Ors. , the Apex Court quashed the detention order because there was an unexplained delay of five months. In the absence of there being any explanation having been tendered for this long delay of almost 11 months in the passing of the detention order, we find force in the submission of counsel for the petitioner that the detention order cannot be sustained and is liable to be quashed.

17. It is well settled principle of law that if there is un-explained delay in executing the detention order then it is liable to be quashed. In the present case detention order was passed on 7th November, 2001, it admittedly got executed on 15th December, 2001. There is delay of about one month and seven days, when confronted Mr. K.K. Sud, Addl. Solicitor General, Union of India tried to explain it way by saying that by mistake the detention order for the purpose of execution was sent to DCP West District instead of DCP South West District. On mistake being detected the DCP West District sent the same back on 19th November, 2001 with the remarks that the given address falls under the jurisdiction of South West District. Thereafter the detention order was sent to the DCP South West District in whose office it was received on 20th November, 2001. The DCP South West District sent it to ACP Naraina on 3rd December, 2001 who in turn sent the same to SHO of Police Station Maya Puri on 4th December, 2001 for serving it on the petitioner. SHO of PS Maya Puri marked it to one Head Constable on 5th December, 2001 and the official of the Maya Puri Police Station kept discreet watch on the petitioner between 5th December, 2001 to 15th December, 2001. Ultimately detention order was served on the detenu on 15th December, 2001. The explanation which the respondent has tried to built show the casual approach. It is neither convincing nor can be justified particularly when the liberty of an individual is involved. The respondent took it lightly as if execution of the detention order on the petitioner was a mere formality. Since the liberty of an individual is involved law imposes duty on the detaining authority to ensure that the detention order is expeditiously served on him. From the explanation given in the additional affidavit filed by Mrs. Nisha Malhotra, Joint Secretary to the Government of India, Ministry of Finance, the respondent has tried to justify that it was an omission on the part of the Police Headquarters of having sent the detention order to DCP West District instead of DCP South West District where almost one week was wasted. Then from 20th November, 2001 till 15th December, 2001 the detention order was rotated between DCP South West District to ACP and then from ACP to SHO and from SHO to the Head Constable. These facts do not justify the delay nor can be called sufficient explanation. The delay in execution of the detention order is fatal hence the detention order is liable to be quashed on this ground as well. Once we hold that there was an unexplained delay in passing the detention order and further there was un-explained delay in executing the same, hence the detention order is liable to be quashed.

18. Judgment relied by the respondent in the case of Sushila Aggarwal v. Union of India and Ors. 98 (2002) Delhi Law Times 557 (DB) is distinguishable on facts. Respondent cannot take any help from this judgment.

19. For the reasons stated above the detention order cannot be sustained. The petition is allowed and the rule is made absolute. The order of detention and the continued detention is hereby quashed. The petitioner be set at liberty forthwith, if not required in any other case.