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L.K.R.Al. Alagappa Chettiar Vs. Director of Enforcement - Court Judgment

LegalCrystal Citation
CourtAppellate Tribunal for foreign Exchange New Delhi
Decided On
Case NumberAPPEAL NO. 5 OF 1974
Judge
AppellantL.K.R.Al. Alagappa Chettiar
RespondentDirector of Enforcement
Advocates:M. Raghunathan for the Applicant. Vijay Raghavan for the Respondent.
Excerpt:
foreign exchange regulation act, 1947 - section 5 - comparative citation: 2001 (32) scl 515 (ferab).....v. raghunathan, who appeared for the appellant, emphasised that there was no material barring this retracted confession to connect his client with the alleged offence. he suggested that having searched the appellant’s premises on the basis of information and not finding any material in support of the case, the departmental officers must have resorted to pressure in order to obtain a confessional statement from the appellant. shri raghunathan laid particular stress on the fact that accord-ing to the order itself the statement was obtained as a result of inter- rogation with reference to the intelligence available. he contended that there was no reason why a person should voluntarily make a confession thereby rendering himself liable to be proceeded against under the law when no.....
Judgment:

1. This is an appeal by Shri L.K.R. Alagappa Chettiar against the order of the learned Deputy Director of Enforcement, Madras, imposing on him a penalty of Rs. 10,000 for contravention of the provisions of Section 5(1)(aa) of the Foreign Exchange Regulation Act, 1947 (‘the Act’).

2. The case for the department is as follows. On the basis of certain information, the premises of the appellant were searched but no documents or other material were seized. However, on interrogation, he admitted to the Enforcement Officers that before coming to India in March, 1968, he handed over a sum of $ 6,000 to a party in Malaysia with instructions that he should be given Rs. 20,000 in India and that this sum was, accordingly, received by him. The motive for resorting to this transaction is the gain of Rs. 5,000 which would accrue by resort to unauthorised channels.

3. However, during the course of adjudication proceedings, the appellant denied that the statement was genuine and voluntary. Nevertheless, the appellant was found guilty and the impugned order was passed.

4. Shri V. Raghunathan, who appeared for the appellant, emphasised that there was no material barring this retracted confession to connect his client with the alleged offence. He suggested that having searched the appellant’s premises on the basis of information and not finding any material in support of the case, the departmental officers must have resorted to pressure in order to obtain a confessional statement from the appellant. Shri Raghunathan laid particular stress on the fact that accord-ing to the order itself the statement was obtained as a result of inter-

rogation with reference to the intelligence available. He contended that there was no reason why a person should voluntarily make a confession thereby rendering himself liable to be proceeded against under the law when no material against him was available with the department.

5. On behalf of the respondent, Shri Vijay Raghavan while conceding that the statement was not corroborated in any way, strenuously contended that the officers of the department had no reason to implicate the appellant falsely and that it was inconceivable that they should foist a case upon a stranger. He also emphasised that the intelligence upon which the department had acted was reliable. Stress was also laid upon the fact that the statement itself was also laid upon the fact that the statement contained details, such as the name of the remitter, which can be known to the appellant and that the statement itself was consistent with its being genuine and voluntary. Reliance was also placed on the judgment of the Madras High Court, which has already been referred to in the order of the learned Deputy Director, in Narayan v. Director of Enforcement as authority for the proposition that a person could be found guilty on the basis of a retracted confession. It was also emphasised that the strict rule of evidence did not apply to adjudication proceedings.

6. However, the fact remains that barring the appellant’s retracted statement, there is nothing else to connect him with the offence. No details have been gathered even as to the manner in which the sum of Rs. 20,000 was spent except in the most general terms. It may be that it is open to the adjudicating authority to act on the basis of a retracted confession but, on the other hand, it is to be kept in mind, as observed by the Supreme Court in Subramania Goundan v. State of Madras 1958 SCR 428, that while there is no absolute rule requiring corroboration of a retracted confession in material particulars, yet as a matter of prudence and caution which has sanctioned itself into a rule of law, retracted confession cannot be made solely the basis of conviction unless the same is corroborated. In the present case, there is no corroboration with regard to any aspect of the case against the appellant. It may be that the officers had no personal animus against the appellant, but nevertheless I do not consider that it would be prudent to act in the present case on the basis of this retracted statement alone, particularly as there is no extraneous evidence to support any part of it.

7. In these circumstances, the appellant would be entitled to the benefit of the doubt. The appeal is, therefore, allowed and the order of the learned Deputy Director set aside. The penalty, if paid, would be refunded.


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