The appellant had imported second hand steel mill machinery and parts covered by three transit bonds totalling 595 cases. The officials of the Preventive Branch of the Commissionerate searched the industrial premises of the appellant, including the notified public bonded warehouse and found that only 304 cases were stocked inside the warehouse, whereas 264 cases were found outside the warehouse but within the industrial/factory premises of the appellant. Remaining 27 cases were neither found inside the warehouse nor outside the warehouse. The Commissioner of Customs and Central Excise, inter-alia, confiscated 264 cases of imported goods valued at Rs.48,79,776.00 seized from within the factory premises of the appellant but outside the approved warehouse u/s. 111 of the Customs Act. However, the confiscated goods were permitted to be redeemed on payment of fine of Rs.2 lakhs. Further, the Commissioner had confirmed customs duty amounting to Rs.39,03,821.00 in terms of s.71 r/w. the proviso to s.28A of the Customs Act. That apart, appellant was directed to pay interest of Rs.18,88,425.00 on the aforesaid quantum of customs duty in respect of the 264 cases from the date of warehousing till the date of detection of the shortage in the warehouse. In appeal, CESTAT by the impugned order affirmed the aforesaid decision of the Commissioner.

* Author

[2024] 3 S.C.R. 890 : 2024 INSC 231

M/s. Bisco Limited

v.

Commissioner of Customs and Central Excise

(Civil Appeal No. 4663 of 2009)

20 March 2024

[B. V. Nagarathna and Ujjal Bhuyan,* JJ.]

Issue for Consideration

The appellant had imported second hand steel mill machinery

and parts covered by three transit bonds totalling 595 cases.

The officials of the Preventive Branch of the Commissionerate

searched the industrial premises of the appellant, including

the notified public bonded warehouse and found that only

304 cases were stocked inside the warehouse, whereas

264 cases were found outside the warehouse but within the

industrial/factory premises of the appellant. Remaining 27

cases were neither found inside the warehouse nor outside the

warehouse. The Commissioner of Customs and Central Excise,

inter-alia, confiscated 264 cases of imported goods valued at

Rs.48,79,776.00 seized from within the factory premises of the

appellant but outside the approved warehouse u/s. 111 of the

Customs Act. However, the confiscated goods were permitted

to be redeemed on payment of fine of Rs.2 lakhs. Further,

the Commissioner had confirmed customs duty amounting to

Rs.39,03,821.00 in terms of s.71 r/w. the proviso to s.28A of the

Customs Act. That apart, appellant was directed to pay interest

of Rs.18,88,425.00 on the aforesaid quantum of customs duty

in respect of the 264 cases from the date of warehousing till the

date of detection of the shortage in the warehouse. In appeal,

CESTAT by the impugned order affirmed the aforesaid decision

of the Commissioner.

Headnotes

Customs Act, 1962 – s.71 r/w. the proviso to s.28A, s.111 – The

allegation of the respondent is that 264 cases were improperly

or unauthorisedly removed from the notified warehouse as

those were found lying outside the notified area but within the

industrial/factory premises of the appellant – That apart, 27

cases were neither found inside the notified warehouse nor 

[2024] 3 S.C.R. 891

M/s. Bisco Limited v. Commissioner of Customs and Central Excise

outside the said warehouse but within the factory premises

of the appellant – In such circumstances, the respondent

has justified the order dated 28.04.2005 (passed by the

Commissioner),which was affirmed by the CESTAT vide order

dated 30.04.2009 – Propriety:

Held: The appellant had submitted that soil outside the notified

area that become very sluggish due to heavy rains – As a

result, the trailers carrying the consignment could not enter the

notified warehouse and appellant had requested the concerned

Superintendent of Customs and Central Excise to shift the

machineries to under a shed within the factory premises –

The permission was granted – The permission granted by the

Superintendent to the appellant to unload a portion of the cargo

outside the open space which was notified as public bonded

warehouse but within the factory premises of the appellant was

neither cancelled nor revoked by the Superintendent or even by

the Commissioner – Infact, a view can reasonably be taken that

the appellant as the owner of the goods had exercised its right

u/s. 64(d) which was endorsed by the Superintendent – Therefore,

it would not be correct to say that the 264 cases found outside

the notified warehouse but within the factory premises of the

appellant were improperly or unauthorisedly removed from the

notified public bonded warehouse – Also, the period of warehousing

had not expired and continued to remain operational in terms

of the proviso to s.61 of the Customs Act – The decision of the

respondent to invoke s.71 and thereafter levy interest on the

goods covered by the 264 cases u/s. 28AB of the Customs Act

was not justified – Since the imported goods covered by the 264

cases were never warehoused inside the notified public bonded

warehouse but were unloaded outside the notified area but within

the factory premises of the appellant and kept under a shed on

permission granted by the Superintendent which permission

was neither cancelled nor revoked, question of warehousing the

goods covered by the 264 cases within the notified public bonded

warehouse did not arise – However, there is no explanation on

the part of the appellant qua the missing 27 cases – Therefore,

the view taken by the respondent and affirmed by the CESTAT

that those 27 cases were improperly or unauthorisedly removed

from the notified public bonded warehouse is correct and requires

no interference. [Paras 13, 50, 51, 53, 54]

892 [2024] 3 S.C.R.

Digital Supreme Court Reports

Case Law Cited

Kesoram Rayon v. Collector of Customs, Calcutta

[1996] Suppl. 5 SCR 77 : (1996) 5 SCC 576 – held

inapplicable.

Simplex Castings Ltd. v. Commissioner of Customs,

Vishakhapatnam (2003) 5 SCC 528; Paper Products

Ltd. v. Commissioner of Central Excise (1999) 7 SCC

84; SBEC Sugar Ltd v. Union of India [2011] 2 SCR

585 : (2011) 4 SCC 668 – referred to.

List of Acts

Customs Act, 1962; Customs Tariff Act, 1975; Right to Information

Act, 2005.

List of Keywords

Customs; Custom duty; Notified public bonded warehouse;

Industrial/factory premises; Confiscation of imported goods;

Improper or unauthorised removal of goods from the notified

warehouse; Period of warehousing.

Case Arising From

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 4663 of 2009

From the Judgment and Order No.C/155/09 dated 30.04.2009 in

Appeal No.C/441/2005-CU (DB) of the Customs, Excise and Service

Tax Appellate Tribunal, New Delhi

Appearances for Parties

Aarohi Bhalla, Sanchar Anand, Devendra Singh, Aman Kumar Thakur,

Arjun Rana, Ms. Sumbul Ausaf, Advs. for the Appellant.

Rupesh Kumar, Mukesh Kumar Maroria, V.C. Bharathi, H.R. Rao,

Suyash Pandey, Hemant Kumar, Advs. for the Respondent.

Judgment / Order of the Supreme Court

Judgment

Ujjal Bhuyan, J.

Heard learned counsel for the parties.

2. This is a statutory appeal under Section 130E of the Customs Act,

1962 (briefly the ‘Customs Act’ hereinafter) against the final order 

[2024] 3 S.C.R. 893

M/s. Bisco Limited v. Commissioner of Customs and Central Excise

dated 30.04.2009 passed by the Customs, Excise and Service Tax

Appellate Tribunal, New Delhi (for short ‘CESTAT’ hereinafter) in

Customs Appeal No.441 of 2005 dismissing the appeal filed by

the appellant against the order dated 28.04.2005 passed by the

Commissioner of Customs and Central Excise, Indore (for short ‘the

Commissioner’ hereinafter).

2.1. By the aforesaid order dated 28.04.2005, the Commissioner

had confirmed the duty demand of Rs.3,99,255.00 in respect

of 27 cases not found in the warehouse and imposed penalty

of Rs.1 lakh on the appellant under Section 112 of the

Customs Act. That apart, the appellant was directed to pay

interest on the duty confirmed in terms of Section 28AB of the

Customs Act from the date of enforcement of the said section

till the date of actual payment of duty. The Commissioner

had also confiscated 264 cases of imported goods valued at

Rs.48,79,776.00 seized from within the factory premises of the

appellant but outside the approved warehouse under Section

111 of the Customs Act. However, the confiscated goods were

permitted to be redeemed on payment of fine of Rs. 2 lakhs.

Thirty days’ time was granted to the appellant to exercise the

option for redeeming the goods. Further, the Commissioner

had confirmed customs duty amounting to Rs.39,03,821.00

in terms of Section 71 read with the proviso to Section 28A

of the Customs Act. The appellant was also required to pay

interest amounting to Rs.18,88,425.00 on the customs duty

confirmed on the 264 packages from the date of warehousing

till the date of detection of the shortage in the warehouse; in

addition, appellant was also required to pay interest on the

duty confirmed in terms of Section 28AB of the Customs Act

from the date of enforcement of the said section till the date

of actual payment of duty confirmed on the 264 cases.

3. Appellant before us is M/s Bhanu Iron and Steel Company Limited,

Plot No. 801, Sector III, Industrial Estate, Pithampur, District Dhar

in the State of Madhya Pradesh (‘BISCO’ for short).

4. This appeal has a chequered history. Before finally landing in this

Court, the appellant had gone through several rounds of appeal and

remand. For a proper perspective, it would be apposite to briefly

narrate the factual trajectory of the case.

894 [2024] 3 S.C.R.

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5. Appellant had imported second hand steel mill machinery and parts

thereof under Project Import Facility covered by Chapter Heading

No.98.01 of the Schedule to the Customs Tariff Act, 1975.

6. A warehouse within the precincts of the industrial/factory premises

of the appellant was notified as a public bonded warehouse on

management basis with M/s Central Warehousing Corporation as

warehouse keeper by the then Collector of Customs and Central

Excise, Indore vide the notification dated 03.05.1989 for storage of

the imported second hand steel mill machinery and parts thereof

without payment of customs duty. According to the respondent, the

appellant had imported in all 595 cases of machinery parts which were

required to be warehoused in the notified public bonded warehouse.

The breakup of the 595 cases of the machinery parts as provided

by the respondent is as under:

Sl.

No.

Transit Bond No. & Date No. of cases actually

received in the customs

bonded warehouse.

1. T-1592 dated 31.05.89 172

2. T-7012 dated 04.12.89 146

3. T-2014 dated 30.05.90 277

Total 595

7. Acting on the basis of information received that the appellant had

misused the warehousing facility, officials of the respondent had

searched the industrial premises of the appellant including the

notified public bonded warehouse on 07.08.1992. In the course of the

search, the stock lying within the notified public bonded warehouse

were verified. On such verification, only 304 cases were found lying

inside the warehouse; 264 cases were found outside the warehouse

but within the industrial/factory premises of the appellant; remaining

27 cases were not found either inside the warehouse or outside the

warehouse within the industrial/factory premises.

8. As no documents showing clearance of the goods contained in the

264 cases from within the warehouse but lying outside the warehouse

on payment of duty and interest as required under Section 71 of

the Customs Act could be produced, the said goods were seized in

terms of Section 110 of the Customs Act. The value of the goods

seized was estimated at Rs.48,79,776.00.

[2024] 3 S.C.R. 895

M/s. Bisco Limited v. Commissioner of Customs and Central Excise

9. In his statement recorded under Section 108 of the Customs Act on

07.08.1992, Sh. Yashwant Singh Bisht, Project Officer (Commercial) of

the appellant stated that the 264 cases of imported goods were kept

outside the bond under a shed as the trailers transporting the goods

could not enter the notified warehouse in view of the soil becoming

very sluggish on account of heavy rains and also because of paucity of

space. The Collector, therefore, opined that the appellant had removed

the 264 cases of warehoused goods valued at Rs.48,79,776.00

attracting duty of Rs.39,03,821.00 and interest of Rs.18,88,425.00 in

violation of Section 71 read with Section 111(j) of the Customs Act.

The seized goods were thus held liable for confiscation.

10. It was further alleged that appellant had unauthorisedly cleared 27

cases of the imported goods valued at Rs.4,99,068.00 attracting duty

of Rs.3,99,255.00 with interest of Rs.2,41,326.00 which were liable

to be recovered under Section 71 read with the proviso to Section

28(1) of the Customs Act.

11. That apart, it was alleged that M/s. Central Warehousing Corporation,

Pithampur had abetted the appellant in clearing the warehoused

goods without payment of duty and interest.

12. In the above circumstances, a show cause notice dated 22.01.1993

was issued to the appellant as well as to the warehouse keeper by

the Collector (now the Commissioner) to explain and show cause

as to why:

(i) the seized quantity of 264 cases of goods valued at

Rs.48,79,776.00 and attracting duty of Rs.39,03,821.00

plus Rs.18,88,425.00 due to interest should not be

confiscated in terms of Section 71 read with Section

111(j) of the Customs Act.

(ii) the amount of duty of Rs.3,99,255.00 plus interest

of Rs.2,41,326.00 payable on 27 cases of goods

valued at Rs.4,99,068.00 cleared and utilized by the

appellant, should not be demanded from the appellant

in terms of Section 71 read with the proviso to Section

28 (1) of the Customs Act.

(iii) a penalty under Section 112 of the Customs Act

should not be imposed for violation of Section 71

and Section 111(j) of the Customs Act. 

896 [2024] 3 S.C.R.

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13. Appellant submitted reply dated 02.04.1994. In its reply, appellant

stated that there was heavy rain in the month of August 1989 and

the soil outside the notified warehouse had become very sluggish.

As a result, the trailers carrying the consignment could not enter the

notified warehouse. The goods were downloaded in the open outside

the notified warehouse but within the factory premises. To prevent the

goods from getting damaged, appellant had requested the concerned

Superintendent of Customs and Central Excise to shift the machineries

to under a shed within the factory premises under Section 64 of the

Customs Act. Permission was granted by the Superintendent. In terms

of such permission of the Superintendent, who was the proper officer,

appellant had shifted the goods to under the shed to prevent further

damage of the goods. It was contended that the goods were still under

the bonded warehouse and could not be said to have been cleared.

In this connection, reference to and reliance was placed on Section

15 of the Customs Act. This position was clarified by Sh. Yashwant

Singh Bisht in his statement recorded on 07.08.1992. The appellant,

therefore, requested the authority to drop the proceedings.

14. It may be mentioned that the Central Warehousing Corporation (for

short ‘the Corporation’ hereinafter) had also submitted its reply dated

19.12.1993. In the reply it was stated that an open area of 2,000 sq.

meters in the premises of the appellant having fencing and a gate

with locking arrangement was approved by the customs and central

excise authorities as a public bonded warehouse. Appellant vide

letter dated 30.08.1989 sought permission from the Superintendent,

Customs and Central Excise, Range-III, Pithampur for unloading

the cargo covered by Bond No.T-1592 dated 31.05.1989 outside

the said warehouse on account of heavy rains, etc. It was pointed

out that the trailers carrying the consignment could not enter the

said warehouse because those got stuck in the soil outside the said

warehouse as the soil had got sluggish due to heavy rains. The

Superintendent gave permission for unloading the cargo outside the

warehouse but within the factory premises on the body of the letter

itself. The machinery parts had to be shifted to a shed outside the

bonded warehouse but within the factory premises to protect those

parts from further rusting and corrosion.

15. Commissioner by his adjudication order dated 28.08.1996 did not

accept the reply of the appellant and confirmed the demand and

interest. It was ordered as under:

[2024] 3 S.C.R. 897

M/s. Bisco Limited v. Commissioner of Customs and Central Excise

(i) demand for duty of Rs.3,99,255.00 plus Rs.2,41,326.00

leviable on 27 cases cleared in a clandestine manner

was confirmed for recovery from the appellant in

terms of Section 71 read with the proviso to Section

28(1) of the Customs Act.

(ii) 264 cases of imported goods valued at Rs.48,79,776.00

seized from the premises other than the approved

warehouse were confiscated under Section 111

of the Customs Act but permitted to be redeemed

on payment of fine of Rs.12,00,000.00 (Rs. twelve

lakhs only). Appellant would also suffer duty of

Rs.39,03,821.00 plus interest at the time of their

ultimate clearance.

(iii) penalty of Rs.5,00,000.00 (Rs. five lakhs only) was

imposed on the appellant under Section 112 of the

Customs Act.

(iv) penalty of Rs.25,000.00 (Rs. twenty five thousand

only) was imposed on the Central Warehousing

Corporation under Section 112 of the Customs Act.

16. Aggrieved by the aforesaid order of the Commissioner, appellant

preferred an appeal before the then Central Excise and Gold Appellate

Tribunal (CEGAT). By order dated 18.02.1999, CEGAT disposed

of the appeal by setting aside the order of the Commissioner and

remanding the matter back to the Commissioner for fresh adjudication.

The Commissioner was directed to look into the new facts and

documents brought on record by the appellant and thereafter decide

the case de novo in accordance with the principles of natural justice.

17. Following the remand, a fresh adjudication order was passed by

the Commissioner on 31.12.2002. In this order, the Commissioner

recorded that the warehoused goods were removed to a place outside

the approved warehouse without following the procedure set out

under Sections 67, 68 and 69 of the Customs Act. The Commissioner,

thereafter, reiterated the first adjudication order dated 28.08.1996.

18. Assailing the aforesaid order of the Commissioner dated 31.12.2002,

appellant preferred appeal before the CESTAT. In its order dated

08.10.2003, CESTAT observed that the Commissioner had not

looked into the additional documents which were part of the record. 

898 [2024] 3 S.C.R.

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CESTAT, therefore, opined that the matter should be remanded

back to the adjudicating authority for fresh adjudication after taking

into consideration the documents produced by the appellant,

including those produced before the CESTAT. Thus, by the order

dated 08.10.2003, CESTAT allowed the appeal of the appellant by

remanding the matter back to the Commissioner for re-adjudication

after affording an opportunity of hearing to the appellant.

19. The matter was taken up by the Commissioner afresh on remand.

By a detailed order dated 28.04.2005, the Commissioner directed

as under:

(i) demand of Rs.3,99,255.00 leviable on the 27 cases

found not warehoused was confirmed for recovery

from the appellant in terms of the conditions of transit

bond.

(ii) appellant should pay interest on the duty confirmed

in terms of Section 28AB of the Customs Act from

the date of enforcement of the said section till the

date of actual payment of duty. The interest amount

was directed to be worked out and communicated to

the appellant by the Assistant Commissioner, Central

Excise Division, Pithampur.

(iii) 264 cases of imported goods valued at Rs.48,79,776.00

seized from the premises of the appellant outside the

approved warehouse were confiscated under Section

111 of the Customs Act. As the goods were within the

factory premises but outside the bonded warehouse,

a lenient view was taken; the goods were permitted

to be redeemed on payment of fine of Rs.2,00,000.00

(Rupees two lakhs only). The option for redeeming

the goods was to be exercised by the appellant within

30 days from the date of receipt of the order.

(iv) customs duty amounting to Rs.39,03,821.00 for

recovery from the appellant in terms of Section 71

read with the proviso to Section 28A of the Customs

Act was confirmed.

(v) appellant was required to pay interest amounting to

Rs.18,88,425.00 on the customs duty confirmed on 

[2024] 3 S.C.R. 899

M/s. Bisco Limited v. Commissioner of Customs and Central Excise

the 264 packages from the date of warehousing till the

date of detection of the shortage in the warehouse,

i.e. from 04.02.1989 to 07.08.1992, in terms of Section

71 of the Customs Act.

(vi) appellant was also required to pay interest on the

duty confirmed in terms of Section 28AB of the

Customs Act from the date of enforcement of the

said section to till the date of actual payment of duty

confirmed on the 264 packages. The interest amount

was directed to be worked out and communicated to

the appellant by the Assistant Commissioner, Central

Excise Division, Pithampur.

(vii) penalty of Rs.1,00,000.00 (Rupees one lakh only)

was imposed on the appellant under Section 112 of

the Customs Act.

20. It was against this order that the related appeal was filed by

the appellant before the CESTAT. By the impugned order dated

30.04.2009, CESTAT dismissed the appeal.

21. Hence the present appeal. This Court by order dated 21.08.2009

had issued notice.

22. Respondent has filed counter affidavit. It is stated that during the

visit of the officials of the Preventive Branch of the Commissionerate

on 07.08.1992, the impugned goods were found outside the notified

warehouse. That apart, there was no explanation for the imported

goods contained in the 27 cases which were neither found within

the bonded warehouse nor outside the bonded warehouse within the

factory premises. In such circumstances, the respondent has justified

the order dated 28.04.2005 which was affirmed by the CESTAT vide

order dated 30.04.2009.

23. It may be mentioned that appellant has brought on record two

additional documents. Appellant had sought for information from

the Central Warehousing Corporation under the Right to Information

Act, 2005 vide letter dated 22.09.2009 regarding payment of custom

establishment charges by the Corporation. Appellant was informed

by the Central Warehousing Corporation vide letter dated 18.12.2009

that the Corporation had deposited a sum of Rs.56,10.294.00 under

the head of ‘Pithampur Warehousing (Bhanu Iron and Steel Company 

900 [2024] 3 S.C.R.

Digital Supreme Court Reports

Limited along with wind up Warehouse) custom establishment

charges’ for the financial year 1992-1993 to 2007-2008.

24. Learned counsel for the appellant submits that CESTAT had failed

to consider the fact that it was on the basis of specific permission

granted to the appellant by the proper officer that the impugned goods

were found outside the warehouse but within the industrial/factory

premises of the appellant. Therefore, in terms Section 64(d) of the

Customs Act respondent could not have treated the said goods as

having been removed from the warehouse. He submits that since the

appellant had not cleared the warehoused goods, Section 64 of the

Customs Act would come into play. Therefore, CESTAT was clearly

in error in upholding the order of the respondent applying Section

15(1)(b) of the Customs Act for determining the rate of duty in respect

of those goods. According to him, in the facts of the present case

the only provision that would be applicable is the residuary provision

i.e., Section 15 (1) (c) of the Customs Act.

24.1 Learned counsel has also placed reliance on the circular

dated 12.07.1989 of the Central Board of Excise and Customs

which was fully applicable to the case of the appellant. Though

this circular was subsequently superseded by circular dated

14.08.1997, it would be the former circular which would be

applicable to the facts of the present case.

24.2 Learned counsel further submits that CESTAT was not justified

for upholding the order of the respondent applying Section 71 of

the Customs Act read with Section 28AB of the said Act while

imposing interest on the confiscated goods. Confiscation itself

was not justified.

24.3 Finally, it is contended that both the respondent as well as

CESTAT had overlooked the fact that the goods in question

were denied to the appellant for a long time. Therefore, a lenient

view ought to have been taken.

25. Learned counsel for the respondent, on the other hand, submits

that on the basis of reliable information received about suspected

misuse of the warehousing facility by the appellant, officers of the

Preventive Branch of the Collectorate of Central Excise and Customs,

Indore had searched the premises of the appellant on 07.08.1992

and physically verified the stock. On verification, it was found that 

[2024] 3 S.C.R. 901

M/s. Bisco Limited v. Commissioner of Customs and Central Excise

304 cases were stocked inside the warehouse while 264 cases

were found outside the warehouse but within the factory premises.

Remaining 27 cases were found neither inside the warehouse nor

within the factory premises. It was thereafter that action was taken

under the relevant provisions of the Customs Act following which

show cause notice was issued to the appellant.

25.1 Learned counsel has justified the ultimate adjudication order

as well as the impugned order of the CESTAT confirming the

said adjudication order.

25.2 In such circumstances, he submits that there is no merit in the

appeal and, therefore, the same should be dismissed.

26. Submissions made have been duly considered.

27. We may now refer to some of the relevant provisions of the Customs

Act. Section 2(43) defines a ‘warehouse’ to mean a public warehouse

licensed under Section 57 or a private warehouse licensed under

Section 58 or a special warehouse licensed under Section 58A of the

Customs Act. ‘Warehoused goods’ has been defined under Section

2(44) to mean goods deposited in a warehouse.

28. Section 12 of the Customs Act deals with dutiable goods. SubSection(1) thereof says that duties of customs shall be levied at

such rates as may be specified under the Customs Tariff Act, 1975

on goods imported into or exported from India.

29. Date for determination of rate of duty and tariff valuation of imported

goods is dealt with in Section 15. Sub-Section(1) of Section 15 says

that the rate of duty and tariff valuation, if any, applicable to any

imported goods shall be the rate and valuation in force-

(a) in the case of goods entered for home consumption

under Section 46, on the date on which a bill of

entry in respect of such goods is presented under

that section;

(b) in the case of goods cleared from a warehouse

under Section 68, on the date on which the goods

are actually removed from the warehouse;

(c) in the case of any other goods, on the date of

payment of duty.

902 [2024] 3 S.C.R.

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30. While Section 28 provides for recovery of duties not levied or short

levied, Section 28AA deals with interest on delayed payment of duty.

On the other hand, Section 28AB provided for interest on delayed

payment of duty in special cases. Substance of Section 28AB (since

deleted) was that where any duty was not levied or paid or short

levied etc., the person who was liable to pay the duty would also be

liable to pay interest in addition to duty at such rate not below 10%

and not exceeding 36% per annum as may be fixed by the central

government by notification in the official gazette.

31. Chapter IX of the Customs Act comprising of Sections 57 to 73A

deal with warehousing. Section 57 provides for licensing of public

warehouses where dutiable goods may be warehoused. As per

Section 58, as it stood at the relevant time, the proper officer may

license a private warehouse where dutiable goods imported by or

on behalf of the licensee or any other imported goods in respect of

which facilities for deposit in a public warehouse are not available,

may be deposited. Sub-Section(2) provides for cancellation of

license so granted by giving a month’s written notice in advance if

the licensee had contravened any of the provisions of the Customs

Act or committed breach of any of the conditions of the license.

However, before such cancellation, the licensee was required to be

given a reasonable opportunity of being heard.

32. ‘Warehousing bond’ is provided for in Section 59. As per subSection(1), the importer of any goods specified in Section 61(1)

which had been entered for warehousing and assessed to duty

under Sections 17 or 18 shall execute a bond binding himself in a

sum equal to thrice the amount of the duty assessed on such goods.

33. As per Section 60, as it stood at the relevant point of time, when the

provisions of Section 59 have been complied with in respect of any

goods, the proper officer may make an order permitting the deposit

of goods in a warehouse.

34. Section 61 mentions the period for which the goods may remain

warehoused. Sub-Section (1) says that any warehoused goods

may be left in the warehouse in which they are deposited or in any

warehouse to which they may be removed-

(a) in the case of capital goods intended for use in any

hundred percent export-oriented undertaking, till the

expiry of five years;

[2024] 3 S.C.R. 903

M/s. Bisco Limited v. Commissioner of Customs and Central Excise

(aa) in the case of goods other than capital goods intended

for use in any hundred percent export-oriented

undertaking, till the expiry of three years; and

(b) in the case of any other goods, till the expiry of one

year;

after the date on which the proper officer has made an order under

Section 60 permitting the deposit of the goods in a warehouse.

However, proviso (i) (B) says that in the case of any goods which

are not likely to deteriorate and which are not intended for use in any

hundred percent export oriented undertaking, the period specified

in clauses (a), (aa) or (b) may, on sufficient cause being shown,

be extended by the Principal Commissioner or Commissioner of

Customs for a period not exceeding six months and by the Principal

Chief Commissioner or Chief Commissioner of Customs for further

period as he may deem fit.

35. Section 64 deals with owner’s right to deal with warehoused

goods. Section 64, as it stood at the relevant point of time, read

as under:

64. Owner’s right to deal with warehoused goods.- With

the sanction of the proper officer and on payment of the

prescribed fees, the owner of any goods may either before

or after warehousing the same-

(a) inspect the goods;

(b) separate damaged or deteriorated goods from the

rest;

(c) sort the goods or change their containers for the

purpose of preservation, sale, export or disposal of

the goods;

(d) deal with the goods and their containers in such

manner as may be necessary to prevent loss or

deterioration or damage to the goods;

(e) show the goods for sale; or

(f) take samples of goods without entry for home

consumption, and if the proper officer so permits,

without payment of duty on such samples.

904 [2024] 3 S.C.R.

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35.1. Thus, this section provided that the owner of any goods

with the sanction of the proper officer and on payment of

the prescribed fees may either before or after warehousing

the same, deal with the goods and their containers in such

manner as may be necessary to prevent loss or deterioration

or damage to the goods.

36. Section 67 deals with removal of goods from one warehouse to

another. It says that the owner of any warehoused goods may with

the permission of the proper officer, remove them from one warehouse

to another subject to such conditions as may be prescribed for the

due arrival of the warehoused goods at the warehouse to which

removal is permitted.

37. Heading of Section 68 is ‘Clearance of warehoused goods for home

consumption’. This section, as it stood at the relevant point of time,

provided that the importer of any warehoused goods may clear those

goods from the warehouse for home consumption if –

(a) a bill of entry for home consumption in respect of such

goods has been presented in the prescribed form;

(b) the import duty leviable on such goods and all

penalties rent, interest and other charges payable in

respect of such goods have been paid; and

(c) an order for clearance of such goods for home

consumption has been made by the proper officer.

38. There is an embargo provided in Section 71 from taking out goods

from a warehouse. As per Section 71, no warehoused goods shall be

taken out of a warehouse except on clearance for home consumption

or re-exportation or for removal to another warehouse or as otherwise

provided by the Customs Act.

39. Section 71 is followed by Section 72 which deals with goods improperly

removed from warehouse, etc. As per sub-Section(1)(b) where any

warehoused goods have not been removed from a warehouse at

the expiration of the period during which such goods are permitted

under Section 61 to remain in a warehouse, the proper officer may

demand and the owner of such goods shall forthwith pay, the full

amount of duty chargeable on account of such goods together with

all penalties, rent, interest and other charges payable in respect of

such goods.

[2024] 3 S.C.R. 905

M/s. Bisco Limited v. Commissioner of Customs and Central Excise

40. Once the goods covered by any bond executed under Section 59

have been cleared for home consumption or exported or transferred

or are otherwise duly accounted for, and when all amounts due on

account of such goods have been paid, the proper officer shall cancel

the bond as discharged in full and deliver the same after cancellation

to the person who has executed or is entitled to receive it.

41. Section 110(1) of the Customs Act empowers the proper officer to

seize any goods if he has reason to believe that such goods are

liable to confiscation under the Customs Act.

42. As per Section 111(j), any dutiable or prohibited goods removed

or attempted to be removed from a customs area or a warehouse

without the permission of the proper officer or contrary to the terms

of such permission, shall be liable for confiscation.

43. In the event of such an act, the concerned person shall be liable to

pay penalty under Section 112.

44. Central Board of Excise and Customs had issued Circular No.98/95-

Cus. dated 12.07.1989. Subject matter of this circular was what would

be the relevant date for calculation of customs duty in cases where

warehoused goods were cleared after expiry of the warehousing

period. Reference was made to the instructions of the Board dated

17.03.1987 where it was clarified that in cases where warehoused

goods were cleared from a warehouse after expiry of the bond period,

the rate of duty would be the one which was prevalent on the date

of expiry of the bond. The issue was reconsidered in the tripartite

meeting held between the Ministry of Law, Department of Revenue

and the Comptroller and Auditor General. It was observed in the

meeting that on expiry of the warehousing period, the goods kept in

a warehouse ceased to be warehoused goods and, therefore, their

removal from the warehouse could not be regarded as covered by

the provisions of Section 15(1)(b) of the Customs Act. After noting

that there was no specific legal provision to determine the rate of

duty in such cases of warehoused goods where the bond period

had expired, it was concluded that the residual clause of Section

15(1)(c) of the Customs Act could apply to cases where the goods

were removed from the warehouse after expiry of the warehousing

period and that the rate of duty in such cases would be the rate

prevalent on the date of payment of duty. It was further clarified that

provisions of Section 15(1)(b) of the Customs Act would continue to 

906 [2024] 3 S.C.R.

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apply in cases where goods were cleared from the warehouse after

extension of the warehousing period but before expiry of the extended

period for which applications from the importers for extension of

the warehousing period should be received before expiry of the

permitted period of warehousing. These conclusions reached in the

tripartite meeting were accepted by the Board and by the aforesaid

circular dated 12.07.1989, direction was issued for their immediate

implementation superseding the instructions dated 17.03.1987.

45. The above provision continued to hold the field till the decision of

this Court in Kesoram Rayon versus Collector of Customs, Calcutta,

(1996) 5 SCC 576. The question for consideration in Kesoram was

the rate at which customs duty was to be levied on goods that

remained in a bonded warehouse beyond the permitted period. A

two judge bench of this Court after referring to various provisions

of the Customs Act held that Section 15(1)(b) would apply to the

case of goods cleared under Section 68 from a warehouse upon

presentation of a bill of entry for home consumption; payment of

duty, interest, penalty, rent and other charges; and an order for home

clearance. This Court clarified that provisions of Section 68 and

consequently Section 15(1)(b) would apply only when goods have

been cleared from the warehouse within the permitted period or its

permitted extension and not when by reason of their remaining in the

warehouse beyond the permitted period or its permitted extension,

the goods would be deemed to have been improperly removed from

the warehouse under Section 72. In the facts of that case, it was

found that there was nothing on record to suggest that clearance of

the goods in question under Section 68 was ordered and, therefore,

Section 15(1)(b) had no application. Finally, this Court held that the

consequence of non-removal of the warehoused goods within the

permitted period or the permitted extension by virtue of Section 72

is certain. The date on which it comes to an end is the date relevant

for determining the rate of duty; when the duty is in fact demanded

is not relevant.

46. Following the decision of this Court in Kesoram, the Central Board of

Excise and Customs issued Circular No.31/97-Cus. dated 14.08.1997.

The Board held that in view of this Court’s judgment, the date of

payment of duty in the case of warehoused goods removed after

expiry of the permissible or extended period would be the date of

expiry of the warehousing period or such other extended period, 

[2024] 3 S.C.R. 907

M/s. Bisco Limited v. Commissioner of Customs and Central Excise

as the case may be, and not the date of payment of duty. Goods

not removed from a warehouse within the permissible period or the

extended period are to be treated as goods improperly removed

from the warehouse.

47. In Simplex Castings Ltd. versus Commissioner of Customs,

Vishakhapatnam, (2003) 5 SCC 528, the appellant had questioned

filing of appeal by the Commissioner before the CEGAT in view of the

circular dated 12.07.1989 issued by the Central Board of Excise and

Customs. It was argued that it was not open to the Commissioner to

take the stand that non-removal of the goods from the warehouse

after the period of warehousing was over would be deemed removal

from the warehouse and that the rate of duty would be leviable from

the date the period of warehousing was over. The Commissioner had

appealed against the decision of the Collector of Customs (Appeals)

in which the circular dated 12.07.1989 was followed. The appeal

filed by the Commissioner was allowed by the CEGAT by relying

upon the decision of this Court in Kesoram. This Court referred to

its earlier decision in Paper Products Ltd. versus Commissioner of

Central Excise, (1999) 7 SCC 84, and held that the circular dated

12.07.1989 was binding on the Department and, therefore, it was

not open to the Department to prefer appeal before CEGAT contrary

to what was laid down in the circular dated 12.07.1989 in which it

was specifically provided that the residual Section 15(1)(c) of the

Customs Act would apply to cases where the goods were removed

from a warehouse after expiry of the warehousing period and that

the rate of duty in such cases would be the rate prevalent on the

date of payment of duty. This Court noted that the aforesaid circular

dated 12.07.1989 was withdrawn by the subsequent circular dated

14.08.1997. But, at the relevant point of time, the circular dated

12.07.1989 was holding the field. Thus, the appellate order passed by

the Collector of Customs (Appeal) could not be said to be in anyway

illegal or erroneous and, therefore, it was not open to the Department

to challenge the said order before the CEGAT in contravention of

the circular dated 12.07.1989.

48. The decision in Kesoram was approved and applied by a coordinate

bench of this Court in SBEC Sugar Ltd versus Union of India, (2011)

4 SCC 668. This Court held that Section 15(1)(b) would be applicable

only when the goods are cleared from the warehouse under Section

68 of the Customs Act i.e. within the initially permitted period or during 

908 [2024] 3 S.C.R.

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the permitted extended period. When the goods are cleared from

the warehouse after expiry of the permitted period or its permitted

extension, the goods are deemed to have been improperly removed

under Section 72(1)(b) of the Customs Act with the consequence that

the rate of duty has to be computed according to the rate applicable

on the date of expiry of the permitted period under Section 61.

49. Let us now briefly recap the facts. Appellant had imported second

hand steel mill machinery and parts covered by three transit bonds

totalling 595 cases. The customs authority had notified an open

area of 2000 square meters within the industrial/factory premises of

the appellant as a public bonded warehouse. This open area was

fenced and had gate with locking arrangement. The imported goods

covered by the 595 cases were required to be warehoused in the

said notified public bonded warehouse without payment of customs

duty. Appellant had written a letter dated 30.08.1989 to the concerned

Superintendent seeking permission to unload a portion of the cargo

outside the warehouse but within the factory premises. It was pointed

out that the trailers carrying the consignment could not enter the

said warehouse as because those trailers had got stuck in the soil

outside the warehouse but within the factory premises as the soil

had become very sluggish due to heavy rain and also because of

paucity of space within the notified open area. The Superintendent

gave permission on the body of the letter itself for unloading the

cargo outside the warehouse but within the factory premises. The

machinery parts which were thus unloaded were shifted to a shed

outside the bonded warehouse but within the factory premises of

the appellant so that those machinery parts did not get damaged,

lying in the open and getting exposed to the elements.

49.1. Officials of the Preventive Branch of the Commissionerate

searched the industrial premises of the appellant, including the

notified public bonded warehouse, on 07.08.1992 and physically

verified the stock in the notified public bonded warehouse as

well as outside but within the industrial/factory premises of the

appellant. On such verification, it was found that only 304 cases

were stocked inside the warehouse, whereas 264 cases were

found outside the warehouse but within the industrial/factory

premises of the appellant. Remaining 27 cases were neither

found inside the warehouse nor outside the warehouse but

within the industrial/factory premises of the appellant.

[2024] 3 S.C.R. 909

M/s. Bisco Limited v. Commissioner of Customs and Central Excise

49.2. After issuance of show cause notice and hearing, respondent

passed adjudication order dated 28.08.1996 which suffered

several rounds of appeals and remand. Ultimately, the

Commissioner passed the final adjudication order dated

28.04.2005 whereby demand of Rs.3,99,255.00 leviable on

the 27 cases found not warehoused was confirmed. Appellant

was also directed to pay interest on the said duty in terms of

Section 28AB of the Customs Act. The 264 cases of imported

goods found outside the notified warehouse were confiscated

but option of redemption was given to the appellant on

payment of fine of Rs.2,00,000.00. For the goods covered by

the 264 cases, customs duty amounting to Rs.39,03,821.00

was directed to be recovered from the appellant in terms of

Section 71 read with the proviso to Section 28A of the Customs

Act. That apart, appellant was directed to pay interest of

Rs.18,88,425.00 on the aforesaid quantum of customs duty in

respect of the 264 cases from the date of warehousing till the

date of detection of the shortage in the warehouse. Further,

appellant was directed to pay interest under Section 28AB

in respect of the 264 cases from the date of enforcement of

the said section to till the date of actual payment of the duty.

Penalty of Rs.1,00,000.00 was also imposed on the appellant

under Section 112 of the Customs Act.

49.3. In appeal, CESTAT by the impugned order affirmed the

aforesaid decision of the Commissioner.

50. We may mention that the permission granted by the Superintendent to

the appellant on 30.08.1989 to unload a portion of the cargo outside

the open space which was notified as public bonded warehouse but

within the factory premises of the appellant was neither cancelled nor

revoked by the Superintendent or even by the Commissioner. Infact,

a view can reasonably be taken that the appellant as the owner of

the goods had exercised its right under Section 64(d) which was

endorsed by the Superintendent. Therefore, it would not be correct

to say that the 264 cases found outside the notified warehouse

but within the factory premises of the appellant were improperly or

unauthorisedly removed from the notified public bonded warehouse.

51. It has also come on record that Central Warehousing Corporation

had deposited a sum of Rs.56,10,294.00 with the respondent as 

910 [2024] 3 S.C.R.

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custom establishment charges in respect of the aforesaid notified

public bonded warehouse for the period 1992-1993 to 2007-2008.

This would mean that the warehousing in the aforesaid notified

public bonded warehouse continued during the said period. Thus,

the period of warehousing had not expired and continued to remain

operational in terms of the proviso to Section 61 of the Customs Act.

52. This would further be borne out from the fact that it is not the case

of the respondent that the 304 cases found inside the notified

warehouse were kept there beyond the warehousing period. In fact,

the allegation of the respondent is that 264 cases were improperly or

unauthorisedly removed from the notified warehouse as those were

found lying outside the notified area but within the industrial/factory

premises of the appellant. That apart, 27 cases were neither found

inside the notified warehouse nor outside the said warehouse but

within the factory premises of the appellant.

53. In such a scenario, the provisions of Sections 71 and 72 would not

be applicable. Therefore, the decision of the respondent to invoke

Section 71 and thereafter levy interest on the goods covered by the

264 cases under Section 28AB of the Customs Act was not justified.

Since the imported goods covered by the 264 cases were never

warehoused inside the notified public bonded warehouse but were

unloaded outside the notified area but within the factory premises

of the appellant and kept under a shed on permission granted by

the Superintendent which permission was neither cancelled nor

revoked, question of warehousing the goods covered by the 264

cases within the notified public bonded warehouse did not arise.

As a corollary, the further question of improperly or unauthorisedly

removing the 264 cases from the notified warehouse to outside the

said area but within the factory premises of the appellant attracting

Section 71 and the consequences following the same did not arise.

Inference drawn by the respondent that the permission granted by

the Superintendent was only temporary and therefore, the rigor of

Section 71 would be attracted, in our view, would not be a correct

understanding of the situation and the law.

54. Having said that, we find that there is no explanation on the part of

the appellant qua the missing 27 cases. Therefore, the view taken

by the respondent and affirmed by the CESTAT that those 27 cases

were improperly or unauthorisedly removed from the notified public 

[2024] 3 S.C.R. 911

M/s. Bisco Limited v. Commissioner of Customs and Central Excise

bonded warehouse is correct and requires no interference.

55. Reverting back to the 264 cases, we are of the view that in a case

of this nature, Section 15(1)(b) would have no application. Rather,

Section 15(1)(c) would be attracted.

56. In so far the Board’s circular dated 12.07.1989 is concerned, the

subject matter of the said circular was what would be the relevant

date for calculation of customs duty in cases where warehoused

goods were cleared after expiry of the warehousing period. In that

context, it was clarified that provisions of Section 15(1)(b) of the

Customs Act would apply to cases where the goods were cleared

from the warehouse after extension of the warehousing period

but before expiry of such extended period. On the other hand, in

respect of cases where the goods were removed after expiry of the

warehousing period, the residual clause of Section 15(1)(c) of the

Customs Act would apply. Evidently, this circular dated 12.7.1989

would not be applicable to the facts of the present case in as much

as it is not the case of the respondent that either the warehousing

period had expired or that the warehousing period was extended.

As we have seen, the warehousing in the notified public bonded

warehouse continued as the Corporation had deposited with the

respondent a sum of Rs. 56,10,294.00 in respect of the notified

warehouse as custom establishment charges for the period from

1992-1993 to 2007-2008. That apart, we can refer to the fact that

respondent had not levied any customs duty on the 304 cases

found within the notified area which would mean that the notified

warehousing continued. Therefore, this is not a case where Section

15(1)(b) could have been invoked.

57. As regards, the decision of this Court in Kesoram is concerned, the

question for consideration in that case was the rate at which customs

duty could be levied on goods that remained in a bonded warehouse

beyond the permitted period. It was in that context that this Court held

that Section 68 would not be applicable since Section 68 operates in

a different context. On the contrary, Section 72 would apply. Thus,

this Court clarified that the date on which the warehousing period

comes to an end, would be the date relevant for determining the

rate of duty and when the duty is actually demanded would not be

relevant. It was further clarified that Section 15(1)(b) would apply to

goods cleared under Section 68. Goods which remain in the bonded 

912 [2024] 3 S.C.R.

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warehouse beyond the permitted period would be deemed to have

been improperly removed from the warehouse under Section 72.

It is quite evident that this decision would not be applicable to the

facts of the present case.

58. Thus, having regard to the discussions made above, we are of

the view that the demand raised by the respondent against the

appellant and affirmed by the CESTAT qua the 264 cases including

levy of customs duty and interest cannot be sustained. Those are

accordingly set aside and quashed. Parties are directed to work out

their remedies in respect of the 264 cases of goods under Section

15(1)(c) of the Customs Act within a period of eight weeks from

the date of receipt of a copy of this order. In so far the demand of

customs duty and interest on the 27 cases is concerned, the same

is hereby sustained. The decision imposing penalty of rupees one

lakh on the appellant under Section 112 of the Customs Act is also

not disturbed in view of the conduct of the appellant in unauthorisedly

removing the 27 cases of imported goods not only from the notified

public bonded warehouse but also from the industrial/factory premises

of the appellant.

59. Impugned order of CESTAT would stand modified accordingly.

60. Appeal is allowed in part in the above terms. No costs.

Headnotes prepared by: Ankit Gyan Result of the case:

Appeal partly allowed.

Penal Code, 1860 – s. 302 and s. 307– Role of an investigating officer is that of the backbone of the entire criminal proceeding in respect of the particular offence(s) he is charged with investigating – Faulty Investigation - Examined.

* Author

[2024] 3 S.C.R. 747 : 2024 INSC 212

Periyasamy

v.

The State Represented

by the Inspector of Police

(Criminal Appeal No. 270 of 2019)

18 March 2024

[Hrishikesh Roy and Sanjay Karol,* JJ.]

Issue for Consideration

Whether the High Court justified in affirming the judgment of trial

court convicting and sentencing the accused appellant, (A-1), for

the offence punishable under sections 302 & 307 of Penal Code,

1860 and accused appellant (A-2) for the offence punishable under

sections 302/109 & 307/109 of Penal Code, 1860.

Headnotes

Penal Code, 1860 – s. 302 and s.307 – Trial Court convicted

and sentenced appellants – Relying on ocular and medical

evidence – High Court confirmed the sentence and conviction

– Whether the sentence and conviction falls short of standard

of beyond reasonable doubt:

Held: Trial court primarily relied on testimonies of PW-1 to PW-3 –

PW-1 is an injured witness and a relative of D1 – PW-2 is also an

injured witness and a neighbor of D1 – The evidence of an injured

witness is considered to be on a higher pedestal than that of a

witness simpliciter – PW-2 deposed that were about 50 persons

at the scene of the crime – Then, how has the non-examination

of independent witness been countenanced by the prosecution

is something that escapes, or rather confounds this Court – The

evidence of PW-3 appears to be fraught with contradictions – His

actions not to be akin to that of a prudent man – When A-1 had

allegedly broken a bottle on the head of D1, PW-3 took the injured

D1 not to the hospital but to an STD booth located nearby – Why

a person would “hold” a person with a grievous head injury near

an STD booth and not take him to the hospital – Significant delay

in recording statements of PW-1 and PW-2 – Various lapses such

as these cumulatively affect the overall sanctity of the prosecution 

748 [2024] 3 S.C.R.

Digital Supreme Court Reports

case, making it fall short of the threshold of beyond reasonable

doubt – Challenge on the grounds sustained, among others that,

(a) examined private persons were interested witnesses, with

inconsistencies amongst them; (b) no independent witnesses were

examined; (c) there was a delay in filing the FIR; (d) there were

interpolations on record; (e) there were numerous lapses in the

investigation; and (f) the medical and scientific evidence on record

does not support the prosecution’s version of events. [Paras 31,

33, 36, 39, 41, 47,48]

Penal Code, 1860 – s. 302 and s. 307– Role of an investigating

officer is that of the backbone of the entire criminal proceeding

in respect of the particular offence(s) he is charged with

investigating – Faulty Investigation - Examined.

Held: The investigation officer of a case is the charioteer tasked

with using the resources and personnel at his disposal to ensure

law and order as also that a person who has committed a crime

is brought to the book – Nowhere has it come on record as to

how the investigating officer (PW-22) reached the bus stand

from where A-2 was arrested – who informed the authorities

about A-2’s movement by bus – PW-22 made two visits to the

scene of the crime and that he also examined several witnesses

- how is there a striking lack of independent witnesses to lend

credence to the prosecution’s version of events – He also did

not conduct any scientific investigation at the spot of crime – The

wound certificate for PW-1 and PW-2 was issued by Doctor, who

had not been examined in the instant proceedings – Was it that

the initial investigation was being managed so as to shield the

real assailants, which could have been the complainant party

themselves? – Particularly when, as the record reveals, as is

so admitted by PW-22 of A-2 being a practicing advocate who

has been, (i) pursuing the matters against the officials of the

police station (ii) has been lodging complaints against the police

officials for inaction; and (iii) had nothing to do with the ownership,

management or control of the wine shop – The injured witnesses

and the Investigation Officer in their testimony together are not

inspiring confidence – The prosecution case stands shaken beyond

a point to which no conviction resting thereupon can be said to be

just in the eyes of law – appeals are allowed and the convictions

accordingly set aside. [Paras 43, 44, 46, 47]

[2024] 3 S.C.R. 749

Periyasamy v. The State Represented by the Inspector of Police

Case Law Cited

Raghbir Singh & Ors. v. State of Haryana [2008] 15

SCR 1108 : (2008) 16 SCC 33; James Martin v. State

of Kerala [2003] Suppl. 6 SCR 910 : (2004) 2 SCC

203; Vidhya Singh v. State of M.P. (1971) 3 SCC 244;

Darshan Singh v. State of Punjab & Anr. [2010] 1 SCR

642 : (2010) 2 SCC 333; State of Rajasthan v. Kalki

[1981] 3 SCR 504 : (1981) 2 SCC 752; Sarwan Singh

v. State of Punjab (1976) 4 SCC 369 (3J); Rajesh and

Anr. v. State of Madhya Pradesh [2023] 15 SCR 1 :

2023 SCC OnLine SC 1202 – referred to.

Books and Periodicals Cited

Russel on Crime, 11th Edition Volume I.

List of Acts

Penal Code, 1860; Code of Criminal Procedure, 1973.

List of Keywords

Standard of beyond reasonable doubt; Interested witness; Right

of private defence; Independent Witness; Related Witness; Police

Investigation; Star prosecution witness; Faulty Investigation; Delay

in filing FIR; Delay in Examination of Witness.

Case Arising From

CRIMINAL APPELLATE JURISDICTION : Criminal Appeal No.270

of 2019

From the Judgment and Order dated 26.11.2014 of the High Court of

Madras at Madurai in CRLA No.240 of 2014

With

Criminal Appeal No.271 of 2019

Appearances for Parties

S. Arun Prakash, B. Balaji, Vipin Kumar Jai, Mrs. Gurinder Jai, Vipul

Jai, Ms. Sanjna Dua, Advs. for the Appellant.

Dr. Joseph Aristotle S., Ms. Shubhi Bhardwaj, Advs. for the

Respondent.

750 [2024] 3 S.C.R.

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Judgment / Order of the Supreme Court

Judgment

Sanjay Karol J.

1. The present appeals arise from the final judgment and order dated

26th November 2014 passed by the Madurai Bench of Madras High

Court, in Crl. A. (MD) No. 238 and 240 of 2014, which confirmed the

judgment and order dated 31st July 2014 in Sessions Case No. 109

of 2005 passed by the Sessions Court, Tiruchirapalli, vide which the

present appellants, Periyasamy1

 and R. Manoharan2

 were convicted

in the following terms under the Indian Penal Code3

:

S. No Name Crime Punishment Awarded

1. A1 –

Periyasamy

IPC – S.302

(2 counts)

Imprisonment for life and Rs.

1,000 fine

IPC – S.307

(2 counts)

Rigorous Imprisonment for

seven years and Rs. 1,000

fine

2. A2 - R.

Manoharan

IPC – S.302

r/w S.109

(1 count)

Imprisonment for life and Rs.

1,000 fine

IPC – S.307

r/w S.109

(2 counts)

Rigorous Imprisonment for

seven years and Rs. 1,000

fine

2. The incident in question relates to the death of two persons after being

stabbed, allegedly by A-1 at the instigation of A-2. The prosecution

case emerging from the record, as also set out by the Courts below,

is as follows:-

2.1 On 3rd March 2002, Dharmalingam4

 had after already having

procured liquor in an earlier completed transaction, half an hour

later demanded more brandy on credit from the owners and

1 Hereinafter ‘A-1’

2 Hereinafter ‘A-2’

3 Hereinafter ‘IPC’

4 Hereinafter ‘D1’

[2024] 3 S.C.R. 751

Periyasamy v. The State Represented by the Inspector of Police

workers of Saravana Wine Shop located in Neithalur Colony.

A quarrel arose, and a showcase of the shop was smashed,

and the bottles stored therein were damaged. In this course

of events, it is alleged that D-1 retrieved a knife and stabbed

one Thangavel5

 (one of the owners of the shop). A-1, with a

knife, caused fatal injuries to D-1. He also stabbed Sakthivel

(son of Muthuveeran)6

 in his stomach repeatedly. When D-2

intervened to prevent the attack, A-1 stabbed him. While the

injured persons were being taken to hospital, on the way, both

D-1 and D-2 succumbed to injuries.

2.2 Sakthivel, who was injured in the incident, reported it to A.

Rajasekar (PW-20), a Police Inspector at the Hospital. Upon

this statement, FIR no. 87/2002 came to be registered. Upon

investigation on 1st July 2004, charges were framed against

A-1 and A-2, as indicated in the above table.

Trial Court Findings

3. In order to prove the charges, the prosecution examined 22

witnesses; exhibited 33 documents and nine material objects. To

repel the charges, the defence produced a solitary witness and

three documents.

4. The Trial Court has relied on ocular and medical evidence to establish

the charges against the accused persons. PW-1 and K. Sakthivel,

son of Kaathaan7

 (PW-2) both deposed that in the quarrel between

the deceased and accused persons, though they tried to pacify the

situation, A-2 handed a knife to A-1 with which the latter stabbed

the deceased persons.

5. The Learned Trial Court found no substance in the challenge put

forth by the defence attempting to shake the prosecution’s case.

A-1 was held guilty on two counts of Section 302, IPC, i.e., for the

murder of D-1 and D-2; A-2 was held guilty on one count only, i.e.,

for abetting the murder of D-1.

6. The charges of attempt to murder were found to be proven against

both A-1 and A-2. It relied on the evidence of PW-1, PW-2, and PW-3

5 Hereinafter ‘D2’

6 Hereinafter ‘PW-1

7 Hereinafter ‘PW2’

752 [2024] 3 S.C.R.

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to hold that A-2 instigated A-1 to attack the deceased. The learned

Trial Court observed that the injuries sustained by PW-1 and K.

Sakthivel (PW-2) were of such a nature that the act of the accused

would be termed as an act of attempt to murder.

High Court Findings

7. The High Court, in appeal, was faced with the question of the absence

of the name of A-2 in the FIR. Having referred to certain decisions of

this Court, it was observed that simply because the name was not

mentioned in the FIR, an accused can not be absolved of liability

for having committed the offence. The next question considered by

the Court with respect to A-2 was his involvement or lack thereof

in the occurrence of this offence. The argument on his behalf relies

on the fact that PW-1’s statement did not mention him, and neither

did Exhs. P-6 and P-11, was considered unworthy, keeping in view

the testimonies of injured eyewitnesses PW-1 and PW-2 as also the

statement of PW-3 under Section 161 (3) of the Code of Criminal

Procedure, 1973; it was held that the involvement of A-2 stood proved

beyond reasonable doubt.

8. For A-1, three primary arguments were put forth, i.e., Dr.

Radhakrishnan8

 (PW-17) Doctor at Seahorse Hospital did not give

evidence in regard to the surgical procedure undergone by PW1; the injuries faced by A-1 were not sufficiently explained by the

prosecution; and about the occurrence, the owner of the wine shop

stood not examined.

9. It was observed that the genuineness of the statement made by

PW-1 to the police could not be doubted as he had told PW-17

that he was a victim of an attack by A-1. Such genuineness stands

buttressed by the fact that the document reached the court on the

same day.

10. On A-1’s injuries being unexplained, it was observed that the

same would not be sufficient to dispel the entire prosecution case.

Reference was made to Amar Malla v. State of Tripura9

. It was held

that since both PW-1 and PW-2 are consistent on facts, including

the place of occurrence, as also the same being an admitted fact,

8 Hereinafter ‘PW-17’

9 (2002) 7 SCC 91

[2024] 3 S.C.R. 753

Periyasamy v. The State Represented by the Inspector of Police

the contention in that regard on behalf of A-1 has to be negatived.

Given that the presence of the owner of the shop has nowhere

been mentioned, his non-examination cannot be termed fatal to

the prosecution case.

11. In such terms, the High Court confirmed the conviction and sentence

handed down by the Trial Court as regards A1 and A2.

Submissions

12. The present appeals are a challenge to the judgments of the Trial

Court and High Court. We have heard Mr. S Nagamuthu, learned

senior counsel, Mr. S. Arun Prakash for A-1, and Mr. Vipin Jai for

A-2. Dr. Joseph Aristotle S. was heard for the State.

Contentions on behalf of A-1

13. The primary ground urged on behalf of A-1 was that nearly all

witnesses were “interested” in the case’s outcome and, therefore,

unreliable; and none of the witnesses examined were independent.

Further, it was canvassed that the delay in lodging the FIR stands

unexplained, more so when the medical evidence does not speak

of PW-1 having undergone surgery. Also, it must be noted that there

was no prior animosity or reason for discord. The events as they

unfolded were the result of a spur-of-the-moment quarrel in which

he also sustained grievous injuries. The right of private defence has

also been pleaded as an alternate argument.

Contentions on behalf of A-2

14. It was argued on behalf of A-2 that his presence at the scene of

the crime was never established. Four limbs of A-1’s arguments,

i.e., delay in lodging the FIR; almost all witnesses qualifying as

“interested witnesses”; there being no enmity between the involved

persons; and the lack of independent witnesses, were adopted by

A-2.

Submissions on behalf of the Respondent

15. The respondent has filed detailed submissions which attempt to

discredit as a whole the submissions on behalf of the accused

persons. In doing so, the State relied on various judgments from

this Court. We have perused the written submissions filed and also

examined the cases referred.

754 [2024] 3 S.C.R.

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Consideration and Conclusion

16. The question that we are called upon to decide is whether, in

the sum total of facts, circumstances, and the law applicable, the

convictions handed down to A-1 and A-2 are based on the standard

of beyond reasonable doubt having been met and, therefore, are

sustainable.

17. It would be apposite for this Court to consider the law on the various

facets of the penal laws of the land, involved in this case.

The Right of Private Defence

18. A-1 has contended that his actions were covered under the ambit

of the right of private defence. The principle is best captured in the

following words found in Russel on Crime, 11th Edition Vol.I

 “… a man is justified in resisting by force anyone

who manifestly intends and endeavours by violence or

surprise to commit a known felony against either his

person, habitation or property. In these cases, he is not

obliged to retreat, and may not merely resist the attack

where he stands but may indeed pursue his adversary

until the danger is ended and if in a conflict between

them he happens to kill his attacker, such killing is

justifiable”.

19. The right of private defence is not defined under the IPC. Whether

under the circumstances of each case, such a right is available or not

is determined within the said boundaries only. No test in the abstract

can be laid down for determining whether a person legitimately acted

in private defence. The law only provides that the person claiming

such a right bears the onus10 to prove the legitimacy of the actions

done in furtherance thereof and it is not for the Court to presume

the presence of such circumstances or the truth in such a plea

being taken. (See: Raghbir Singh & Ors. v. State of Haryana11.)

The burden on the person pleading the right of private defence has

been succinctly explained in James Martin v. State of Kerala12. This

right has been held to be “very valuable, serving a social purpose”

10 Section 105 Indian Evidence Act 1872

11 [2008] 15 SCR 1108 : (2008) 16 SCC 33

12 [2003] Suppl. 6 SCR 910 : (2004) 2 SCC 203

[2024] 3 S.C.R. 755

Periyasamy v. The State Represented by the Inspector of Police

and, therefore, it should not be construed narrowly. (See: Vidhya

Singh v. State of M.P.13)

20. This Court has summarised the principles in regard to the exercise

of right of private defence in Darshan Singh v State of Punjab &

Anr.14 as referred to in Sukumaran v State15

"(i) Self-preservation is the basic human instinct and is duly

recognised by the criminal jurisprudence of all civilised

countries. All free, democratic and civilised countries

recognise the right of private defence within certain

reasonable limits.

(ii) The right of private defence is available only to one who

is suddenly confronted with the necessity of averting an

impending danger and not of self-creation.

(iii) A mere reasonable apprehension is enough to put the

right of self-defence into operation. In other words, it is

not necessary that there should be an actual commission

of the offence in order to give rise to the right of private

defence. It is enough if the accused apprehended that such

an offence is contemplated and it is likely to be committed

if the right of private defence is not exercised.

(iv) The right of private defence commences as soon as a

reasonable apprehension arises and it is coterminous with

the duration of such apprehension.

(v) It is unrealistic to expect a person under assault to modulate

his defence step by step with any arithmetical exactitude.

(vi) In private defence the force used by the accused ought

not to be wholly disproportionate or much greater than

necessary for protection of the person or property.

(vii) It is well settled that even if the accused does not plead

self-defence, it is open to consider such a plea if the same

arises from the material on record.

13 (1971) 3 SCC 244

14 (2010) 2 SCC 333

15 (2019) 15 SCC 117

756 [2024] 3 S.C.R.

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(viii) The accused need not prove the existence of the right of

private defence beyond reasonable doubt.

(ix) The Penal Code confers the right of private defence only

when that unlawful or wrongful act is an offence.

(x) A person who is in imminent and reasonable danger of

losing his life or limb may in exercise of self-defence inflict

any harm even extending to death on his assailant either

when the assault is attempted or directly threatened.”

However, this Court will only enter into the question of applicability

of the right of private defence if the primary submission of complete

acquittal fails, for it has been submitted by Mr. Nagamuthu, learned

senior counsel that this submission is an alternate to the arguments

advanced by Mr. S. Arun Prakash, learned counsel for A-1.

Independent and Related or Interested Witnesses

21. It is a well-recognised principle in law that the non-examination of

independent witnesses would not be fatal to a case set up by the

prosecution. The difference between a witness who is “interested”

and one who is “related” stand explained by a Bench of three learned

Judges in State of Rajasthan v. Kalki16

“7. …“Related” is not equivalent to “interested”. A witness

may be called “interested” only when he or she derives

some benefit from the result of a litigation; in the decree

in a civil case, or in seeing an accused person punished.

A witness who is a natural one and is the only possible

eyewitness in the circumstances of a case cannot be said

to be “interested.”

We may refer to the observation in Sarwan Singh v. State of Punjab17

as under to appreciate the evidentiary value of such testimonies: –

“...Moreover, it is not the law that the evidence of an

interested witness should be equated with that of a

tainted evidence or that of an approver so as to require

corroboration as a matter of necessity. The evidence of

16 [1981] 3 SCR 504 : (1981) 2 SCC 752

17 (1976) 4 SCC 369 (3J)

[2024] 3 S.C.R. 757

Periyasamy v. The State Represented by the Inspector of Police

an interested witness does not suffer from any infirmity as

such, but the courts require as a rule of prudence, not as a

rule of law, that the evidence of such witnesses should be

scrutinised with a little care. Once that approach is made

and the court is satisfied that the evidence of interested

witnesses have a ring of truth such evidence could be

relied upon even without corroboration. Indeed there may

be circumstances where only interested evidence may be

available and no other, e.g. when an occurrence takes

place at midnight in the house when the only witnesses

who could see the occurrence may be the family members.

In such cases it would not be proper to insist that the

evidence of the family members should be disbelieved

merely because of their interestedness…”

In other words, if witnesses examined are found to be ‘interested’

then, the examination of independent witnesses would assume

importance.

Faulty Police Investigation

22. Recently, this Court in Rajesh and Anr. v. State of Madhya Pradesh

(3-Judge Bench)18, while setting aside the conviction of the three

Appellants therein, remarked:

“39. Before parting with the case with our verdict, we may

note with deep and profound concern the disappointing

standards of police investigation that seem to be the

invariable norm. As long back as in the year 2003, the

Report of Dr. Justice V.S. Malimath’s ‘Committee on

Reforms of Criminal Justice System’ had recorded thus:

‘The manner in which police investigations

are conducted is of critical importance to the

functioning of the Criminal Justice System. Not

only serious miscarriage of justice will result if

the collection of evidence is vitiated by error

or malpractice, but successful prosecution of

the guilty depends on a thorough and careful

search for truth and collection of evidence which

18 2023 SCC OnLine SC 1202

758 [2024] 3 S.C.R.

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is both admissible and probative. In undertaking

this search, it is the duty of the police to

investigate fairly and thoroughly and collect all

evidence, whether for or against the suspect.

Protection of the society being the paramount

consideration, the laws, procedures and police

practices must be such as to ensure that the

guilty are apprehended and punished with

utmost dispatch and in the process the innocent

are not harassed. The aim of the investigation

and, in fact, the entire Criminal Justice System

is to search for truth. ……The standard of police

investigation in India remains poor and there is

considerable room for improvement. The Bihar

Police Commission (1961) noted with dismay that

“during the course of tours and examination of

witnesses, no complaint has been so universally

made before the Commission as that regarding

the poor quality of police investigation”. Besides

inefficiency, the members of public complained of

rudeness, intimidation, suppression of evidence,

concoction of evidence and malicious padding

of cases…..’

40. Echoing the same sentiment in its Report No. 239 in

March, 2012, the Law Commission of India observed that

the principal causes of low rate of conviction in our country,

inter alia, included inept, unscientific investigation by the

police and lack of proper coordination between police and

prosecution machinery. Despite passage of considerable

time since these gloomy insights, we are dismayed to

say that they remain sadly true even to this day. This is

a case in point….”

23. A perusal of the judgment of the Trial Court shows that for both

counts before it, reliance primarily has been placed on PW-1 to

PW-3. Apart from these three-star prosecution witnesses, the

Investigating Officer (PW-22), by virtue of having been “in the driver’s

seat” of the case, acquires importance. The salient points that can

be appreciated from an assay of their respective testimonies may

be referred to as follows:-

[2024] 3 S.C.R. 759

Periyasamy v. The State Represented by the Inspector of Police

23.1 PW-1 is Sakthivel, S/o Muthuveeran. It was stated that upon

information that D-1 and Senthilkumar were quarreling with the

owner of the wine shop, he and Sakthivel, S/o Kathan rushed to

the shop. It is there that upon the instigation of A-2, who handed

A-1 a knife he stabbed the witness thrice in the stomach of PW-1

and PW-2, D-1, and D-2 as well. SI, Kulithalai, interrogated him at

4.30 a.m. on 4th March 2002, and the statement made thereunder

is Exh.P-1. In his cross-examination, it has come forth that upon

his arrival at Seahorse Hospital by 10:00 p.m., he was conscious,

and it is upon administration of anesthesia for surgery that he

became unconscious. Regarding the location of a wine shop, it

has been deposed that the same is located in a crowded area

and has a regular stream of visitors in and around the area.

23.2 With respect to A-2, it has been deposed that whether or not

he was an owner of the wine shop is unclear, but he certainly

was a visitor.

23.3 However, he contradicts his earlier version that upon reaching

the hospital, he was not in a position to speak and had not

informed the doctor of the incident, and instead, it was the

people who accompanied him who briefed the doctor.

24. Sakthivel, S/o Kathan (PW-2) stated that A-1 stabbed him in the

stomach twice, which was at the instigation of A-2. According to

this witness, A-1, A-2, and D-2, along with other persons, worked in

the wine shop. His statement was recorded in the evening after the

incident. He states that the showcase upon his reaching the wine

shop was intact. Further, D-1 was under the influence of alcohol

when PW-2 saw him, but, significantly, D-1 had not stabbed A-1,

and as such, no blood was seen on the hands of A-1.

25. Senthilkumar (PW-3) states that he was interrogated the morning after

the incident at 7.30 a.m. His deposition reveals him not to know as

to whether D-1 (Dharmalingam) was in a state of intoxication before

going to the wine shop. Nor has he seen the showcase of the shop

in a broken condition.

26. The learned Trial Court found sufficient evidence to convict both A-1

and A-2 based on these three testimonies.

27. K. Raajasekar (PW-22) (the Investigating Officer) at the relevant

time Inspector of Police, Kulithalai, took charge of the investigation 

760 [2024] 3 S.C.R.

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of the incident on 4th March 2002. In his examination-in-chief, he

has described how the investigation proceeded. It was deposed

that on 5th March 2002 at about 12 noon, he arrested A-2 from

the Pettavaithalai bus stand. He also deposed, having visited the

scene of the crime twice and interrogated several witnesses. On

9th April 2002, he examined the witnesses (medical evidence) who

had allegedly furnished wound certificates for A-1 and A-2. Further

witnesses were examined on 10th July 2002, and a chargesheet was

filed on 15th July 2002.

28. It is undisputed that PWs 1 and 2 are injured witnesses. It is a

well-established principle of law, not requiring any underscoring or

reiteration, that the evidence of an injured witness is considered to

be on a higher pedestal than that of a witness simpliciter.

29. The learned Trial Court observed that for the reasons, (a) that the

witnesses had nothing to gain from deposing against the accused

persons; (b) there is no suggestion that any rival business interest

was to be benefitted by Sarvana Wines being embroiled in the

controversy; (c) A-2 was in fact a “good Samaritan” ; (d) that the

witnesses were deposing the accused persons at the behest of the

police being an unsubstantiated claim; and (e) that the witnesses

cannot be said to be “interested”. The concept of interested witness,

as referred to hereinabove, shows that for a person to be such, he

ought to have an interest in seeing the accused persons punished.

30. There is a direct statement by PW-1 that D-1 was his relative, i.e.,

son of his paternal uncle. D-2 was a relative of the owner of the

wine shop, who, according to him, was A-1, but in another instance,

he states that A-1 was only a worker. In respect of A-2, the only

statement is that it was upon his instigation that A-1 stabbed them.

31. It is hard to conceive how the Trial Court concluded that despite being

the first cousin of D-1 and himself a person injured in the incident,

PW-1 was not an interested witness. Further, we find a categorical

statement that, “the wine shop is in the main road’ and “the wine

shop would be crowded always”. In such a situation, the joining of

independent witnesses ought not to have been a difficult task but,

yet, it remained unachieved.

32. Further, we note that he admits variation in his statement (Exh.P-1)

in different ink and hand. He further states that there wasn’t much 

[2024] 3 S.C.R. 761

Periyasamy v. The State Represented by the Inspector of Police

light at the spot of the incident, but then denies it to be “too dark”

when the occurrence has happened.

33. This Court has to strike a balance between the testimony of the injured

witness and that of an interested witness. It is also not a case that

PW-1 was a natural witness, as he stated that he had not been to

the wine shop and was only near the STD booth where the ensuing

quarrel was separated. In striking the above-stated balance, other

factors must also be considered, which will be discussed subsequently.

34. PW-2 was a neighbour of D-1. Upon being informed of the quarrel

between A-1 and D-1, he and PW-1 allegedly went there and

separated the parties. He claims to be an eyewitness to the incident.

After having undergone surgery, he regained consciousness the next

day at 6.30 a.m.

35. It was that evening when the police recorded his statement. At the

time of recording these statements in Court, i.e., 14th November

2005, a separate case preferred by the accused persons was under

trial and PW-2 was made an accused thereunder. Now, having been

made an accused in a case, as also having been injured with two

stabs in the stomach and additionally being the neighbour of D-1, it is

difficult to reconcile that PW-2 would be a witness of unquestionable

integrity upon whose statement convictions can be based. Once

again, we find that in regard to A2 the only thing stated is that upon

the instigation of A-2, A-1 stabbed them. There is no other statement

as to what may have been said by A-2 to enrage him enough that

even after the quarrelling parties were separated and they had

dispersed in their respective directions, A-1 went ahead angrily and

repeatedly stabbed them.

36. He has also deposed that there were about 50 persons at the scene

of the crime, then, how has the non-examination of independent

witness been countenanced by the prosecution and “approved” by the

Courts below, is something that escapes us, or rather confounds us.

37. Another essential aspect to be examined is that the statement of

PW-1 was recorded at 4.30 a.m. on 4th March 2002 wherein as

summarised above, he has clearly mentioned the role of PW-2,

however, the latter’s examination by the police was only at 5.00 p.m.,

that too when per his own statement he had regained consciousness

from his surgery at 6.30 a.m. itself. This gap is entirely unexplained

and wholly overlooked by the Courts below. 

762 [2024] 3 S.C.R.

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38. Coming to the version of PW-2 again, we notice him to be extremely

evasive on the issue as to whether the police had visited the spot

in the night intervening 3/4th March 2002 or not. He denies being

interrogated by the police before 4th March 2002 till about 5.00 p.m.

He admits having visited a private hospital and, yet, as discussed

earlier, failed to report the matter to the police, more so the cause of

injuries sustained by him or for that matter others present on the spot.

39. The evidence of PW-3, upon which the counsel has laid considerable

emphasis for the respondent, appears to us to be fraught with

contradictions. In his examination-in-chief, it is recorded that D-1

had asked A-2 and A-1 for a bottle of liquor on credit, which the

latter two refused and scolded him, upon which he pushed down

the showcase, leading A-1 to grab a beer bottle and break it on the

head of D-1. When he was cross-examined he deposed as follows:

“The police recorded what all I have stated and obtained

my signature. It is not correct to state that Dharmalingam

asked 1st Accused in the wine shop to provide bottle on

credit; that as he has refused, Dharmalingam picked up

the quarrel, pushed the show case and broken into pieces;

that Thangavel appeared there to question it; that we and

Dharmalingam stabbed his relatives and Thangavel;….”

40. As is apparent, he states, for one, that D-1 had indeed broken the

showcase but subsequently states that to depose the same would

be incorrect. Furthermore, we find his actions not to be akin to that

of a prudent man. When A-1 had allegedly broken a bottle on the

head of D-1, PW-3 took the injured D-1 not to the hospital but to an

STD booth located nearby, where a quarrel ensued between him

and A-1, which was eventually separated by PWs 1 and 2. Even

more so, when A-1 was allegedly stabbing PW-2, he was still at the

STD booth with D-1, yet not having gone to the hospital and also not

having made any attempt to stop such stabbing. Why a person would

“hold” a person with a grievous head injury near an STD booth and

not take him to the hospital or, additionally, not try and stop others

from being grievously injured is something that compromises, in our

mind, the credibility of the version of PW-3.

41. Apart from the three star witnesses of the prosecution, in our

considered view, failing the standard of scrutiny applied to a

criminal proceeding, a perusal of the records reveals another facet, 

[2024] 3 S.C.R. 763

Periyasamy v. The State Represented by the Inspector of Police

compromising in nature to the prosecution case. It has come forth

in the evidence of PW-1 that upon his arrival at the hospital, he

was in a conscious state, so why the recording of the statement

delayed till 4.30 a.m. is unsubstantiated. This is further so because

while PW-1 speaks of being operated upon, none of the witnesses

examined as medical witnesses corroborate such a statement. For

emphasis, we may refer to the statement of PW-17, the medical

officer in the Seahorse Hospital, at the relevant time. He stated that

upon admission, PW-1 was fully conscious. The wound certificate

was issued by Dr. Pon Shanthi, who has not been examined.

42. The delay therefore renders the circumstances questionable. Also, as

we have alluded to earlier, there is a significant gap in the examination

of PW-2 as well. For all the aforesaid reasons, it cannot be said

that the prosecution had succeeded in establishing its case against

the two accused persons beyond reasonable doubt warranting a

conviction under Section 302 IPC.

43. We further examine the role of the I.O. The investigation officer

of a case is the charioteer tasked with using the resources and

personnel at his disposal to ensure law and order as also that a

person who has committed a crime is brought to the book. In other

words, the role of an investigating officer is that of the backbone of

the entire criminal proceeding in respect of the particular offence(s)

he is charged with investigating. A perusal of his testimony reveals

certain problematic statements. Nowhere has it come on record

as to how the investigation reached the bus stand from where A-2

was arrested – who informed the authorities about A-2’s movement

by bus? Further, he has deposed that he made two visits to the

scene of the crime and that he also examined several witnesses.

Then how is there a striking lack of independent witnesses to lend

credence to the prosecution’s version of events? He does not know

where D-1 had expired. How? He also did not conduct any scientific

investigation at the spot of crime. Such an investigation carried out

most casually and callously is sought to be made the basis by the

police in seeking the conviction of the accused.

44. Another direct contradiction concerns his examination of the doctors

who allegedly gave wound certificates for PWs 1 and 2. In the

testimony of PW-17, it is clear that he was not the one who gave the

wound certificate as he was only on duty from 9 a.m. to 9 p.m., and 

764 [2024] 3 S.C.R.

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PW-1 was brought to the hospital at 10 p.m. The wound certificate

was issued by Dr. Pon Shanthi, who had not been examined in the

instant proceedings.

45. For the charges under Section 307 IPC, the learned Trial Court also

considered the evidence of PWs 1, 2, and 3. We have considered

the evidence of these three witnesses in detail and are of the opinion

that for the reasons afore-stated, the said witnesses cannot be relied

upon.

46. In addition to the person who led the investigation, we must consider

the testimonies of the people who aided in it.

46.1. PW-20 was the Sub-Inspector, Kulithalai Police Station,

at the relevant time. His testimony appears to be evasive

and full of improvements, needing to explain the material

interpolations on the medical record. He admits not having

recorded any information received from the Seahorse Hospital

on the night of 3rd of March, 2022 at 11.00 hours. He admits

not to have added a version in the sentence - Exhs. P-1 and

P-24, which, as we notice, record the name of the assailant.

He admits the jurisdictional police station to carry out the

investigation, was not his (Tirupathur Town Police Station)

but only Kulithalai. He admits that neither he nor any one of

the police officers from any of the police stations visited the

spot till the morning after the date of the incident, despite the

travel distance being less than half an hour. No explanation

is forthcoming as to why one of the most essential aspects of

the criminal investigation was ignored or delayed. We notice

the witness to have admitted having informed the details of

the incident both to the Deputy Superintendent of Police and

K. Rajasekar (PW-22). Was it that the initial investigation was

being managed so as to shield the real assailants, which

could have been the complainant party themselves? Or was it

that the police were trying to frame the accused? Particularly

when, as the record reveals, as is so admitted by PW-22 of

A-2 being a practicing advocate who has been, (i) pursuing

the matters against the officials of the police station; (ii) has

been lodging complaints against the police officials for inaction;

and (iii) had nothing to do with the ownership, management

or control of the wine shop. 

[2024] 3 S.C.R. 765

Periyasamy v. The State Represented by the Inspector of Police

46.2.There is yet another disturbing feature emanating from his

statement. Why is it that the police used a private vehicle for

carrying out the investigation, as was admitted by this witness

in any case, whose owner and driver in any event not examined

during trial or investigation? The prosecution doesn’t contend

that at the relevant time, no government vehicle was available

at the police station or that the said private vehicle was hired by

them. It is also significant that PW-21 admits that PW-1 had not

named A-2 in his statement, and, PW-22 when speaking about

A-2, only states, “On 5.3.2002 at 12.00 noon, I arrested the

accused Manoharan at Pettavaithalai Bus Stand after enquired

sent him to the Court Custody on the same day.”

46.3.In respect of PW-21, we find him to have not denied but feigned

ignorance of the fact that Sundaravadivel had held Paramasivam

S/o Kaalimoopan against whom a false case stood fastened by

Inspector Sundaravadivel, under the Tamil Nadu Prevention of

Dangerous Activities of Bootleggers, Drug Offenders, Goondas,

Immoral Traffic Offenders, Forest Offenders, Sand Offenders,

Slum-Grabbers and Video Pirates Act, 198219 . He only states

that “being an Advocate the 2nd accused came to the area police

stations.” This in no way discloses what led either PW-22 or him

to suspect and thence, act on the complicity of A-2 in the crime.

47. Various lapses such as these cumulatively affect the overall sanctity

of the prosecution case, making it fall short of the threshold of

beyond reasonable doubt. It is in such circumstances, on analysis

of the record, that we are unable to sustain the conviction handed

down by the Courts below to A-1 and A-2. The injured witnesses and

the Investigation Officer in their testimony together are not inspiring

confidence, and in our own estimation the prosecution case stands

shaken beyond a point to which no conviction resting thereupon can

be said to be just in the eyes of law.

48. We sustain the challenge on the grounds, among others that,

(a) examined private persons were interested witnesses, with

inconsistencies amongst them; (b) no independent witnesses were

examined; (c) there was a delay in filing the FIR; (d) there were

interpolations on record; (e) there were numerous lapses in the

19 Hereinafter referred to as ‘Goondas Act’

766 [2024] 3 S.C.R.

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investigation; and (f) the medical and scientific evidence on record

does not support the prosecution’s version of events.

49. During the course of submissions on behalf of A-1, the learned

senior counsel appearing on his behalf had urged the right of private

defence as a secondary submission, in the event of the arguments

in favour of complete acquittal on finding favour with the court. Given

that, upon consideration and analysis of the submissions made and

the material on record, we have found that the convictions cannot

stand in the eyes of law, we need not delineate on that submission.

50. In that view of the matter, the appeals are allowed and the convictions

subject matter thereof, are accordingly set aside. Both appellants are

directed to be released forthwith, if not required in any other case.

Pending application(s), if any, shall stand disposed of.

Headnotes prepared by: Result of the case:

Gaurav Upadhyay, Hony. Associate Editor Appeals allowed.

(Verified by: Kanu Agrawal, Adv.)