LAWS(TLNG)-2022-4-112

K.S. SUBBA RAO Vs. STATE OF TELANGANA

Decided On April 06, 2022
K.S. Subba Rao Appellant
V/S
State of Telangana Respondents

JUDGEMENT

(1.) This petition is filed by the petitioners-A2 and A3 under Sec. 482 Cr.P.C. to quash the proceedings in CC No.57 of 2016 on the file of XII Additional Chief Metropolitan Magistrate, Hyderabad.

(2.) The case of the petitioners was that the 1st petitioner was an Intelligence Officer and the 2nd petitioner was a Senior Intelligence Officer of the Directorate of the Revenue Intelligence (DRI), Hyderabad Regional Unit. The DRI was the Intelligence and Enforcement Agency of the Anti Smuggling matters under the Ministry of Finance, Government of India.

(3.) The 2nd respondent was the founder Director of a family concern, by name, M/s. Flytech Aviation Limited (FAL) and held 69% of shares in FAL. On the basis of specific intelligence about evasion of Customs Duties by FAL, the DRI, Regional Unit, Hyderabad initiated investigation into the import of 180 LED Panels (5 LED Boards) from Hong Kong and Aerophile Helium Baloon from United Kingdom. The imports of FAL were made from Sigma Resources Group Incorporation, New York, USA (Sigma), which was also solely owned by the 2nd respondent. Sigma, in turn, purchased the goods from Strongbase Investment Ltd., and Benson International HK Ltd., both based in Hong Kong. Both the purchaser and vendor companies were owned by the 2nd respondent. The essence of the illegal transaction was that FAL paid small amounts to Sigma for the imports, but the Sigma and other entities paid huge amounts to the Benson International and Strongbase Investment Ltd., for the same imports. Lesser amounts were shown in invoices to FAL from Sigma to evade customs duty to Indian Government, among other illegal motives of money laundering. The Additional Director, DRI, Hyderabad issued orders for search on 28/12/2007. The petitioners, along with a team of other members, conducted search at the office premises of FAL and at the residence of the 2nd respondent. The 1st petitioner was one of the fourmember search team in respect of the search at the office premises of the FAL. The 2nd petitioner was one of the four-member search team in respect of the search at the residence of the 2nd respondent. During the search, a detailed panchanama of the seized items was recorded. The search at both the places resulted in recovery of documents revealing that the 2nd respondent held 69% shares in FAL and he was also the sole owner of Sigma and he purchased the LED Boards from M/s.Benson International (HK) Ltd., and Strongbase Investment Ltd., Hong Kong and supplied them by grossly under invoicing the same to his own company FAL in contravention of the provisions of Sec. 14 of the Customs Act, 1962 and the Customs Valuation Rules, 1988.