JUDGEMENT

This Criminal Revision Case is filed by the petitioners aggrieved by the judgment dated 10.03.2008 in Crl.A.No.185 of 2007, on the file of Metropolitan Sessions Judge, Hyderabad.

2. Heard the learned counsel for the revision petitioners and the learned Assistant Public Prosecutor appearing for respondent-State.

3. The revision petitioners who are arrayed as A-1 and A-2 were convicted by the Special Court for Economic Offences for the violations under Foreign Exchange Regulation Act (for short ‘FERA’).

4. The said conviction was questioned in the appeal before the learned Sessions Judge. Learned Sessions Judge confirmed the conviction under Section 56 of FERA.

5. During the course of pendency of the Revision, A-1 died and this Court by order dated 22.04.2024 permitted legal representatives of A-1 to prosecute the Revision.

6. Briefly, the case of the prosecution is that Deputy Director of Directorate of Revenue Intelligence (DRI) intimated Enforcement Directorate about seizing of assorted foreign currency equivalent to Rs.54,20,854/-

from A-1 while he was attempting to smuggle out the foreign currency. Petitioner (A-1) was convicted under Conservation of Foreign Exchange and Prevention of Smuggling Activities Act (COFEPOSA). The statements of A-1 and A-2 were recorded by DRI under Section 108 of the Customs Act. It is the further case that statements could not be recorded under Section 40 of FERA as the accused failed to appear in the concerned office though opportunity was given.

7. Mainly, the Courts below relied upon the statements which were recorded by DRI under Section 108 of the Customs Act. The Courts found that Enforcement Directorate was unable to record statements under Section 40 of FERA, for the reason of non-appearance of accused.

However, the statements recorded under Section 108 of Customs Act can be made basis to adjudicate on the complicity or otherwise of the accused.

8. Both the Courts below found that said statements which were recorded by DRI can be made basis and accordingly recorded conviction.

9. Learned counsel appearing for the revision petitioner would submit that both the Courts below have committed an error in relying on the statements recorded by DRI without their being any investigation. The Enforcement Directorate cannot make statements under Section 108 of Customs Act recorded by DRI officials to prosecute the accused. The said judgment is contrary to the judgment of this Court in Deputy Commissioner (Legal) vs. K.Neelakanta Rao & Another 1 . The relevant paragraphs are as follows:-

“60. Coming to the charge under Section 13(2) of the FERA against A.4 and A.5, the basis of the prosecution of A.4 and A.5 under the said Act are the statements recorded under Section 108 of the Customs Act, 1962 by the Customs Officers from A.1 to A.5.

61. The learned counsel for A.4 and A.5 contended that the FERA is a special law which prescribes as special procedure for investigation of

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breaches of foreign exchange regulations; the Customs Act, 1962 has a different ambit, scope and intendment; and therefore, statements recorded under the provisions of the Customs Act, 1962 can at best be used to prosecute persons for violation of the provisions of the Customs Act,1962, but they cannot be used to prosecute persons under the FERA. He pointed out that Section 40 of the FERA contains provisions empowering the Gazetted Officials of Enforcement to summon persons to give evidence and produce documents under the FERA and on the basis of statements recorded under Section 108 of the Customs Act, a prosecution for violation of provisions of the FERA cannot be initiated. He placed reliance on the judgment in K.T.M.S. Mohd. and another Vs. Union of India. 1992 2 Crimes (SC) 314.

63. In the above case, there was prosecution launched for perjury against the appella