IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED:27.06.2011 C O R A M THE HONOURABLE MR.JUSTICE P.R.SHIVAKUMAR Crl.A.No.862 of 1999 K.G.Sundaram ... Appellant/Accused Vs. State Rep. by Inspector of Police SPE/CBI/ACB/CHENNAI D.R.C.No.44(A)/90) ... Respondent/Complainant Criminal Appeal filed under Sections 374, 382, 386 of Cr.P.C and Section 27 of the Prevention of Corruption Act, 1988 as against the judgment of conviction and sentence dated 05.10.1999 of the learned Principal Special Judge for CBI Cases, Chennai made in New C.C.No.88 of 1997, old C.C.No.111 of 1993 397 r/w.401 of Criminal Procedure Code For Appellant :Mr.AR.L.Sundaresan, Sr. Advocate for M/s.Lakshmi Priya Associates For Respondent :Mr.N.Chandrasekaran Special Public Prosecutor for CBI cases JUDGMENT The sole accused in C.C.No.88 of 1997 on the file of the learned Principal Special Judge for CBI Cases, Chennai, who stood charged for an offence under Section 13(2) r/w.13(1)(e) of Prevention of Corruption Act, 1988, tried and found guilty as per the charge and sentenced by the trial Court in its judgment dated 05.10.1999 to undergo simple imprisonment for one year and to pay a fine of Rs.5,000/- with a default sentence of two months simple imprisonment, has come forward with the present appeal against the conviction as well as sentence. 2.The facts of the prosecution case, in brief, are as follows: i) The appellant/accused joined the Indian Oil Corporation as an officer on 19.12.1964 and was promoted to the rank of Assistant Manager on 14.06.1969 and to the rank of Deputy Manager on 13.07.1983. From 13.07.1983 to 29.08.1990, he was functioning as Deputy Manager (Lubes), Indian Oil Corporation, Chennai. Haridasan Nair, Inspector of Police, SPE:CBI:ACB Madras received reliable information that the appellant/accused was possessing https://hcservices.ecourts.gov.in/hcservices/ disproportionate wealth and on preliminary investigation, the appellant's/accused's income during the check period, namely the period from 13.07.1983 to 18.08.1990, was found to be Rs.9,24,000/-. The expenditure and the likely savings of the appellant/accused in the said period were estimated approximately at Rs.2,68,000/- and Rs.6,56,000/- respectively. The assets possessed by the appellant/accused was valued at Rs.13,80,200/- and hence it was found that he was in possession of assets disproportionate to his known sources of income to the tune of Rs.7,24,200/-. Information was also collected to the effect that the appellant/accused would not be in a position to satisfactorily account for the above said excess assets and hence, PW-17-Haridasan Nair prepared Ex.P125-First Information Report in the printed format and registered a case in Crime No.R.C.44(A)/90 on 28.08.1990 on the file of Delhi Special Police Establishment, ACB Madras Branch. After the registration of the case, the Superintendent of Police, SPE:CBI:ACB Madras authorized Haridasan Nair, Inspector of Police, CBI, ACB Madras to investigate the same by issuing proceedings dated 28.08.1990 under Ex.P129. PW-17 Haridasan Nair obtained search warrants from the Chief Metropolitan Magistrate, Chennai and conducted search at the residence of the appellant/accused in Chennai and prepared Ex.P4 search list. In the search made in the residence of the appellant/accused, a cash of Rs.1,71,000/- was also seized. He also caused searches to be made in four other places. Ex.P130 is the search list prepared by PW17-Mr.Ramanaghulu, who conducted the search in the second place. Though searches were made in the remaining three places also, no property and no document was seized from those places. For the searches Ex.P5 search inventory was also prepared by PW17. ii) On 08.01.1991, PW2-G.Manian, who was working as Chief Town Planning Officer in Madurai Corporation, handed over the documents relating to the building belonging to the appellant/accused within the corporation limits of Madurai, in respect of which appellant/accused had paid a sum of Rs.520 towards licence fee and Rs.1,270/- towards road laying fees. During the course of investigation, PW3 furnished information regarding the rent paid by the appellant/accused for the residential portion at Deenadayalu Street, Thyagaraya Nagar, Chennai in which the appellant was residing as a tenant. Ex.P2-Electricity consumption card containing the particulars of electricity consumed for the above said building was produced by PW4-Munusamy, the Junior Engineer, Tamil Nadu Electricity Board, T.Nagar, Chennai along with the covering letter Ex.P3. iii) PW-17, the Investigating Officer examined PW5-Subbiah, then the Joint Sub-Registrar No.IV, Madurai on 07.01.1991 and PW-5 furnished the information that the appellant K.G.Sundaram had purchased a property in S.No.43/1B from one Sambandam at Ponmeni village under a document registered as Document No.5182/83 for a sum of Rs.21,112/-, for which a stamp duty of Rs.2,751.60 and a registration fee of Rs.215/- were paid. The Investigating Officer also prepared Ex.P5-search list, which was attested by PW6 and the above said Rajamanikkam. PW-7-P.V.Viswanathan was the Deputy https://hcservices.ecourts.gov.in/hcservices/ Manager of Indian Oil Corporation during the period 1991-1992. He furnished the salary particulars of the appellant/accused under Ex.P54 and the particulars relating to the loans obtained and Income Tax paid under Ex.P55 to the Investigating Officer. On the instructions of the Superintending Engineer of CPWD, PW-8- Thiru.Muthusamy, who was the then Assistant Electrical Engineer in CPWD, inspected the house of the appellant/accused at Somasundaram Colony, Madurai on 21.01.1991 along with the Inspector of Police and a Civil Engineer (PW-10-P.Natarajan) and estimated the value of the building, electrical appliances and motor pump-set. On the basis of his inspection, he issued Ex.P84 valuation certificate. iv) During the course of investigation, the Investigating Officer, namely P.W.17-Haridasan Nair obtained search warrant from the Chief Metropolitan Magistrate, Madras and conducted searches in the premises of the appellant/accused in five places. Out of the five places nothing was recovered from three places and the search list prepared by him is Ex.P7. For the seizures made in the residence of the appellant/accused, Ex.P4-search list was prepared and for the seizures made in the premises belonging to Ramanaghulu, Ex.P130-search list was prepared. During search a cash of Rs.1,71,000/- was recovered. An inventory was also taken under Ex.P10. The income of the appellant/accused was ascertained to be Rs.8,27,404/- and the value of the assets created by him during the check period was estimated at Rs.14,04,495.10. The value of the disproportionate wealth was fixed at Rs.7,16,761.91P as per the calculations. After an opportunity was given to the appellant/accused to explain the sources for the said assets, he was not able to give satisfactory explanation and on the other hand, the explanation given was not convincing and hence P.W.17 decided to file a charge-sheet. Before filing the charge-sheet, he applied for sanction for prosecution. P.W.1-Ram Mohan, who was the General Manager (Lubes), Marketing Operation, Indian Oil Corporation Head Office, Mumbai was the competent officer to take disciplinary action against the appellant/accused, as he was a 'C' grade officer. He perused the records placed before him, applied his mind and on being satisfied that there were enough materials to prosecute the appellant/accused, accorded sanction under Ex.P1 for such prosecution. P.W.17 submitted the final report dated 16.03.1999, along with the said sanction order, on the file of the Special Judge for CBI cases alleging commission of an offence punishable under Section 13(2) r/w 13(1)(e) of the Prevention of Corruption Act, 1988. 3. The trial judge took the final report on file as C.C.No.111/1993, framed necessary charges and conducted trial pursuant to the plea made by the appellant/accused that he was not guilty. In order to prove the case of the prosecution, P.Ws.1 to 17 were examined and Exs.P1 to P134 were produced on the side of the prosecution. 4. After the completion of recording of evidence on the side of the prosecution, the appellant/accused was questioned under Section 313(1)(b) regarding the incriminating materials available https://hcservices.ecourts.gov.in/hcservices/ in the evidence adduced on prosecution side. The appellant/accused denied them to be false and reiterated his stand that he was not guilty. The appellant/accused examined 11 witnesses as D.Ws.1 to 11 and produced 98 documents as Exs.D1 to D98 on his side. 5.At the conclusion of trial, the learned trial judge heard the arguments advanced on both sides and considered the evidence adduced on both sides. Upon such consideration, the learned Trial Judge came to the conclusion that the charge against the appellant/accused was proved and accordingly convicted him for the offence as per the charge and imposed punishment as indicated supra. However the learned trial Judge quantified a lesser amount as the value of unexplained disproportionate wealth. Challenging the conviction as well as the sentence, the appellant/accused has come forward with the present appeal. 6. The arguments advanced by Mr.AR.L.Sundaresdan, learned senior counsel representing M/s.Lakshmi Priya Associates, learned counsel on record for the appellant and by Mr.N.Chandrasekaran, learned Special Public Prosecutor for CBI cases, appearing for the respondent were heard. The materials available on record were also perused. 7. The point that arises for consideration in this appeal is: "Whether judgment of the trial court convicting the appellant/accused is infirm and defective either in respect of conviction or in respect of punishment or in respect of both warranting interference of this court in this appeal?" 8. The first information report was registered alleging that the appellant/accused was in possession of assets disproportionate to his known sources of income to the tune of Rs.7,24,200/-. After investigation, a final report was filed in which the value of the disproportionate wealth was shown to be Rs.7,16,767.91P. The check period was taken as the period between 13.07.1983 to 29.08.1990. However, the learned trial judge came to the conclusion that the appellant/accused was not able to account for a portion of the said amount and the value of the unaccounted disproportionate wealth was Rs.2,93,034/-. 9. It is the contention of the learned senior counsel for the appellant that the trial Court committed an error in not taking note of the fact that the Investigating Officer valued the assets at the beginning of the check period at a lower rate and in direct contrast to the same, the value of the assets at the end of the check period was made at a higher rate; that the court below failed to appreciate the fact that the Investigating Officer took into account the assets acquired and investments made not during the check period, but subsequent to the check period, whereas the income of the appellant/accused covering the said subsequent period was not taken into consideration to find out whether the wealth possessed by the appellant/accused was disproportionate to the known sources of income; that the Court below also failed to note https://hcservices.ecourts.gov.in/hcservices/ that the investments proved to be belonging to other persons had also been included in the assets of the appellant/accused and that if the said discrepancies were taken into consideration, then the margin between the source of income and the value of the assets acquired during the check period would be small. It is the further contention of the learned senior counsel for the appellant that the Investigating Officer and also the Court below failed to take into account the correct figure of income received by the appellant/accused as rent for his building and a major portion of the income of the wife of the appellant/accused was also omitted to be taken into consideration and that if the same are also taken into consideration, then the margin will be either nil or within the permissible percentage. 10.Per contra, the learned Special Public Prosecutor for CBI cases has contended that the assets that were available at the beginning of the check period were correctly noted after making an inventory and the value of the assets acquired prior to the check period as per the documents and information furnished by the appellant/accused was adopted in Statement-A filed along with the final report. It is the further contention of the learned Special Public Prosecutor that the value of the assets found at the end of the check period was correctly ascertained with reference to the bills, vouchers and also the valuation made by competent officials to evaluate and hence the figures furnished in Statement-B cannot be challenged as valuation made at a higher rate. The learned Special Public Prosecutor for CBI Cases has contended further that the entire income of the appellant, including the income of the wife of the appellant/accused, during the relevant period was taken into consideration and all the items of such income were included in Statement -C; that the probable expenditure during the check period has been stated correctly or even at a lower rate by the Investigating Officer in Statement-D and that, therefore, it cannot be said that a portion of the income was left out and the expenditure during the check period was boosted to show the assets held by the appellant/accused to be disproportionate to the known of sources of income of the appellant/ accused. The learned Special Public Prosecutor would submit that even the scaling down of the expenditure by the trial Court ought not to have been done and the figure noted in Statement – D as total amount of probable expenditure during the check period ought to have been taken as correct; that even assuming that certain items in Statement-B could be omitted as investments not pertaining to the check period or belonging to third persons, still a considerable difference shall be noticed between the net income derived from all sources and the assets acquired during the check period; that the amount that would have been saved during the check period for investment towards the assets acquired during the check period would be less than the value of the assets acquired during the check period and that the difference shall be several items more than the permissible limit. This Court paid its anxious considerations to the above said submissions made on both sides. https://hcservices.ecourts.gov.in/hcservices/ 11.Along with the final report, PW17-Investigating Officer has produced four statements with the designations 1) Statement – A, 2) Statement – B, 3) Statement-C and 4) Statement – D. 44 items have been shown in Statement-A as assets possessed by the appellant / accused at the beginning of the check period i.e., as on 13.07.1983. The total value of the assets that were available with the appellant/accused as on 13.07.1983 has been shown as Rs.37,317/-. The details of assets and their value at the end of the check period, namely as on 29.08.1990 are found noted in Statement-B. A total number of 99 items have been shown in Statement-B and the total value of those items has been given as Rs.14,04,495.10P. The total income of the appellant/accused during the check period, namely the period between 13.07.1983 to 29.08.1990, including the income of the wife of the appellant/accused, is shown to be Rs.8,27,404.66P in Statement-C. The probable expenditure of the appellant/accused during the check period is furnished in Statement -D. Totally 12 items of expenditure have been noted therein and the total expenditure of the appellant/accused during the check period is given as Rs.1,76,994.47P in Statement-D. Deducting the total amount found in Statement-D, representing the probable expenditure incurred by the appellant/accused during the check period, from the total amount of income found noted in Statement-C., the figure of Rs.6,50,410.19P was arrived at by the Investigating Officer as the savings of the appellant/accused during the check period that could have been invested for the acquisition of the assets during the check period. The difference between the value of the assets acquired during the check period (namely total amount found in Statement – B minus total amount found in Statement-A) and the amount representing the probable savings (namely total amount found in Statement – C minus total amount found in Statement-D), was found and thus the Investigating Officer arrived at the figure Rs.7,16,767.91P as the value of the unexplained assets, for which the appellant/accused was not able to show the source of investment. According to the prosecution, the appellant/accused was not able to account for the assets to the tune of Rs.7,16,767.91P and hence he had committed the offence of misconduct punishable under Section 13(2) r/w.13(1)(e) of Prevention of Corruption Act, 1988. 12. It is the contention of the learned senior counsel for the appellant/accused that though the appellant/accused was facing charge of possessing assets disproportionate to his known sources of income and hence he was bound to satisfactorily account for the same, the initial burden of showing that the assets held by the appellant/accused was disproportionate to the sources of income of the accused known to the prosecution lies on the prosecution and that only when the prosecution discharges its burden of proving the same, the burden shall be shifted and cast upon the appellant/accused to satisfactorily account for such assets found to be over and above the known sources of income. In other words, the contention of the learned senior counsel for the appellant is that a public servant facing a charge of possessing disproportionate wealth shall have a defence, which is two fold : – https://hcservices.ecourts.gov.in/hcservices/ firstly, to contend that the prosecution has not proved that the assets held by him is disproportionate to the income derived from lawful sources known to the prosecution and secondly, even if the prosecution is able to show that the accused is in possession of assets in excess of his known sources of lawful income, the appellant/accused shall have the opportunity of showing that such assets were acquired with the help of any income derived from any lawful source. The said contention of the learned senior counsel for the appellant states the proposition of law, the correctness of which cannot be disputed and in fact, is not disputed by the other side namely, the Special Public Prosecutor for CBI Cases. Based on the above submission regarding the preposition of law, the learned senior counsel for the appellant has argued that the prosecution failed to prove that the appellant/accused did possess assets disproportionate to or in excess of his known sources of income. In this regard, the following are the points urged by the learned senior counsel in his submissions to show that the prosecution failed to prove that the appellant/accused did possess assets disproportionate to his known sources of income:- 1)assets at the beginning of the check period were not correctly valued and they were under valued; 2)value of the assets found at the end of the check period was assessed at a higher amount by including assets that were not that of the appellant/accused and also by adopting higher value than the actual value for certain items; 3)income during the check period was assessed at a lower rate and certain income that came from lawful sources were omitted to be taken into account; and 4)expenditure of the appellant/accused during the check period was assessed at a higher rate and obsessed by duplication of items of expenditure. 13.The learned senior counsel for the appellant pointed out the fact that the contention of the appellant was partly accepted by the trial Court and it arrived at a conclusion that the value of the disproportionate wealth possessed by the appellant/accused at the end of the check period was Rs.2,93,434/- as against Rs.7,16,797.91P stated by the prosecution in the final report. The learned senior counsel for the appellant would contend that the trial Court committed an error in disallowing the claim of the appellant/accused for increase in the estimate of the assets at the beginning of the check period and also for the reduction of the value of the assets found at the end of the check period and that the Court below also committed an error in negativing the claim of the appellant/accused for the increase in estimation of the income of the appellant and reduction of the probable household expenditure during the check period. Let us now consider the sustainability of the above said contentions made by the learned senior counsel for the appellant to find out whether the Court below is right in holding the appellant/accused guilty of the offence as per the charge. https://hcservices.ecourts.gov.in/hcservices/ 14. Statement – A contains 44 items of assets which were claimed to be with the appellant/accused at the beginning of the check period. All those items were included in Statement-A based on the documents produced showing the date of acquisition and the statements made by the accused and his family members regarding the time of acquisition and value of those items. An ancestral house, value of which has not been noted, is shown to be the first item in Statement-A. That is the reason why the said ancestral house is not shown to be one of the assets included in Statement-B representing the assets found at the end of the check period. If its value is noted in Statement-A, the very same value should be reflected in statement-B also. To find out the assets acquired during the check period, the value of the assets found in Statement-A should be deducted from the value of the assets found in Statement-B. Therefore, the omission to state the value of the ancestral house or the value of the share of the appellant in it, does not have any consequence as the inclusion of the same in both the statements, namely Statement-A and Statement-B, will neutralize and will not effect any change in the value of the assets acquired during the check period. It is also pertinent to note that no argument was advanced on behalf of the appellant/accused finding fault with the Court below for not showing the value of the ancestral house or the share of the appellant in it in Statement-A. 15. So far as Item No.2 found in Statement -A is concerned, admittedly the same was purchased as a vacant site by the appellant/accused before the check period. The Sub-Registrar, on whose file the sale deed under which the appellant/accused purchased it as a vacant site in the year 1983, has been examined as PW5. According to his testimony, the said property was purchased as a vacant site under a sale deed registered as Document No.5182 of 1983 on the file of the Joint Sub-Registrar No.4, Madurai and the sale consideration was Rs.21,112/-. The very same plot was also available at the end of the check period, but with the construction that was made by the appellant in the said plot during the said period. Therefore, the prosecution has rightly chosen to state the same amount as value of the plot in Statement-A and Statement-B and separately assess the value of the building. 16. Item No.17 to 44 in Statement – A are share certificates and their values at the beginning of the check period noted in Statement-A are not disputed. They are also repeated in Statement- B representing the assets at the end of the check period. Items 3 to 14 found in Statement – A are the household articles. As rightly held by the trial Court, those items are found included in Item No.1 of Statement-B. Two items in Statement-A (items 15 and 16) are gold ornaments. Item 15 is a minor chain and its value at the time of acquisition is noted as Rs.700/- in accordance with the statement made by the appellant/accused and the members of his family at the time of inventory. The same value is reflected in Statement-B also. Item No.16 in Statement -A is shown to be 55.7 sovereigns of gold ornaments. Its value is not found noted in Statement-A. It was the contention of the appellant/accused before the trial Court that the value of those jewels ought to have been https://hcservices.ecourts.gov.in/hcservices/ included in the assets that were available at the beginning of the check period and the same should have been deducted from the total value of the assets found in Statement-B to arrive at the value of the assets acquired during the check period. Statement-A refers to the assets which were claimed to be with the appellant/accused at the beginning of the check period. The check period is between 13.07.1983 and 29.08.1990. But the inventory of such assets was taken under Ex.P5 only on 29.08.1990. A total number of 48 items are found noted in Ex.P5 inventory. Out of the said 48 items, 14 items have been shown to be purchased prior to the check period and their values have also been furnished. The total value of those 14 items as found in Ex.P5