SANDEEP JAIN Vs. UNION OF INDIA

JUDGEMENT

(1.) The facts set out in the writ petition are these. Following a tip off the Custom Preventive Unit, recovered 31 pieces of foreign marked gold biscuits of ten tolas each valued at Rs.16,30,184/- and having a purity of 9990 as embossed on the gold biscuits from the possession of premises of M/s Kuldeep Dyes Cutters and Jewellers, 3728, Gali Bara Tooti, Sadar Bazar, Delhi in presence of its proprietor Kishan Gopal Verma. Kishan Gopal could not produce any documentary evidence for its lawful possession. The above said contraband was seized under section 110 of the Customs Act. Kishan Gopal Verma was quizzed. In his statement under Section 108 of the Customs Act, he admitted the recovery and seizure of the above said gold biscuits and disclosed that those had been purchased by him from M/s Kishan Grover, Prem Jewellers, M/s Babu Ram, Om Parkash and M/s Pooran Mal through brokers namely Subhash and Suresh and documents in support of these were lying with his Chartered Accountant Shri Subhash. However, it transpired that the statement made by him was false. Thereafter, he changed his stance and subsequently disclosed that he was not aware of the antecedents of Subhash and Suresh. He was taken into judicial custody.

(2.) In his bail application moved before the learned Additional Sessions Judge, he blurted out that he had procured the gold from M/s True Gold, Nai Sarak, Delhi. The present petitioner is its proprietor. In order to buttress his defence he produced two vouchers purporting to have been issued by M/s True Gold. However, the Customs Department replied that Kishan Gopal was constantly changing his stand and has attempted to float another theory which is utterly bogus and an afterthought. Subsequently, a complaint was filed against Kishan Gopal Verma for the offence under Section 135 (1) (b) of the Customs Act, 1962 in the court of learned A.C.M.M., New Delhi. The statement of the present petitioner was recorded under Section 108 of the Customs Act, wherein he disclosed that, although, he is a proprietor of M/s True Gold, Jogiwara, Nai Sarak, yet, its transactions are mainly looked after by his brother-in-law Sunil Kumar Jain. He further explained that the impugned bills for the sale in question were issued by his Muneem Narender Pal Chopra at the behest of said Sunil Kumar Jain. He denied having any acquaintance with the above said Kishan Gopal Verma. Statement of Narender Pal Chopra under Section 108 of the Customs Act was recorded. He disclosed that the petitioner mostly concentrates in his saree shop M/s Jai Santoshi Textiles. He also contradicted the statement of petitioner's brother-in-law, Sunil Kumar Jain allegedly recorded under Section 108 of the Act in which he denied about any instructions having been given to the Muneem for issuance of the impugned bills. It is averred that Muneem and the petitioner also informed the Department that Sunil Kumar Jain is well versed in gold business and used to visit Sandeep Jain in his saree business. Consequently, notice was issued to Kishan Gopal Verma as well as the petitioner wherein they were called upon as to why gold in question should not be confiscated and penalty should not be imposed upon them. In response to the said notice, the petitioner denied these allegations. The petitioner also prayed that he wanted to cross-examine Kishan Gopal Verma, Narender Pal Chopra and Investigating Officer at the time of personal hearing in the matter. Personal hearing was granted to the petitioner and petitioner was directed to pay penalty in the sum of Rs.2,50,000/- under Section 112 (a) and 112 (b) of the Custom Act.

(3.) Aggrieved by that order the petitioner preferred an appeal before the Tribunal in which he was directed to make pre-deposit of Rs.75,000/- before 1st August, 2002. The petitioner could not comply with that order and his appeal was dismissed on 7th August, 2002. Out of blue, the petitioner received a letter of hearing on 27th January, 2005, wherein he was informed that the matter was fixed for personal hearing before the learned Adjudicating Authority on 15th February, 2005 because the matter was remanded for de novo proceedings in the appeal of said co noticee Kishan Gopal Verma. The petitioner filed a reply dated 15th February, 2005. His counsel was heard on 24th March, 2005. However, the petitioner received the following order, dated 27th April, 2005, wherein, it was held that the order passed by the CESTAT dated 7.8.2002 had attained finality and penalty in the sum of Rs.2,50,000/- was imposed upon Sandeep Jain under Section 112 (a) and 112 (b) of the Customs Act. He was required to deposit the said amount within a month under Section 142 of the Customs Act. The petitioner preferred an appeal. When the matter came up on 23rd August, 2005, learned Tribunal was of the view that the appeal was not maintainable as the same had already been dismissed. The appeal was filed by the wife of Kishan Gopal Verma after his death. Since Kishan Gopal Verma had expired, therefore, no penalty was imposed upon him. Under the circumstances, the petitioner withdrew the appeal vide order dated 29th August, 2005 in order to file the present writ petition.