Sant Lal Jaiswal Vs Deputy Director (Appellate Tribunal under SAFEMA, New Delhi)
PMLA Attachment Upheld Where Cash Explanation Failed and Evidence Linked It to Illegal Liquor Transactions
Background
The appeal concerned the attachment of ₹11,26,000 in cash recovered from the premises of Sant Lal Jaiswal, a licensed CL-2 country liquor warehouse owner at Jaunpur. The Adjudicating Authority had confirmed the provisional attachment by its order dated 6 November 2023.
The proceedings arose from an investigation into the alleged illegal manufacture, transportation and sale of country liquor by Cooperative Company Limited, Tapri, Saharanpur, and associated persons. FIRs included allegations of cheating, forgery and falsification of accounts, providing the foundation for proceedings under the Prevention of Money Laundering Act, 2002.
The central question was whether the seized cash represented legitimate business receipts or proceeds connected with the alleged criminal activity.
The Double-Trip Arrangement
The investigation disclosed an alleged arrangement under which a truck delivered one consignment of liquor against valid documents, returned to the factory and carried another consignment using the same gate pass, bilty and PD25A pass.
Duplicate barcodes and QR codes were allegedly used to facilitate the second consignment without payment of corresponding excise duty. Other methods included switching off vehicle GPS systems and factory CCTV cameras, and manufacturing liquor from unaccounted quantities of Extra Neutral Alcohol.
Of 147 consignments examined, the SIT identified 99 instances of double trips, involving an assessed excise-duty loss of approximately ₹34.74 crore. The investigation attributed two double-trip transactions connected with the appellant to an alleged benefit of ₹70.17 lakh.
Appellant’s Defence
The appellant denied involvement in the illegal activities and emphasised that his name did not appear in the FIRs. He maintained that he operated a licensed business, kept proper books and stock records, and underwent periodic verification by the Excise Department.
According to him, no excess or shortage of stock had been detected at his warehouse. He argued that the absence of such discrepancies contradicted the allegation that he had received or sold unaccounted liquor.
Regarding the seized cash, he explained that ₹3,80,000 had been withdrawn from his Union Bank of India savings account, while ₹7,46,000 represented receipts from traders in the ordinary course of business.
He relied on his cash book, stock register, income-tax returns and statements describing the money as business sale proceeds. He also explained that cash receipts were ordinarily retained before being deposited for making procurement payments.
Bank Records Did Not Support the Explanation
The Tribunal found that the claimed bank withdrawal was not substantiated.
The investigation had examined the relevant bank statement and found no withdrawal corresponding to the explanation that ₹3,80,000 had been withdrawn shortly before the search. The appellant failed to establish the claimed withdrawal through supporting bank records.
The explanation concerning ₹7,46,000 received from traders also remained unsupported by satisfactory independent evidence. The ED’s case was that the cash book did not contain the relevant receipt entries.
The Tribunal declined to treat the cash book as sufficient proof in these circumstances. It observed that a cash book remained within the party’s control and could be prepared by that party; it therefore required corroboration when the stated source was contradicted or unsupported by other records.
Stock Records Did Not Answer the Alleged Off-Book Transactions
The Tribunal also rejected the argument that the stock register disproved participation in excise-duty evasion.
Its reasoning was that transactions undertaken outside the recorded system would not necessarily appear in the very records maintained for authorised business. Consequently, an apparently regular stock register did not, by itself, answer the evidence concerning duplicate consignments and reuse of transport documents.
The Tribunal relied on the statements of the driver and others concerning the double-trip mechanism, the investigation connecting the appellant with the supplies, and his failure to satisfactorily explain the seized cash.
It also considered the significant increase in declared income during financial year 2020-21, which the investigation correlated with the period of the alleged illegal activity.
Tribunal’s Decision
The Tribunal accepted the cumulative material as establishing a prima facie connection between the appellant, the alleged illegal liquor transactions and the seized cash.
It found that the appellant had not satisfactorily addressed the adverse evidence or substantiated the claimed legitimate sources of the money. The appeal was therefore dismissed, leaving the attachment of ₹11,26,000 undisturbed.
Author’s Comments
A cash explanation must reconcile with the records that should ordinarily support it. When the explanation is a recent bank withdrawal, the bank statement becomes crucial. When it is collections from traders, contemporaneous receipts, ledger entries and confirmations can materially strengthen the claim.
The decision also illustrates why a stock register may have limited value against an allegation of transactions conducted wholly outside the books. Regular entries concerning authorised supplies do not necessarily explain alleged unrecorded supplies.
However, the ruling should be read within its factual setting. Failure to explain cash is not, by itself, a substitute for establishing its connection with criminal activity relating to a scheduled offence. Here, the Tribunal relied on the alleged double-trip transactions and surrounding investigation in addition to the deficient cash explanation.
Likewise, an increase in disclosed income cannot independently establish money laundering. Its relevance in this order arose from the Tribunal’s assessment of the combined circumstances. The decision concerns confirmation of attachment; it does not constitute a final criminal conviction.
FULL TEXT OF THE ORDER OF APPELLATE TRIBUNAL UNDER SAFEMA
By this appeal under Section 26 of the Prevention of Money Laundering, 2002 (in short ‘the Act of 2002’), a challenge has been made to the order dated 06.11.2023 passed by Adjudicating Authority confirming the Provisional Attachment Order No. 06/2023 dated 24.05.2023 whereby cash amounting to ₹11,26,000/- was provisionally attached.
2. It was a case where predicate proceedings originated from FIR No. 0098/2021 dated 04.03.2021, registered by the Uttar Pradesh Police at Police Station Kotwali Saharanpur, pursuant to a complaint made by Shri Mohd. Arif Jameel, Assistant Excise Commissioner, Meerut. The FIR was for offences under Sections 420, 467, 468, 471 and 477-A of the Indian Penal Code, 1860, against Shri Ashwani Upadhyay, Sales Head, and other directors/employees of M/s Cooperative Company Limited, Tapri, Saharanpur (“CCL”), along with other persons. The Directorate of Enforcement recorded ECIR No. ECIR/LKZO/23/2021 on 31.03.2021.
3. During the course of investigation, it was found that a Special Investigation Team (“SIT”), Lucknow, was also investigating the matter. Consequently, the Enforcement Directorate addressed a communication dated 03.06.2021 to the Superintendent of Police, SIT, Lucknow, pursuant to which it was found that FIR No. 03/2021 dated 06.03.2021 was also registered by the SIT under Section 60 of the U.P. Excise Act.
4. A charge sheet bearing No. 02/2021 dated 31.05.2021 was filed before the Special Judge, CBI, Central Lucknow, for offences under Section 60(2) of the U.P. Excise Act, Sections 120-B, 420, 467, 468, 471 and 477-A of the IPC, Section 66 of the Information Technology (Amendment) Act, 2008, and Sections 7 and 13 of the Prevention of Corruption Act, 1988. Another FIR bearing No. 04/2021 dated 06.03.2021 was also registered by the SIT for the offences under Sections 420, 467, 468, 471 and 477-A of the IPC.
5. The investigation disclosed a systematic modus operandi for the illegal manufacture, transportation and sale of country liquor, coupled with evasion of excise duty. Information was received by the Excise Department, Meerut, that country liquor in the brand name “Shabnam Angoori” was being supplied from CCL, Saharanpur Tapri, to various CL-2 warehouses by using the same gate pass and PD25A pass for more than one consignment. The second consignment was to transport liquor without payment of the corresponding excise duty and was subsequently sold without proper documentation, thereby causing loss to the Government Exchequer and corresponding unlawful gain to the accused persons.
6. The modus operandi was found on the interception of truck No. UP11 BT 0935. The truck was issued a gate pass dated 01.03.2021 and supplied country liquor to the warehouse of Ajay Jaiswal at Unnao on 02.03.2021. After returning to the CCL premises on 03.03.2021 for reloading, the same truck was apprehended by the Special Task Force, Uttar Pradesh, and the Excise Department. The driver, Gulsher, disclosed that the same gate pass, which was valid up to 05.03.2021, is being used repeatedly on the instructions of the transporter. He stated that he had already delivered liquor at the CL-2 warehouse at Unnao and had received ₹2,500/- from the owner of Sharma Transport Corporation, Saharanpur, and ₹2,000/- from the owner of the CL-2 warehouse at Unnao.
7. He further disclosed that the truck’s GPS had been tampered on the instructions of the transporter and that several trucks were operating on a similar pattern.
8. The statement of Shri Pradeep Kumar, Barcode Dispatcher at CCL disclosed that multiple barcodes bearing the same number were being issued/printed through Monarch software on the directions of the owner/management of CCL. The investigation also revealed that CCL was receiving Extra Neutral Alcohol (“ENA”) from Jain Distillery, Bijnor, Muzaffarnagar. Approximately 35,000 litres of ENA were supplied but invoices were raised only for 25,000–30,000 litres, leaving the balance quantity unbilled and unaccounted for. The unaccounted ENA was allegedly utilised for manufacturing liquor outside the recorded production process.
9. The investigation further disclosed that such unaccounted liquor was removed from the factory premises without corresponding entries in the “Out-Register” and that the CCTV cameras were switched off during such movement. The transporters, including Shri Jaibhagwan and his brother Shri Satyavan, allegedly instructed the truck drivers to switch off the GPS so as to prevent tracking of the vehicles. It was further alleged that the CCTV display was located in the cabin of the HR Head, Shri Veerendra Shankhdhar, who instructed Shri Ashok Kumar Kashyap, Attendant, to switch off the CCTV cameras when trucks carrying illegal liquor were being taken out of the factory premises.
10. The material collected by the SIT also indicated the involvement of various management officials of CCL, including Shri Pranay Aneja, Managing Director, Shri Ashwani Upadhyay, Sales Head, Shri Kamal Daniel, Vice-President (Technical), and Shri Somshekhar, along with transporters, CL-2 warehouse owners and certain Excise Department officials. It was alleged that officials posted at CCL and at CL-2 warehouses facilitated the illegal activity. When the truck No. UP11 BT 0935 was intercepted at Saharanpur, a team was also sent to the CL-2 warehouse at Unnao. It was allegedly found that Shri Ravindra Verma, an Excise Department official posted at CL-2 Unnao, had informed Shri Ashok Dixit for impending search and instructed him to manage the stocks at the godown.
11. The specific modus operandi of the double-trip transactions was found in which a truck would be loaded initially with approximately 1,500 boxes of country liquor (each box containing 45 bottles of 200 ml each) against a valid PD25A pass, bilty and gate pass. The liquor was transported to the designated CL-2 godown and unloaded, following which the truck returned to CCL. The same truck was thereafter loaded with another consignment of approximately 1,500 boxes and again transported to the same destination using the same PD25A pass, bilty and gate pass by employing duplicate barcodes and QR codes. Thus, two consignments were transported under documentation which ostensibly to cover only one trip. Consequently, excise duty payable on the second consignment was evaded, resulting in an unlawful financial benefit to CCL and the persons associated with the arrangement.
12. The investigation also disclosed that the illegal activity extended beyond the double-trip mechanism. Shri Arvind Kumar, Chemist at CCL, stated before the SIT that tankers containing approximately 35,000 litres of ENA were supplied to CCL, whereas the distilleries raised invoices only for approximately 25,000–30,000 litres. The unaccounted ENA was allegedly utilised, at the direction of CCL management, for manufacturing liquor which was not reflected in the books and records of the company. The records were allegedly manipulated to facilitate the production and sale of unaccounted liquor through CL-2 warehouse owners, thereby evading excise duty for generating unlawful proceeds.
13. The SIT charge-sheet records that, during the period from 01.04.2020 to 28.02.2021, CCL supplied 569 consignments of “Shabnam Angoori” country liquor to CL-2 godowns situated in Unnao, Kanpur Nagar, Badaun, Sambhal, Bareilly, Jaunpur and Mahoba. Out of these 569 consignments, 147 consignments were examined by the SIT and 99 were found to involve in double trips. The investigation assessed the excise duty evasion to ₹35,08,650/- for each such illegal round of transportation. On the basis of the 99 double trips, the total loss caused to the Government Exchequer was assessed at ₹34,73,56,350/-. It was, however, noted that 422 consignments were yet to be examined, and further investigation could potentially establish a higher amount of loss.
14. The investigation further alleged that a portion of the evaded excise duty was paid to Excise Department officials posted at the factory. It was also alleged that Shri Jaibhagwan, owner of the transport company, had accumulated wealth and acquired vehicles out of the illegal earnings generated from the sale of liquor supplied to various warehouse owners. The material collected during investigation, including statements recorded under Section 50(2) and 50(3) of the PMLA, was relied upon to explain the generation, possession, deployment and utilisation of the alleged proceeds of crime.
15. In the case of Shri Sant Lal Jaiswal, the material relied upon by the Enforcement Directorate indicates that he was one of the CL-2 warehouse owners/persons associated with the supply and sale of country liquor from CCL. The SIT specifically records that double trips were undertaken for the supply of country liquor to CL-2, thereby benefiting Sant Lal Jaiswal. The investigation attributed an excise-duty benefit/loss of ₹35,08,650/- to each double trip and, in respect of two such double trips relating to the concerned transactions, referred to a benefit of ₹70,17,300/-.
16. A search under Section 17 of the Act of 2002 was conducted on 29.07.2021 at the premises of Shri Sant Lal Jaiswal. During the search, cash amounting to ₹11,26,000/- along with certain documents/records were recovered and seized. Statements of Shri Deviprasad Jaiswal and Shri Sant Lal Jaiswal were recorded under Section50(2) of the Act of 2002. The seized cash was not satisfactorily explained. Shri Deviprasad Jaiswal, who was present at the premises during the search, stated that the cash is related to business and could be explained by Shri Sant Lal Jaiswal.
17. Shri Sant Lal Jaiswal sought to explain the cash by referring to withdrawals from his bank account bearing No. 4421020110111794 with Union Bank of India and amounts allegedly received from traders. However, upon examination of the bank statement and cash book of the relevant period, the explanation was found to be vague and unsupported by the contemporaneous financial records. No satisfactory documentary evidence could be produced to establish that the seized cash represented legitimate withdrawals or genuine business receipts.
18. The investigation also examined the Income Tax Returns of Shri Sant Lal Jaiswal and noted a significant increase in his declared income during the financial year 2020-21 as compared with the preceding years. The increase was considered material in the context of his commencement/continuation of supplies of country liquor from CCL during the relevant period. Further, appellant failed to produce invoices or other contemporaneous documents substantiating legitimate purchases of liquor from CCL. The investigation, therefore, formed a view that the transactions were, at least in part, undertaken in cash and were connected with the illegal liquor business. Therefore, the case of the Enforcement Directorate was not founded solely upon the fact that ₹11,26,000/- was found in cash. The alleged nexus is established through the cumulative effect of: (i) the predicate offences relating to illegal liquor manufacture, transportation, forgery and excise-duty evasion; (ii) the statements and investigation regarding the double-trip mechanism; (iii) the specific transactions allegedly benefiting Shri Sant Lal Jaiswal; (iv) the substantial quantum of excise-duty evasion established in the examined consignments; (v) the search and recovery of ₹11,26,000/- from his premises; (vi) the absence of a satisfactory and contemporaneously supported explanation for the source of the cash; (vii) the increase in his income during the relevant financial year; and (viii) the alleged absence of invoices/documentary evidence supporting legitimate purchases from CCL.
19. The principal issue arising for consideration, therefore, is whether the aforesaid material establishes a sufficient nexus between the cash of ₹11,26,000/- provisionally attached from Shri Sant Lal Jaiswal and the alleged proceeds generated from the scheduled/predicate offences.
20. Shri Sant Lal Jaiswal is the licence holder of the CL-2 godown at Jaunpur. It is alleged that, during the period from 03.01.2021 to February 2021, he received consignments of country liquor, namely “Shabnam Angoori”, from M/s Cooperative Company Limited, Saharanpur Tapri (“CCL”). The Enforcement Directorate relied upon the investigation conducted in respect of the alleged double-trip mechanism adopted by CCL and its associated persons and alleged that certain consignments were supplied to CL-2 godowns by using the same bilty, gate pass and PD25A pass.
21. During the search conducted at the premises of Shri Sant Lal Jaiswal on 29.07.2021, cash amounting to ₹11,26,000/- was recovered and seized. He was specifically called upon to explain the source of the said cash. In response, Shri Sant Lal Jaiswal stated that ₹3,80,000/- represents cash withdrawn a few days earlier from his savings bank account bearing No. 4421020110111794 maintained with Union Bank of India, while the remaining amount of ₹7,46,000/- represents receipt of amount from various traders in the ordinary course of his licensed liquor business. In support of his explanation, he furnished, inter alia, his Income Tax Returns, the cash book of CL-2 Jaunpur for the period from 01.04.2021 to 29.07.2021, stock register and other business records.
22. The Enforcement Directorate, however, disputed the explanation furnished by Shri Sant Lal Jaiswal. According to the investigation, the cash book for the relevant period did not contain entries evidencing receipt of ₹7,46,000/- from the alleged traders. Further, analysis of the relevant bank account allegedly showed that no cash withdrawal had been made from the said account for a considerable period prior to the search. The Enforcement Directorate, therefore, concluded that the claim regarding withdrawal of ₹3,80,000/- from the bank account a few days before the search was incorrect and that the cash book and bank account statement did not corroborate his explanation.
23. On this basis, the Enforcement Directorate treated the entire cash amount of ₹11,26,000/- recovered from the premises as having been generated from the illegal business activities of Shri Sant Lal Jaiswal, particularly from the sale of illegally supplied liquor of CCL, Saharanpur Tapri. The cash was accordingly alleged to constitute proceeds of crime. The Enforcement Directorate further contended that, since transactions relating to the alleged illegal liquor business were undertaken in cash, the absence of the seized amount from the books/records was indicative of its illicit nature.
Arguments of counsel for the appellant:
24. The learned counsel for the appellant submitted that no material exists to connect the appellant with the crime. The appellant specifically denied having any involvement in the alleged illegal activities of CCL. He submitted that his name did not find mention in the FIRs and accordingly neither the predicate offence agency nor the Enforcement Directorate could produce any evidence establishing involvement of the appellant. According to him, all liquor received at CL-2 godown was duly accounted for and proper books of account, including the cash book and stock register were maintained.
25. The counsel for the appellant submitted that neither the SIT nor the Enforcement Directorate had alleged any excess or shortage of liquor stock at the appellant godown. The stock registers and other records were periodically verified by the Excise Department. No variation or discrepancy had ever been detected. According to him, had any unaccounted or illegal liquor been received or sold from his godown, the same would have been resulted in a corresponding discrepancy in the physical stock or the records maintained at the godown.
26. The counsel for the appellant further denied any nexus with the alleged illegal transportation and sale of country liquor. It was submitted that the appellant was merely a licensed liquor seller carrying on his business lawfully and was not aware of any illegal activities allegedly undertaken by CCL, its management, transporters or other persons. He contended that no evidence had been brought on record showing that he knowingly participated in, assisted or derived any benefit from the alleged illegal activities.
27. The appellant further submitted that the documents seized by the Enforcement Directorate relates to his legitimate and licensed liquor business and that their seizure had adversely affected the continuation of his business. He contended that the seized documents did not establish any connection with the alleged illegal activities of CCL or its associated persons.
28. As regards the cash of ₹11,26,000/-, the appellant categorically denied that the amount represents proceeds of crime. He maintained that the entire cash was out of legitimate business receipts arising from the licensed sale of liquor and was duly reflected in his books of account. He relied upon the cash book, which, according to him, showed cash-in- hand on the relevant date. It was substantially corresponding with the cash physically found during the search.
29. The appellant further relied upon the statement of Shri Devi Prasad Jaiswal recorded during the search on 29.07.2021 and his subsequent statement under Section 50 of the PMLA dated 14.10.2021, wherein cash was stated to represent business sale proceeds. It was submitted that the nature of the Defendant’s licensed liquor business involved substantial cash transactions and that the cash was ordinarily retained for some time and thereafter deposited into the bank account for preparing drafts/RTGS payments towards procurement and release of the licensed quota of country liquor from manufacturers/wholesalers.
30. The appellant disputed the allegation about the seized cash not matching to his books. It was submitted that the cash book furnished to the Enforcement Directorate records the requisite cash balance. According to him, the statement of the Enforcement Directorate that the seized cash was unaccounted is contrary to the documentary record.
31. The appellant further contended that the investigation has failed to establish any generation of proceeds of crime at his end. The learned counsel relied upon the FIRs and the investigation conducted by the SIT and submitted that there was no allegation of excess stock, shortage of stock, unaccounted liquor or unaccounted sale at his godown. In his submission, the absence of any such discrepancy conclusively weakened the allegation that he had received illegal liquor or sold any liquor outside the authorised quota.
32. It was further submitted that neither the predicate agency nor the Enforcement Directorate had conducted specific investigation which could establish that the appellant had received unaccounted “Shabnam Angoori” liquor. According to the appellant, the investigation was principally directed against CCL, Saharanpur, and other CL-2 dealers situated at places such as Kanpur, Unnao, Badaun, etc., whereas no independent evidence had been collected against him to establish his involvement in the alleged illegal transactions.
33. Accordingly, the appellant contends that the essential nexus between the specific property attached, i.e. ₹11,26,000/-, and the alleged proceeds of crime has not been established. According to him, the cash represented legitimate business proceeds duly reflected in the books of account, whereas the allegation that the same constituted proceeds of crime is based upon an inference drawn from his association with the licensed liquor trade and the alleged movement of CCL trucks to Jaunpur, without any direct evidence of his receipt, possession, use or concealment of proceeds generated from the alleged illegal liquor transactions.
Arguments of counsel for the respondents:
34. The appeal was contested by the learned counsel for the respondents. Elaborate arguments were made on each issue and would be referred while recording finding to the arguments raised by the learned counsel for the appellant. It is to avoid repetition of facts and for the sake of brevity.
Finding of the Tribunal:
35. I have considered the rival submissions of the parties and scanned the record carefully.
36. The brief facts pertaining to the registration of FIR No.0098/2021 dated 04.03.2021 have been given in the opening paras of this order. The FIR was registered for the offence under Section 420,467,468,471 and 477A of the IPC,1860. It was mainly against Ashwani Upadhyay, Sales Head and other directors and employees of M/s Co-operative Company Ltd., Tapri, Saharanpur (CCL).
37. During the course of investigation, it was revealed that the country liquor was being supplied from CCL to various CL- 2 warehouses by using the same gate pass and PD25A Pass for more than one consignment. It was done to evade the excise duty and thereby resulting in unlawful gain to the accused and corresponding loss to the Government exchequer. The Company’s modus operandi was found on interception of the Truck No.UP11 BT 0935. The truck was issued a gate pass dated 01.03.2021 and supplied country liquor to the warehouse of Ajay Jaiswal at Unnao by using the gate pass dated 01.03.2021. The first supply was made to the warehouse on 02.03.2021. After returning to the CCL premises on 03.03.2021 to load more country liquor, it was apprehended by a team of Special Task Force and the Excise Department. It was found that the same gate pass was illegally used again because of its validity till 05.03.2021. Thus, the serious allegation of tampering of truck’s GPS system to determine the route for transportation of country liquor was made. The statement of the Truck Driver fortified the fact aforesaid who was paid for the illegal act.
38. So far as the appellant is concerned, its warehouse was also searched, where not only incriminating documents were found and seized but unaccounted sum of Rs.11,26,000/- was also found. It was seized by the respondents followed by its provisional attachment. The appellant has shown himself to be innocent and not connected with the commission of crime thus the main thrust of the argument was that without involvement of the appellant in commission of crime, the provisional attachment of the amount of Rs.11,26,000/- could not have been caused.
39. The argument aforesaid was contested by the respondents with detailed submissions to show not only involvement of the appellant so as to connect him with the crime but also the recovery of unexplained amount of Rs.11,26,000/-. The appellant was one of CL-2 warehouse owner/person associated with the supply of the country liquor from CCL. The SIT specifically recorded 99 instances of double trips carried out to the benefit of CCL and its associates. It has resulted in a total loss of Rs.34,73,56,350/- to the Government Exchequer. It is for that reason the appellant could not give explanation to possess a sum of Rs.11,26,000/- at the time of search. The appellant though made a reference to the bank account with UBI but no document in lieu thereof was submitted. It could have been the bank statement to show the withdrawal of the equivalent amount immediately before the search. The further statement of the appellant was about receipt of the remaining amount from the traders. The respondents examined the bank statement of the relevant period and found explanation to be vague and unsupported by the documents. No satisfactory documentary evidence could be submitted by the appellant to prove that the cash represented a legitimate withdrawal and genuine business receipts. In the investigation, even the income-tax returns of the appellant, Sant Lal Jaiswal were examined. A significant increase in the declared income was found during the financial year 2020-21, as compared to the previous years. The increase in income was co-related with the illegal act involving evasion of the excise duty and the corresponding increase in the income and other benefits. Therefore, the amount of cash recovered from the appellant was found to be the proceeds of crime. The detailed facts pertaining to the case have been given in the opening paras of this order and otherwise the facts placed on record by the respondents revealed a prima facie case to prove involvement of the appellant. The counsel for the appellant has shown appellant to be innocent but could not clarify the facts adverse to the appellant. It is otherwise a case where the evasion of the excise duty was fortified by the respondents, which was more than the amount attached by the respondents in the hands of the appellant.
40. During the course of search, appellant Sant Lal Jaiswal stated that Rs.3,80,000/- was the cash withdrawn from the saving bank account of UBI, while the remaining amount of Rs.7,46,000/- was received from various traders. The counsel for the appellant failed to prove the bank statement to fortify the withdrawal of the amount of Rs.3,80,000/-. The cash book was referred, however, it can be created by a party at any time because it remains in the possession of the party and cannot be said to be an independent document. The bank statement could have been produced by the appellant to prove withdrawal, but appellant failed to do so and otherwise the investigation revealed that no withdrawal was made corresponding to the period when the amount of Rs.11,26,000/- was found with the appellant. It is also a fact that the amount of Rs.7,46,000/- alleged to have been received from the traders remained for the sake of it. The authentic independent document could not be produced by the appellant and, therefore, not only he was found involved in the commission of crime but even failed to disclose the source to acquire the amount of Rs.11,46,000/-found at the time of search. The counsel for the appellant made a reference of the stock register to indicate that the appellant has not manipulated or evaded the excise duty. The fact, however, remains that when one is involved in evasion of the excise duty, the corresponding entries would not be recorded; otherwise the party would be liable to pay the excise duty. For the evasion of excise duty, one would not keep in possession of the record and accordingly, the main excuse taken by the appellant in reference to the stock register cannot be of his benefit as otherwise fact about double trip was admitted by the driver. The fact otherwise remains that huge unexplained sum was found in possession of the appellant, which is nothing but the proceeds of crime. The modus operandi of the appellant was found on the interception of the trucks using the same gate pass, which is fortified by the statement of the driver and others. In the light of the facts given above, I do not find a case in favour of the appellant. Appeal accordingly fails and is dismissed.
