Kerala HC rejects NIA's plea challenging bail granted to 14 accused in gold smuggling case

In a key development, the Kerala High Court rejected the NIA's plea challenging the order granting bail to 14 persons accused in the gold smuggling scam. As per the FIR filed on July 10, 2020, the accused have been charged under Sections 16, 17 and 18 of the Unlawful Activities (Prevention) Act. A division bench of the HC comprising Justices A Hariprasad and MR Anitha on Thursday ruled that gold smuggling with a mere illegal profit motive does not fall within the definition of a terrorist act in the UAPA.

Endorsing the trial court's view, the court highlighted that materials prima facie did not indicate that the persons released on bail had acted with an intention to damage the economic security of India. Taking cognizance of the fact that the bail order has imposed necessary conditions, the HC stressed that it found no reason to think that the accused will abscond or interfere with the investigation. At the same time, the bench clarified that the NIA can apply for the cancellation of the bail if it unearths material to show the complicity of the accused in a terrorist act. 

In paragraph 33 of the verdict, the bench noted, "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. In our view, 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 way of production or smuggling or circulation of high quality counterfeit Indian paper currency, coin or any other material relatable to currency or coin". It added, "Arrangement of words indicating the things mentioned in the provision does not prompt us to think that gold smuggling with a mere illegal profit motive will fall within the aforementioned definition of terrorist act". 

Read: M Sivasankar Granted Bail In Dollar Smuggling Case; Walks Free After 98 Days In Custody

What is the gold smuggling scam? 

On July 5, 2020, Customs officials seized 30 kg of gold worth Rs.15 crore at the Thiruvananthapuram Airport from a diplomatic cargo addressed to a person in the UAE Consulate. Sarith PS who worked at the UAE Consulate was arrested in this regard. Reportedly, he told the Customs about the role of Swapna Suresh, an ex-Consulate employee now working as the manager of the Kerala State Information Technology Infrastructure Limited. 

Following the backlash over her appointment, she was sacked by the state government. On July 16, Vijayan announced that the suspension of his former Principal Secretary M Sivasankar pending the departmental inquiry. It was reportedly found that he had violated the All-India Services Conduct rules due to his connections with the gold smuggling accused. In January 2020, the NIA filed a chargesheet before the Special Court.

Claiming that the conspiracy started in June 2019, the agency alleged that the aforesaid persons raised funds and smuggled 167 kg of gold between November 2019 and June 2020 through the import cargo addressed to diplomats at the Consulate General of UAE in Thiruvananthapuram. Moreover, it added that the main accused had planned to smuggle more gold from countries such as Bahrain, Saudi Arabia and Malaysia. Holding them responsible for threatening the "economic security of India", the agency revealed that the probe against absconding persons and others who facilitated the crime is underway.

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