SUPERINTENDENT AND REMEMBRANCER OF LEGAL AFFAIRS Vs. HCPATEL

JUDGEMENT

(1.) This is an appeal by the Superintendent and Remembrancer of Legal Affairs to the Government of Bengal, under the provisions of Section 417, Criminal P.C. One H.C. Patel was placed on his trial before a Presidency Magistrate on three charges under Section 420 read with Section 109, Indian Penal Code, on the allegations that he abetted three offences of cheating the Customs Department of the Government of India, and was acquitted of all three charges. Against that acquittal the present appeal has been filed. The case for the prosecution is as follows : There is a firm of merchants named Curmally Janmahomed in Bombay with a Branch in Calcutta and another branch in Osaka, Japan. The Calcutta Branch and the Osaka Branch are both styled Curmally & Co. The firm imports Japanese goods into India for sale in the Indian Market. The respondent H.C. Patel is the manager of the Calcutta Branch. The Osaka Branch is kept in funds by the Head Office in Bombay and by the Branch in Calcutta, and purchases goods from Japanese manufacturers for shipment to Bombay and Calcutta.

(2.) During the year 1989, the Osaka Branch entered into forward contracts with Japanese firms for the supply of a number of articles, including tin whistles, glass beads and glass mirrors, for shipment to Calcutta, and informed the Calcutta office of the purchase and the prices at which the purchases had been made. Subsequently the Japanese manufacturers intimated to the Osaka Branch that they could not supply the goods at the prices agreed upon and that the prices would be increased. The Osaka Branch reported this fact to the Calcutta Branch; and Patel, in reply, agreed to pay the enhanced prices. Thereupon the increase in price was paid to the manufacturers in Japan by the Osaka Branch and debited to the account of the Calcutta Branch. A debit note was sent to the Calcutta Branch for this amount. When the goods were shipped from Japan however invoices were sent from the Osaka Branch to the Calcutta Branch in which the original prices accepted by the manufacturers were given as the cost of the goods and no mention was made of the subsequent increases in price paid by the Osaka Branch under instructions from Calcutta. When the goods arrived at Calcutta, bills of entry were submitted to the customs giving the real value of the goods as the cost at which the goods were supposed to have been bought, and in support of this value, the invoices sent from Japan were produced before the customs authorities, and representations were made to those authorities that the goods had been purchased at the price mentioned in the invoices. Information was received from the Censor, which led the customs authorities to apply for a warrant for the search of the premises of the Calcutta Branch at 55 Canning Street. In the course of that search, documents and correspondence were seized and those documents &c. have been relied on to prove the case against the respondent.

(3.) Three specific charges were framed against the respondent, the first in respect of a consignment of tin whistles which arrived in Calcutta in March 1940, the second in respect of a consignment of hollow glass beads which arrived in Calcutta in June 1940, and the third in respect of a consignment of glass mirrors which arrived in Calcutta in June 1940. Evidence was also given in respect of a number of other consignments in which similar false declarations as to the real value of the consignments were said to have been made. In a long written statement, the respondent admitted that he was the manager of the Calcutta Firm, Gurmally & Co. but asserted that the Osaka branch and the Calcutta branch operated as distinct and separate firms. He denied that he had paid anything more for the goods than the prices agreed upon in the original forward contracts and asserted that the values given in the various bills of entry were the prices actually paid by the Calcutta Firm. As stated above, the prosecution has relied almost entirely on the correspondences and documents seized on the premises of the Calcutta Firm at 55 Canning Street. If these letters and documents reveal the true state of affairs, there can be no doubt that the written statement is substantially false; that the Osaka Firm and the Calcutta Firm did not operate as separate and distinct entities; that the respondent on behalf of the Calcutta Firm did agree to pay the increased prices demanded by the Japanese manufacturers; that those increased prices were in fact paid; and that the invoices submitted by the Calcutta Firm in support of the bills of entry were false and misleading. Consequently, the defence contended that many of the letters and documents seized were not admissible as evidence of the truth of the statements contained in them; that the letters and documents (if admitted as evidence) did not reveal the true state of affairs; and finally that if the letters and documents did reveal the true state of affairs, no offence of cheating had been committed. In the view we take of this case, it is not necessary to decide whether the letters and documents in question are admissible in evidence as proof of the truth of the statements contained in them, nor to decide whether those letters and documents reveal the true state of affairs. We shall assume, without in any way deciding these questions, that the facts are as contended by the prosecution. The material part of the first charge against the respondents was in the following words: That you, H.C. Patel...aided and, abetted one B.G. Samaddar, in committing an offence of cheating the Government of India, in its Customs Department, Calcutta, by causing a false declararation to be made of the real value of tin whistles...dishonestly concealing the fact that an increment of 20 per cent, has been given to the makers of the said goods prior to their delivery at Calcutta, which increment formed part of the real value of the goods as defined in Section 30 (b), Sea Customs Act, and thereby deceived etc. etc.