J.K. AGGARWAL Vs. DIRECTOR OF ENFORCEMENT

JUDGEMENT

(1.) THIS order will dispose of Cr. M(M) 1369 and 1370 of 1991. In Cr.M(M) 1369/91 petitioners 1 and 2 are the Directors while petitioner No. 3 is the ex- Director of a company known as M/s B.L. Marketing Services P. Ltd with its registered office situated at 50/10, Yusuf Saraj, New Delhi. They have filed this petition under section 438 of the Code of Criminal Procedure for grant of anticipatory bail. It is alleged that the Company is engaged in the business of importing life-saving medical equipments into India and also acts as Identing Agents for the import of similar equipments by various Hospitals. The Company received a Memorandum/order from the Enforcement Directorate of FERA dated 16.11.1990 purporting to be under section 33(2) of the FERA wherein the respondent required the Company to supply information regarding its establishment, nature of business etc. including information of imports made by it from 1.4.1988 to 31.3.1990. On 8.12.1990 the Company sent a reply under the signatures of Sunil Aggarwal, petitioner No. 2 along with certain Annexures which were, however not filed along with the petition. Then on 2.1.1991 the Company enclosed certain other documents and requested 15 days' time for tendering remaining documents. The company then received a letter dated 27.5.91 from the second respondent requiring it to furnish the remaining documents within 7 days. The company sent all the documents on 10.6.91. It then received a show cause notice dated 16.3.91 from the Director of Revenue Intelligence, respondent No. 3. Thereafter statement of petitioner No. 3 was recorded and the reply to the show cause was also sent. The petitioners apprehend that they will be arrested and harassed for some alleged offences under FERA, hence this petition.

(2.) NOTICE of this application was issued. It was also directed that the petitioners will not be arrested till the next date. The interim order continues to be in operation even now.

(3.) I have heard arguments advanced by learned counsel for the parties and have carefully perused the records. Some necessary facts culminating from the correspondence between the parties emerge in the show cause notice dated 16.3.1991 issued by the Directorate of Revenue Intelligence (DRI for short). It indicates that searches at various Hospitals including M/s Batra Hospital and Medical Research Centre were also conducted. During the search of Barra hospital premises on 19.10.1990 one cardiac monitor Gould Model No. IM-1000 D.S. No. 2078, Stock No. 141010-004-100 made in USA installed in the Cardio thoracic department of the hospital of the value of Rs. 2 lacs was seizes. The hospital was not in a position to submit any bill of entry or other documents to show valid import of the said item. Mr. Seth. General Manager of the hospital informed that they had purchased the aforesaid Monitor from M/s B.L Marketing Services 50/10, Yusuf Saraj, New Delhi and that the documents pertaining to this import were with the supplier and that efforts would be made to obtain them and submit the same to Customs Authorities. However, till the date of notice no such documents had been supplied. Certain more interesting facts emerge from a scrutiny of documents submitted by the hospital to Customs Authorities. For instance Page No. 19 is a note signed by S.C. Soney, General Manager (Commercial) showing that the monitor was taken on loan from M/s B.L. Marketing Services during the visit of Dr. Bhayana on the clear understanding that it would be returned to them immediately after Dr. Bhayana's return. It was further mentioned in that note that M/s B.L. Marketing had purchased the monitor on behalf of G.B. Pant Hospital and it was after a great deal of discussions and pursuasion that they agreed to give the same to Batra Hospital on loan for a short period. Ultimately when the Monitor was not returned, the note says that the party agreed to sell the Unit to them and thus further delayed delivery to Pant Hospital. The Statement of Ajay Aggarwal ex. Director Petitioner No. 3 was recorded under Section 108 of the Customs Act wherein he could not say whether the said monitor was imported in their own name or in the name of another hospital and later disposed of to Batra Hospital because the records had been taken away by Income tax authorities. He admitted that the sale invoice and proforma invoice for sale of the Monitor to Batra Hospital was signed by him. He denied if the Monitor was originallty imported in the name of Pant Hospital and later diverted to Batra Hospital. His attention was drawn to the noting dated 25.3.87 of Mr. S.C. Soney, General Manager whereafter he said that the Cardiac Monitor was loaned from Pant Hospital for demonstration at Batra Hospital and that the equipments was taken from Pant Hospital with the written permission of late Dr. P.S. Narayanan, Head of the department of cardio-thoracic surgery. Thus prima facie it appears that the pettiioners were not able to produce any documents of import of the aforesaid Cardiac Monitor in the name of Batra Hospital and prima facie, therefore, they appeared to be instrumental in selling it to Batra Hospital. Prosectution says that it was actually sold to Batra Hospital at a highly inflated price.