Gopal Gupta Vs Union of India & Ors. (Delhi High Court)
The petitioners herein have produced certified copies of the detention orders dated 17.05.2019 passed in the case of Union of India & Anr. vs. Dimple Happy Dhakad, reported as (2019) 20 SCC 609 (filed by the detenu’s wife) from the records available in the Supreme Court of India. A purposive comparative consideration of the grounds of detention dated 17.05.2019 in Dimple Happy Dhakad (supra), also passed by Sh. R.P. Singh, the Detaining Authority in these proceedings; and the impugned detention orders, gives substance to the inference is that barring a few differences in the names and references etc–––mutatis mutandis–––the grounds are unerringly identical. The said comparison ground-for-ground leads but to one inescapable conclusion, that the entire exercise of passing the detention orders is mechanical, as the grounds have been lifted from the grounds of an altogether distinct case. Such a blatant copy-paste by the Detaining Authority demonstrates a clear non-application of mind.
We, therefore, hold that the impugned orders of detention are liable to be vitiated on this ground as well.
FULL TEXT OF THE HIGH COURT ORDER /JUDGEMENT
These two writ petitions under Article 226 of the Constitution of India, essentially in the nature of writ of habeas corpus, have been instituted on behalf of Gopal Gupta, the petitioner in W.P.(CRL.) 1829/2020 and Amit Pal Singh, the petitioner in W.P.(CRL.) 1830/2020 (hereinafter collectively referred to as the ‘detenu’), praying for quashing of detention orders bearing No. PD-12001/01/2020-COFEPOSA and PD-12001/02/2020- COFEPOSA respectively, both dated 21.01.2020, and for further directions that the detenu be set at liberty forthwith.
FACTS OF THE CASE:-
2. The relevant facts qua the detenus, as are necessary for the adjudication of the subject writ petitions are briefly encapsulated as follows: –
i) Both the detenus are statedly employees of a company namely, M/s. Its My Name Private Limited (hereinafter referred to as ‘IMNPL’).
ii) IMNPL is a government recognized three star export house, engaged in the business of manufacturing, import and export of gold jewellery and other allied bullion items.
iii) IMNPL has been duly issued an Import Export Code (IEC) bearing No.0514037342 from the office of the Joint Director, Directorate General of Foreign Trade (hereinafter referred to as ‘DGFT’) and is stated to have earned foreign exchange valuing around 150 million USD for the country.
iv) IMNPL has also obtained Advance Authorization Licence from the office of DGFT, New Delhi, inter alia permitting import of 1000 kgs of gold bars.
v) IMNPL has against the said Advance Authorization Licence imported 50 kgs of gold bars and completed export obligation of approximately 19 kgs of gold bars vídé Export Invoice No.ITS/EXP/04 dated 20.04.2019; with balance export obligation of approximately 31 kgs.
vi) At this juncture, it is relevant to observe that the stock related to the aforementioned balance export obligation, was resumed by the Directorate of Revenue Intelligence (hereinafter referred to as the ‘DRI’) on 24-25.04.2019, from the factory premises of IMNPL at Pitampura, Delhi.
vii) It is the detenus’ case that similar licences have been duly issued in the past as well and that export obligations thereunder have been duly fulfilled by IMNPL.
ix) IMNPL also purchased gold form the domestic market, duty and GST in relation to which has been duly paid; besides directly importing gold under the Advance Authorization Scheme, as afore-stated.
ix) IMNPL is stated to have exported domestic gold jewellery under the Exhibition Export Scheme of the Foreign Trade Policy (FTP 2015-20)
x) At this stage, it is relevant to observe that as per Para 4.46 of FTP, read with Para 4.80 of the Hand Book of Procedure, domestic jewellery can be exported for exhibitions abroad with the approval of Gems & Jewellery Export Promotion Council (hereinafter referred to as ‘GJEPC’), which approval was granted to IMNPL subject to the condition that unsold gold jewellery has to be re-imported back within 60 days from the close of such exhibition, failing which they would become liable to pay import duty on the quantity of the said re-import. Further, as per Customs Notification No.45/17 dated 30.06.2017,\
xi) IMNPL had, with the approval of GJEPC, exported gold jewellery manufactured from the domestic stock of gold for overseas exhibition. It is, therefore, the detenus’ case that, evidently there was no duty payment required at the stage of re-import of the subject gold into the country, within the stipulated time period of 60 days.
xii) IMNPL received an invitation for one such exhibition to be held from 18.02.2019 to 30.03.2019 from M/s. M.N. Khan Jeweller, based in United Arab Emirates (UAE), duly signed by its director Mr. Mohd. Nashruddin Khan; and in pursuance thereto had approached GJEPC seeking permission for participation, which was duly allowed vídé letter dated 15.02.2019 for the entire duration of the exhibition, as afore-noted.
xiii) In pursuance to this invitation, detenu Amit Pal Singh was entrusted with the work to hand-carry (personal carriage) the gold jewellery to UAE for the purpose of exhibition, in accordance with the permission granted and in compliance with the provisions applicable.
xiv) Export of the gold jewellery was done by IMNPL after filing the requisite shipping bills along with necessary documents.
xv) The subject gold was duly assessed by the Customs at the time of clearance for export; the photographs of the goods being exported through hand-carry, were also checked and seen by the Customs Jewellery Appraiser posted at the Export Shed Air Cargo; and after verification of the same, the said photographs were signed and appraised by the Appraiser and then given back in sealed cover to the person hand-carrying the gold jewellery.
xvi) The gold jewellery, which remained unsold at the time of exhibition was brought back by the co-detenu Amit Pal Singh from UAE. The detenu Amit Pal Singh landed at the Indira Gandhi International Airport, New Delhi on 24.04.2019 at around 06.30 p.m. and approached the Red Channel for the purpose of declaration of the goods brought back by him.
xvii) Amit Pal Singh, the detenu is stated to have filed reimport documents such as packing lists cum invoice; and provided the sealed packet of photographs to the Customs Appraiser along with the shipping bills, Export Declaration Form and endorsed copies of packing list-cum-invoice, given to detenu at the time of export, respectively for the quantities of unsold gold jewellery being brought back out of earlier exported goods concerning shipping bills dated 20.02.2019 and 13.03.2019; as well as making requisite declaration, as per the Standard Operating Procedure.
xviii) The Customs Jewellery Appraiser deputed at the Red Channel, duly checked and verified the said documents and appraised the subject gold jewellery and after properly satisfying himself that the gold jewellery was the same, which was exported, allowed Amit Pal Singh, the detenu to take the same by issuing necessary Customs Gate Pass in this behalf.
xix) However, when Amit Pal Singh, the detenu was about to leave the IGI Airport, after clearance from the Red Channel, the officers of DRI intercepted him, statedly on specific information and carried out search of his baggage as well as his person allegedly on the suspicion that he was illegally importing gold jewellery for evasion of customs duty.
xx) DRI seized the gold jewellery weighing 51.172 kgs, carried by the detenu Amit Pal Singh in his baggage.
xxi) Thereafter, the business/factory premises of IMNPL were also searched, wherein 25 foreign origin gold bars total weighing 25 kgs, cut pieces of gold bars, gold dust and assorted gold jewellery totally weighing 26.404 kgs and silver bars and cut pieces of silver weighing 44.78 kgs was recovered and seized under Panchnama dated 24-25.04.2019.
xxii) Thereafter, inter alia search was also conducted at the residential premises of one Rahul Gupta, owner of IMNPL, although nothing incriminating was found or recovered therefrom.
xxiii) Mohd. Nashruddin Khan, who was the director of M/s. M.N. Khan Jeweller, UAE and was travelling on the same flight as Amit Pal Singh (the detenu) was also intercepted and detained by the DRI.
xxiv) Gopal Gupta detenu, who is employed as a Chartered Accountant by IMNPL was also detained by the DRI vídé arrest memo dated 26.04.2019.
xxv) Statements of the detenus were recorded on 25.04.2019 under Section 108 of the Customs Act, 1962 (hereinafter referred to as the ‘Customs Act’) and they were taken into custody by the DRI, who formally placed them under arrest on 26.04.2019.
xxvi) It is observed here that, bail was granted to the detenus on 03.06.2019.
xxvii) One Vikram Bhasin, who was the Customs Jewellery Appraiser at the IGI Airport, New Delhi was subsequently arrested by the DRI on 31.05.2019 and his statements were statedly recorded by the DRI. The said Vikram Bhasin (Customs Jewellery Appraiser, IGI Airport, New Delhi) was released on bail vídé order dated 23.07.2019.
xxviii) IMNPL requested the DRI for provisional release of the seized goods, which request was rejected by the ADJ, Adjudication, Delhi vídé order dated 04.10.2019.
xxix) Before rejecting the request for provisional release, a Show Cause Notice dated 26.09.2019 was issued to IMNPL by the DRI, New Delhi proposing confiscation of the seized gold jewellery.
xxx) IMNPL being aggrieved by the DRI’s said order dated 04.10.2019, preferred a Customs Appeal before the Customs Excise and Service Tax Appellate Tribunal (CESTAT), which vídé order dated 13.11.2019 allowed conditional release of the seized goods. The said order passed by the CESTAT was modified by this Court vídé judgment dated 01.06.2020, permitting the provisional release of all the goods seized by the DRI, save and except the gold jewellery that was seized at the airport.
xxxi) A review petition preferred by the IMNPL before this Court in the said proceeding is still pending adjudication; although DRI’s Special Leave Petition (SLP) against this Court’s judgment dated 01.06.2020 was disposed of by the Hon’ble Supreme Court vide order dated 01.10.2020, modifying the judgment of this Court, only to the extent of enhancing the value of Bond and Bank Guarantee, to be furnished for the provisional release.
xxxii) In the meantime, the impugned detention orders were passed on 21.01.2020.
xxxiii) It is relevant to point out that the impugned orders of detention were earlier challenged by the petitioners herein at the pre-execution stage, by filing W.P.(CRL.) 1009/2020 and W.P.(CRL.) 1019/2020, respectively.
xxxiv) This Court by way of its judgment dated 11.09.2020 dismissed both the said writ petitions, which judgment has also been affirmed by the Hon’ble Supreme Court vídé order dated 30.09.2020 in SLP (CRL.) 4618/2020 and SLP (CRL.) 4620/2020.
xxxv) Pursuant thereto, the petitioners surrendered before the learned Additional Sessions Judge, Patiala House Courts, New Delhi vídé surrender application dated 30.09.2020; at which point of time they were served with the detention orders, impugned herein, in the Court premises itself by the officers of the Executing Authority on 01.10.2020 and thereafter taken to Tihar Jail, New Delhi; where the detenus are in custody till date.
3. A perusal of the grounds of detention, impugned in these proceedings reveal that the role assigned therein to detenu Gopal Gupta pursuant to the investigation carried out is that :-
(a) Detenu was Chartered Accountant in IMNPL and used to prepare Bill of Entry for import of gold and packing list & invoice for export, preparation/validation of documents pertaining to exhibition export and re-import of M/s Its My Name Pvt. Ltd, in addition to accountancy work and maintaining accounts for sale/purchase of gold in IMNPL.
(b) Detenu described the modus operandi vídé his voluntary statement recorded under Section 108 Customs Act dated 25.04.2019, whereby the re- imported gold jewellery was mis-declared at the time of import, using improper documentation. The Bill of Entry presented to Customs at the time of import was later replaced in the files in collusion with Vikram Bhasin, the then Jewellery Appraiser, IGI Airport, New Delhi, who allegedly used to replace Bill of Entry of large quantity with those of small quantity of gold jewellery in the official records; after clearance of the gold jewellery, which was exported from India and again brought (smuggled) back into India, in the guise of unsold gold jewellery and cleared through Customs by presenting either registered or unregistered manual Bill of Entry qua the re- import of unsold gold jewellery out of gold exported for exhibition;
(c) The foreign origin duty free gold imported by IMNPL under the Advance Authorization scheme, was diverted into the domestic market through persons working for IMNPL, on the directions of detenu and the Proprietor Mr. Rahul Gupta;
(d) Further, for execution of the conspiracy, a remote server was maintained by the detenu Gopal Gupta in his office (by using URL ‘TRAMU.DDNS.NET’ from the computer installed in their office) to store sensitive documents related to actual export, import, re- export transactions and other related papers. But the said detenu disabled remote server during search proceedings by DRI on 24/25.04.2019 so as to conceal the sensitive documents related to actual export, import, re-export transactions and other related papers;
(e) In the course of investigation in one case detected by Customs (Prev.), relating to misuse of SEZ scheme by M/s. Bharti Gems, it had transpired that the said detenu used to upload import-export documents through Team Viewer application and send it to M/s. Bharti Gems, where Amit Pal Singh, co-detenu , used to download the documents and submit the same documents to SEZ authorities, for further processing of import and export;
(f) Therefore, prima facie it appeared that all the documents relating to fraudulent re-import of gold jewellery for smuggling of the same into India, have been prepared by the said detenu.
4. Also a perusal of the grounds of detention, impugned in these proceedings, reveal that the role assigned therein to detenu Amit Pal Singh, pursuant to the investigation carried out is that:-
(a) Detenu was an employee of IMNPL and played significant role and aided Mr. Rahul Gupta (Director of IMNPL) in misusing the Advance Authorization Scheme through circular trading of gold jewellery exported under the guise of exhibition from India through hand- carrying and subsequently re-importing (smuggling) the same fraudulently into India.
(b) As per the travel details available on record detenu travelled from India to Dubai 115 times and travelled Dubai to India 115 times since 2016;
(c) Detenu was allegedly a key member of the syndicate and played a key role therein by managing the circuitous trade of gold jewellery; by mis–declaring the quantity of gold jewellery; by importing the same through hand-carry; and thereby abetting Mr. Rahul Gupta in misusing the Advance Authorization Scheme; and making several visits from India to Dubai for the purpose of the exhibition of gold jewellery at Dubai on behalf of the firm, IMNPL and by hand-carrying the gold jewellery with him. The said detenu re-imported and smuggled the gold jewellery from Dubai to India (for IMNPL) on each of his visit by using illegal import documentation in the form of illicit Bills of Entry, which had been used multiple times in the past.
(d) Detenu specifically smuggled gold jewellery into India, which was declared to be exported to Nepal by M/s. M.N. Khan Jewellers in Dubai, in collusion with Musthafa Kamal, Mohd. Nashruddin and the Customs official at IGI Airport, New Delhi, on his earlier visits on 29.03.2019 and 02.04.2019 on the strength of Custom Gate Pass Serial No.1561 dated 29.03.2019 and 1563 dated 02.04.2019
(e) Detenu was intercepted by DRI officials at IGI Airport on 24.04.2019 when they noticed that M/s. M.N. Khan Jewellers, Dubai has filed declaration before Dubai Customs that 51.362 kgs gold jewellery were exported to Kathmandu, Nepal through hand-carry by Mr.Musthafa Kamal Ramalap and 0.745 kgs gold jewellery was exported to Delhi through hand-carry by the detenu, but he received all the three consignments of gold jewellery cumulatively weighing 51.362 kgs (gross weight declared to Dubai Customs), which were declared before Dubai Customs, to be exported to Kathmandu, Nepal (by M/s. M.N. Khan Jewellers FZE, Dubai) through Musthafa Kamal Ramalap along with the consignment of gold jewellery cumulatively weighing 0.745 kgs (gross weight), with an intention to smuggle the same into India. As a result detenu allegedly smuggled the whole consignments of gold jewellery into India (declared before Dubai Customs for export to Kathmandu and India.
ARGUMENTS ON BEHALF OF THE PETITIONERS:-
5. Mr. Akhil Sibal, learned Senior Counsel appearing on behalf of the petitioners vehemently assails the impugned orders of detention by first submitting that, the detaining Authority was predisposed and lacked independence; as the petitioners discovered a letter dated 02.09.2019 written by the Detaining Authority–––Mr. R.P. Singh, Joint Secretary (COFEPOSA) to the Director General, DGFT which predates the impugned detention order dated 21.01.2020 by 41/2 months. The said letter was admittedly produced by the DGFT in certain other proceedings. A plain reading of the said communication establishes that Mr. R.P. Singh was aware of and involved with the investigation being conducted into the case against the petitioners much prior to passing the impugned detention orders. Pertinently, the letter is signed by Mr. R.P. Singh as ‘Joint Secretary’. It was urged that in the said letter, Mr. R.P. Singh had painstakingly outlined the investigation carried out by the DRI, shared intelligence and requested cooperation of the DGFT, in what he statedly described as “gold sector fraud having multi agency ramification”. The said letter also carries a reference to an earlier letter dated 02.08.2019 from the DRI, thereby meaning that Mr. R.P. Singh was aware of the petitioners’ cases at least as early as 02.08.2019. Mr. R.P. Singh pertinently ends the letter dated 02.09.2019 by recommending that the DGFT take action and also requests that “…the Bureau may be given periodic updates in the matter so that effective coordination in the investigation may be achieved.”
6. It was further submitted by learned Senior Counsel appearing on behalf of petitioners’ that the additional affidavit dated 10.02.2021 filed on behalf of the respondents in the present proceedings confirms that Mr. R.P. Singh authored the aforesaid letter. However, the affidavit then goes on to explain that the said letter was authored by Mr. R.P. Singh “…while working in the additional capacity of other vertical i.e. Economic Intelligence of the CEIB…”. However, axiomatically no such distinction is discernible from the letter itself. Paragraph 5 of the subject affidavit further states that CEIB is headed by a Director General who is assisted by one Joint Secretary designated as J.S. (COFEPOSA) and two Addl. Directors General. Pertinently, the letter dated 02.09.2019 is signed by Mr. R.P. Singh in his capacity as Joint Secretary and not in any other capacity. As a result, Mr. R.P. Singh was seized of the matter and was sharing intelligence and coordinating between different agencies as on 02.09.2019. Even if it is assumed that Mr. R.P. Singh authored the letter dated 02.09.2019 in “additional capacity of other vertical”, though there is no material to suggest so, it is clear that he was actively engaged in the matter for months prior to passing the impugned detention orders and was abreast of the investigation for onward dissemination, coordination and action to other investigating agencies. Even the Show Cause Notice under Section 124 of the Customs Act dated 26.09.2019 issued by the DRI on culmination of their investigation was revealingly copied to the CEIB.
7. It is also submitted that the dual role played by Mr. R.P. Singh – first, in the Economic Intelligence vertical of the CEIB (as claimed by the respondents) in the active investigation; and second, as J.S. (COFEPOSA) in passing the impugned Detention Orders, goes to the root of the matter and defeats the very purpose of appointing a “specially empowered” officer under Section 3(1) of the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 (hereinafter referred to as the ‘COFEPOSA’), whose satisfaction must in law, be independent and free from any bias or predisposition. As such, the subjective satisfaction of the Detaining Authority in the present case stands vitiated and the impugned detention orders ought to be quashed, on this ground alone.
8. It has then been argued on behalf of petitioners that there was gross and unexplained delay in passing of detention orders dated 21.01.2020, viewed within the four corners of settled law that a detention orders stand vitiated, if on account of delay in passing the same, the live and proximate link and between the prejudicial activities of the detenu and the rationale of clamping a detention orders on the detenu is snapped. In this behalf it is emphasized that the impugned detention orders were passed on 21.01.2020, after:
