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SUPREME COURT OF INDIA
S.R. PANDIAN AND Ms. M. FATHIMA BEEVI, JJ.
K.T.M.S. Mohd. and another, Appellants
Versus
Union of India, Respondent
Criminal Appeal Nos.631 with 632 of 1990, D/-28-4-1992.
WITH
Amanullah Quareshi, Appellant
Versus
Union of India, Respondent
Advocates appeared :
Mr. C.V. Vaidyanathan and Mr. A.T.M. Sampath, Advocates, for Appellants; Mr. K.T.S. Tulsi, Addl. Solicitor General (NP) adn Mr. Ashok Bhan, Advocate with him, for Respondent.
(Para 20)
(ii) Criminal Procedure Code, 1973 - Section 340 - Indian Penal Code, 1860 - Sections 193 and 228 - Offence of perjury - Necessary care and caution are to be taken before Initiating a criminal proceeding for perjury against the deponent of contradictory statements in a judicial proceeding - Mere fact that a deponent has made contradictory statements at two different stages in a judicial proceeding is not by itself always sufficient to justify a prosecution for perjury - It must be established that the deponent has intentionally given a false statement in any stage of the judicial proceeding.
Held: Even assuming for the sake of arguments that those statements fall within the mischief of Section 40 of the FERA, there is absolutely nothing on record to show that either the sanctioning authority or the prosecuting authority applied its mind even subjectively and found that the appellants 1 and 2 gave their earlier inculpatory statements voluntarily but not under any inducement, coercion, threat or promise; that the deponents have intentionally gave a false statement before the ITO at the subsequent stage within the ambit of Section 193 I.P.C. and that it was expedient in the interest of justice to initiate the criminal proceedings for perjury.
(para 24)
(iii) Indian Penal Code, 1860 - Sections 120B r/ws. 193 and 193 - Convictions under – Appeal - Prosecution for conspiring together to give false evidence intending that the same might cause the I.T.O. to arrive at an erroneous opinion touching the nature and source of the sum of Rs. 4,18,7131., allegedly recovered from appellants - Statements were recorded from appellants u/s. 39 of FERA - Appellants re-tracted their statements on the very next day-Whether appellants by sending the letter of retraction denying their earlier statements have made themselves liable to be convicted u/s. 193 of the Code? - (No).
Held: It is not the case of the prosecution that these two appellants gave my inculpatory statement before the I.T.O. and thereafter retracted. In fact the appellants 1 and 2 have retracted their earlier statements even on the very next day which retraction was not taken note of by the I.T.O. (Para 25)
Further held: That the I.T.O. has not taken into consideration of the letter of retraction sent by both the appellants through their lawyer even on 20-10-1966 alleging that "they were coerced to sign statements by using bodily force and threatening with causing injuries to them and they signed the statements fearing danger to their life and body." It may be stated in this connection, that only the Enforcement Officer, namely Shri Amritalingam who recorded the statement from the first appellant alone as been examined as P.W. 4 and the other Enforcement Officer, Shri Panchaksharam who recorded the statement from the second appellant has neither been cited as a witness in the complaint nor appears to have been examined before the court.
Hence for all the reasons stated supra, we hold that the convictions recorded by the Courts below under Sections 120-B read with 193 I.P.C. and 193 (simplicitor) as against the appellants 1 and 2 cannot be sustained. It is very surprising and shocking to note that the complainant has stepped into the shoe of the Enforcement Directorate and appears to have assumed the authority under the FERA and leveled a charge stating that the appellants 1 and 2 by sending the letter of retraction on 20-10-1966 denying their earlier statements dated 19-10-1966 have made themselves liable to be convicted under Section 193 I.P.C.
(Paras 2S & 26)
(iv) Income tax Act - Section 277 Conviction under - Appeal - Tribunal exonerated the appellant completely from the specific case of the I.T.O. that he is the owner of the entire amount recovered from him - Conviction recorded by the subordinate courts under Sections 120.B I.P.C. r/ws. 277 and 277 of the Act are liable to be set aside In the light of the Judgment of the Tribunal as the very basis of the prosecution is completely nullified by the order of the Tribunal.
(v) Indian Penal Code, 1860 - Sections 120-B r/ws 193 and 120-B r/ws. 277 Income tax Act- Conviction under - Necessary Ingredients to make out a case for conspiracy are not brought out in the complaint - Nowhere, It Is stated that the Individual acts of appellants 1 and 2 and that of the third appellant were due to any conspiracy among all the three. The offence said to have been committed by the third appellant is specifically attributed only to him - Evidence is lacking to bring all the three accused under the charge of conspiracy - Conviction of third appellant under the conspiracy charge has to fail- Conviction under Sections 193 of the Code and 277 of the Act is not sustainable as there is mis-joinder of charges which includes mis-joinder of parties also.
Held: Section 277 of the I.T. Act in general seeks to penalise one who makes a false statement in order to avoid his tax liability. In the present case, the Revenu has not come forward that the money represents the income of the third appellant liable to be taxed but on the other hand it is the case of the I.T.O. that it is not the third appellants money at all. Moreover, a cursory reading of the penal clause proposes to impose punishment depending upon the quantum of tax sought to be evaded. Here no question of evading the tax will arise. Even assuming, that the third appellant has made himself liable to be punished under Sections 193 and 277 (simplicitor) of the LT. Act, inasmuch as he has been put in a joint trial with the appellants 1 and 2 for the conspiracy of the said offences without any specific allegation or acceptable evidence to connect the third appellant with the activities of the appellants 1 and 2, there is a clear misjoinder of charges which includes misjoinder of parties also. In the facts and circumstances of the case on hand, the misjoinder of charges cannot be said to be a mere irregularity. In our considered opinion by the joint trial with misjoinder of charges, as pointed out by Mr. ATM Sampath, a failure of justice has in fact been occasioned since all the Courts below have clubbed all the allegations leveled against all the three appellants and two other accused (A4 and A5) together and considered the same as if all the offences were committed in the course of the same transaction pursuant to a conspiracy which is neither supported by the allegations in the complaint nor by any evidence as required under the law. Hence, the conviction under section 193 I.P.C. and 277 of LT. Act (Simplicitor) also have to be set aside.
(Para 36)
Key Points: - Statements recorded under FERA Section 39 are not deemed to be from a judicial proceeding, and cannot be used to prosecute perjury unless formalities under Section 40 of FERA are satisfied (!) (!) . - Even if a statement is retracted, it cannot be deemed involuntary unless the maker proves inducement, coercion, threat, or promise; the authority must apply its mind to the retraction (!) (!) . - A prosecution for perjury requires proof of intentional false statement and must be instituted cautiously; contradictory statements alone do not suffice (!) (!) . - Convictions can be set aside where charges are misjoined and parties are improperly joined, resulting in a failure of justice (!) (!) . - The Tribunal’s finding that the appellant was not the owner of the seized amount nullified the basis for prosecution under Sections 193 and 277 of the I.T. Act (!) (!) .
JUDGMENT
S. RATNAVEL PANDIAN, J.:- The Criminal Appeal No. 631/ 90 is directed by the two appellants namely, K. T. S. Mohammed and M. Jamal Mohamed and Criminal Appeal No. 632/ 90 is directed by Amanullah Quareshi. All the three appellants are challenging the correctness of the common order made by the High Court of Madras in Criminal Revision Cases Nos. 229/81 and 239/81 respectively dismissing the revisions and confirming the judgment of the lower appellate Court made in Cr.A. Nos. 221 and 222 of 1980 which in turn affirmed the judgment of the trial Court convicting and sentencing the appellants under the provisions of the Indian Penal Code and the Income-tax Act (hereinafter referred to as the I.-T. Act).
2. The facts leading to the prosecution case are well set out in the judgments of the Courts below. Nevertheless, we think it necessary to recapitulate the basic matrix, though not in details, in order to enable us to give our own reasons for the findings which we will be arriving at.
3. The first appellant who is the brother-in-law of the second appellant received a cash of Rs. 6 lakhs, brought by a person from Bombay for distributing the said amount to various persons as per the instructions received from a person at Singapore. While he was engaged in the said illegal transaction, the Enforcement Directorate, Madras raided his premises at No. 34, Appu Maistry Street, Madras- 1 on 19-10,66 and recovered a sum of Rs.4,28,713/- and certain documents in coded language relating to the disbursement of the cash. After the search the first appellant K. T. M. D. Mohammed was interrogated by Shri Amritalingam, Enforcement Officer of Madras (PW 4) and the second appellant, Jamal Mohammed was interrogated by Shri Pancheksharan, Enforcement Officer on 19-10-66 and their statements were recorded under Exhs. P 39 and P 40. The first appellant under Exh. P 39 has admitted that he (sic) a sum of Rs. 6 lakhs from a person of Bombay on the previous day for being disbursed to various parties, and that Rs. 50,000 / - and Rs. 48,000 / - were paid to one Baskaran alias Kannan and Angappan of Sarathy & Co. respectively and the amounts were disbursed on receipt of instructions from one Gopal of Singapore whose full address he did not know. The second appellant in his statement Exh. P 40 has admitted the receipt of the amount by the first appellant and the disbursement of Rs. 50,000/- to Bhaskaran and Rs. 40,000/to Angappan as instructed by the first appellant in compliance of the instructions received from Singapore.
4. The Enforcement Officers conducted a further search at the premises of Sarathy and Co., and discovered a cash amount of Rs.48,100/- and three bank drafts. Angappan when examined admitted the receipt of Rs. 49,000/ - for being disbursed as per the details given in certain sheets of paper available with him.
5. On 20-10-66, both the appellants sent their retraction to the Deputy Director of Enforcement Directorate through their Advocate stating that their statements recorded under Exhs. P 39 and P 40 on 19-10-66 were not voluntary statements but obtained under threat and force and the facts stated therein were not correct.
6. While it was so, the Income-tax Officer, Karaikudi (PW 1) on coming to know about the raid, issued summons to the first appellant who was then an assessee within his jurisdiction and recorded a statement Exhibit P 3 from him on 16-11-66. The first appellant denied of having any connection with the cash of Rs. 4,28,718/ - said to have been recovered from his premises and reiterated that the statement by the Enforcement Officers was taken from him under force. The second appellant also gave a similar statement under Exh. P 73 on 11-1-74 before PW 8 when examined after eight years. The appellant in Criminal Appeal No. 632/ 90, namely, Amanullah who was arrayed as accused No. 3 (hereinafter referred as third appellant sent a letter under Exh. P 41 dated 4-11-66 to the Enforcement Officers claiming the money seized as b
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