DHIRAJLAL AMRITLAL MEHTA Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioner is doing business of selling and buying rough diamonds and polished diamonds on commission basis since the year 1961. The petitioner used to reside in Gandhi Building, 2nd floor, Vile Parle, Bombay, in the year 1966. On June 15, 1966, the Officers of the Enforcement Directorate raided the premises of the petitioner on certain information that the petitioner was dealing in smuggled diamonds. At the time of the raid, the Officers noticed a cupboard under lock and key and that cupboard was duly sealed. The petitioner came back to his residence early next morning and in the presence of the petitioner the seal was opened and a packet containing diamonds was found in the cupboard. The statement of the petitioner was recorded by the Customs Authorities in presence of panchas and the petitioner disclosed that on June 13, 1966 he had purchased diamonds from Arunkumar & Co., merchants dealing in rough diamonds. The petitioner also produced the bill issued by Arunkumar & Co. for 555.67 carats of diamonds. The Officers thereupon weighed the diamonds in the packet and noticed that the weight of the diamonds was 625.57 cts. According to the Department, further statement of the petitioner was recorded and in which the petitioner accepted that he had purchased the diamonds from an unknown Muslim in Zaveri Bazar for a small amount. The Department claims that in the two subsequent statements recorded on June 16, 1966, the petitioner admitted that the bill issued by Arunkumar & Co. was not genuine.

(2.) The petitioner was put under arrest and produced before the Judicial Magistrate, but was released on bail on June 17, 1966. On the next day, i.e. June 18, 1966, the petitioner wrote to the Customs Authorities complaining that his two subsequent statements recorded on June 16, 1966, were untrue and were secured from him under coercion and threats. The complaint made by the petitioner was denied by the Customs Authorities by their reply dated June 25, 1966, wherein it was claimed that the statements were voluntary and the complaint of the petitioner was an after-thought. In answer to this letter, the petitioner reiterated his grievance by letter dated June 30, 1966 and demanded from the authorities the copies of the statements which the authorities claimed to have recorded. The Customs Authorities by their reply dated July 8, 1966 declined to furnish the copies forthwith and informed that the same would be handed over when adjudication proceedings commences. The petitioner made another attempt on July 14, 1966 to secure the statements by writing letter to the authorities. In answer to this letter, the Customs Authorities issued a summons to the petitioner to produce his books of accounts and the requisition was made on July 2, 1966.

(3.) On November 20, 1966, the petitioner requested the Customs Authorities through his Attorneys to furnish reasons which led the Officers to the reasonable belief that the diamonds found with the petitioner were smuggled goods. The further statement of the petitioner was recorded on November 30, 1966 and the petitioner disclosed that in addition to the purchase made from Arunkumar & Co. the petitioner has purchased diamonds weighing 240.83 cts. from M/s Shine India Corporation on May 5, 1966. Thereafter on December 17, 1966, the Assistant Collector of Customs informed the petitioner that the time provided under Sub-section (2) of Section 110 of the Customs Act, 1962, was extended. On December 21, 1966, the Assistant Collector furnished the grounds which led him to the reasonable belief that the diamonds found with the petitioner were smuggled articles. The two grounds set out in the letter are the prior information obtained by the Customs Authorities and the failure of the petitioner to lead satisfactory evidence of the legal acquisition of the diamonds in dispute. In answer to this letter, the petitioner wrote to the authorities on December 28, 1966 claiming that the grounds which have led the authorities to the reasonable belief were totally vague and insufficient. The petitioner also demanded that the Officer who seized the diamonds should be tendered for cross-examination to enable the petitioner to establish that there was no ground to arrive at a reasonable belief that the diamonds were smuggled articles.