Gold Smuggling Clearly Defined in Customs Act, Case won't fall under Terrorist Act, Kerala HC Observes

The court said smuggling need not be in respect of articles on which a duty could be levied

Gold smuggling clearly covered by the provisions of the Customs Act will not fall within the definition of "terrorist act", the Kerala High Court observed, while dismissing the appeals by NIA against a Special NIA Court order, granting conditional bail to 10 accused of smuggling of the yellow metal through diplomatic channel.

"... We are unable to hold that smuggling of gold simplicitor will fall within Section 15(1)(a) (iiia) of UA(P) Act. In other words, gold smuggling clearly covered by the provisions of the Customs Act will not fall within the definition of terrorist act in Section 15 of UA(P) Act unless evidence is brought out to show that it is done with the intent to threaten or it is likely to threaten the economic security or monetary stability of India", the court said.

The court noted that what is made an offence under Section 15(1)(a)(iiia) of UA(P) Act is causing damage to the monetary stability of India by producing, smuggling or circulating high quality counterfeit Indian paper currency, coin or any other material relatable to currency or coin.

Upholding the Special NIA court order, the division bench of the High Court, comprising Justices A Hariprasad and M R Anitha, did not accept another contention by NIA that counterfeit currency notes cannot be smuggled because under the Customs Act, smuggling is an offence against levying duty.

The court said smuggling need not be in respect of articles on which a duty could be levied.

"For example, narcotic drugs or other contraband articles are smuggled at times on which no duty could be levied. In our opinion, 'smuggling' is a generic term, indicating the illegal transport of various articles. Therefore, this argument raised by NIA cannot be accepted", the court said.

Referring to the special National Investigation Agency court order, it said the materials on record prima facie did not indicate that the accused to whom bail was granted had acted with an intention to damage the economic security of India.

"The Trial court took note of the fact that most of the accused persons are businessmen having considerable assets. The materials on record revealed that the accused, who are enlarged on bail, were indulging in smuggling activity for illegal gain. Of course, they were using a diplomatic channel for committing the offence of smuggling.

"On going through the materials placed before us, we are of the view that the court below is justified in entering such a finding', the high court said in its February 18 order.

The Special NIA court on October 15 last year granted conditional bail to 10 accused in the Kerala gold smuggling case, observing that there was no prima facie material to show they had any links with terror outfits.

The NIA, probing the terror angle in the gold smuggling through diplomatic channel, initially named P S Sarith, Swapna Suresh and Sandeep Nair and Fazil Fareed as accused in the case, which relates to seizure of 30 kg of 24 carat gold worth Rs 14.82 crore at Thiruvananthapuram airport on July 5 by the Customs (Preventive) Commissionerate, Kochi.

During the course of the investigation, it arraigned at least 30 others as accused and arrested many of them. Besides NIA, the Customs and Enforcement Directorate are also probing the case of smuggling of gold through diplomatic baggage, addressed to the UAE consulate at Thiruvananthapuram since November last year.