R v Kansal (Yash Pal) (Change of Law) (No 2)

JurisdictionEngland & Wales
CourtCourt of Appeal (Criminal Division)
JudgeTHE VICE PRESIDENT
Judgment Date24 May 2001
Neutral Citation[2001] EWCA Crim 1260
Docket NumberCase No: 199802818S1
Date24 May 2001

[2001] EWCA Crim 1260

IN THE SUPREME COURT OF JUDICATURE

COURT OF APPEAL

(CRIMINAL DIVISION)

Royal Courts of Justice

Strand, London, WC2A 2LL

Before:

The Vice President of The Criminal Division

(Lord Justice Rose)

Mr Justice Rougier and

Mr Justice Mccombe

Case No: 199802818S1

R
and
Yash Pal Kansal
On a Reference From The Criminal Cases Review Commission

Mr I Krolick & Miss A Geser (appeared on behalf of the appellant)

Mr J McGuinness (appeared on behalf of the Crown)

THE VICE PRESIDENT
1

On 18th February 1992 at Snaresbrook Crown Court, following a seven-day trial before His Honour Judge Rucker, the appellant was convicted on Counts 1 and 2 of obtaining property by deception contrary to s15(1) of the Theft Act 1968, on count 4 of, being a bankrupt, removing property contrary to s354(2) of the Insolvency Act 1986 and, on count 5, of, being a bankrupt, failing to account for property contrary to s354(3) of the Insolvency Act 1986. Count 3, which alleged that, being a bankrupt, he obtained credit, was left on the file on the usual terms. The appellant's wife Rashme Kansal was acquitted by the jury of aiding and abetting the offence in count 4. The appellant was sentenced to 15 months imprisonment on counts 1 and 2 concurrently and to 3 months imprisonment on counts 4 and 5 concurrently with each other and with the 15 months on counts 1 and 2.

2

On 12th May 1992 (95 Cr App R 348) the Full Court dismissed his appeal against conviction on grounds relating to counts 1, 2 and 4. On 21st May 1992 the Full Court certified a point of law of general public importance of no present relevance. Leave to appeal was refused by the Court of Appeal and subsequently by the House of Lords.

3

The appellant now appeals against conviction upon a reference by the Criminal Cases Review Commission. A reference was initially made in April 1998 in relation to counts 1 and 2, as a consequence of the decision of the House of Lords in Preddy [1996] AC 815, [1996] 2 Cr App R 524. Subsequently, in June 2000, as a result of further submissions from counsel, the CCRC widened the reference to cover all four counts.

4

The facts can be briefly summarised. The appellant came to this country from India in 1967. He qualified as a pharmacist in 1973. In 1977 he formed a company called Yash Pal Kansal and Company which flourished and operated twenty chemist shops. In about 1983 the appellant bought a house in Hornchurch, in joint names with his wife, with the assistance of a £60,000 mortgage. In 1986 the house was re-mortgaged, the original mortgage being paid off and the balance invested in the business. The appellant and the company began to encounter financial problems. In February 1986 a finance company obtained judgment against the appellant in relation to a £4000 loan. The company went into liquidation in February 1987, owing in excess of £1,000,000.

5

On 20th May 1987 a bankruptcy petition was presented against the appellant and, on 11th March 1988, a bankruptcy order was made against him. On 16th March 1988 the Halifax Building Society advanced, by cheque, £150,000 and, on 23rd March, a further £116,250 on the security of the Hornchurch house. These advances formed the subject matter of counts 1 and 2. The prosecution alleged that the building society had been misled by the appellant into drawing those cheques by false representations that his basic annual income was £90,000, that he had never been bankrupt and did not have any judgment or proceedings for debt outstanding and that he did not have any bank or other loans or charge/credit card debts.

6

In relation to count 4, on 23rd March 1988, the appellant's wife collected from the appellant's solicitor approximately £104,000 in cash, part of the building society advance, and took it in a bin liner to India. The prosecution alleged this was done at the instigation of the appellant with knowledge that the money should have been delivered to the official receiver or trustee in bankruptcy. Count 5 related to the failure to account for the loss of a substantial part of his property, occurring in the 12 months before the bankruptcy petition in May 1987 or between then and the date of the bankruptcy order in March 1988, or to give a satisfactory explanation of how such loss was incurred, in that he did not comply with a court order dated 17th June 1988 to lodge a cash account. The appellant claimed to have used the money to pay off creditors but he refused to divulge details.

7

Evidence was given for the prosecution by Christopher Watson a financial advisor. Once or twice in 1987 he visited the appellant who wished to raise money on the Hornchurch house. He was shown a sub-post office which the appellant said he wanted to buy. Application forms for a mortgage from the Halifax Building Society were signed by the appellant and his wife on 29th January 1988 and filled in by Mr Watson with information which the appellant had already provided. The appellant said his annual income was £90,000, that he had never been made a bankrupt and that he had no bank or other loans or credit card debts. Mr Watson said he was never told about the bankruptcy proceedings. Pursuant to this application, the two cheques to which we have referred were issued by the building society.

8

Mr Mangat was a solicitor instructed by the appellant in 1988 in relation to the re-mortgage. He was also instructed by the building society to act for them in the transaction. He received the two cheques which he paid into his client's account. The mortgage of £150,000 was paid off with the first cheque. The appellant told him to use some of the money to pay off an £8,000 loan to Barclays Bank, but the bank returned the cheque because the appellant was bankrupt. The appellant then told Mr Mangat that his wife would collect £104,000 in cash and Mr Mangat made the necessary arrangements putting the money in a dustbin liner. These events gave rise to count 4. Mangat claimed that he did not know that the appellant was bankrupt, but he admitted in cross-examination that he had made a search on 16th March 1988 revealing this. He had not told the building society. He said he had been given no instructions about transferring the appellant's half share in the equity of the house to his wife.

9

The appellant gave evidence. He said that, by the beginning of 1988, he was short of money and decided to re-mortgage the Hornchurch house which was worth over £350,000. He said he had told Mr Watson everything about his debts including the bankruptcy proceedings and the judgment against him for £4000. The figure of £90,000 for his income was suggested by Mr Watson. The appellant was astonished when the application went through.. He was not there when the £104,000 was withdrawn in cash. But he had told Mangat that his wife was to have the money to pay debts in India and Mangat had given him no reason why it should not be handed over to his wife or taken to India. He admitted that he had not given information about the loans: this was because it was all too embarrassing. In cross-examination, he said he had borrowed £120,000 from India on the security of properties belonging to his father-in-law. The money should not have been sent from India because of exchange control and everyone wanted to keep it secret, hence the need for cash. He had planned to make over his share of the Hornchurch house to his wife but this had never been done formally. His wife went to India on 26th March 1988 taking with her the balance of the £104,000 after paying for her air ticket. She had gone to pay the debts.

10

At the trial, it was submitted that the appellant's statement of affairs in the bankruptcy proceedings and the documents relating to his public examination in bankruptcy were inadmissible by virtue of s31 of the Theft Act 1968, not- withstanding s433 of the Insolvency Act 1986. The trial judge ruled that the evidence was admissible and that ruling was upheld by the Court of Appeal, on the basis that s31 of the Theft Act 1968 did not provide the appellant with any protection against the admissibility in criminal proceedings of compelled statements made under s433. It was further submitted to the trial judge that, as the appellant's wife had an equitable interest in the matrimonial home amounting to almost £100,000, she was entitled to take the £104,000 withdrawn in cash. The judge ruled that the status of the money was a question of fact for the jury.

11

The grounds of appeal fall into 4 categories. First, ground 1 challenges the safety of the convictions on counts 1 and 2 in the light of Preddy. [1996] AC 815 Secondly, ground 2 challenges the propriety of joining counts 1 and 2 in the same indictment as counts 4 and 5. Thirdly, grounds 3 to 10 and 12 are variously critical of directions given by the trial judge in his summing-up, of the alleged duplicity of count 5 and of the judge's ruling that there was a case to answer. Fourthly, ground 11 challenges the judge's ruling admitting the transcript of the examination of the appellant at the bankruptcy proceedings, in the light of the decision of the European Court of Human Rights in Saunders [1997] 23 EHRR 313. Not all these grounds have the support of the CCRC. But, in the light of s 14(5) of the Criminal Appeal Act 1995, once a reference has been made, the appeal may be on any ground.

12

Before turning to the grounds of appeal, there is a point of considerable importance in relation to the treatment, by this court, of appeals resulting from a reference by the CCRC.

13

So far as we are aware, the point has not previously been the subject of argument in this court. It is related to the grounds which rely on Saunders and Preddy. It is one which was not...

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