A Division Bench of the Kerala High Court has granted bail to the Accused Nos.1, 2, 3, 4, 5, 8, 10 & 11 in the NIA case relating to Gold Smuggling. The case relates to allegations that the accused smuggled gold through the diplomatic channel availing the intimate connection of some accused with the Consulate of United Arab Emirates at Thiruvananthapuram.
The primary contention of the Accused was that in an earlier round of litigation seeking bail, another Division Bench of the High Court in its Judgment reported as Muhammed Shafi P. v. NIA Kochi had held that threat to economic security, which is brought under the definition of a 'terrorist act' is only relating to counterfeiting of currency or coins, that too of a high quality, and not smuggling of gold.
It was the argument of the Accused that Section 135 of the Customs Act is sufficient to penalize the accused if the allegations against them are proved.
Senior Advocates S.Sreekumar, Dr. S. Gopakumaran Nair, and C.C.Thomas and Advocates Sooraj T.Elenjickal, Nireesh Mathew and others appeared for the Accused.
ASG Senior Advocate S.V.Raju argued for the NIA, opposing the bail applications, that threats against economic stability would definitely be a terrorist act coming under Section 15 of the UAPA. He argued that the decision of the Division Bench in the matter of Muhammed Shafi P. has been appealed against and that since the appeal was pending before the Supreme Court, the proper course of action for the High Court would be to stay the hearing until the Supreme Court disposes of the appeal.
The Division Bench of Justice K. Vinod Chandran and Justice C. Jayachandran refused to reconsider the decision in the matter of Muhammed Shafi P. and instead agreed with the decision.
The Bench held that, "True; acts of destabilization of the economy, as distinguished from a physically violent subversive act could also be deemed to be a subversive act against the nation. If the intention was to widen the definition of terrorism, to bring in acts, destabilizing the economy; surely the Parliament had the power. But, the Parliament by inserting economic security in Sec. 15(1) and simultaneous insertion of sub-clause (iiia) of clause (a) by the very same amending act, restricted the definition of a terrorist activity, in so far as destabilizing the economy, to counterfeiting of high quality currency or coins".
The Bench also rejected the argument that the words 'any other material' in Section 15 of UAPA will include smuggled gold.
The Court observed that the legislature had the power to bring in any act threatening the 'economic security' as a terrorist act, since it subverts the security and very stability of the country. But the insertions by amendments, made in Act of 2013, confined it to counterfeiting of high quality currency.
The Bench relied upon Home Ministry's stand before the Parliamentary Standing Committee as an aid to interpret Section 15 in favor of the Accused.
The Bench held that, "In fact in our humble view even smuggling of gold and other precious metals which aims at destabilizing the economy would be covered under threats to economic security, as generally understood. But this element was not contemplated by the Parliament as is evident from the debates on the bill, which the members of the Treasury Bench supported on the specific ground of state/sovereign sponsored counterfeiting from across the borders."
The Court also noted that going by the explanation to Section 15, even a petty counterfeiting carried on by a small operator was not intended to be covered under the UAPA and that it only covers counterfeiting of currency comprising of the key security features as specified in the Third schedule.
The Court refused to give a more expansive meaning to Section 15 to include the smuggling of gold. The Court held, "According to us, in the guise of a purposive interpretation, the intent to threaten or the likelihood of threatening economic security in Section 15(1), if given a more expansive meaning, then it would be undermining the very intention of the Parliament which is explicit in sub-clause (iiia) of clause (a)."
The Court observed that but for allegations in the charge-sheet with the words 'damage to economic security and stability of the country and terrorist activities', there was nothing more to prima facie find the accused having indulged in such activities as defined under Section15 of the UAPA. The Court held that even the witness schedule and conspectus of the intention behind proffering them as witnesses from the charge-sheet, does not reveal any terrorist act.
The Court, however, clarified that if the smuggling of gold is carried out by transnational forces to subvert the security and stability of the nation, the provisions of UAPA will be attracted.
"We also keep in mind that if there are transnational forces involved in subverting the security and stability of the nation by any act; to further which the smuggling of gold was carried out, then too the provisions of the UA(P)A are attracted, specifically S.15. S.17 also speaks of punishment for raising funds for terrorist act and S.18 provides punishment for conspiracy, attempt to commit or even advocating, abetting, advising, inciting or directly or knowingly facilitating the commission of any such act or even any act preparatory to the commission of a terrorist act."
The Court granted bail to all the appellants on a condition inter alia of executing a bond for a sum of Rs.25,00,000/- and not leaving the state of Kerala without permission from the NIA Court.