H.M. Prabhakar vs State (Nct Of Delhi)
2004 Latest Caselaw 1158 Del

JUDGMENT

S.K. Agarwal, J.

1. By this application under Section 482 of the Criminal Procedure Code (in short Cr.P.C), petitioner is seeking clarification of the order dated 1.9.2003 vide which he was ordered to be released on bail, in a case being investigated by the Directorate of Revenue Intelligence (for short DRI) for the offence under section 132 and 135(1) of the Customs Act, 1962.

2. The case of the petitioner is that he is the Managing Director of M/s.Akay Cones Pvt.Ltd. and M/s.Intrade Impex Pvt.Ltd. (hereinafter referred to as, the Companies). These companies were founded in the year 1986 and are engaged in the business of import of various items including textile fabrics. In the year 2000, the companies started importing furnishing fabric from Japan, Taiwan and Singapore, primarily from the two manufacturers namely M/s.Culp and Microfibers which are based in USA and Europ (hereinafter referred to as, manufacturing companies). The manufacturing companies generally sell the goods in bulk consignments through their agents/distributors, in Japan, Taiwan and Singapore, which in turn used to sell to various other buyers. The manufacturing companies also used to sell goods directly to the petitioner's companies, at the mutually agreed price. In August, 2002, petitioner on receipt of notice, submitted list of the consignments imported from the said two manufacturing companies between 1st April, 2001 and 31st March, 2002 Along with the relevant documents. DRI Officials raided premises of the petitioner and seized certain records in September, 2002. Again in June, 2003 DRI officials raided residence of the petitioner, offices and godowns of the companies and seized various documents, invoices, cheque books and the printed fabrics worth more than rupees three crores. On receipt of notices, from DRI officials and petitioner joined investigations on 23rd, 26th and 30th Jun, 2nd, 3rd, 15th, 22nd and 23rd July, 2003; and his statements were recorded. In the afternoon on 23rd July, 2003, petitioner was put under arrest on the abovenoted charges. He moved an application, opposing remand and for grant of bail, which was declined by the learned trial court. Against the order granting remand, petitioner filed revision petition, which was directed to be treated as the bail application vide order 1st September, 2003. Notice on the bail application was issued. DRI filed the reply, opposing the bail. After hearing learned counsel for the parties, by a detailed order dated 1.9.2003 petitioner was granted bail, subject to certain conditions. The operative portion of the order reads as under :-

In the peculiar facts and circumstances of the case, petitioner is ordered to be released on bail, on his furnishing a personal bond in the sum of Rs.5.0 lacs with one surety in the like amount to the satisfaction of the trial court, subject to the condition that he shall not leave the country, without prior permission of the court; shall not tamper with the evidence; shall surrender his passport, if any and shall join investigations as and when required.

3. Even while on bail Petitioner joined investigation on 18th September, 2003. In October, 2003, petitioner moved an application for release of passport and permission to go abroad to meet his business commitments which was allowed by the learned trial court; he went abroad and come back as per the schedule; and deposited his passport in the trial court, on his return. On 26th February, 2004; petitioner again moved an application for permission to go abroad and release of his pass-port, before the trial court. Petitioner's application was listed on 1st March, 2004 DRI filed the reply opposing the application. It was contended that apart from the 14 consignments, further facts have come to light that petitioner was also involved in duty evasion in respect of 25 more consignments; that the file of the DRI was claimed to be not available, the matter was adjourned to 26th March, 2004 Petitioner apprehending his arrest and unnecessary harassment at the hands of the Investigating Officer, DRI, has moved before this Court, seeking clarification of the bail order to the effect that it covers investigations being carried out by the DRI in respect of the import of 25 consignments from Belgium/Europe as well. Notice of this application was issued.

4. DRI has opposed petitioner's application inter alia, on the ground that petitioner had also fraudulently imported more than 25 consignments of printed flock fabrics from Belgium/Europe; that the documents concerning these consignments were seized from the petitioner and and in respect of the same a show cause notice under Section 124 read with section 28 of the Customs Act, 1962 was issued to him on 1st December, 2003. It is pleaded that earlier petitioner was arrested on 23rd July, 2003 for fraudulent duty evasion of Rs.4 crores in respect of import of 14 consignments of printed flock fabrics imported from two firms of USA. The Investigation Reports with regard to the import from Belgium/Europe regarding under valuation in respect of 25 other consignments was received only on 16th December, 2003; the petitioner is required to be examined again on the basis of the information received through the reports. It was pleaded that the petitioner is being summoned in connection with his examination in respect of 25 consignment which are separate/independent transactions of import of goods made from Belgium by the companies controlled by the petitioner wherein he appears to have evaded customs duty amounting to Rs.7.0 lacs approximately. This is contested by the petitioner. I have heard learned counsel for the parties and have been taken through the record.

5. Learned counsel for petitioner argued that the allegations against the petitioner are totally false. Petitioner's Companies are in the import business for the last 16 years. Petitioner has been fully cooperating with the investigation for the last more than two years, since August, 2002; he has been interrogated on number of dates specifically with regard to the import from the manufacturing companies in Belgium/Europe as well as in USA. Petitioner was arrested on 23rd July, 2003; he remained in judicial custody for more than 40 days. Thereafter he was released on bail. Learned counsel argued that merely because some Report in respect of the import consignments from Belgium/Europe have now been received by the DRI, cannot be a ground to arrest the petitioner again qua which documents have already been seized; searches have been carried out and he has been interrogated; thus clarification of the bail order is necessary. Mr.Satish Aggarwal, learned counsel for DRI (respondent) on the other hand vhemently argued to the contrary. Learned counsel appearing for DRI, on instructions from Mr.U.K.Mishra, Sr.Intelligence Officer, did not contest that the investigation into the import by the petitioner from the manufacturing companies in USA, Belgium are being dealt with by them in the same file. It was also not contested that the petitioner was questioned with regard to the 25 import consignments from Belgium/Europe. Learned counsel, however, argued that each import is a separate offence and the DR has the right to separately prosecute the petitioner for each consignment. It is argued that the petitioner was arrested earlier in respect of 14 consignment from USA and after having received the report in respect of the imports from Belgium, they are entitled to interrogate the petitioner in respect of these consignments again.

6. I have considered the rival contentions. The real question is whether DRI is entitled to subject the petitioner to the custodial interrogation with regard to the import from Belgium/Europe regarding 25 consignments on the ground that investigation report from abroad has been received by the DRI on 16th December, 2003? The answer to this question would depend upon whether the transaction regarding which the petitioner is sought to be now interrogated was a subject matter of enquiry or investigation earlier when the petitioner was arrested and remained in judicial custody. In order to determine this, DRI officials were directed to produce the investigation records. They took 3-4 adjournments on one pretext or the other and ultimately produced the interrogation record on the last date of hearing. They have also filed statements of the petitioner recorded on 3rd, 15th, 22nd and 23rd July, 2003 as well as 18th September, 2003. The perusal of the various questions put to the petitioner during interogation reveal that the petitioner was specifically questioned on number of dates with regard to the import from the manufacturing companies from Belgium/Europe. Further show cause notice dated 1st December, 2003 issued by the DRI, to the petitioner during adjudication proceedings, also reveals that they have been investigating the imports from USA and Europe jointly. Relevant portion of the show cause notice, reads as under :-

M/s.Microfibre Inc. USA, M/s.Culp Inc. USA and M/s.Microfibres Belgium, declared in the import documents filed before the Indian Customs as printed Flock Fabrics. The intelligence suggested that while M/s.Microfibre Inc. USA, M/s.Culp Inc. USA and M/s. Microfibres Belgium actually invoiced the imported fabrics at approx. US $ 3.00 to US $ 3.50 per mtr, the Indian importers were declaring a value of approx. US $ 1.00 per meter only on the basis of invoices issued by traders of Singapore and Taiwan etc, apparently introduced for the sole purpose of issuing invoices at suppressed value.

7. The general policy of law is to allow bail. The accused cannot be subjected to custodial interrogation unless his presence is actually needed in order to serve some important and specific purpose connected with the completion of inquiry. General statement to the effect that accused may be able to give any further information cannot be accepted. The custodial interrogation is permissible only for the shortest period and in the cases in which the time is required by the Investigating Agency to complete the inquiry, the accused should be detained in the judicial custody.

8. In this case, at the risk of repetition, it may be recalled that the raid was conducted on the offices of the petitioner in August, 2002; petitioner participated in investigation and his statement was recorded on eight different dates between June, 2002 and July, 2003; he was arrested on 23rd July, 2003. He remained in custody for more than 40 days before he was ordered to be released on bail. It is not in dispute that the matter with regard to imports from USA and Belgium/Europe was even then under investigation of the DRI. The offence for which the petitioner is charged, is punishable with maximum imprisonment for three years or fine or both. Even after the petitioner was released on bail, he continued to join investigation; he has fixed root in the society and there is nothing to show that he would flee from justice. The investigating agency cannot be permitted to split composite and connected transactions into different cases during investigation at their convenience, with an object to arrest the accused again and subject him to further interrogation.

9. For the foregoing reasons, the application is allowed and it is ordered that the order dated 1.9.2003 granting bail to the petitioner would apply to the imports made by the said companies from USA as well as from Belgium/Europe. It is clarified that nothing said in this order will prevent DRI to file different complaints in respect of different transactions in accordance with law, if so advised. With these observations petition stands disposed of.