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Chaman Kumar Shah v/s Union of India & Others


Company & Directors' Information:- R J SHAH AND COMPANY LIMITED [Active] CIN = L45202MH1957PLC010986

Company & Directors' Information:- SHAH INDIA PVT LTD [Active] CIN = U51909WB1960PTC024535

Company & Directors' Information:- B. B. SHAH PRIVATE LIMITED [Active] CIN = U17117RJ1984PTC002922

Company & Directors' Information:- D M SHAH & COMPANY PVT LTD [Active] CIN = U29244WB1988PTC045183

Company & Directors' Information:- C. M. SHAH AND COMPANY PRIVATE LIMITED [Strike Off] CIN = U74140MH1971PTC015107

Company & Directors' Information:- T M SHAH PRIVATE LIMITED [Strike Off] CIN = U10101UP1966PTC003139

Company & Directors' Information:- S B SHAH AND COMPANY PRIVATE LIMITED [Active] CIN = U51496DL1991PTC045040

Company & Directors' Information:- H B SHAH PRIVATE LIMITED [Active] CIN = U36100MH1947PTC005536

Company & Directors' Information:- M M SHAH PRIVATE LIMITED [Strike Off] CIN = U51311MH1962PTC012293

Company & Directors' Information:- D J SHAH AND CO PRIVATE LIMITED [Active] CIN = U74899DL1987PTC030169

Company & Directors' Information:- CHAMAN INDIA PRIVATE LIMITED [Active] CIN = U35921DL1998PTC096474

Company & Directors' Information:- C C SHAH LTD. [Strike Off] CIN = U15421WB2000PLC007659

Company & Directors' Information:- A H SHAH AND CO PVT LTD [Active] CIN = U51311MH1949PTC007019

Company & Directors' Information:- SHAH AND SHAH PVT LTD [Strike Off] CIN = U33112WB1980PTC032838

Company & Directors' Information:- A D SHAH PVT LTD [Strike Off] CIN = U51909MH1972PTC015715

Company & Directors' Information:- B. SHAH AND COMPANY LIMITED [Dissolved] CIN = U99999MH1952PLC008789

    Criminal Misc. Bail Application No. 5031 of 2020

    Decided On, 27 February 2020

    At, High Court of Judicature at Allahabad

    By, THE HONOURABLE MR. JUSTICE JAYANT BANERJI

    For the Applicant: Ayush Khanna, Advocate. For the Respondents: A.S.G.I., G.A., Ramesh Chandra Shukla, Advocates.



Judgment Text


Heard Shri Ayush Khanna, learned counsel for the applicant and Shri Ramesh Chandra Shukla, learned counsel appearing for the Union of India.

A counter affidavit has been filed today on behalf of the Union of India, which is taken on record.

This bail application has been filed to release the applicant on bail in case crime no. NIL of 2019 under Section 135 of Customs Act, P.S. G.R.P. Pandit Deendayal Upadhyaya Junction.

As per the panchnama that has been enclosed as Annexure No. 1 to the bail application, on 9.12.2019, four gold bars were recovered from the possession of the applicant weighing 1749.910 grams having a total value of Rs. 67,19,655/-. The gold recovered from the possession of the applicant was seized and the applicant was handed over by the G.R.P. Police of Pandit Deendayal Upadhyaya Railway Junction to the officers of Customs Preventive Division, Varanasi on 9.12.2019. The applicant made a voluntary statement on 10.12.2019 that on 6.12.2019, after reaching Bangkok, he made a WhatsApp call to one Mohd. Jaiki who then introduced him to a shop owner in Bangkok over WhatsApp who gave him four pieces of cylindrical gold bars without making any payment as Jaiki Alam had already made the payment. Thereafter, the applicant handed over the four pieces of gold bars to Sanjay Kumar Kushwaha who was already present in Bangkok and thereafter they reached India on 9.10.2019. Then they boarded a train after taking with them the four pieces of gold bars concealed in a bag. Thereafter, they were caught at the Pandit Deendayal Upadhyaya Station. The applicant was, therefore, charged under Section 135 of the Customs Act, 1962.

It is the contention of the learned counsel for the applicant that the chargesheet in the case has already been filed and admittedly the value of the gold recovered from the possession of the applicant is below Rs. 1,00,00,000/- and the entire proceedings do not reflect that the case is covered under any clause of sub-section (6) of Section 104 of the Customs Act. It is, therefore, contended that in view of the provisions of sub-section (7) of Section 104 of the Customs Act, on a bare reading of the recovery memo, it is clear that it is a bailable offence and under the circumstances the applicant is entitled to bail. Learned counsel relied upon a judgement dated 6.1.2020 of this Court passed on similar facts in Criminal Misc. Bail Application No. 48198 of 2019 by means of which the applicant therein was enlarged on bail.

Learned counsel for the Customs & Central Excise, on the other hand, relied upon an order dated 28.11.2019 passed in Criminal Misc. Bail Application No. 42111 of 2019 (Vineet Agrawal Vs. Union of India) to contend that in a similarly situated matter, this Court was pleased to reject the bail application. He strongly opposed the bail application. He has, however, not disputed the fact that this case is covered under the provisions of Section 104(7) of the Customs Act.

A perusal of the order passed in Criminal Misc. Bail Application No. 42111 of 2019, that has been relied upon by the learned counsel for the Union of India, however, does not reveal whether the provisions of Section 104 of the Customs Act were brought to the notice of the Court or that it was argued before the Court. A perusal of the counter affidavit, on the other hand, reveals that the complaint in the present case has been filed on 7.2.2020 before the court of the Special C.J.M., Varanasi, that is before the completion of 60 days from the date of arrest. It has further been stated therein that the applicant-accused has stated in his voluntary statement dated 10.12.2019 recorded under Section 108 of the Customs Act, 1962, that he had purchased the four pieces of the gold in Bangkok on the saying and direction of the aforesaid Mohd. Jaiki Alam.

Section 104 of the Customs Act is as follows:

"Section 104. Power to arrest?(1) If an officer of customs empowered in this behalf by general or special order of the Principal Commissioner of Customs or Commissioner of Customs has reason to believe that any person in India or within the Indian customs waters has committed an offence punishable under section 132 or section 133 or section 135 or section 135A or section 136, he may arrest such person and shall, as soon as may be, inform him of the grounds for such arrest.

(2) Every person arrested under sub-section (1) shall, without unnecessary delay, be taken to a magistrate.

(3) Where an officer of customs has arrested any person under sub-section (1), he shall, for the purpose of the releasing such person on bail or otherwise, have the same powers and be subject to the same provisions as the officer-in-charge of a police-station has and is subject to under the Code of Criminal Procedure, 1898 (5 of 1898).

(4) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), any offence relating to?

(a) prohibited goods; or

(b) evasion or attempted evasion of duty exceeding fifty lakh rupees, shall be cognizable.

(5) Save as otherwise provided in sub-section (4), all other offences under the Act shall be non-cognizable.

(6) Notwithstanding anything contained in the Code of? Criminal Procedure, 1973, (2 of 1974), an offence punishable under section 135 relating to?

(a) evasion or attempted evasion of duty exceeding fifty lakh rupees; or

(b) prohibited goods notified under section 11 which are also notified under sub-clause (C) of clause (i) of sub-section (1) of section 135; or

(c) import or export of any goods which have not been declared in accordance with the provisions of this Act and the market price of which exceeds one crore rupees; or

(d) fraudulently availing of or attempt to avail of drawback or any exemption from duty provided under this Act, if the amount of drawback or exemption from duty exceeds fifty lakh rupees, shall be non-bailable.

(7) Save as otherwise provided in sub-section (6), all other offences under this Act shall be bailable."

Sub-section (4) of Section 104 mandates that any offence relating to prohibited goods or evasion or attempted evasion of duty exceeding fifty lakh rupees shall be cognizable, notwithstanding anything contained in Code of Criminal Procedure. Sub-section (5) provides that save as otherwise provided in sub-section (4) all other offences under the act shall be non-cognizable. Sub-section (6) which starts with a non-obstante clause, provides that offences punishable under Section 135 relating to: (a) evasion or attempted evasion of duty exceeding fifty lakh rupees; or (b) prohibited goods notified under section 11 which are also notified under sub-clause (C) of clause (i) of sub-section (1) of section 135; or (c) import or export of any goods which have not been declared in accordance with the provisions of this Act and the market price of which exceeds one crore rupees; or (d) fraudulently availing of or attempt to avail of drawback or any exemption from duty provided under this Act, if the amount of drawback or exemption from duty exceeds fifty lakh rupees, shall be non-bailable. Sub-section (7) of Section 104 provides that save as otherwise provided in sub-section (6), all other offences under this Act shall be bailable.

Therefore, to demonstrate that the offence of which the applicant is accused of is cognizable, the prosecution is required to demonstrate that the goods that are recovered are prohibited or that the evasion or attempted evasion of duty exceeds fifty lakh rupees. Moreover, to demonstrate that the offence is non-bailable, the prosecution has to demonstrate that the offence punishable under Section 135 of the Customs Act relates to any one of the four clauses mentioned under sub-section (6) (as specified above).

A perusal of the counter affidavit filed on behalf of the Union of India reveals that the complaint has already been filed in the present case on 7.2.2020 before the court of Special Chief Judicial Magistrate, Varanasi. With reference to the statement made by the accused persons, it is mentioned that the recovered four gold pieces were smuggled from Bangkok and there was no invoice or document pertaining to the same. It is stated that as per Section 123 of the Customs Act, the burden of proof that the gold is not smuggled lies on the person from whose possession the gold is recovered. It is pertinent to mention here that in paragraph no. 18 filed in support of the bail application, it is stated as follows:

"18. That the alleged recovery from the possession is less than one crore, therefore, the offence if any is a bailable offence and the applicant is liable to be released on bail as per Section 135 of the Customs Act, 1962. Section 135 of the Customs Act, 1962 which reads as follows:-

"Section 135. Evasion of duty or prohibitions ? (1)Withoutprejudice to any action that may be taken under this Act, if any person -

(a) .............

(b) .............

(c) .............

(d) .............

he shall be punishable -

(i) in the case of an offence relating to-

(A) Any goods the market price of which exceeds onecroreof rupees; or (B) The evasion or attempted evasion of duty exceeding [fifty lakh] of rupees; or (C) Such categories of prohibited goods as the Central Government may, by notification in the Official Gazette, specify; or (D) Fraudulently availing of or attempting to avail of drawback or any exemption from duty referred to in clause (d), if the amount of drawback or exemption from duty exceeds [fifty lakh] of rupees, with imprisonment for a term which may extend to seven years and with fine:"

In reply to this paragraph, paragraph no. 20 of the counter affidavit reads as follows:

"20. That with respect to the content of para 18 of the bail application, it is pertinent to mention that the inquiry is being carried out with respect to the other persons who are engaged in the said act of smuggling alongwith the accused and despite issuance of several summons, they are not co-operating in the inquiry. Granting bail to the accused will give the mastermind(s) behind the said racket of smuggling an opportunity to escape the ongoing investigation and tamper with the evidence".

Thus, the fact is not disputed that the market price of the goods seized does not exceed one crore of rupees. Nowhere in the counter affidavit has it been stated that the gold that was seized from the applicant belongs to the category of prohibited goods duly notified by the Central Government, nor has it been stated that evasion or attempted evasion of duty exceeds fifty lakh rupees. Further, no fraud has been alleged as referred in clause (d) of sub-section (6) of Section 104.

Under the circumstances, there is a merit in the contention of the learned counsel for the applicant that the offence is a bailable offence as provided in sub-section (7) of Section 104 of the Customs Act.

It is no longer res integra that the right to claim bail as provided under Section 436 Cr.P.C. in a bailable offence is an absolute and indefeasible right and in such offences there is no question of discretion in granting bail as the words of Section 436 are imperative (Rasiklal v. Kishore Khanchand Wadhwani, AIR 2009 SC 1341). Though, it is the contention of the prosecution in the counter affidavit that the inquiry is being carried out with respect to the other persons who are engaged in the said act of smuggling alongwith the accused and despite issuance of seve

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ral summons, they are not co-operating in the inquiry and granting bail to the accused will give the mastermind(s) behind the said racket of smuggling an opportunity to escape the ongoing investigation and tamper with the evidence, however, the judgement of the Supreme Court in Rasiklal itself provides the circumstances for cancellation of bail of an accused. Moreover, the judgement in Criminal Misc. Bail Application No. 48198 of 2019, that has been relied upon by the learned counsel for the applicant, supports his case. In view of the aforesaid, it is a fit case for bail. This bail application is allowed. Let the applicant- Chaman Kumar Shah s/o Naresh Kumar Shah be released on bail in case crime no. NIL of 2019 under Section 135 of Customs Act, P.S. G.R.P. Pandit Deendayal Upadhyaya Junction, on his furnishing a personal bond with two sureties each of the same amount to the satisfaction of the court concerned. Identity, status and residence proof of the applicant and sureties shall be verified by the court concerned before the bonds are accepted. It is clarified that the observations, if any, made in this order are strictly confined to the disposal of this bail application and must not be construed to have any reflection on the ultimate merits of the case.
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