VINOD SOLANKI versus UNION OF INDIA & ANR.

Citation: [2008] 17 S.C.R. 1070 · Decided: 18-12-2008 · Supreme Court of India · Bench: S.B. SINHA · Disposal: Appeal(s) allowed

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Judgment (excerpt)

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[2008] 16 S.C.R. 1070 
VINOD SOLANKI 
v. 
UNION OF INDIA & ANR. 
(Civil Appeal No. 7407 of 2008) 
DECEMBER 18, 2008 
[S.B. SINHA AND CYRIAC JOSEPH, JJ.] 
Foreign Exchange Regulation Act: ss.8(3), 9(1) -
Violation of - Confession - Retraction of - Imposition of 
penalty- Tribunal placed burden to prove that c;onfession was 
obtained from him by threat, coercion or force upon 
proceedee - Affirmed by High Court - Held: Initial burden to 
prove that confession was voluntary in nature and not obtained 
as an outcome of threat is on the department - Special or 
peculiar knowledge of person proceeded against would not 
relieve prosecution or department altogether of burden of 
producing evidence in support· of its case - With a view to 
arrive at a finding as regards the voluntary nature of statement 
or otherwise of a confession which has since been retracted, 
the Court must bear in mind attending circumstances which 
would include time of retraction, nature thereof, manner in 
which such retraction was made and other relevant factors -
Law does not say that the accused has to prove that retraction 
of confession made by him was because of threat, coercion, 
etc. but the requirement is that it may appear to the court as 
such - Evidence Act, 1872 - s.24. 
The office premises of appellant was searched and 
Indian currency amounting to Rs.2.65 lakhs was 
recovered. Appellant was detained. On the next two , 
succeeding dates, he allegedly made two statements 
before the authorities under the Foreign Exchange 
Regulation Act, 1973 disclosing that all the transactions 
in the name of two companies related to import of goods 
made by him and stating that no import of goods took 
place in the name of said companies. He also confessed 
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VINOD SOLANKI v. UNION OF INDIA & ANR. 
1071 
that he was responsible for remittance of foreign 
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exchange worth US $ 11,400 and US $ 22,830. In view of 
the said purported confession, he was arrested for 
violation of provisions of a.8(3) and s.9(1 )(a) of the Act. 
When he was produced before CMM, he filed an 
application retracting his confession. Respondent, 
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however, initiated proceedings under s.8 (3) of the Act. A 
show-cause Notice was issued on him. In reply to show-
cause Notice, appellant stated that no reliance should be 
placed on the retracted confessional statement unless the 
same was corroborated sub~tantially in material c 
particulars by some independent evidence. 
The appropriate authority relying on the basis of 
confession made by appellant imposed a consolidated 
penalty of Rs.10 lakhs. It held that appellant was guilty 
of contravention of s.8 (3) to the extent of US $ 34,230 in 
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as much as he failed to utilize the said foreign exchange 
for the purpose it was released to him. Further, it also held 
him guilty of contravention of charge under s.9(1)(a) of 
the Act for the same amount in as much he deposited in 
a foreign bank account without exemption from RBI. 
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Appellant filed appeal before the Tribunal. Tribunal placed 
the onus of proof upon appellant that the confession was 
obtained from him by threat, coercion or force. The 
Tribunal held that retraction alone would not make the 
confession inadmissible and as even retracted 
confessional statement may be- sufficient to hold the 
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proceedee guilty of violation of the provisions of the Act, 
imposition of penalty was legally permissible. High Court 
affirmed the decision of the Tribunal. Hence the present 
appeal. 
Allowing the appeal, the Court 
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HELD:1. The proceeding under the Foreign 
Exchange Regulation Act is quasi criminal in nature. The 
Act is a special Act, which confers various powers upon 
the authorities prescribed therein. Even the sarutory 
principles of mens rea and actus reus in a proceeding 
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1072 
SUPREME COURT REPORTS 
[2008] 17 S.C.R. 
\.--
A under the Act may not be held to be applicable. It is now 
a well settled principle that presumption of .innocence as 
contained in Article 14(2) of the International Covenant on 
I.: 4;.'.-
Civil and Political Rights is a human right although per 
se it may not be treated to be a fundamental right within 
B the meaning of Article 21 of the Constitution of India. The 
Act, thus, does not provide for a 'reverse burden'. No 
presumption of commission of an offence is raised under 
the Act. [Paras 17, 19 and 21] [1083-H; 1084-8-D-G] 
Noor Aga vs. State of Punjab & Anr. (2

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