Statements are often recorded by investigating agencies during the course of a search proceedings or summons appearance. This article analyses retractions filed against such statements in detail and identifies issues and salient things to be kept in mind.

I. Introduction

Statements of various witnesses or accused persons are recorded by various authorities under oath, which are considered as having strong evidentiary value. Of course, such statements are subject to various tests laid down in evidence law and the constitution. However, if such tests are satisfied, such statements even if they amount to an admission of guilt, would be admissible. Now, whether or not the legal tests are satisfied regarding the admissibility of such statements, and whether or not there is a mistake committed by the person while giving his statement, a remedy always is available to such person in the form of retraction of his statement. Retraction simply means the withdrawal of a statement given by a person to an authority or court. This article discusses various nuances and issues related to retractions.

At the outset, let us consider the burden of proof. Though any statement or admission, even if given on oath, is not the final or conclusive proof of the facts admitted and may be explained or shown to be wrong through a retraction, submitting a retraction indubitably raises an estoppel and shifts the burden of proof on the person making it. Thus, unless shown or explained to be wrong, an admission is an efficacious proof of the facts admitted [Avadh Kishore Das v. Ram Gopal AIR 1979 SC 861]. This sets the foremost condition - that a retraction should be based on supporting corroborative evidence. Bald retractions, submitting a mere bare denial without supporting evidence, would almost always be ignored. For instance, mere filing of a letter retracting the statement is not a rebuttal of the presumption that what is admitted is true [Param Anand Builders (P.) Ltd. v. ITO [1996] 59 ITD 29 (ITAT- Mum)].

Admission made in a statement is the best evidence on a point in issue and, though not conclusive, it is decisive of the matter unless successfully withdrawn or proved erroneous. Any retraction of a clear admission made has to be on the ground of it being either erroneous or factually incorrect or one made under threat or coercion [CIT v. O. Abdul Razak [2013] 350 ITR 71 (Ker)]. A statement given on oath may be retracted, but it is specific to the facts and circumstances of each case. When a person intends to retract his or her statement, the same should be done without undue delay and by giving cogent reasons for doing so, along with other evidence to corroborate the reasons given for retraction - raising the second most important condition - that a retraction should be made at the earliest opportunity.

Let us now identify and analyze some critical issues that arise regularly in retractions of statements.

II. Salient issues that arise in retractions

(a) Mistaken understanding of facts: If the person making a statement contends that he had proceeded on a mistaken understanding or on misconception of facts or on untrue facts, such statement cannot be relied upon without first considering the aforesaid contention [Satinder Kumar (HUF) v. CIT [1977] 106 ITR 64 (HP)]. For instance, if the person is shown a piece of paper on which a name is written followed by some other text or contents, and he wrongly presumes that such name is that of a person known to him and explains the text or contents following that understanding, he may later retract such statement if he subsequently discovers that the name mentioned on such paper referred to someone else - this being a mistaken understanding of facts by the person.

(b) Absence of complete documents and information: The person may also not have the availability of relevant details, documents and books of account at the time of giving such statements in the absence of which a complete and accurate explanation relating to the query raised cannot be correctly furnished. The person making such statement is, therefore, entitled to modify/clarify the statement after verifying the necessary details from the relevant records at later point of time [Surinder Pal Verma v. Asstt. CIT [2004] 89 ITD 129 (Chd.) (TM)].

(c) Confusion vs duress: It is also important to note that courts have recognized that confusion regarding certain facts or queries can arise lead to incorrect answers or statement being given by a person. Thus, whatever is deposed during a search or summons proceeding, could be said to be without proper application of mind and hence worthy of retraction. This is different from duress or coercion (dealt with subsequently). In DCIT v Pramukh Builders [2008] 112 ITD 179 (Ahmedabad)(TM), it was held that 'duress has to be distinguished from confusion. Duress is a constraint, illegally exercised to force a person to perform some act. This, as mentioned earlier, might be absent. But confusion means something thrown into disorder wherein a person might be perplexed or embarrassed or thrown into turmoil'. In case this was the prevailing reason which led to a wrong statement being given, the retraction should clearly point out the confusion leading to the incorrect statement.

(d) Force, coercion and intimidation: Confessional statements made during searches or raids are often vulnerable on the ground that the person giving such statements are under force, coercion, or threat, or because of the very protracted nature of such proceedings, are under mental duress. The use of force, coercion, or intimidation during the recording of statements is entirely illegal. The very pretext of granting in law an evidentiary value to such statements is that these statements are recorded by a senior official before whom the person deposing could be free from the influence of such negative methods and could state the truth.

(e) Evidence law: The Indian Evidence Act, 1872 lays down in Section 24 that a confession made by a person is irrelevant if it is made under any inducement, threat or promise. The Hon'ble Supreme Court, in Asst. Collector v Duncan Agro Industries (2000) 7 SCC 53 held, relying on several earlier decisions, that considering Article 20(3), any statements recorded under Section 108 of the Customs Act, 1962 shall have to pass the tests contained in Section 24 of the Indian Evidence Act, 1872. The retraction should clearly, thus, mention the use of any force, coercion, intimidation, inducement, threat or promise, through which the statement was extracted from the person.

(f) Right against self-incrimination: The right against self-incrimination contained in Article 20 of the Constitution also provides that such statement cannot lead to a person incriminating himself or herself. It is important to note, especially in the context of economic and tax laws, that statements recorded during a summons appearance, or a search proceeding are relevant only for the purpose of levy of duty or tax (which are civil proceedings by nature), and not for the purpose of affixing criminal liability. In Veera Ibrahim v State of Maharashtra (1976) 2 SCC 302, the Hon'ble Supreme Court held that in case of a statement recorded of a person under the Customs Act, 1962, right against self-incrimination is not available because such person is not an accused yet. Thus, the Court reasoned that statements under Section 108 will be admissible since the intent behind recording of such statements was only levy and recovery of customs duty. However, the moment a prosecution complaint is filed, the nature of allegations shifts from a civil duty liability to a criminal liability and hence the admissibility of such statements will have to be considered keeping in mind Article 20(3) in mind. It is to be kept in mind that the retraction should clearly state this aspect i.e., that even if the retraction is not accepted, the statement should not be used for affixing any criminal liability on the person considering his right against self-incrimination.

(g) Complaint with higher authorities or police: It is important in cases involving force, coercion or intimidation that complaint be filed with the higher authorities or the police. This would assist in preventing the retraction from being rejected on the ground of merely being an afterthought. Affidavits of the pancha witnesses (as named in the Panchanama) should also be filed pointing out any untoward incidents that took place during the proceedings, to support the allegations in the retraction.

(h) Statements recorded at odd hours: Statements recorded at odd hours or during a search proceeding that has continued for a long time (say, few days) are vulnerable with regard to their admissibility, on the ground of duress and stresses mental state of the person. It may also be construed as exercising undue influence and coercion on the person. The Hon'ble Patna High Court, in CCIT v State of Bihar [2012] 205 Taxman 232 (Patna), held that continuance of search for long hours is not prohibited by any rule but the basic human rights and dignity of the individual are also required to be protected.

III. Mode and manner of making a retraction

i. Affidavit - A retraction should be made on an affidavit along with supporting evidence, if any. An affidavit is a statement made on oath, wherein a person solemnly affirms the truth of what he is stating. Affidavits are created through a statutory process, and it is undeniable that an affidavit would only in rarity be created under coercion or duress and involuntarily. An affidavit, being also recorded under a solemn affirmation, is also an apt answer to a statement recorded on oath and carry an equal (or, persuasively even more) evidentiary value. It is to be kept in mind that wrong or false statements made on affidavit may attract criminal liability, and the courts also keep in mind this penal aspect while admitting the truth stated on the affidavit.

ii. Affidavit of witnesses - Additional affidavit of the witnesses present during recording of the statement may also be filed. The statement of the witnesses present holds good value and may aid in getting relief.

iii. Elaborate - It must clearly lay down the facts of the case and detail the evidence showing inter alia use of force, coercion, intimidation or any mistake of fact/law, whatever may be the case. If there has been a use of force, coercion, or intimidation while recording the statement that is being retracted, the same should ideally be supported by a complaint to the appropriate authorities.

iv. Highlight the errors and inaccuracies, and reason for the same - In case of a mistake of fact or law, it must clearly lay down as to what statement was recorded, what mistake took place in making such a statement, the reason for the same and the actual correct position. Evidence in support of the correct facts must also be attached. The reasons as applicable as to why the errors and inaccuracies arose should also be clearly explained.

v. Earlier the better - Any retraction should be done at the earliest without any delay. A retraction made immediately may strengthen the case whereas a belated retraction will in most cases will have no value and would be seen as an afterthought.

Retraction should be made at the earliest possible opportunity, by leading reliable evidence and proving thereby the erroneous or incorrect nature of the facts admitted or confessed, and also where the evidence available on record is inconsistent with the confessional statement [Asstt. CIT v. Rameshchandra R. Patel [2004] 89 ITD 203 (Ahd.) (TM)]. On the contrary, retraction after a sufficient long gap or point of time, loses its significance and is generally considered to be an afterthought [Thiru S. Shyam Kumar v. ACIT [2018] 99 39 (Madras)].

It is noteworthy here that sometimes a statement recorded may contain a different wording than what was stated by the person. This typically happens when the statement is being typed by the officials themselves and the person is merely made to sign on the same. The retraction should, in such cases, be done as soon as this fact comes to light and the retraction should state clearly that the reason for the delay in retraction was that the person was unaware of the error and the retraction is now being made as soon as the error came to his knowledge.

vi. Forum for making the retraction - A doubt commonly arises as to which should be the appropriate forum for making the retraction - should it be the authority investigating the relevant case, or should it be a court of law. The retraction should be made before the authority who recorded the original statement in the first place. We are concerned with a statement which can be admitted into evidence and hence prejudice the case against the person. Hence, the authority would be empowered to accept evidence (i.e., the retraction affidavit) on record. Further, any court may not have been seized of the case yet, making it lack jurisdiction in the case's regard. Thus, the retraction should always be made before the authority and should thus be made a part of the investigation record.

IV. Conclusion

Retraction of a statement is a serious procedure in law. If done properly, it results in nullifying the original statement and all consequences that would have arisen from such statement. As stated earlier, a retraction should not be a mere bald denial and should be based on corroborative evidence and submissions clearly pointing out (i) the errors and inaccuracies in the original statement, (ii) the reasons that led to such errors, and (iii) the correct answers or facts relating to the queries raised in the original statement, along with evidence. If the above is satisfied, the retraction would be proper, admissible, trustworthy, and acceptable regarding the facts in question. Overall, the retraction should instill confidence in the authorities and courts seized of the matter.

Originally published on Sep 30, 2022

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.