THE ASSISTANT COLLECTOR OF CENTRAL EXCISE, RAJAMUNDRY versus DUNCAN AGRO INDUSTRIES LTD. AND ORS.

Citation: [2000] SUPP. 2 S.C.R. 162 · Decided: 07-08-2000 · Supreme Court of India · Bench: K.T. THOMAS · Disposal: Appeal(s) allowed

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Judgment (excerpt)

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THE ASSISTANT COLLECTOR OF CENTRAL EXCISE, 
RAJAMUNDRY 
v. 
DUNCAN AGRO INDUSTRIES LTD. AND ORS. 
AUGUST 7, 2000 
[K.T. THOMAS AND R.P. SETHI, JJ.] 
Customs Act, 1962 : Section 108. 
Code of Criminal Procedure, 1973 : Section 164 
Central Excises and Salt Act, 1944 : Section 9(1) 
Evidence Act, 1872 : Sections 24 and 25. 
Excise officer-Statements recorded by-Admissibility of 
Cigarette companies-Directors-Prosecution under section 9( 1) of 
Central Excise Act and Section 120-B Indian Penal Code-Statements of -
accused recorded by excise officer-Accused not administered warning as 
required under section 164(2) Criminal Procedure Code-Held, such statements 
are admissible in evidence-However court should examine whether inculpatory 
statements were voluntary or were vitiated on account of the provisions 
contained in section 24 of the Evidence Act. 
Certain cigarette companies and their Directors, respondents herein, 
were prosecuted under section 9(1) of the Central Excises and Salt Act, 
1944 and section 120-B of the Indian Penal Code, 1860. The case against 
them was that pursuant to a criminal conspiracy hatched and perpetrated 
by them a very huge amount of central excise duty was evaded fraudulently. 
The Trial Judge acquitted all of them. Revenue preferred appeal and moved 
for leave before the Andhra Pradesh High Court. Single Judge of the High 
Court declined to grant leave to appeal. Relying on an earlier decision * 
rendered by a Division Bench, the Single Judge held that since the excise 
officers who have recorded the confessional statements of the accused have 
not administered the warning to the accused as required under section 164(2) 
of the Code of Criminal Procedure, those statements were inadmissible 
against the makers thereof or against the co-accused. Consequently all the 
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confessional statements were excluded from consideration and the remaining 
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ASSISTANT COLLECTOR OF CENTRAL EXCISE v. DUNCAN AGRO INDUSTRIES LTD. 163 
evidence was found to be insufficient to establish the guilt of the accused 
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persons. Against the order of the Single Judge Revenue preferred appeals 
before this Court. 
Allowing the appeals, this Court 
HELD : 1. A statement recorded by customs officers under section 
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108 of the Cus. ns Act is admissible in evidence. The court has to test whether 
the inculpating portions were made voluntarily or whether it is vitiated on 
account of any of the premises envisaged in section 24 of the Evidence Act. 
Such an exercise can be made only after the appeal is regularised by granting 
'leave to appeal. Since leave was declined on a wrong interpretation of law, 
the impugned order calls for interference. Consequently, leave applied for 
will stand granted. Resultantly, the appeal filed in the High Court will stand 
regularised. The High Court should dispose of the appeal as expeditiously 
as possible in accordance with law. [169-G-H; 170-A-B] 
2. Section 164 of the Code of Criminal Procedure empowers a judicial 
Magistrate to record any confession or statement made to him during the 
course of an investigation. The power conferred by said provision could be 
exercised only by a judicial Magistrate. Even a police officer on whom power 
of a Magistrate has been conferred is forbidden from recording a confession. 
Sub-sections (2) and (4) deal with procedure which such Magistrate has to 
follow while recording inculpatory statements made by persons.[167·G·Hl 
3. Section 108 of the Customs Act does not contemplate any Magisterial 
intervention. The power under the said section is intended to be exercised 
by a gazetted officer of the Customs Department. Sub-section (3) enjoins on 
the person summoned by the officer to state the truth upon any subject 
respecting which he is examined. He is not excused from speaking the truth 
on the premise that such statement could be used against him. The said 
requirement is included in the provision for the purpose of enabling the 
gazetted officer to elicit the truth from the person interrogated. There is no 
involvement of the Magistrate at that stage. The entire idea behind the 
provisions is that the gazetted officer questioning the person must gather all 
the truth concerning the episode. If the statement so extracted is untrue its 
utility for the officer gets lost. [168-A·C] 
4. A confession made to a police officer can be recorded by him without 
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any of the constraints incorporated under section 

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