The initial funds for obtaining gold, says the National Investigation Agency (NIA) in the diplomatic baggage gold smuggling case, was raised by persons with dubious antecedents and the funds were sent abroad through hawala channel.
The agency, which opposed the bail application of the accused in the case, submitted before the NIA Special Court, Kochi, that it was also investigating the source of gold smuggled in from the United Arab Emirates (UAE).
The NIA invoked the Unlawful Activities (Prevention) Act in the case on the apprehension that the proceeds of the smuggled gold could be used for financing terrorism in India. There was prima facie evidence to the effect that the accused intentionally smuggled gold, it said.
During the course of the arguments, the Special Judge asked the NIA on the evidences available with it to show the intentions of the accused in the case.
While pointing out that in the smuggling cases, the violations of various laws including tax evasions were considered, the court wanted the Assistant Solicitor General to convince him how the present case attracted the provisions of the Act.
The NIA contended that it was revealed during the investigation that the accused had the knowledge that their act would threaten the security of the country besides affecting its monetary stability. This was enough for invoking the Act, the agency said. Terrorist organisations were using gold and drugs as parallel currency in different parts of the world, as trading with counterfeit currencies had become difficult, the agency contended.
The counsel of the accused sought a copy of the statement made by Sandeep Nair, the first accused in the cases before the Customs, as he felt that the investigation agency was banking on it to build up its case against Swapna.