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2013 SCJ 292 Record No !0"# THE SUPREME COURT O$ MAURITIUS I% &'e ()&&er o*+ Too,-. Bee/)d'0r A11e,,)%& v 1 I%de1e%de%& Co((2--2o% A3)2%-& Corr01&2o% 2 T'e S&)&e Re-1o%de%&JUDGMENT

On 8 March 2010, an information containing four counts charging the appellant with the offence of having made a payment in cash in excess of Rs 3 0,000 !etween "une 2002 and "anuary 200# and in excess of Rs sections 00,000 on 10 "anuary 200$ in contravention of

%1& and 8 of the 'inancial (ntelligence and )nti*Money +aundering )ct 2002

%,the )ct-& was preferred against the appellant.

/he information also contained a fifth count charging the appellant with the offence of having on 12 'e!ruary 2003 accepted a payment in cash in foreign currency, the e0uivalent amount of which was in excess of Rs 3 0,000.

1articulars of the payments made in cash in excess of Rs 3 0,000, su!2ect matter of counts (, ((( and (3, were cash deposits of Rs #00,000, Rs respectively. 00,000 and Rs 00,000

2 1articulars of the payment accepted in cash in foreign currency, the e0uivalent amount of which was in excess of Rs 3 0,000, su!2ect matter of count ((, was 45R 60,000, the e0uivalent of which was Rs 2,$08,820. 1articulars of the payment made in cash in excess of Rs 00,000, su!2ect matter of count 3, was Rs 820,000.

/he appellant who was assisted !y 7ounsel pleaded not guilty to the information.

/he learned Magistrate, in a 2udgment handed down on 2 8ovem!er 2010, found the appellant guilty on all five counts. /he appellant, who had a clean record, was

sentenced to pay a fine of Rs 10,000 under each count and Rs 00 costs.

/here were initially 8 grounds of appeal challenging the appellant9s conviction !oth in law and on facts as well as his sentence. (t is common ground that the only remaining live issue in this appeal is whether the cash transactions, su!2ect matter of the five counts of the information, are exempt transactions within the meaning of the )ct.

/he prosecution relied essentially on the statements %:ocs ) and )1& given !y the appellant to prove its case. /he facts of the case as can !e gathered from the appellant9s statements are rather straightforward and were hardly disputed. /he appellant, a $0 year old Mauritian, left his country of !irth in 16 6 to settle down in 4ngland. ;e too< up

employment in the 8ational ;ealth =ervice %8;=& and wor<ed as 8ursing Officer in several hospitals in 4ngland. (n 16#2, he married an (talian lady, also a 8ursing Officer in the employment of the 8;=. /hey !oth retired in 200>. On their retirement, they o!tained a lump sum in the total amount of ?@1 80,000. )part from their lump sum, they have also !een !enefitting from a monthly pension of ?@1 3, 00, which is their only source of revenue.

3 =ince 'e!ruary 166 , the appellant had !een on fre0uent visits to Mauritius and each time would !ring along cash as his poc<et money. ;e is the holder of two !an< accounts at the =tate @an< of Mauritius %=@M&A one is a 2oint account in his and his wife9s names, !earing no. 00110100182#6 %the 2oint savings account into which the five transactions were conducted& which he had opened in or a!out 2000 or 2003A the other one is a term deposit account which he opened in "anuary 200$ and in which he had credited an amount of Rs 820,000. ;e was also the holder of a third !an< account with the @arclays @an< !ut which is of no relevance to the present case.

/he appellant admitted having made cash deposits in his 2oint !an< account in the following amounts and on the following datesB* Rs #00,000 on 1> "une 2002 %count (&A %ii& Rs 00,000 on 11 "anuary 200# %count (((&A Rs 00,000 on 1$ "anuary 200# %count (3& and Rs 820,000 on 10 "anuary 200$ %count 3&.

)s regards the transaction on 10 "anuary 200$ %count 3&, the appellant explained that he changed ?@1 $, 00 at the rate of Rs ##.10 at =hi!ani 'inance and o!tained an amount of Rs >6 ,$ 0 to which he added Rs 32>,2 0, which he had in cash in his possession to ma<e up the total amount of Rs 820,000 which he then credited into his 2oint account.

/he appellant also admitted having on 12 'e!ruary 2003 accepted a payment of 4uros 60,000 in exchange of Rs 2,$08,820 which he had withdrawn from his 2oint savings account %count ((&. /hat money, he explained, he too< to =pain for the ac0uisition of an immovea!le property.

;e further explained that the purpose of having all this money in his !an< accounts was for investment purposes and also to provide for his retirement in Mauritius. ;e was unaware that according to Mauritian law his !an<ing cash transactions were !eyond the statutory limit. ;e added that all the money credited into his !an< accounts in Mauritius was

4 the e0uivalent of ?@1 representing his as well as his wife9s savings and pension which he had !rought from 4ngland on each of his visits to Mauritius and which he had converted into Mauritian currency, each time in small amounts of less than Rs 100,000 o!tained from various money changers whose names he was una!le to recollect. ;is statement also contained details of various other fixed deposit accounts with other financial institutions such as =(7OM 'inancial =ervices, Mutual )id )ssociation +td and )@7 'inance and +easing in the respective amounts of Rs 3.3m, Rs 2m and Rs 2.$m as well as his ignorance of the law of the land which prohi!ited cash transactions a!ove the statutory limit.

/he appellant reiterated under oath his version contained in his out*of*court statements. ;e added that all the money was de!ited from his !an< account in 4ngland and converted !y him into Mauritian currency from different money changers. ;e does not

possess any immovea!le properties in Mauritius save for one which is situated at /rou aux @iches and which he ac0uired in 1660. )t no time did the =@M inform him of the provisions of the )ct. )s regards his ac0uisition of an immovea!le property in =pain, this was done through an agent with the money he had o!tained in 4uros from the =@M and which he had deposited into a =panish !an< account.

Citness @hee<hoo, (nvestigator posted at the (ndependent 7ommission )gainst 7orruption, and the only witness to depose on !ehalf of the prosecution, admitted in cross* examination that there was nothing in his file to contradict the appellant9s version as regards the origin of the monies su!2ect matter of the information or anything suggestive of the fact that the money was of tainted origin.

/he learned Magistrate accepted the evidence esta!lishing the ma<ing of and accepting payment in cash of the amounts su!2ect matter of the information. ;e also

accepted the testimony of witness @hee<hoo that all the money transactions were not in

5 respect of funds whose origins were tainted and that of the appellant that the money was the fruit of his savings and that there is nothing on record to prove the contrary.

;e re2ected the su!missions of Mr "addoo, 7ounsel who appeared for the appellant, that the information was defective for not having averred an essential element of the offence, namely that the property was the proceeds of crime. ;e also re2ected the defence9s

contention that grave pre2udice has !een suffered !y the appellant on account of the delay in !ringing him to prosecution.

;e nevertheless too< into account the defence complaints of its difficulty in o!taining !an< documents from 4ngland !ut was satisfied that this difficulty had not in any way impeded the defence case and that its version was fully !efore the 7ourt and therefore the issue of delay had little !earing on the defence case.

/he learned Magistrate then concluded his findings in the following termsB* ...the prosecution has shown from the surrounding circumstances that the accused intentionally made the cash transactions in question. The fact that the accused did not know that he could not make a cash payment over a certain limit is not relevant on the issue of guilt !efore convicting the appellant.

)s already stated a!ove, 7ounsel for the appellant is now relying solely on ground 2 which challenges the findings of the learned Magistrate that merely depositing andDor withdrawing money in excess of the statutory limit amount to a commission of an offence.

(t was first su!mitted !efore us that on the undisputed facts of the present case, the appellant9s cash transactions amount to exempt transactions as defined in the (nterpretation section of the )ct.

6 4xpatiating on his su!missions, learned 7ounsel for the appellant argued that there !eing unchallenged and unre!utted evidence that %a& the appellant is an esta!lished customer of the =@M since 2002A and %!& the monies, su!2ect matter of the five cash transactions, came from the appellant9s and his wife9s savings, lump sum and pensions, the only live issue was whether these monies were commensurate with the lawful business activities of the customer. (n that respect, learned 7ounsel argued that in the a!sence of any definition of what constitutes lawful business activities of the customer, the 7ourt should not favour a restrictive approach in its interpretation and confine the meaning of those words to the exercise of commercial activities which generally connote dealings involving profit ma<ing !ut should adopt a pragmatic approach !y ascri!ing a wider meaning to include the normal things that a person would do in the course of his everyday life, such as for instance !uying an immovea!le property in =pain, investing in Mauritius, spending one9s money whilst on holiday in Mauritius etc. E which activities, so argued learned 7ounsel, would necessarily amount to lawful business activities of the customer.

+astly, 7ounsel argued that an offence under section

of the )ct will !e committed

only if the prosecution esta!lishes that the transaction falls outside the am!it of an exempt transaction which is an element of the offence which the prosecution had the !urden of proving and which it has, in the present case, failed to do. (n short, the prosecution has failed to aver and show that the five transactions were not exempt transactions.

5pon certain o!servations made !y us to learned 7ounsel, latter readily conceded that this was not a live issue !efore the trial 7ourt. ;e su!mitted that in such circumstances the appropriate course of action would !e for us to exercise our discretionary powers conferred on us !y section 6# of the :istrict and (ntermediate 7ourts %7riminal "urisdiction& )ct and remit the case either to the same Magistrate for this issue to !e fully canvassed or to a different @ench for a fresh hearing.

7 (n reply to the su!missions of 7ounsel for the appellant that the five impugned transactions are exempt transactions, Miss @issoonauthsing, 7ounsel appearing for respondent no. 1, raised two points in support of her su!missions that those transactions were not exempt transactions. /hey are as followsB* (i) in the a!sence of any legal definition of business activities, in deciding the meaning to !e ascri!ed to those words, the natural, ordinary and dictionary meaning must !e resorted to as well as the intention of the legislator in his choice of words. (n using the words business activities of the customer,

it could not have !een anything !ut the legislator9s intention of confining the nature of those !usiness activities to the customer9s commercial activities into which the latter is engaged, or, in other words, to !usiness*related activities carried out !y the customer for money ma<ing and profit ma<ing as opposed to a mere monetary transaction the nature of which is non*commercial E which is the case hereA


two essential re0uisites of the defence of exempt transaction must !e satisfied !y the appellant !efore he can !e permitted to call in aid that defence, which areB* %a& evidence that the appellant is an esta!lished customer of a !an< or financial institutionA and %!& evidence that the transactions were commensurate with his lawful business activities.

Miss @issoonauthsing further su!mitted that to esta!lish %a&, there must first !e evidence of the year in which the appellant opened his !an< account at the =@M. Chat the evidence adduced on record esta!lishes is that cash payments and withdrawals were made !etween the years 2002 to 200$. /herefore it cannot !e seriously argued that the appellant was an esta!lished customer of the !an<. =econd, there must !e evidence of the

8 application !y the !an< of the FG7 %Fnow Gour 7ustomer& formula, namely disclosure !y the appellant of the nature of his employment, his source of revenue and other personal and relevant details which would have helped in assessing whether or not the appellant fell into the category of established customer.

(f %a& is successfully esta!lished, this would largely help in determining %!&.

(n view of the meaning to !e ascri!ed to business activities and in the a!sence of evidence that the appellant satisfies conditions %a& and %!&, he cannot claim that he was an established customer of the !an< and that the five impugned su!stantial transactions were commensurate with his lawful business activities and, therefore, the transactions were not exempt transactions.

+astly, she su!mitted that it was incum!ent upon the appellant to raise the defence of exempt transaction and afford the prosecution the opportunity of re!utting same. /he onus of esta!lishing on a !alance of pro!a!ilities that the transactions were exempt transactions was on the appellant and not on the prosecution as contended !y 7ounsel for the appellant. /he appellant having failed to raise the defence of exempt transaction and made it a live issue for the determination of the trial 7ourt, he cannot now, at appellate stage, !e allowed to raise and argue an issue which has not !een mooted !efore the trial 7ourt, and further as< this 7ourt to exercise its discretionary power to remit the matter to the trial 7ourt for its consideration.

'or his part, Mr )hmine, 7ounsel appearing for respondent no. 2, agreed that the point raised !y the appellant is a novel one. ;e too has not come across any local or foreign 2udgments to assist us in our determination of the issue canvassed on appeal !efore us. ;e has, in his attempts at finding anything of relevance or interest on the point in issue, sought assistance from the de!ates of the 8ational )ssem!ly when the 'inancial

9 (ntelligence and )nti*Money +aundering @ill was passed. ;e has gracefully favoured us with copy of an extract of the ;ansard.

)ccording to Mr )hmine, two issues are called for determinationB* are the five transactions exempt transactions and whether !y the very fact that this issue was not canvassed !efore the trial 7ourt and in respect of which there is no evidence on record and no findings from the learned Magistrate, it is permissi!le for the appellant, at appellate stage, to raise those issues.

4xpatiating on the a!ove, Mr )hmine su!mitted that the mischief which the )ct was mainly aimed at suppressing is money laundering, corruption, and other financial related crimes. =ection , which is to !e found in 1art (( of the )ct and which is entitled Money Laundering ffences, was intended to deter the putting into circulation of large amounts of

cash, precisely to com!at money laundering which may pose serious threats to the economy and politics of the country and engender social pro!lems and encourage other financial related offences. 5nli<e sections 3 and > of the )ct, which re0uire proof that the property is the proceeds of crime, the commission of a section offence does not re0uire proof !y the

prosecution that the cash paid or accepted which exceeds the statutory amount is of tainted origin. )ll that the prosecution must come up to proof in esta!lishing a section offence is

to show the payment or acceptance of cash exceeding the prescri!ed amount. (t will then !e left to an accused party against whom such prima facie evidence has !een adduced to choose whether to raise the statutory defence and show to the satisfaction of the 7ourt that his cash transactions fell into one of the categories of exempt transaction as defined and enumerated in the (nterpretation section of the )ct.

1ursuing his su!missions, Mr )hmine contended that !an<s or other financial institutions have a duty and are responsi!le for reporting any suspicious financial transactions exceeding the prescri!ed limit to the 'inancial (ntelligence 5nit. (n deciding

10 whether or not such cash transactions fall into the category of exempt transaction! !an<s or other financial institutions stand guided !y the (nterpretation section of the )ct.

(t was also the contention of Mr )hmine that a section

offence is more in the nature

of a strict lia!ility offence so that once a cash payment exceeding the statutory limit is made or received, the payer or recipient would commit an offence unless the defence of exempt transaction applies. (n that respect, the conditions which must !e satisfied !y an accused party in order to avail himself of such a defence are thatB* %a& %!& he is an e-&)4,2-'ed c0-&o(er of the !an< or financial institutionA the transaction 2- *ro( ) 4)%5 )cco0%& ()2%&)2%ed 4. '2( )- c0-&o(er 62&' &')& 4)%5 or financial institutionA and %c& the impugned transaction is o* ) corre-1o%d2%3 e7&e%& or 1ro1or&2o% to his ,)6*0, 40-2%e-- )c&2v2&..

/he legal definition of ,an esta!lished customer- is not provided in the )ct. ;owever, common sense and logic dictate that the customer must have !een !an<ing at the !an< for a reasona!ly sufficient time for the !an< to satisfy the FG7 re0uirement, the standard !an<ing policy that every !an< needs to put into practice to determine whether a customer is or is not an esta!lished customer. Once condition %a& is satisfied, this will necessarily influence

condition %!& in view of some overlapping elements !etween the two conditions.

)s regards condition %c&, Mr )hmine candidly avowed his hesitation in expressing a firm opinion on the legislator9s intention in using the words commensurate with the lawful business activities. ;e was nevertheless of the view that those words should !e given their ordinary dictionary meaning having regard to the mischief the legislator had intended to suppress !y enacting the )ct. ;e contended that those words should !e literally interpreted and confined to commercial activities as it is understood in the !usiness 2argon. (n short, to commercial activities involving large cash transactions !y, for instance, hypermar<ets, petrol stations or similar !usiness concerns, where at the end of the day it would !e 0uite

11 reasona!le for the !usiness concern to !an< the proceeds of the sale of goods which may !e in cash exceeding the prescri!ed limit, and which will !e commensurate with its !usiness activities.

(n Mr )hmine9s view, as the evidence on record does not esta!lish that the appellant is an e-&)4,2-'ed c0-&o(er of the !an< and that the five transactions are o* ) corre-1o%d2%3 e7&e%& or 1ro1or&2o% to the ,)6*0, 40-2%e-- )c&2v2&. of the appellant, latter cannot avail himself of the defence of exempt transaction.

Ce have anxiously applied our mind to the su!missions of learned 7ounsel for the appellant. Ce must first remar< that the su!missions of 7ounsel, as he readily conceded !efore us, were !ased on pure logic. ;is research on the point in foreign 2urisdictions has not yielded any fruitful results so that no authorities were forthcoming which could have !een of assistance to us.

)ll the five counts of the information against the appellant were !rought under section %1& of the )ct. (t is not disputed that an exempt transaction would not !e caught !y section %1&. )s already stated a!ove, the sole live issue in this appeal is whether the cash transactions, su!2ect matter of the five counts, are exempt transactions within the meaning of the (nterpretation section %section 2& of the )ct.

(t is appropriate to set out the relevant provisions of the law which read as followsB* 2. Interpretation "n this #ct $ ..... exempt transaction means a transaction $ %a& between the 'ank of Mauritius and any other person( %b& between a bank and another bank( %c& between a bank and a financial institution( %d& between a bank or a financial institution and a customer where $

12 %i& the customer is! at the time the transaction takes place! an established customer of the bank or financial institution( and

%ii& the transaction consists of a deposit into! or withdrawal from! an account maintained by the customer with the bank or financial institution! where the transaction does not exceed an amount that is commensurate with the lawful business activities of the customer( or %e& between such other persons as may be prescribed... 5. Limitation of payment in cash %)& *otwithstanding section +, of the 'ank of Mauritius #ct! but sub-ect to subsection %.&! any person who makes or accepts any payment in cash in excess of /00!000 rupees or an equivalent amount in foreign currency! or such amount as may be prescribed! shall commit an offence. %.& 1ubsection %)& shall not apply to an exempt transaction.

/he first 0uestion for our determination is whether, as contended !y the appellant, the !urden is on the prosecution to aver and prove that an impugned transaction is not an ,exempt transaction- inasmuch as this is a constitutive element of the offence under section or, as contended !y the respondents, the !urden is on an accused party to raise

and prove the statutory defence provided !y section %2& that an impugned transaction is an ,exempt transaction-.

(t is compellingly clear to us from the wording of section

of the )ct that 1arliament

had not intended the impugned transaction !eing a non exempt transaction to !e a constitutive element of an offence under that section. (n fact, the elements of the offence which the prosecution is re0uired to prove are %i& the ma<ing or accepting of any payment, %ii& in cash, and %iii& !eyond a prescri!ed amount which was Rs 3 0,000 and which figure was amended and su!stituted in 200# for Rs 00,000. /he prohi!ited conduct contemplated !y the legislator in enacting section , therefore, is the ma<ing or accepting a cash payment over and a!ove the prescri!ed limit.

13 ;owever, the legislator has also deemed it fit to provide a statutory defence to what would otherwise !e an a!solute prohi!ition. =u!section %2& of section of the )ct provides

that su!section %1&, which creates the offence, shall not apply to an exempt transaction-. )nd what constitutes an exempt transaction has !een specifically and exhaustively defined in section 2 %a!ove&.

(t is apposite here to 0uote the following extract from Po,2ce v $r) 819#9 MR 19#:B* ,"t is permissible for the legislature! if it deems it expedient to prohibit absolutely and make an offence of any act however innocent morally it may be thought to be and however foolish or arbitrary it may seem for the legislature to forbid it! provided the prohibition does not violate the 2onstitution generally! or particularly the citi3en4s fundamental rights as established by the 2onstitution. "t is also permissible for the legislature! sub-ect to the same restriction! to make the doing of any particular act an offence! save in specified circumstances! or by persons of specified classes! or with special qualifications or with the permission or licence of specified authorities( the effect of the enactment being in such a case to prohibit either expressly or by necessary implication the doing of the act in question sub-ect to a proviso! exception! excuse or qualification! and the burden of proving that the proviso and the like applies being placed on the contravener. 1uch an enactment would not infringe subsection %.&%a& of section )0 of the 2onstitution and is expressly allowed by subsection %))&%a& of that section! which provides that a law that imposes upon a person charged with a criminal offence the burden of proving particular facts is not inconsistent with the presumption of innocence protected by subsection %.&%a&.-

)pplying the a!ove principles, the language of section

leaves no dou!t that the

offence created !y that section is more in the nature of a strict lia!ility offence. /he whole purpose and the main o!2ectives of the )ct are to offer a legislative framewor< to com!at money laundering and the financing of terrorism in Mauritius which are of great pu!lic concern and may pose a real threat with serious conse0uences to the economy of the country, its political sta!ility and !e a social danger, and to !ring Mauritius into line with the recommendations of the (nternational Monetary 'und %,(M'-&, the 'inancial )ction /as< 'orce %,')/'-& and other international anti*money laundering standards. )mong the means used !y the legislature to promote and achieve the o!2ects of the )ct, it has deemed fit to prohi!it the ma<ing or acceptance of cash transactions a!ove a prescri!ed limit.

14 ;owever, this prohi!ition is su!2ect to a statutory exception, namely the non* application of section %1& to an exempt transaction. =ection 2 sets out exhaustively the specific instances where a transaction would constitute an exempt transaction %a!ove&. Chether a cash transaction carried out !y a person would !e an exempt transaction within the meaning of the )ct would !e within the peculiar or exclusive <nowledge of that person. (n other words, section %2& affords a complete defence to an accused party !ut the facts needed to !e proved to avail himself of such a defence are within his peculiar and exclusive <nowledge. Moreover, if the !urden were on the prosecution to prove that a transaction is not an exempt one, it would have to underta<e in each case an investigation with a view to disproving all the lim!s of the defence given that an exempt transaction may ta<e one of several different forms as is made clear !y its definition in section 2. (f this were the case, the prohi!ition created !y section %1& would then !ecome inoperative. /his cannot have !een the intention of the legislator.

(n these circumstances, we have no dou!t in our mind that the !urden is on an accused party to raise and prove the defence that a cash transaction is an exempt transaction. Ce are of the view that there is no need for the prosecution to aver and prove that a cash transaction is not an exempt one as an element of the offence under section %1&. Once the prosecution has adduced prima facie evidence of the elements of the

offence, the !urden shifts to the accused party to prove the defence of exempt transaction on a !alance of pro!a!ilities if he wishes to avail himself of such a defence. Of course, once an accused party has raised the defence as a live issue, it is open to the prosecution to adduce such evidence as it deems fit in order to disprove such defence.

)s was held in Po,2ce v Moor4)%%oo 819#2 MR 22:, 5facts which bring a defendant within the ambit of a particular exception! if they are peculiarly or exclusively within his knowledge! should be regarded as matters which it is for him to establish. The reason behind that qualification was or must have been that the defendant in such a case

15 had or should have had readily available to him the means by which he could establish whether or not he fell within the excepted class of persons! and if he did not come forward with his evidence! it could safely be inferred that he did not so fall. #cting on that view! the court have found it possible to construe a number of statutes in which it was made an offence for a person to do or not to do an act unless he had some qualification! authority or licence to do or not to do it as throwing upon the accused the burden of showing that he came within the exception. "t is plain enough that a prohibition of that kind would soon become inoperative if the prosecution had to undertake in each case an investigation with a view to ascertaining whether the offender is possessed of the necessary qualification! authority or licence.

(t was therefore open to the appellant to ma<e the defence of exempt transaction a live issue !y invo<ing same and to esta!lish on a !alance of pro!a!ilities that the five impugned transactions were exempt transactions. (t is not disputed that such a course of action was not made use of !y the appellant in the course of his trial.

(t is, however, the contention of learned 7ounsel for the appellant that there is enough evidence on record to ena!le this )ppellate 7ourt to consider the a!ove issue in law or to remit the case to the lower 7ourt to consider this issue.

(t is agreed !y 7ounsel for the appellant that if the defence of exempt transaction is availa!le to the appellant, it is paragraph %d& as set out a!ove which would apply. (n that respect there are three conditions which an accused party claiming to !e entitled to the defence of exempt transaction must satisfy.

/hey are that %i& the accused party is an esta!lished customer of a !an< at the time of the impugned transactionA %ii& the transaction consists of a deposit into, or withdrawal from, an account maintained !y the accused party with the !an<A and %iii& the transaction is commensurate with his lawful !usiness activities.


Ce have !een called upon to pronounce ourselves on the meaning to !e ascri!ed to the term commensurate with the lawful business activities of the customer.

Ce have considered the arguments put forward !efore us as to why we should restrict the meaning of those words to commercial activities only. /he 0uestion is should we confine the term business only to activities having a commercial element or should we extend its meaning to non*commercial activities. Ce have sought assistance on the meaning of business from the S'or&er O7*ord E%3,2-' D2c&2o%)r.; S&ro0d<- J0d2c2), D2c&2o%)r.; Jo62&&- D2c&2o%)r. o* E%3,2-' =)6; >ord- )%d P'r)-e- J0d2c2),,. De*2%ed.

/he S'or&er O7*ord E%3,2-' D2c&2o%)r. provides several meanings some of which are reproduced as hereunderB*

6 the state of being busily engaged in anything( * stated occupation! profession! or trade( * a matter that concerns a particular person or thing( * a matter with which one has the right to meddle( * a sub-ect of consideration or discussion( * trade! commercial transactions or engagements( and * a commercial enterprise as a going concern.

(n S&ro0d<- and the other dictionaries, the term business has different connotations and its construction will depend largely on the o!2ects and purposes of the statutes in which reference is made to the term.

@e that as it may, in deciding this issue, we are of the view that we should !ear in mind the o!2ects and purposes of the )ct and the mischief which the statute was primarily aimed at suppressing E which we have already set out in the earlier part of our 2udgment. )s we have said 1arliament, in its determination to prevent social, economic and

17 political disasters which money laundering and terrorism may engender, has enacted in section of the )ct almost a!solute prohi!itions of cash transactions of more than

Rs 00,000. (n this respect, it is clearly the aim of the )ct to com!at money laundering !y prohi!iting su!stantial cash transactions.

/he legislator, however, has deemed fit to provide an exception to such a rigid and severe prohi!ition, as the prohi!ition might well otherwise have proved to !e impractica!le, unrealistic and unfair. )s rightly pointed out !y Mr )hmine, there are supermar<ets, hypermar<ets or !usinesses of similar nature which everyday deal with and deposit su!stantial amounts of cash exceeding Rs 00,000. 8ow such !usinesses would !e everyday contravening section were it not for the defence of exempt transaction. (t is precisely with these !usinesses in mind that the legislator has thought fit to provide a form of exemption to those engaged in activities which necessarily involve dealing in cash !eyond the prohi!ited limit. ;owever, the legislator has struc< a !alance !etween catering for such an exemption and restricting such an exemption so that it is not too wide. /he legislator9s intention in using the words lawful business activities in paragraph %d& of the definition of exempt transaction could only have !een to restrict the activities to those of a commercial or professional nature.

;ad it !een the legislator9s intent to include in the net of exempt transaction activities which are non*commercial, the word business would not have !een used and he would instead have used the term lawful activities simpliciter.

Ce therefore favour a literal construction and confine business activities to activities which are money ma<ing or profit ma<ing, in short to commercial activities and purposes.

(n these circumstances, we !elieve that the defence of exempt transaction could not have !een intended to !e of !road application. Ce ta<e the view that the defence is limited to a certain category of persons who, if 0ualified, may claim the protection afforded

18 !y section %2& of the )ct. Ce do not !elieve that section %2& was intended to apply to persons such as the appellant whose source of income or revenue is derived from an activity which is anything !ut of a commercial nature and who effects cash transactions !eyond the prohi!ited limit. (n fact, it was never the case for the appellant that he was engaged in lawful !usiness activities.

Ce are of the view that to 2ustify the enactment of such provisions in the law and to effectively assist the enforcement of the law, the defence of exempt transaction must !e narrowly construed to encourage greater caution and awareness to prevent the commission of the prohi!ited act.

)s the evidence !efore the trial 7ourt falls short of esta!lishing that the impugned transactions were exempt transactions, the appellant9s claim that he is entitled to that defence cannot succeed.

)n added reason why the defence of exempt transaction cannot avail the appellant is the lac< of evidence of the appellant having !een an established customer of the !an<.

(n view of the current standard practice of !an<s or other financial institutions to verify a customerHs identity termed ?@C A B5%o6 .o0r c0-&o(erB, evidence from the !an< that the FG7 practice had !een o!served would have helped in determining whether or not the appellant was an established customer of the !an<. (t was incum!ent on the appellant to adduce evidence that he was an established customer of the !an<. (n the a!sence of any evidence to esta!lish that the appellant was an established customer of the bank, we fail to see how the defence of exempt transaction would have availed him.

'or the a!ove reasons, the appeal fails and it is dismissed, with costs.

N Dev)& J0d3e


D C')% ?)% C'eo%3 J0d3e 2! J0%e 2013 J0d3(e%& de,2vered 4. Ho% N Dev)&; J0d3e $or A11e,,)%& + Mr- A&&or%e. S B J)ddoo Mr S Tr2,oc'0%; o* Co0%-e, &o3e&'er 62&' Mr S G'oor)'; o* Co0%-e,

$or Re-1o%de%& No 1 + Mr A&&or%e. S So')6o% M- P B2--oo%)0&'-2%3; o* Co0%-e, &o3e&'er 62&' Mr H Po%e%; o* Co0%-e, $or Re-1o%de%& No 2 + Pr2%c21), S&)&e A&&or%e. Mr A R A'(2%e; A--2-&)%& D2rec&or o* P04,2c Pro-ec0&2o%- &o3e&'er 62&' Mr N A T'o()-oo