A K SAHDEV Vs. RAMESH NANJI SHAH

JUDGEMENT

(1.) BY this petition, the petitioners, who are the officers of Enforcement Directorate of the Government of India. Mumbai, seek quashing of Criminal Case No. 4/s of 1996 initiated against them in the Court of the Metropolitan Magistrate, 3rd Court, Esplanade, Bombay, at the instance of respondent No. 1.

(2.) ACCORDING to the petitioners, respondent No. 1 is a Non-resident Indian. The Income-tax Department forwarded to the Enforcement Directorate for further proceedings certain diaries and documents which had been seized by the Income-tax Department from the premises of respondent No. 1 Ramesh Nanji Shah during their investigation. Respondent No. 1 had admitted in correspondence that the said diaries and documents belonged to him and are in his hand-writing. According to the petitioners the said diaries and documents revealed illegal transactions in the nature of havala on a large scale running into crores of rupees. The said havala transactions were carried out by the respondent and his brother Dhirubhai Nanji Shah. According to the petitioners, in pursuance of the said documents, the Enforcement Officers recorded the statements of a number of persons who include Anwar Gulam Hussain Lalan, Suresh Dayalal Chablani of M/s. Rose Travels, Chimanbhai Ramji Savla and Velji G. Shah both of Benzer Departmental Stores, Bharat Shah of M/s. Roopam Departmental Stores, Rishi Kapoor, a well-known Cine star and various other persons and all of them were interrogated and admitted to have been beneficiary of large scale hawala racket run by respondent No. 1 from outside India and his brother Dhirubhai Shah, who was operating as his counter-part in India.

(3.) ACCORDING to the petitioners, summons were issued under section 40 of the Foreign Exchange Regulation Act, 1973 to the respondent No. 1 and his brother Dhirubhai Shah in order to give evidence and produce documents. The summons was duly served on the respondent No. 1 through the Indian High Commission in Dubai. However, instead of responding to the summons and appearing before the Enforcement Directorate, the respondent No. 1 sent a letter dated 20-12-1995 informing the Directorate that it will not be possible for him to appear before the Directorate due to his business in Dubai and also called upon the Directorate to give reasons for requiring his presence before the Enforcement Directorate. By another letter dated 20-1-1996 he informed the Directorate that he is not in a position to help the Directorate in the investigation as the Directorate had failed to inform him the reasons requiring his presence before the Directorate and in case his statement is to be recorded, it should be recorded in the Indian High Commission in Dubai on a date convenient to the parties concerned. He was also sending copies of the letters to the higher authorities. He had also informed the Revenue Secretary, Government of India about the same and by letter dated 25-1-1996 he informed the Revenue Secretary of the Government of India that he was ready and willing to compensate the loss of foreign exchange suffered by the Government of India. According to the petitioner, respondent No. 1 was informed by letter dated 31-1-1996 by the Enforcement Directorate that his statement could not be recorded in Dubai and that he should respond to the summons of the Directorate, and by another letter dated 14-2-1996, the Enforcement Directorate denied all the false allegations made by respondent No. 1. Thereafter by another letter dated 10-2-1996, respondent No. 1 informed the Revenue Secretary of the Government of India that the flat at Vile Parle belonged exclusively to him. By another letter dated 8-3-1996 the respondent No. 1 informed the Revenue Secretary that he had been advised by his Doctor not to undertake any travel as he was not keeping well.