CRIMINAL APPEAL NO 300 OF 2022 THE DIRECTOR OF PUBLIC PROSECUTIONS VS MAGARETH KOBELO GONZAGA ANOTHER

IN THE COURT OF APPEAL OF TANZANIA

AT PAR ES SALAAM fCORAM: SEHEL, J.A.. KENTE, 3.A And MPEMU. J.A.^ CRIMINAL APPEAL NO. 300 OF 2022 THE OIRECTOR OF PUBLIC PROSECUTIONS................................ APPELLANT

VERSUS MAGARETH KOBELO GONZAGA...... 1st RESPONPENT ALLOYCIOUS GONZAGA MAN PAGO .2nd RESPONPENT (Appeal from the decision of the High Court of Tanzania, the Corruption and Economic Crimes Pivision, at Par es Salaam) fLuvanda. J.l dated the 15th day of July, 2022 In Economic Application No. 01 of 2019

JUDGMENT OF THE COURT 7thJune & 30th July, 2024 MPEMU. J.A.: The appellant, the Director of Public Prosecutions filed an application for assets forfeiture in the High Court of Tanzania, the Corruption and Economic Crimes Division (the Economic Court) under the provisions of section 4(1) (c), 9 (1) and 14 (1) and (2) of the Proceeds of Crime Act, Cap.

256. According to the affidavit in support of that application, the orders sought for in the application were in respect of forfeiting the following properties: Plot No. 1378 Block "E" Tegeta with the certificate of title No. 41275; Plot No. 176 Block "B" located at Annan Gomvu having the certificate of title No. 138598; Plot No. 191 Block "B" Aman Gomvu with certificate of title No. 132797; Plot No. 174 Block "B" Aman Gomvu registered under the certificate of title No. 138597; Plot No. 199 Block "D" Tegeta with the certificate of title No. 121302 and Plot No. 200 Block "D" Tegeta area registered under the certificate of title No. 39021. According to the supporting affidavit deposed by the officials of the appellant, properties subject for forfeiture were allegedly acquired illicitly by using the proceeds from illegally lending business operated by Superior Financial Solution Limited (SFS), illegal trade and investment and also through tax evasion by the said SFS company. It was deposed that, the proceeds thereof were deposited in a jointly owned account number 01J103428800 of the respondents housed by the CRDB Bank. It was alleged further that, a total of T2S 4, 214, 736, 248.00 was deposited in the said account from the year 2011 to 2016. Believing that the said properties were acquired by the respondents within the mentioned period, the appellant thought they were acquired

by using the deposited illicit money, hence the application for asset forfeiture filed in the Economic Court. Along with the filing of a counter affidavit, the respondent also filed a notice of preliminary objection raising the following points of objection on the competency of the application; namely: 1. The application is incompetent for want o f conviction o f the respondent for the offence o f money laundering.

2. That, the application is incompetent for want of conviction o f any predicate offence against the respondent 3. That, the application is incompetent for being supported by an incurably defective affidavit 4. That, the amended chamber application is defective bringing new application in contravention o f an order o f the court to join the interested party. However, the learned High Court Judge held that the preliminary objections will be disposed along with the merit of the application for forfeiture order. In his ruling dated 15th July, 2022 the learned High Court Judge entered a deemed conviction and dismissed the preliminary objections. For ease of reference, we find it apt to reproduce part of the ruling that: "And as much the respondent made evasive denial to paragraphs 34, 35and 36 which in totality are to the effect 3 that she went in hiding to dodge and avoid appearance into criminai proceedings initiated and later instituted against her at the Resident Magistrate's Court o f Dar es Salaam at Kisutu despite the issuance o f warrant o f arrest and service through substituted service as per annexture NPS 23. To my opinion; in the circumstances o f factual above, the respondent is taken to have been convicted of the offence o f money laundering contrary to section 12(d) and 13(a) o f the Ant-Money Laundering Act No. 12 o f2006 as per annexture NPS 22 to the affidavit My

verdict is premised on the law governing deemed conviction, in particular section 4(1) (c) of Cap, 256 (supra)..." Having convicted the first respondent, the leaned High Court Judge proceeded to determine an application for a forfeiture order. Relying on the depositions made in paragraphs 30 and 31 of the founding affidavit, the learned Judge found and declared the following properties to be tainted consequently, he made an order for the same to be forfeited by the Government of the United Republic of Tanzania: Plot No. 1378 Block "E" Tegeta with the certificate of title No. 41275; Plot No. 176 Block "B" Aman Gomvu having the certificate of title No. 138598; Plot No. 191 Block "B" Aman Gomvu with the certificate of title No. 132797 and Plot No. 174 Block "B" Aman Gomvu registered under the certificate of title No. 138597. 4 However, the learned High Court Judge found that properties in Plot No. 199 Block "D" Tegeta with the certificate of title No. 121302 and Plot No. 200 Block "D" Tegeta registered under the certificate of title No. 39021 were not tainted properties, as such, they were not amenable for forfeiture. This decision appears to have aggrieved the Director of Public Prosecutions hence, the instant appeal on the following two grounds: 1. That, the honourable trial Judge erred in law and in fact by holding that the properties on Plot No. 199 Block "D" Tegeta with the certificate o f title No.121302 and Plot No. 200 Block "D" Tegeta with the certificate o f title No. 39021 are not amenable for forfeiture order while they are tainted properties.

2. That, the honourable trial Judge erred in law and in fact by failure to link the properties on Plot No. 199 Block "D" Tegeta with the certificate o f title No. 121302 and Plot No. 200 Block "D" Tegeta with the certificate o f title No. 39021 with the charges which the respondent was convicted with. The appeal came before us for hearing on 7th June, 2024. The appellant the Director of Public Prosecutions had the services of Messrs. Catherine Gwaltu, Lilian Rwetabura and Erick Kamala, learned Principal State Attorney, Learned Senior State Attorney and learned State Attorney 5 respectively. The respondent enjoyed the services of Messrs. Jamhuri Johnson and Adinani Chitale, both learned advocates. Having heard the appeal, we reserved the delivery of a judgment to a date to be notified to the parties. However, in the course of composing our judgment, we observed that there is an important issue which parties have to address us. The Court noted that as the appeal arose from an application for assets forfeiture, we recalled the parties to address us on whether or not it was preceded by a conviction and by which court. That was on 12th June, 2024. Submitting on behalf of the appellant's team of State Attorneys, Ms. Gwaltu acknowledged that, there is no evidence on record suggesting that the respondent was convicted prior to the filing of an application for a forfeiture order against

the alleged tainted properties. What is in the record of appeal according to the learned Principal State Attorney is the deemed conviction meted out by the learned High Court Judge during the determination of the application for a forfeiture order. She however argued that, it was not proper for the learned High Court Judge to deem conviction in the course of determining the application for a forfeiture order. 6 On his part, Mr. Jamhuri Johnson submitted that, the provision of section 9 of the Proceeds of Crime Act is clear that, an application for a forfeiture order may be instituted either to the convicting court or to the appropriate court having jurisdiction for that purpose. In his argument, as the respondent faced criminal charges possibly in respect of the alleged tainted properties which was the subject of forfeiture in the Resident Magistrate Court of Dar es Salaam at Kisutu, then it would have been proper for the prosecution to secure first the deemed conviction in that court and thereafter would have instituted an application for a forfeiture order in that convicting court or in the appropriate court, the Economic Court in this case. He added further that, at Kisutu Court, there has never been any proceedings which would establish the existence of a deemed conviction. The charge sheet and the warrant of arrest available thereat, may not, in his argument, be the

evidence of a deemed conviction. On that account, the learned counsel urged us to nullify all the proceedings and the resultant decision and orders made by the Economic Court for that matter. Having heard submissions from the parties, we wish to state from the outset that for the reasons to be shortly revealed, we shall not deal with the grounds of appeal. We wish to begin by restating the legal position on the 7 law regarding asset forfeiture. The applicant made an application vide Economic Application No. 1 of 2019 before the Economic Court for a forfeiture order against the 1st respondent's properties. |The application was premised under sections 4(1) (c), 9 (1) and 14 (1) and,(2) of the Proceeds of Crime Act. Section 9 (1) of the Act requires an application for a forfeiture order to be preceded by a conviction, it be actual or deemed conviction. We reproduce the said section as follows for ease of reference: 9.-(l) Where a person is convicted of a serious offence, the Director o f Public Prosecutions may, subject to subsection (2), apply to the convicting court, or to any other appropriate court, not later than twelve months after the conviction o f the person, for- (a) a forfeiture order against any property that is tainted property in respect o f the offence; (b) a forfeiture order against any property of corresponding value; or (c) a pecuniary penalty order against the

person in respect o f any benefit derived by the person from the commission o f the offence. Our understanding of the above provision of the law is that an application for a forfeiture order is conditional upon prior conviction of a 8 serious offence on the part of a person to whom the tainted properties are the subject of a forfeiture order and that, such application has to be made by the Director of Public Prosecutions to the convicting court or to any other appropriate court not later than twelve months after the conviction. Therefore, a conviction of a serious offence is a necessary prerequisite action before the filing of an application for forfeiture orders. Paragraph 4 of The Asset Forfeiture, Recovery and Management Guidelines, 2023 issued by the Director of Public Prosecutions also makes it mandatory to secure a conviction prior to the institution of an application for assets forfeiture. It is in this way: ”4.0 CONFISCA TION OF ASSETS Confiscation o f assets can be in the form o f a forfeiture o f a tainted property, forfeiture o f a property o f a corresponding value or a pecuniary penalty order. Confiscation can be preferred where there is actual conviction in a criminal case or a deemed conviction[emphasis supplied] A question which comes next before us is whether the first respondent was ever charged with any serious offence. The answer|in our view is in

the affirmative for two reasons. One, as stated earlier, the appellant had filed 9 an application for a forfeiture order before the Economic Court. In that application, the charge of money laundering preferred against the first respondent was annexed to the affidavit in support of the application. Two, at page 449 of the record of appeal, the learned High Court Judge appreciated the existence of the charge sheet when he said: "...my understanding is grounded on a fact that the offences o f lending money illegally, tax evasion■ , false documents, forgery, occasioning loss to a specified authority, conspiracy, uttering false documents were levelled to the first interested party and his co-directors of Ms SFS as pleaded in paragraph 27 o f the affidavit in support. However, in a charge, annexture NPS 22 to the affidavit, the only charge laid to the respondent was money laundering, "[emphasis supplied] Next to this is whether the first respondent was convicted of the offence of money laundering contrary to section 12 (d) and 13 (a) of the Ant-Money Laundering Act, No. 12 of 2006. We answer this question in the negative because, as correctly argued by both counsel, the record of appeal is silent as to what transpired in the Resident Magistrate's Court of Dar es Salaam at Kisutu where the first respondent stood charged with the offence 10 of money laundering in Criminal Case No. 28

of 2019. It is not clear to us as to whether there was any conviction or not. As argued by Mr. Jamhuri, the charge sheet and the warrant of arrest available in the record of appeal may not stand as evidence that there was a criminal proceeding leading to any subsequent conviction of the first respondent. The learned High Court Judge had no jurisdiction to enter a deemed conviction against the first respondent when exercising its powers of dealing with an application for a forfeiture order because first, there were no criminal charges before him, second, as we said, the application for assets forfeiture has to be preceded by a conviction in a criminal charge and third, the Legislature in enacting the provisions of sections 4, 9 and 14 of the Proceeds of Crime Act did not intend criminal proceedings for conviction purposes, be it actual or deemed, be determined together with an application for a forfeiture order. Section 9(1) of the Proceeds of Crime Act in particular, as we quoted above, is clear that for an application of asset forfeiture to be meaningful and properly before the court, there must be a conviction in the first place from the court of law clothed with criminal jurisdiction. To ensure compliance with that condition, the leaned High Court Judge struggled a lot to secure conviction by making reference to the charge li and warrant of arrest which was not the evidence

before him and which he ultimately, using such evidence, managed to enter a deemed conviction against the first respondent as recorded at page 453 of the record of appeal, thus: " To my opinion in the circumstances o f factual above, the respondent is taken to have been convicted o f the offence o f money laundering contrary to section 12(d) and 13(a) o f the Ant-Money Laundering Act No. 12 o f 2006 as per annexture NPS 22 to the affidavit. My verdict is premised on the law governing deemed conviction, in particular section 4 (1) (c) o f Cap. 256 (supra)....." Since the said deemed conviction was not supposed to be entered by the Economic Court when dealing with an application for a forfeiture order, we hold that the deemed conviction met by the learned High Court Judge in respect of the first respondent, was not, in legal perspective, a conviction within the meaning of section 4 (1) of the proceeds of Crime Act which is quoted as hereunder: "4 (1) For the purposes o f this Act a person shall be taken to be convicted o f an offence if— (a) he is convicted, whether summarily or otherwise, of the offence; 12 (b) he is charged with, and found guilty and convicted o f the offence but is discharged conditionally or unconditionally or pardoned; or (c) the person absconds in connection with the offence." We note that the deemed conviction meted out by the learned High Court Judge

would have been proper had it been entertained by the Kisutu Court to which the criminal charges against the first respondent in Criminal Case No. 28 of 2019 was pending. Much as the deemed conviction is permitted for purposes of forfeiture orders, it must be according to law commenced by presence of the charge against a person to whom a forfeiture order is envisaged in the deeming court, availability of abscondment evidence by the respondent which may be proved through, for instance, by the evidence in respect of the issuance of warrant of arrest. In absence of all these, as was to the learned High Court Judge, we think he usurped his powers over asset forfeiture by deeming conviction. In absence of conviction, it be actual or deemed, that application for a forfeiture order was not supposed to be filed in the Economic Court. Having said so, it is our findings that what proceeded before the Economic Court by deeming conviction in respect of the first respondent and 13 subsequently going ahead to determine the application for forfeiture order, was a nullity for want of jurisdiction. We thus, using our revisional powers bestowed on us under section 4 (2) of the Appellate Jurisdiction Act, Cap. 141, we nullify the proceedings, the resultant decision and any orders subsequent thereto in Economic Application No. 01 of 2019. The appeal by the Director of Public Prosecutions for that matter fails and it is hereby dismissed in its entirety. It is so ordered. DATED at DAR ES SALAAM this 29th day of July, 2024. B. M. A. SEHEL

JUSTICE OF APPEAL P. M. KENTE

JUSTICE OF APPEAL G. J. MDEMU

JUSTICE OF APPEAL Judgment delivered this 30th day of July, 2024 in the presence of Mr. Leonard Chalo, learned Senior State Attorney, for the Appellant/ Republic and Ms. Fatuma Mlonja holding brief for Mr. Jamhuri Johnson both learned counsel, for the respondent is hereby certified as a true copy of the original. 14