The Indian evidence Act, 1972 is the principal statute governing the rules of evidence in judicial proceedings. The traditional rules of jurisprudence follow the commands of the evidence act and hence the law of evidence becomes an important part of any justice delivery system.
With respect to the traditional Criminal law, the Code of Criminal Procedure 1973 and the Indian Evidence Act ,1972 lay out the guidelines for the manner and recording of evidence. But since the transition of the criminal Jurisprudence and its paradigm shift into more specialized offences like money laundering, narcotic, foreign exchange violations, customs, etc, the legislature has departed from the well settled rules of recording statements of the witnesses and accused during the investigation and the nature of its admissibility.
The present article is focused on analysing the validity of the statements recorded during investigation into the specialized crimes with prime focus on the Prevention of Money Laundering Act, 2002 and its comparison with similar provisions contained in the contemporary statutes.
RECORDING OF STATEMENTS- THE TRADITIONAL CRIMINAL LAW JURISPUDENCE
Under the general criminal statutes, the law prohibits for treating any statement made before the investigating officer as admissible. Section 24-26 of the Indian evidence act makes it clear unambiguously. Further, section 161 and 162 CrPC supplement the provisions of the evidence act by holding that, any statement made to a police officer shall not be treated as admissible and can only be used for the purposes for investigation.
The general criminal law permits the admission of statements for the purpose of evidence only when the same have been tested in the court of law by way of examination in chief and cross examination. Section 33 of the Indian Evidence act is very clear about it. It stipulates that no statement made to the officer will be deemed to be admitted unless they have been tested through cross-examination(refer to Ripen Kumar V. Director of Customs 2001 CrLj 1288 2000 tor of Customs) . There are a very few instances where the courts have gone on to hold the confessions made before the police officers admissible, however those are a very few isolated instances and that too in cases where the confessions are of a sterling quality. Moreover such exercise of power by the courts is only an exception and not a rule.
Let us discuss the above said proposition with a help of a basic example:
"Mrs. 'E', is a Contractor. She issues an advertisement with respect to an upcoming housing project. The housing projects requires the potential investors, to pay a amount, for booking a house in the project, and thereafter payments to be made by the investors in piecemeal manner, till the houses are fully constructed. Many investors, invest the money. However after a couple of months, it is learnt by the investors that Mrs 'E' has not even initiated the project. On further enquiry, it appears that Mrs 'E' was not authorized to undertake projects and that she has cheated a large number of investors. Thus the investors get the FIR registered against Mrs 'E'.
Now, after the registration of the FIR, the criminal law will be set into motion. The Investigating officer will begin to examine witness and accused and their statements would be recorded under section 161 CrPC. Once the investigation is concluded and the trial commences then the witnesses would be called into the court for their examination in chief and cross examination and that's how their testimonies would be finally treated as evidence.
Thus, without the chief and cross examination, the statements of the witnesses recorded under section 161 CrPC would be nothing except for the purpose of contradicting or refreshing their memory during the examination in chief and cross examination in the course of trial. The law in this respect has been very clear as per the judgements of the Hon'ble Apex Court in Chaudhari Ramji bhai V. State of Gujrat 2003 Supp 5 SCR 390 and Sukhawant Singh V. State 1995 Scc, Supl 2 262
With respect to the statements/confessions of the Co-accused, it has been held by the Hon'ble Supreme court that a confession by the co-accused cannot be made a sole basis for conviction since it is a weak piece of evidence and does not necessarily gets covered under the definition of evidence under section 3 of IEA, 1872. Reference may be made to Kashmira Singh V. State of MP 1952 SCR 526
A new trend has now however immerged, whereby the courts are dispensing with the detailed examination in chief of the witnesses and instead the witness is asked to produce his on an affidavit in lieu of examination in chief to save the court's time.
Thus, in the General criminal law, confessional statements made before the investigating officer holds little value and definitely not an admissible or a reliable piece of evidence.
INVESTIGATION UNDER PREVENTION OF MONEY LAUNDERING ACT, 2002
The task of administering PMLA is entrusted over to a specialised agency called as the Enforcement Directorate (ED). ED has got wide powers to carry out investigation into the offence of money laundering.
The Power to investigate includes the power to record statements under section 50 PMLA. Section 50 of the PMLA authorizes the investigating officer to call for information from the accused and the witnesses, and obliges the persons called for, to give true and correct information.
The most draconian part of section 50 statement is that, it makes it mandatory for the investigating officer to record statements on oath. This implies that, if the person gives a false statement under section 50 he would be liable under section 197 and 228 of the Indian Penal code and if he improves his testimony in the course of trial then he would be liable for perjury.
Even the Hon'ble Supreme Court in the matter of Rohit Tandon V. Enforcement Directorate, 2017 observed that the statements recorded under section 50 PMLA are admissible as evidence.
Now the important issue which invites our attention is the strength of the evidence recorded under section 50 PMLA.
Money laundering is not an ordinary crime and hence the investigating agency has been clothed with extraordinary powers which includes power to record extra-judicial confessions. Money laundering investigations are highly complex in nature, whereby the ED has been tasked to tap the nexus of the illegitimate money and prevent it from merging with the economy.
Acknowledging the gravity of the offence of the money laundering, the Apex Court in YS Jagan Mohan Reddy' case, opined that the economic offences have deep rooted conspiracies, involves huge loss of public funds and need to be dealt with seriously.
However, Article 20(3) of the Indian Constitution being a fundamental right protects every person from self-incrimination. Thus, even if the money laundering is to be considered as grave offence as per the scheme of the act and the judgement of the Hon'ble Supreme Court, it wouldn't warrant convicting someone solely on the basis of confessional statements made to a police officer.
As discussed earlier in Ripen Kumar (Supra), the Hon'ble Supreme Court has held that evidence in totality would mean and include statements recorded in examination in chief and cross examination and thus merely because the statute allows the extra judicial confessions to be considered as evidences doesn't imply that the rules of natural justice and the fundamental rights should be forgotten.
COMMON QUESTIONS OF LAW WHICH ARISE UNDER PMLA AND OTHER STATUTES HAVING PARI-MATERIA PROVISONS
Any discussion with respect to the admissibility of confessional statements involves the following questions:
- Whether the investigating officers under the PMLA and other similarly placed statutes are deemed police officers for the purposes of section 25 and 26 of the Indian Evidence Act ,1872?
- Whether there is a protection from testimonial compulsion under the special statutes?
- Whether the investigation in the special statutes of quasi-judicial nature?
THE PREVENTION OF MONEY LAUNDERING ACT
Section 50 of PMLA talks about the power of authorities regarding summoning of persons and documents and their power to take evidence.
The aforesaid section vests great powers with the investigating officer to summon any person and get his confession recorded. The person who has been served with section 50 summons is bound to adhere to them otherwise it would amount to disobeying the command of public servant. Further, the nature of proceedings under section 50 is judicial since the evidence is taken on oath.
Section 50 of PMLA is somewhat a concoction of some similar provisions of CrPC. The only difference being that section 50 is a modified version of section 91 and 161 of CrPC. Sub sections (1) and (2) are respectively similar to section 91 and 160 of CrPC. Just like section 91 talks about calling for information and documents, sub section (1) of section 50 also talks about the same. The major differences between the corresponding provisions in CrPC with PMLA is, that PMLA uses the word 'evidence' and considers the proceedings before the investigating officer as judicial proceedings.
With Respect to the grant of protection from testimonial compulsion under PMLA, there is no clear precedent and refuge is to be taken into the provisions of the constitution. Further in Dalmia Cements Ltd V. Enforcement Directorate, 2016 it has been held that the persons appearing in response to the summons issued under section 50 PMLA are not to be treated as accused because there is no provision of registration of FIR under PMLA and the officers under the PMLA are not police officers. Hence the persons summoned under section 50 PMLA do not fall in the teeth of Article 20(3) of the Indian Constitution.
THE NARCOTIC DRUGS AND PSYCOTROPIC SUBSTANCES ACT, 1985
The NDPS act is another piece of special legislation crafted to deal with the organized crime of drug abuse and distribution.
Even the NDPS has similar provision like section 50 PMLA where the authorized officers are empowered to call for information and summon persons to give evidence.
The controversy of admissibility of confessional statements is quite an old one. Starting from the case of Kanhaiyalal V. Union Of India (2013) 16 SCC 31, where the Hon'ble Apex court held that the officers under the NDPS Act are not the Police officers and hence the protection of section 24-26 of the IEA would not apply to the proceedings under NDPS Act.
The court again in , Mohammad Fasrin V. State (2019) 8 SCC 811, held that although the statements recorded under section 67 NDPS Act however while recording those statements the accused must have given the statement on its own volition and after understanding its consequences.
The controversy with respect to the question that whether the officers under NDPS act are police officers or not has now been settled in Tofan Singh V. State Tamil Nadu, (2021) 4 SCC 1, whereby the Hon'ble Supreme court has now held that officers under the NDPS act are police officers and the confessions recorded or made before them are inadmissible as evidence.
FOREIGN EXCHANGE REGULATION ACT, 1973
FERA was the erstwhile legislation existing before the Foreign Exchange Management Act ,1999 (FEMA) when India was a not a free economy but a regulated one. Under section 40 of FERA, the investigating officer was invested with similar powers as are given under PMLA and NDPS ACT.
The Hon'ble Supreme Court, A. Tajudeen V. UOI (2014) 4 SCC, observed that, the confessional statements recorded by the IO under FERA will not be sufficient to prove an offence or establish someone's guilt. The Prosecuting agency would have to bring some independent cogent evidence to corroborate the confessional statement in order to establish the offence.
CUSTOMS ACT, 1962
The Customs act, 1962 is another example of a special legislation where pari-materia provisions can be found with respect to the recording of evidence by the investigating officer.
Section 108 of the Customs act contains the provision where the Investigating officer can summon the persons to give statements on oath and produce evidences and documents.
In one of the early cases tilted as State of Punjab V. Barkat Ram, 1962 AIR 276, the question came up before the Supreme Court that whether an officer under the customs act is a police officer under section 25 of the IEA?. The Court answered the reference in affirmative and held that, though technically, the officers under the customs act are not the police officers , however the nature of the functions discharged by them is akin to a police officer. Thus, if the statements made before them are to be treated as gospel's truth then it would be in gross violation of the fundamental rights and thus, the confessional statements made before the customs officers would be admissible in evidence as it is unless corroborated by some independent evidence.
Upon analysing the position of law with respect to the confessional statements made before the investigating officers under various similarly placed statutes, it can be said that the courts have consistently held that, although such statements have to be treated as evidence since the legislature declares it to be so, however such an evidence is a very weak piece of evidence and cannot be made a sole basis of conviction without any independent corroboration.
The Hon'ble Supreme court has recognized the right of fair investigation as part of Article 21 in DK Basu V. State of West Bengal, Husainanara Khatoon V. State of Bihar Arnesh Kumar V. State of Bihar etc . More particularly in Nandany Satpathy V. PL Dani, AIR 1977, SC 1025, the Apex Court observed that article 20(3) prohibits any interference with the accused's right of having a fair trial and investigation into an offence. Article 20(3) protects the accused from succumbing to the coerced confessions and executive arbitrariness.
To sum up, the law of confessional statements under PMLA is not very lucid. However, taking guidance from the settled principles of criminal jurisprudence, it can be safely concluded that if the confessional statements made before the investigating officer are taken at face value, then it can have disastrous effect on the administration criminal justice.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.