IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE M.SASIDHARAN NAMBIAR MONDAY, THE 10TH JANUARY 2011 / 20TH POUSHA 1932 CRL.A.No. 294 of 2002 ------------------------------------- CC.9/1999 of ENQUIRY COMMR. & SPL.JUDGE, KOZHIKODE .................... APPELLANT/2ND ACCUSED: M.SIVARAMAN, S/O.CHOYIKUTTY, MUTHIRAKALAYIL HOUSE, JOSEPH ROAD, RADHAMANDIRAM, KOZHIKODE. BY ADV. SRI.T.G.RAJENDRAN RESPONDENTS/COMPLAINANT/STATE: 1. DEPUTY SUPERINTENDENT OF POLICE, VIGILANCE AND ANTI-CORRUPTION BUREAU, KOZHIKODE. 2. STATE REP. BY PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM. BY PUBLIC PROSECUTOR SRI.I.V.PRAMOD THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 10/01/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: M.Sasidharan Nambiar, J. -------------------------------------- Crl.A.No.294 of 2002 -------------------------------------- JUDGMENT Appellant, the second accused in C.C.No.9/1999, was convicted and sentenced for the offences under Section 13 (2) read with Section 13(1)(c) of Prevention of Corruption Act and Section 409 of Indian Penal Code by Special Judge (Vigilance), Kozhikode. Prosecution case is that first accused was the Lay Secretary and Treasurer of Institute of Maternal and Child Health, Kozhikode. Appellant was the Peon therein. The treasury bills of the establishment were being presented to the Treasury and get them encashed by the first accused authorising appellant. It is the prosecution case that during the period 3.2.1992 to 25.2.1992, Rs.68,774/- covered by Exhibit P20 series of bills which were encashed from the Treasury, by presenting the bills along with Exhibit P2 Treasury Bill Book were not accounted and both the accused misappropriated the CRA 294/02 2 amount and thereby committed the offences. As authorised by the first accused, appellant presented Exhibits P20(d) to P20(h) bills on 25.2.1992 and got the bills passed and did not entrust the amount to the first accused. Appellant did not attend the office from 26.2.1992 onwards. First accused submitted Exhibit P1(a) report to PW1, Superintendent of Institute of Maternal and Child Health, Kozhikode informing the non receipt of the amount covered by the Treasury Bills and the absence of the appellant PW1, in turn, intimated the police under Exhibit P37(a). Based on the information Crime No.59/1992 was registered under Exhibit P37 FIR of Medical College Police Station. As the offences alleged include offence under Prevention of Corruption Act, the case was transferred to Vigilance and Anti Corruption Bureau, Kozhikode. PW23, Superintendent of Police, Vigilance and Anti Corruption Bureau, re-registered the case so received as Vigilance Crime No.2/1993 under Exhibit P44 FIR. PW22, Deputy Superintendent of Police, investigated the case. PW24 continued the investigation and CRA 294/02 3 laid the charge on getting Exhibit P38 order sanctioning the prosecution. Learned Special Judge took cognizance of the offences under Section 13(1) read with Section 13(2) and Sections 409 and 109 of the Indian Penal Code. On the appearance of the accused learned Special Judge framed charge for the offences under Section 13(1)(c) read with Section 13(2) of Prevention of Corruption Act and Section 409 of Indian Penal Code against both the accused and for the offence under Section 109 of Indian Penal Code also against the first accused. Both the accused pleaded not guilty. 2. Prosecution examined 24 witnesses and marked Exthibits P1 to P44. After closing the prosecution evidence, accused were questioned under Section 313 of Code of Criminal Procedure and were called upon to adduce evidence, if any. Appellant examined DW1. Learned Special Judge, on the evidence, found the first accused not guilty of the offences and acquitted him. Finding that Exhibits P20 (a) to P20(h) bills were presented before the CRA 294/02 4 Treasury, as authorised by the first accused, by the appellant and the bills were encashed by him and holding that appellant did not entrust the amount back to the first accused and he misappropriated Rs.68,774/-, appellant was found guilty of the offences. He was convicted and sentenced to rigorous imprisonment for two years and a fine of Rs.67,481/- and in default, simple imprisonment for two years for the offence under Section 13(2) read with section 13(1)(c) of Prevention of Corruption Act and rigorous imprisonment for two years for the offence under Section 409 of Indian Penal Code. The substantive sentences were directed to run concurrently. He was granted set off as provided under Section 428 of Code of Criminal Procedure. This appeal is filed challenging the conviction and sentence. 3. Learned counsel appearing for the appellant and learned Public Prosecutor were heard. 4. Argument of the learned counsel appearing for the appellant is that learned Special Judge did not properly appreciate the evidence and should have found that first CRA 294/02 5 accused, being the Drawing and Disbursement Officer, who is responsible to keep custody of Exhibit P2 Treasury Bill Book and to present it, along with the bills for encashment was primarily responsible for the amount encashed through the appellant. It was argued that Exhibit P2 Treasury Bill Book establishes that appellant had encashed the bills as authorised by the first accused and entrusted the money to the first accused but first accused was not in the habit of properly accounting the amount so received. It was pointed out that Exhibit P2 Treasury Bill Book shows that on 18.2.1992, 21.2.1992 and 25.2.1992 several bills were entrusted by the first accused to the appellant, to present them before the Treasury and first accused admitted receipt of money so encashed under many of those bills, though he is disputing entrustment of the money covered by Exhibits P20(a) to P20(h) bills. Learned counsel pointed out that when Exhibit P26, the personal register maintained by the first accused, establishes that some of the bills encashed on 25.2.1992 were entrusted to the first accused by the CRA 294/02 6 appellant, he cannot be heard to contend that the remaining amounts covered by the bills were not entrusted to him and as appellant had to take leave on compelling reasons on 26.2.1992 and could not attend the office on the next two or three days a complaint was lodged to escape from the liability, as first accused was aware that audit will be conducted on 27.2.1992 and that audit would reveal the misappropriation. It was argued that when appellant is responsible for receipt of the amount covered by Exhibits P20(a) to P20(h) bills, when first accused admitted that appellant entrusted the remaining undisputed bills, which were entrusted to the appellant by the first accused on 18.2.1992, 21.2.1992 and 25.2.1992, learned Special Judge should not have accepted the case of the first accused or the prosecution that appellant did not entrust the amount covered by Exhibits P20(a) to P20(h) bills to the first accused and for the sole reason that appellant did not attend the office on 26.2.1992 and the subsequent days, appellant could not be convicted. Learned counsel pointed CRA 294/02 7 out that appellant was convicted finding that he did not attend the office on 26.2.1992 onwards and Exhibit P2 Treasury Bill Book was not returned by the appellant to the first accused but there is no evidence to prove that Exhibit P2 Treasury Bill Book was returned to the appellant on 25.2.1992. It was argued that evidence would establish that when bills are objected to by the Treasury Officer, there is a practice of retaining the Treasury Bill Book in the Treasury and Exhibit P2 shows that two bills were objected on audit reasons and in such circumstances, explanation of the appellant that Exhibit P2 Treasury Bill Book was not returned to the first accused on 25.2.1992 should have been accepted, especially when, it is the prosecution case that subsequently Exhibit P2 Treasury Bill Book was produced before the Deputy Superintendent on 15.9.1992, by PW1, the Treasury Officer. 5. Learned Public Prosecutor argued that it is not disputed that Exhibits P20(a) to P20(h) bills were entrusted by the first accused to the appellant authorising him to CRA 294/02 8 present them before the Treasury and to get them encashed and appellant admittedly encashed them and there is no evidence to prove that the amount so received by the appellant under Exhibits P20(a) to P20(h) bills were entrusted to the first accused or to the office by the appellant and therefore, the conviction is perfectly legal. 6. The following points arise for consideration: 1. Whether appellant misappropriated Rs.68,774/- received under Exhibits P20(a) to P20(h) bills? 2. Whether appellant committed the offence under Section 13(1)(c) read with Section 13(2) of Prevention of Corruption Act and Section 409 of Indian Penal Code and if so, whether the sentence awarded is reasonable? The Points: 7. The fact that appellant, the second accused, was Peon of Institute of Maternal and Child Health, Kozhikode and he was being authorised by the first accused Lay Secretary as the Disbursing Officer, to present the bills before the Treasury and to receive the amount on behalf of CRA 294/02 9 the first accused are not disputed. It is proved by Exhibit P2 Treasury Bill Book also. It is also in evidence that even though, as per the Rules, first accused is to authorise a Clerk to present the bill and receive the amount if it exceeds Rs.10,000/-, first accused was sending the appellant even if the bill exceeds Rs.10,000/- is also not disputed. Prosecution case is that first accused authorised appellant to present Exhibit P20 series of bills and they were presented before the Treasury by the appellant and he received the amounts and first accused, along with the appellant, misappropriated the amount by not showing receipt of the amount in the account of the Institute of Maternal and Child Health. Learned Special Judge, on the evidence, found the first accused not guilty of the offences and acquitted him holding that there is no evidence to prove that first accused, in any way, assisted or aided appellant in the misappropriation, even though there are circumstances indicating laches on his part in the financial transactions of the establishment through the Treasury. Learned Special CRA 294/02 10 Judge found that as appellant admitted that he received Rs.68,774/-, evidenced by Exhibits P20(a) to P20(h) bills and there is no evidence to prove that he entrusted the amount to the first accused and as appellant did not attend the offence from 26.2.1992 onwards and did not take Exhibit P2 Treasury Bill Book from the Treasury, appellant is guilty of the offences. As rightly pointed out by the learned counsel appearing for the appellant, learned Special Judge did not appreciate the evidence properly. 8. Exhibit P2, the Treasury Bill Book, contains the instructions to be followed by the Disbursing Officers. 9. Under Instruction No.6, Drawing Officer is personally responsible for the entries in Column Nos.1 to 6 and 12 to 13 and for any omission to make appropriate entries in these columns in respect of any bill. Similarly, the Treasury officer shall be responsible for entries in Columns 7 to 11 and for the omission to make any entry in these columns in respect of any bill presented/ encashed at the Treasury. Column 14 may be filled up and attested by the CRA 294/02 11 Drawing Officer or the Treasury Officer, as the case may be, according to the nature of the entry made therein. Instruction No.7 is most relevant. It reads: “Columns 12 and 13 shall be completed by the Drawing Officer on the same day of encashment of the bill.” 10. Under Instruction No.8, when a bill is objected to in the Treasury, the word 'objected' should be got written in column 10 by the Treasury or the Sub Treasury Officer with dated signature in column 11. When such bills are presented again after clearing the objections, bills should be entered afresh in the Bill Book. Instruction No.9 reads: “Drawing Officer shall take note of the fact if columns 1 to 6 and 12 to 13 are not filled up by him, the bills presented subsequently at the Treasury will not be honoured for payment.” Instruction No.10 reads: “It is the primary responsibility of the Drawing Officer to get back the Treasury Bill Book from the concerned Treasury immediately after the bills CRA 294/02 12 presented are cashed or objected and to keep the book safely. Used Treasury Bill Books should be preserved as a permanent record.” Therefore, under Instruction No.7, Drawing Officer is expected to complete columns 12 and 13 on the same day of encashment of the bill. Column 12 relates to the date of entry in the cash book and column 13 signature of the Drawing Officer in charge of the cash. Therefore, it is clear that when a bill, along with the Treasury Bill Book, is presented before the Treasury for encashment either by the Disbursing Officer personally or as authorised by him by some other subordinate officer, as and when the bill is encashed or objected to, the Treasury Bill Book shall be received back by the drawing Officer and on the date of encashment of the bill itself, columns 12 and 13 are to be filled up. If column 12 is to be filled up on the same day, it is mandatory that receipt of the amount covered by the bill should be entered in the cash book on the same day and then only, the date of entry in the cash book could be CRA 294/02 13 entered in column 12 and Disbursing Officer could affix his/her signature in column 13. 11. Exhibit P2 Treasury Bill Book conclusively establish that Exhibit P20(a) bill was presented before the Treasury. It is seen entered as Sl.No. 209 in Page No.33 of Exhibit P2. The relevant entry was separately marked as Exhibit P2(a). It is for Rs.1,293/-. The bill shows that after it was prepared, first accused signed in it on 29.1.1992 and it was passed by the Treasury as Bill No.3372 on 29.1.1992. It shows that the amount thereunder was received by the appellant on 3.2.1992. As per Instruction No.7, first accused should have shown receipt of that amount in the cash book on the same day and should have filled up columns 12 and 13 also on the same day. Exhibit P2 Treasury Bill Book shows that first accused filled up columns 12 and 13 on 30.1.1992, but did not fill up columns 12 and 13 in Exhibit P2(a) entry. At the same time, Exhibit P2 shows that in Page No.34, the bills encashed subsequently on 1.2.1992 were received by the first accused and columns 12 and 13 were filled up on CRA 294/02 14 3.2.1992. Exhibit P2 shows that even thereafter first accused was sending bills for presentation before the Treasury through the appellant. Though Exhibit P2 shows that various bills were encashed, columns 12 and 13 were not filled up in many of the pages of Exhibit P2 Treasury Bill Book, in violation of the mandatory instructions provided under Instruction No.7 of Exhibit P2 Treasury Bill Book. Learned Special Judge unfortunately held that though instructions are mandatory to the Drawing Officer and if the bills are not presented following the instructions, they need not be honoured by the Treasury, it does not prohibit the Treasury officer from receiving the bills or passing the bills. I cannot agree with the said finding. When instructions in the Treasury Bill Book mandate that as when bills presented before the Treasury are encashed or objected to, the Bill Book should be received back by the Disbursing Officer from the Treasury and columns 12 and 13 should be filled up on the same day and before presenting the next bill, columns 12 and 13 should be filled up. The Treasury Officer CRA 294/02 15 should not have passed the bill when columns 12 and 13 are not filled up regarding the bills which were passed previously. Whatever it be, when presentation or encashment of Exhibit P20 bill, evidenced by Exhibit P2(a) entry is not the subject matter of the charge, it is not very relevant to be considered in this appeal. 12. Exhibit P20(a) bill is for Rs.4,034/-. It shows that the bill relates to arrears of pay consequent to the pay fixation of several employees, including PW4, the Nursing Assistant. Exhibit P2 Treasury Bill Book shows that it was prepared as Bill No.444/91-92 and was entered in Exhibit P2 as Sl.No.254 and was presented before the Treasury through the appellant, along with Exhibit P2 bill book. The relevant entry shows that first accused signed in column 6 on 17.2.1992 and the bill was passed on 18.2.1992. Though learned Special Judge, on the evidence, found that there is no evidence to prove that appellant, who admittedly encashed the amount, did not pay the amount covered by Exhibit P20(a) bill to the first accused, Exhibit P2 bill book CRA 294/02 16 shows that several other bills were also presented before the Treasury by the appellant on the same day and were encashed. Sl.No.251 is a bill for reimbursement for Rs.3,350/- and it was presented on 17.2.1992 and was passed on 18.2.1992. As Sl.No. 250, bill for Rs.15,120/-, being the GPF advance, was presented through appellant on 17.2.1992 and was passed on 17.2.1992. As Sl.No.249, GPF advance bill for Rs.10,250/- was presented before the Treasury through the appellant and was encashed on 17.2.1992. Similarly, bills shown as Sl.Nos.252, 253, 254, 255, 256, 257, 258, 259 and 260 were also presented on 17.2.1992 respectively for Rs.534/-, Rs.995/-, Rs.4,034/- Rs.665/-, Rs.23,120/-, Rs.7,280/-, Rs.2,428/-, Rs.2,630/- and Rs.792/-. Columns 12 and 13 are seen filled up. Therefore, Exhibit P2 itself establishes that even though bills were presented before the Treasury through appellant and were encashed, the bill book was not properly maintained. Exhibit P26 was produced as the personal register maintained by the first accused. It is claimed that in Exhibit CRA 294/02 17 P26 register, first accused used to enter the amounts received by him as entrusted by the appellant after bills were encashed from the Treasury. Case is that if the amounts covered by Exhibits P20(a) to P20(h) bills were encashed and those amounts were entrusted to the first accused by the appellant, it would have been entered in Exhibit P26 register. Argument is that as Exhibit P26 register does not contain the entries for receipt of the amounts covered by Exhibits P20(a) to P20(h) bills, it is to be accepted that amounts were not entrusted by the appellant. If Exhibit P26 was being properly maintained and the amounts covered by the disputed bills are not seen in the said register, it could be said that appellant did not entrust the amount. But, when Exhibit P26 is a personal register maintained by the first accused and appellant has no opportunity to go through the register and when no endorsement of the appellant is being obtained in Exhibit P26 register, if first accused committed omissions in preparing Exhibit P26, based on the omissions in Exhibit CRA 294/02 18 P26, it cannot be said that appellant did not entrust the amounts received by him, on encashing the bills, to the first accused. When Exhibit P2 Treasury Bill Book establishes that several bills were presented before the Treasury on the same day and when subsequent bills are presented before the Treasury by the Disbursing Officer and he is expected to fill up columns 12 and 13 before presenting the subsequent bills, first accused should have necessarily gone through Exhibit P2 Treasury Bill Book regarding the details of the previous bills. If first accused had gone through the relevant entries about the previous bills in Exhibit P2 before presenting the subsequent bills, he must be aware of the fact that previous bills were encashed. If that be so, defence of the first accused cannot be believed that he was unaware of encashment of the previous bills and therefore, he did not find out the omissions or misappropriation, if any, committed by the second accused. As stated earlier, when Exhibit P20(a) bill is seen passed by the Treasury on 18.2.1992 as Sl.No.254 of Exhibit P2, first accused CRA 294/02 19 admittedly presented the subsequent bills on 21.2.1992 through the appellant, evidenced by Exhibit P2 Treasury Bill Book. It cannot be believed that first accused was unaware of encashment of Exhibit P20(a) bill on 18.2.1992. Exhibit P26 register also shows that first accused had shown receipt of several bills, including GPF advance Bill 83 and Treasury Bills 440, 446, 447, 448 and 449. It is also to be borne in mind that Exhibit P20(a) bill includes arrears of salary to be paid to PW4. In such circumstances, it cannot be believed that the staff will be unaware of encashment of the bills. 13. Exhibit P20(b) bill for Rs.14,237/- was seen prepared on 21.2.1992. It relates to surrender of earned leave of various staff of Institute of Maternal and Child Health. It is seen presented as Bill No.450/91-92 and passed by the Treasury as Bill No.1786 on 21.2.1992. Similarly, Exhibit P20(c) bill was seen prepared on 19.2.1992 for Rs.21,740/- and was presented as Bill No.85/91-92 and passed by the Treasury on 21.2.1992 as Bill No.1785. These CRA 294/02 20 two bills are seen encashed by Token Nos.1237 and 686 by the appellant as per the endorsements made on 21.2.1992. Exhibit P2 Treasury Bill Book also shows that they were passed and encashed. The relevant entry in columns 12 and 13 are not seen filled up, either in respect of the said bills or the bills presented and encashed along with those bills, on the same day. Even though Exhibit P2 Treasury Bill Book was presented along with subsequent bills on 25.2.1992, it shows that on 21.2.1992, apart from Exhibits P20(b) and P20(c) bills, Bill No.86/91-92 for Rs.27,683/- and Bill Nos. 451, 452, 453, 454 and 455 were also presented before the Treasury on the same day respectively for Rs.5,502/-, Rs.59/-, 1,474/-, Rs.838/- and Rs.98/- and they were all encahsed on the same day. Exhibit P26 register shows that on 27.2.1992, the amounts encahsed under GPF bills 82/91- 92, 436, 405, 404, 455, 459 and 452 are entered. But receipt of the amounts covered by Exhibits P20(b) and P20 (c) bills are not seen entered. When Exhibit P2 Treasury Bill Book was definitely sent by the first accused on 25.2.1992, CRA 294/02 21 at the time of presenting the subsequent bills before the Treasury after filling up columns 6 and 7, it can only be found that first accused had seen the relevant entries with respect to Exhibits P20(b) and P20(c) bills at least on 25.2.1992, when he had filled up columns 6 and 7 and presented the subsequent bills by authorising the very same appellant to encash them on his behalf. Exhibits P20(d) to P20(h) are Bill Nos.453, 460, 462, 464 and 465 respectively for Rs.1,474/-, Rs.15,035/-, Rs.9,981/-, Rs.490/- and Rs.490/-. The respective bills show that they were prepared on 25.2.1992 and first accused authorised appellant to present those bills and encash the same. Bills were presented by the appellant before the Treasury on 25.2.1992. Exhibit P2 also shows that apart from Exhibit P20(d) to P20(h) bills, GPF Bill 84 for Rs.23,120/-, Bill 463 for Rs.6,280/-, Bill 451 for Rs.5,502/- Bill 461 for Rs.5,917/- and Bill 456 for Rs.1,192/- were also presented and encashed on the same day. Exhibit P26 register maintained by the first accused shows that he entered receipt of Rs.23,120/-, received by the appellant CRA 294/02 22 under Bill No.84/91-92, Rs.6,280/-, received under Bill No. 463, Rs.5,502/-, received under Bill No.451, Rs.5,917/-, received under Bill No.461 and Rs.1,192/-, received under Bill No.456. It is, therefore, absolutely clear that out of the several bills presented by the first accused through the appellant on 25.2.1992, appellant had entrusted at least the amounts shown in Exhibit P26 register to the first accused. Though appellants claims that he entrusted the entire amount covered by Exhibits P20(d) to P20(h) bills to the first accused, it was denied by the first accused. Question is whether, on the evidence, it can be found that appellant did not entrust the amounts to the first accused and thereby misappropriated the amount or appellant, in conspiracy with the first accused, misappropriated the said amount as aided by the first accused. 14. Findings of the learned Special Judge are that