THE HON’BLE SRI JUSTICE B. SESHASAYANA REDDY Criminal Appeal No.30 of 2005 Date:26th April, 2011 Between: The State through Inspector of Police, CBI/SPE rep. by its C.B.I., Hyderabad. …Appellant/Complainant and N.Srinivas Rao S/o.N.B.Ramanamurthy …Respondent/Accused *** THE HON’BLE SRI JUSTICE B. SESHASAYANA REDDY Criminal Appeal No.30 of 2005 JUDGMENT: This Criminal Appeal is directed against the judgment, dated 07.05.2003, passed in C.C.No.314 of 2000 on the file of XXIII Metropolitan Magistrate, Hyderabad, whereby and whereunder the learned Metropolitan Magistrate found accused N.Srinivas Rao not guilty for the offences under Sections 409, 468, 471 and 477-A of IPC and acquitted him accordingly. 2. The respondent is the accused in C.C.No.314 of 2000 on the file of XXIII Metropolitan Magistrate, Hyderabad. He was put on trial for the offences under Sections 409, 468, 471 and 477-A of IPC. 3. The prosecution case in brief is:- a) Accused N.Srinivas Rao worked as Cashier in the office of the Chief Commissioner of Income-Tax, Hyderabad from 08.07.1994 to 27.06.1997. As a cashier his duties were: preparation of pay bills, T.A. bills, disbursement of salaries, leave encashment amounts, deduction of profession tax from the salaries of the staff while disbursing pay and allowances and remitting the collected amounts in Government account, and receiving cash amounts from the welfare section etc. He collected the profession tax of Rs.47,836/- from the employees of the Chief Commissioner of Income-Tax, Hyderabad, during the period from January, 1996 to September, 1996 and made entries regarding the said collection in the cash book. He had shown in the cash book as if the amounts were deposited in the bank. He also received Rs.2,500/- on 24.04.1996 and Rs.5,111/- on 06.05.1996 relatable to the auction of scrap; Rs.1475/- on 03.10.1996 relatable to van charges paid by the employees; Rs.235/- on 07.05.1996 relatable to sale of old newspapers and Rs.8,975/- on 18.09.1996 relatable to sale proceeds of old furniture. He received these amounts from the welfare section people for being credited to the government account. He failed to deposit the amount in government account and thereby misappropriated an amount of Rs.66,132.25 ps. To cover-up the amount misappropriated by him, he fabricated challans as if the amounts relatable to profession tax have been deposited to the government account. The Chief Commissioner of Income Tax, Hyderabad, received anonymous complaint stating that the profession tax collected from the employees had not been remitted to the government account. The Chief Commissioner of Income-Tax instructed PW.1 S.S.Kannan, Additional Commissioner of Income-Tax, (Headquarters) (Administration), Income-Tax Department, Hyderabad, to enquire into the matter. Thereupon, PW.1 directed PW.7 Smt.Neera Malhotra, the Assistant Commissioner of Income-tax, to conduct enquiry on the allegations mentioned in anonymous complaint. PW.7 Smt.Neera Malhotra called PW.6 Sunil Kumar, UDC/Cashier, to produce the challans. PW.6 Sunil Kumar verified and informed her that challans were not available. PW.7 Smt.Neera Malhotra, instructed PW.6 Sunil Kumar to enquire with the respondent/accused, who was the cashier at the relevant point of time. On 26.12.1997 the respondent/accused approached PW.7 Smt.Neera Malhotra, and admitted of his not depositing the amounts collected from the employees towards profession tax and sought permission to deposit the amount on the following Monday. The respondent/accused deposited Rs.42,925/- on 29.12.1997 with a shortfall of Rs.600/- and subsequently he made good the deficit by depositing the balance amount on 30.12.1997. On the instructions of the superiors, PW.7 Smt.Neera Malhotra, visited the bank and made enquiries with the Manager of the Bank. Her enquiries revealed that the amounts covered under challans were never paid in the bank and the specimen seal appearing on the challans was not that of the bank. PW.1 S.S.Kannan, presented a complaint before the Superintendent of Police, CBI, Hyderabad. Certified copy of which has been marked as Ex.P20. PW.16 Vijaya Saradhi, Inspector of Police, CBI, received the complaint from PW.1 S.S.Kannan through the Superintendent of Police, CBI, and registered a case in Rc.No.1(A)/98- Hyderabad, for the offences under Sections 409, 477-A, 471, IPC and Sections 13(2) r/w.13(1)[c](d) of the Prevention of Corruption Act, 1988 and issued Ex.P63 FIR. He examined PW.1 S.S.Kannan, PW.6 Sunil Kumar, PW.2 G.Jhonson, PW.3 G.Rajasekhar, PW.12 CBRPrasad, PW.4 Harsha N.Rathod, Laxmi Jhonson, PW.9 Sureka Vijay Kumar, Pw.5 K.S.Saibaba Rao, PW.8 Goli Srinivas Rao, PW.7 Smt.Neera Malhotra, and PW.13 Aruna Chari and recorded their statements under Section 161 Cr.P.C. He collected two cash books, which have been marked as Exs.P14 and P15, and 9 challans, which have been marked as Exs.P1 to P5 and P.16 to P19, during the course of investigation. He also addressed a letter to the Commercial Tax Department with regard to particulars of the profession tax received from the office of the Chief Commissioner of Income Tax, Hyderabad for the years 1994 to 1997. Ex.P55 is the letter dated 24.02.1998. Ex.P56 is the reply issued by the Deputy Commercial Tax Officer, Basheerbagh, Hyderabad, to the Inspector of Police. He also addressed a letter to the Zonal Accounts Officer, CBDT, Hyderabad, calling for particulars with regard to remittance of the amounts by the office of the Chief Commissioner of Income-tax, Hyderabad under various accounts such as sale of scrap material etc. Ex.P64 is the letter addressed to the Zonal Accounts Office and Ex.P65 is the reply issued by the Zonal Accounts Office. He collected specimen signatures and handwritings of the respondent/accused and also specimen seals of the bank and sent the same to the handwriting expert for comparison with the disputed handwritings and disputed seal appearing on the challan. PW.11 Narender Singh, Deputy Government Examiner of Questioned Documents, examined the disputed writings and specimen writings and also disputed seal and specimen seal and found that the writings appearing on the challans in question tallied with the specimen handwritings and whereas, the seal appearing on the challans does not tally with the specimen seal. Ex.P53 is the opinion given by him and Ex.P54 is the reasons for Ex.P53 opinion. PW.15 R.Nagendran, is the Chief Manager of State Bank of Hyderabad, Gruhakalpa Branch, Hyderabad. He speaks of his predecessor in office of Chief Manager, SBH, Gruhakalpa Branch, Hyderabdd, receiving letter from the CBI, Hyderabad and reply thereto clarifying that Ex.P1 to P.5 and P16 to P19 challans are not entered in the bank scrolls maintained by the cashier on relevant dates. After completion of investigation, PW.16 Vijaya Saradhi, Inspector of Police, CBI laid charge-sheet before XXIII Metropolitan Magistrate, Hyderabad. b) The learned XXIII Metropolitan Magistrate, Hyderabad, took the charge-sheet on file as C.C.No.314 of 2000. On appearance of the accused and on furnishing copies of the documents to him, the learned Metropolitan Magistrate examined the accused under Section 239 Cr.P.C. and framed charges under Sections 409, 468, 471 and 477-A of IPC, read over and explained the same to the accused, for which the accused pleaded not guilty and claimed to be tried. c) To bring home the guilt of the accused for the offences with which he stood charged, prosecution examined 16 witnesses as PWs.1 to 16 and proved 65 documents as Exs.P1 to P65. The plea of the accused is one of total denial of the case. On his behalf, he marked 2 documents as Exs.D1 and D2. Ex.D1 is the letter dated 2.2.2001 seeking permission to verify the challans, Ex.D2 is reminder dated 1.5.2001 to Ex.D1 letter. d) The learned Metropolitan Magistrate, on appreciation of the evidence brought on record and on hearing the prosecution and the accused, found that the prosecution failed to show that the accused fabricated signatures of the bank officers on Exs.P1 to P5 and P16 to P19 challans and thereby proceeded to record acquittal of the accused for the offences with which he stood charged, by judgment, dated 07.05.2003. Hence, this appeal by the State. 4. Heard learned Standing Counsel for CBI appearing for the appellant/State and Sri C.Padmanabha Reddy, learned senior counsel appearing for the respondent/accused. 5. Learned Standing Counsel for CBI appearing for the appellant/State submits that the trial Court failed to note that the appellant/accused is the person who received profession tax from the employees and also various amounts from the welfare department and made entries in the cash book. The entries in the cash book revealed that the said amount had been deposited in bank, but on verification, the challans, which have been exhibited as Ex.P1 to P5 and P16 to P19, were fabricated to make up the misappropriation of the amounts collected from the employees. He would also contend that the respondent/accused having received the amounts from the welfare department of the Chief Commissioner of Income-tax, Hyderabad, failed to deposit the same in the government account. Learned Standing Counsel for CBI refers Ex.P21 to P25, whereunder the respondent/accused acknowledged the receipt of the amounts from the welfare department. He would also contend that the evidence of PW.1, PW.6 and PW.7 is crystal clear that the respondent/accused having accepted the misappropriation of the amounts and fabrication of the challans, deposited the amount of Rs.42,925/- on 29.12.1997 and Rs.600/- on 30.12.1997. The trial Court has not appreciated the evidence brought on record in right perspective and thereby erred in recording acquittal of the respondent/accused for the offences with which he stood charged. 6. Learned Senior Counsel appearing for the respondent/accused submits that the trial Court considered the evidence brought on record in right perspective and found that the respondent/accused is not guilty for the offences with which he stood charged and the reasons given by the trial Court are quite convincing and therefore, the findings recorded by the trial Court do not warrant interference in this appeal. The learned senior counsel would also contend that the respondent/accused made a request for verification of the challans, but the department refused to accord permission for verification and in which case, it cannot be said with certainty that the amounts covered under Exs.P1 to P5 and P16 to P19 challans are not accounted to the government. Learned senior counsel would further contend that non-examination of the cashier of the bank on the relevant dates is fatal to the prosecution and the trial Court rightly drawn adverse inference for non-examination of the cashier of the bank on the relevant dates. Learned senior counsel took me to the findings recorded by the trial Court on this aspect to convince that the said findings are based on sound reasons and therefore, they do not warrant interference in this appeal. Relevant portion in the judgment impugned in the appeal, on which much emphasis has been laid by the learned senior counsel, reads as hereunder: “ PW.14 Syed Hussain Ashrof who was the then Deputy Commercial Tax Officer states that he was not examined by the Investigating Officer, he speaks to the Ex.P55 letter issued by the Inspector and his office gave reply under Ex.P57 to CBI and he speaks to the ledger register produced by him pertaining to year 1995-96 and 1996-97 ledger to show the payments posted in Ex.P57 and Ex.P58 is the ledger copy of ledger on page No.178. This witness also states in his cross that the entries made in the ledger books were based on the challans received from the concerned treasury and he has not made any entries in Ex.P56 to P58 and he states in his cross-examination that if the treasury not sent any challen they will not carry forward in ledger books and it can not reflect in Ex.P56 to P58 and he did not issue any show cause notice to Chief Commissioner for not paying any professional tax and he further states in his cross that if his office not received any challan, it does not mean that the amount is not paid in the treasury office. In view of this evidence, it can not be said that accused failed to remit the amounts under challan. The investigating officer states in his cross that all the challans under which professional tax was remitted in District Treasury Office, R.R. District and states that he has not examined any staff from Jan, 1996 to Sept.,1996 and what is the amount remitted by the accused in the bank. In the context that the prosecution failed to prove beyond reasonable doubt about accused forging signatures of bank officer in challans Ex.P1 to P9 and Exs.P16 to P19 and I hold that the prosecution failed to establish the forgery of accused for the offence under Sec.468 of IPC beyond reasonable doubt and failed to prove that accused used the same as genuine and that accused also wilfully with the intention defrauded the Chief Commissioner of Income Tax. The prosecution failed to prove the guilt of the accused beyond reasonable doubt, about the falsification of entries made by accused and as such I hold that the prosecution failed to prove the offence against the accused u/sec.477-A of IPC. Accordingly, the accused is entitled for benefit of doubt and he is to be acquitted for the offencesu/sec.468, 409, 471 and 477-A of IPC.” 7. The points that arise for determination in this appeal are: 1) Whether the acquittal of the respondent/accused for the offences under Sections 409, 468, 471 and 477-A of IPC is legal and proper? 2) Whether the prosecution is able to prove the guilt of the respondent/accused for the offences under Sections 409, 468, 471 and 477-A IPC beyond reasonable doubt? 8. Points 1 and 2:- I am conscious of the fact that in an appeal against the acquittal the appellate Court is circumscribed by the limitation that no interference has to be made with the order unless approach made by the trial Court to the consideration of evidence is vitiated by some manifest illegality or the conclusion recorded by it is such which would not have been possibly arrived at by any Court acting reasonably and judicially and therefore, to be characterized as perverse. It is trite to note that there is no embargo on the appellate Court to review the evidence upon which an order of acquittal is based. Generally, the order of acquittal shall not be interfered with because the presumption of innocence of the accused is further strengthened by acquittal. The golden thread, which runs through the web of administration of justice in criminal cases, is that if two views are possible on the evidence adduced in the case, one pointing to the guilt of the accused and the other to his innocence, the view, which is favourable to the accused should be adopted. The paramount consideration of the Court is to ensure that miscarriage of justice is prevented. A miscarriage of justice which may arise from acquittal of the guilty is no less than from the conviction of an innocent. In a case where admissible evidence is ignored, a duty is cast upon the appellate court to re-appreciate the evidence for the purpose of ascertaining as to whether any of the accused committed any offence or not. The principle to be followed by the appellate court considering the appeal against the judgment of acquittal is to interference only when there are compelling and substantial reasons for doing so. If the impugned judgment is clearly unreasonable, it is a compelling reason for interference. These aspects were highlighted by the Supreme Court in Shivaji Sahabrao Bobade v. State of Maharashtra[1]; Ramesh Babulal Doshi v. State of Gujarat[2]; and Jaswant Singh v. State of Haryana[3]. The principles highlighted in the above decisions have been reiterated by the Supreme Court in State of Rajasthan v. Rajaram’s case.[4] 9. The prosecution case against the respondent/accused is very simple and it is that the respondent/accused having collected profession tax from the employees of the Chief Commissioner of Income-tax, Hyderabad, failed to deposit the same in the bank and misappropriated the same. The further accusation is that the respondent/accused having received the amounts from the welfare department relatable to auction of scrap, van chares, sale of old newspapers and sale of old furniture, failed to deposit the same to the government account. To cover up the misappropriation, he fabricated Exs.P1 to P5 and P16 to P19 challans as if the amounts have been credited to the government account. It is not in dispute that the respondent/accused was the cashier at the relevant point of time and he received the amounts from the employees towards profession tax and also amounts relatable to various items from the welfare department. The said amounts were required to be deposited in the Bank to the credit of the Government account. Exs.P1 to P5 and P16 to P19 are the challans, whereunder, the respondent/accused allegedly deposited the amounts in bank to the credit of the government account. The respondent/accused did not dispute the fact of his being the author of contents of Exs.P1 to P5 and P16 to P19 challans. Ex.P14 is the cash book for the period from 28.09.1993 to 31.05.1996. Ex.P15 is the cash book for the period from 01.06.1996 to 12.01.1998. Indisputably, the amounts covered under the challans, which have been marked as Exs.P1 to P5, and P16 to P19, are not credited to the government account. This fact is evident from Ex.P65 letter emanating from the Zonal Accounts Office. PW.16 addressed a letter to the Zonal Accounts Office, CBDT, Hyderabad, which has been exhibited as Ex.P64. Ex.P65 is the reply by the Zonal Accounts Office. Of the various items mentioned in Ex.P64 letter, Zonal Accounts Office clarified that except Rs.88,500/- relatable to the sale of old vehicle, other amounts mentioned in ExP64 letter are not credited to the Zonal Accounts Office. 10. PW.7 Smt.Neera Malhotra, is the Asst. Commissioner of Income Tax, in the office of the Chief Commissioner of Income-tax, Hyderabad, during the period from 1996-1998. She testifies that she made enquiries on the instructions of PW.1 S.S.Kannan with regard to payments of profession tax and her enquiries revealed that the respondent/accused having collected the profession tax amount from the employees of the office of the Chief Commissioner of Income-Tax, Hyderabad, failed to remit the same in the bank. She further testifies that the respondent/accused came to her residence and admitted of his not crediting the profession tax amount collected from the employees as well as the amounts received by him from the welfare section to the credit of the government. It is also stated by her that the respondent/accused made payment of Rs.42,925/- on 29.12.1997 with a shortfall of Rs.600/- and thereafter, made the balance payment of Rs.600/- on 30.12.1997. PW.7 is a responsible officer and she has no motive to speak false against the respondent/accused. She categorically stated in the cross- examination that she visited the bank and enquired the manager and came to know that the challans produced by the respondent/accused are fabricated. For better appreciation, I may refer the evidence of PW.7 in her own words and it is thus: “On the instructions of my superiors, I visited the bank and made enquiries with the manager of the bank. As per the enquiries made, it was gathered that the challans given by Mr.Srinivas were never paid in the bank. Further enquiries revealed that the bank had not placed the stamps on the challan. Mr.S.S.Kannan had recorded the statement of Srinivas and I came to know that these were not genuine challans as was verified in the bank.” 11. PW.6 D.Sunil Kumar, was the Cashier, who succeeded the respondent/accused. He testifies that he accompanied the Assistant Commissioner of Income-tax, to the State Bank of Hyderabad, Gruhakalpa Branch and that the manager confirmed the challans produced by the respondent/accused were fake. He also testifies that he accompanied the respondent/accused to remit the amount of Rs.42,925/- . It is a matter of record that deposit of Rs.42,925/- is subsequent to the receipt of the anonymous complaint against the respondent/accused by PW.1. The material brought on record clearly established that the respondent/accused having collected the profession tax from the employees of the Chief Commissioner of Income-tax, failed to deposit the same in the bank to the credit of the government account and instead he fabricated Exs.P1 to P5 and P16 to P19 challans. The evidence brought on record also established that the respondent/accused received various amounts from the welfare section and failed to deposit the same in the bank to the credit of the government account. 12. PW.14 Syed Hussain Ashraf, Deputy Commercial Tax Officer, Basheerbagh Office, Hyderabad, testifies that profession tax amount relatable to the employees in the office of the Chief Commissioner of Income-tax, Hyderabad, have not been credited to the government account. 13. PW.15 R.Nagendran, Chief Manager, State Bank of Hyderabad, Gruhakalpa Branch, Hyderabad, testifies that the scrolls maintained by the cashier on the relevant date do not reflect the deposit of the amounts under the challans in question (Exs.P1 to P5 and P16 to P19). Ex.P61 and Ex.P62 are the certified copies of the bank scrolls of the relevant dates. The trial Court brushed aside the evidence of PW.15 on the ground that the cashier of the bank has not been examined. The reason assigned by the trial Court for rejecting the evidence of PW.15 cannot be sustained. Whatever stated by PW.15 is basing on the records maintained in usual course of business transactions. 14. PW.11 Narender Singh is the handwriting expert. He compared the seal of the bank appearing on the challans in question with the specimen seal of the bank and opined that they are not the same. He categorically stated that the stamp impressions appearing in the challans in dispute do not tally with the specimen stamp impressions. Nothing is elicited in the cross-examination disputing the opinion of the handwriting expert. For better appreciation, I may refer the relevant portion of the chief-examination as well as the cross-examination of PW.11, which reads as hereunder: “The stamp impressions in the Red enclosed parts Q-9 to Q-21 do not tally with the stamp impressions S-67 to S-72. This opinion I have expressed in para.3 and 2 of my typed opinion Dt.4.6.98 which is marked as Ex.P53. The reasons for my opinion (attested Xerox copy) is marked as Ex.P54.” Cross-examination: The specimen writings are of two kinds. 1) written in normal course and another which is obtained for the purpose of comparison. The specimen signatures which are written during normal course are not sent tome for comparison.” 15. A thorough reading of evidence of PW.11 indicates that the respondent/accused does not dispute his opinion with regard to the stamp impressions appearing on the challans in question. The trial Court has thoroughly misread the evidence brought on record and came to the conclusion that the prosecution has not placed on any material to substantiate the accusations leveled against the respondent/accused. 16. Exs.P40 to P48 are the entries made in Ex.P14 cash book and Exs.P49 and P50 are the entries made in Ex.P15 cash book. Exs.P21 to P25 are the acknowledgements issued by the respondent/accused with regard to the receipt of amounts from the welfare section. The amounts received by him from the welfare section are Rs.2,500/- on 21.04.1996; Rs.5111/- on 06.05.1996; Rs.1475.25ps. on 03.10.1996; Rs.235/- on 07.05.1996 and Rs.8975/- on 18.09.1996. The total amount received was Rs.18,296.25 ps. These receipts are marked through PW.1. Nothing is suggested to PW.1 disputing the receipt of the amounts covered under the above referred receipts. PW.2 G.Johnson, speaks of Ex.P26 to P29 office notes whereunder the amounts relatable to sale of scrap material, sale of old newspapers and sale of condemned furniture have been sent to the respondent/accused. PW.3 G.Rajasekhar, is the Assistant to the respondent/accused. He testifies that it is the respondent/accused who made entries in Exs.P14 and P15 cash books. Exs.P40 to P48 are the relevant entries in Ex.P14 cash book and Exs.P49 and P50 are the relevant entries in Ex.P15 cash book. The respondent/accused does not dispute of his being the author of the entries in the cash books. The evidence of PWs.3, 6, 7 and 8 clearly establish that the respondent/accused received various amounts from the welfare section and failed to deposit in bank to the credit of the government account and thereby misappropriated the said amounts. The reasons assigned by the trial Court for not believing the testimony