Case ID: 775

Judgment:
Criminal Appeal No. 177 of 1957. Appeal by special leave from the judgment and order dated April 11	 1957	 of the Punjab High Court in Criminal Appeal No. 7 D of 1955	 arising out of the 463 judgment and order dated January 19	 1955	 of the Court of Special Judge	 at Delhi in Corruption Cas No. 2 of 1953. G. section Pathak	 R. Ganapathy Iyer and G. Gopalakrishnan	 for the appellant. C. K. Daphtary	 Solicitor General of India	 G.C. Mathur and R. H. Dhebar	 for the respondents. May 21. The Judgment of the Court was delivered by SINHA J. This appeal by special leave is directed against the judgment and order of the High Court on Judicature for the State of Punjab at Chandigarh dated April 11	 1957	 affirming those of the Special Judge	 Delhi	 dated January 19	 1955	 convicting the appellant under section 5(2) of the Prevention of Corruption Act (2 of 1947). The sentence passed upon the appellant was six months ' rigorous imprisonment. The facts leading upto this appeal	 may shortly be stated as follows: During and after the Second World War	 with a view to augmenting the food resources of the country	 the Government of India instituted a "Grow More Food Division" in the Ministry of Agriculture. section Y. Krishnaswamy	 a Joint Secretary in; that Ministry	 was placed in charge of that Division	 with effect from January 2	 1947. The appellant was working in that Department as Director of Fertilizers. He was a former employee of the well known producers of fertilizers	 etc.	 called "Imperial Chemical Industries ". Fertilizers were in short supply and	 therefore large quantities of such fertilizers had to be imported from abroad. As chemical fertilizers were in short supply not only in India but elsewhere also	 an international body known as the " International Emergency Food Council " (I.E.F.C.) had been set up in United States of America	 and India was a member of the same. That body used to consider the requirements of different countries in respect of fertilizers	 and used to make allotments. Russia was not a member of that Organisation. Towards the end of 1946	 a Bombay firm	 called 'Messrs. Nanavati and Company '	 464 which used to deal in fertilizers and had bussiness contcts with Russia	 offered to supply ammonium sulphate	from Russia to the Government of India. In the years 1947 and 1948	 considerable quantities of ammonium sulphate were obtained through Messrs. Nanavati and Company aforesaid. One D. N. Patel	 who was a former employee of Messrs. Nanavati and Company	 joined a partnership business under the style of Messrs. Agri Orient Industries Limited of Bombay '. This firm obtained a contract from the Government for the supply of twenty thousand tons of ammonium sulphate from United States of America	 in February	 1950. In the course of this business deal	 the said patel experienced some difficulty in obtaining Government orders regarding some consignments. The appelant was approached in that connection; and it is aleged that Patel paid to the appellant Rs. 10	000 at Bombay as bribe for facilitating matters. But in spite of the alleged payment	 difficulties and delays occurred and the consignments	 even after they had reached heir destination in India	 were not moving fast enough	 thus	 causing considerable loss to the firm in which Patel was interested. Patel	 therefore approached Shri K. M. Munshi who was then the Minister For Food and Agriculture in Delhi	 and disclosed to him the alleged payment of bribe of Rs. 10	000	 as also the fact that the appellant had been receiving arge sums of money by way of bribes for showing favours in the discharge of his duties in the Department. The Minister aforesaid directed thorough enquiries to be made	 and the matter was placed in the hands of the Inspector General of Special Police Establishment. A departmental committee was also set up of three senior officers of the Department to hold a departmental inquiry	 and ultimately	 as a result of that inquiry	 the Minister passed orders of dismissal of the appellant	 in August	 1950. A further inquiry in the nature of a quasi judicial inquiry	 was held by the late Mr. Justice Rajadhyaksha of the Bombay High Court	 in 1951. The inquiry related to matters concerned with the import of fertilizers into India. After receipt of the report of the inquiry by 465 the late Mr. Justice Rajadhyaksha	 in January	 1952	 and after consideration of the matters disclosed in that report	 a first information report was lodged on April 4	 1952	 and thorough investigations were made into the complaints. The result was that two cases were instituted. The first one related to an " alleged conspiracy involving the appellant	 Krishnaswamy and one of the proprietors of Messrs. Nanavati and Company	 and several others	 relating to bribery and corruption in connection with the supplies of ammonium sulphate from Russia. With that case	 we are not concerned here. The second case	 out of which the present appeal arose	 was instituted against two persons	 namely the appellant and Krishnaswamy	 that they had entered into a conspiracy to receive bribes and presents from various firms	 in connection with the import of fertilizers. The learned Special Judge	 who heard the prosecution evidence	 came to the conclusion that it did not disclose any conspiracy as alleged	 except in certain instances which formed the subject matter of the charge of conspiracy which was being tried separately	 as aforesaid. The present case	 therefore	 proceeded against the appellant alone under two heads of charge	 namely	 (1) that he had been habitually accepting or obtaining	 for himself or for others	 illegal gratifications from a number of named firms and others	 in connection with the import and distribution of fertilizers section 5(1) (a) of the Prevention of Curruption Act	 1947 (hereinafter referred to as 'the Act ')	 and (2) that he had been habitually receiving presents of various kinds by abusing his position as a public servants. 6 (1) (d) of the Act. The High Court	 in agreement with the learned Special Judge	 found the evidence of P. Ws. 9 and 10	 who were the principal prosecution witnesses as regards the passing of certain sums of money from certain named firms to the appellant	 as wholly unreliable. Further more	 Patel	 being in the position of an accomplice	 his evidence did not find sufficient corroboration from other facts and circumstances proved in the case. The High Court	 not being is a position to accept the tainted evidence aforesaid	 found that the case of payment of 59 466 particular sums of money by way of bribes	 had not been established. But relying upon the presumption under sub section (3) of section 8 of the Act	 the High Court came to the conclusion that the appellant had not satisfactorily accounted for the receipt of Rs. 73	000 odd in cash and about Rs. 18	000 by cheques	 during the years 1947 and 1948	 which sums were wholly disproportionate to the appellant 's known source of income	 namely	 his salary as a Government servant	 and that	 therefore	 he was guilty of criminal mis conduct in the discharge of his official duties. In that view of the matter	 the High Court confirmed the conviction and sentence of six months ' rigorous imprisonment	 passed by learned Special Judge of Delhi. The learned counsel for the appellant has contended (1) that on the admitted facts	 the ingredients of section 5(3) of the Act	 had not been established	 (2) that when the charge in respect of specific instances of corruption	 has not been proved	 as found by the courts below	 it should have been held that the contrary of the presumption contemplated by section 5(3)	 namely	 of the guilt of criminal misconduct	 had been established	 and (3) that the appellant 's statement under section 342 of the Code of Criminal Procedure	 as also his statements contained in his written statement	 had not been proved to be false	 and that	 therefore	 it should have been held that the case against the appellant had not been proved beyond all reasonable doubt. It is true that section 5(3) of the Act	 does not create a new offence but only lays down a rule of evidence	 enabling the court to raise a presumption of guilt in certain circumstances a rule which is a complete departure from the established principles of criminal jurisprudence that the burden always lies on the prosecution to prove all the ingredients of the offence charged	 and that the burden never shifts on to the accused to disprove the charge framed against him. With reference to the provisions of section 5(3) of the Act	 it has been contended	 in the first instance	 that the charge of criminal misconduct in the discharge of his official duties	 is now confined to the fact as disclosed in his bank accounts with the Imperial Bank of India 467 (New Delhi Branch) and the Chartered Bank of India	 Australia and China (Chandni Chowk Branch)	 that his nett credit with those banks totalled upto a figure just over Rs. 91	000. He accounted for that large balance by stating that he was the only son of his father who had been able to give him advanced education in England for a period of over seven years; that after his return to India	 he had been holding highly paid posts for about 20 years in the Imperial Chemical Industries	 in the Army and in the Government of India; that he had no children and no other dependants except his wife; that with his limited household expenses	 he was able to save a good round sum out of his salary and allowances which were considerable	 because his duty took him throughout the length and breadth of the country	 thus enabling him to earn large sums of money by way of travelling allowances which he saved by staying with his friends and relations during his official tours. He added that he had received a gratuity for services rendered to the Army	 and also considerable sums of money as his provident fund from the Imperial Chemical Industries	 towards the end of November	 1947. He also stated that his deposits in the two banks aforesaid	 represented sums of money saved in cash out of his salaries	 allowances and gifts from his parents	 as also re payments of loans advanced by him to his friends while he was in the Army	 and later. He added that some of the deposits in cash were really re deposits of earlier withdrawals from the banks	 as also the sale proceeds of his old car sold in June	 1948	 for Rs. 5	500	 together with the sale proceeds of gold jewelry belonging to his wife. He also tried to explain the large deposits of cash in 1948	 by alleging that he had borrowed a sum of rupees 20	000 from one Ganpat Ram on a pronote (which he	 later on	 re paid and obtained a receipt)	 with a view to building a house of his own in Delhi	 but as that negotiation fell through	 he deposited that cash amount in his account in the two banks aforesaid in August	 1948	 as the creditor aforesaid would not accept re payment of the loan within a period of two years	 unless the interest for that period was also paid 468 at the same time. With reference to those statements of the accused from the dock	 it was contended by the learned counsel for the accused that in view of those facts	 it could not be said that the accused had not accounted for those large deposits with the two banks aforesaid. The High Court has pointed out that the matters alleged in the 	 statement aforesaid of the accused	 were capable of being easily proved by evidence which had not been adduced; that allegation was no proof	 and that his lucrative posts in the Imperial Chemical Industries and in the Army	 were matters of history in relation to the period for which the charge had been framed. The High Court	 therefore	 found it impossible to accept the appellant 's bare statement from the dock as to how amounts earned far in the past	 could find their way into the banks during the years 1947 and 1948. It has been repeatedly observed by this Court that this Court is not a Court of criminal appeal	 and we would not	 therefore	 examine the reasons of the High Court for coming to certain conclusions of fact. Apparently	 the High Court considered all the relevant statements made by the accused under section 342 of the Code of Criminal Procedure and in his written statement	 and came to the conclusion that those statements had not been substantiated. We cannot go behind those findings of fact. Reference was also made to cases in which courts had held that if plausible explanation had been offered by an accused person for being in possession of property which was the subject matter of the charge	 the court could exonerate the accused from criminal responsibility for possessing incriminating property. In our opinion	 those cases have no bearing upon the charge against the appellant in this case	 because the section requires the accused person to " satisfactorily account." for the possession of pecuniary resources or property disproportionate to his known sources of income. Ordinarily	 an accused person is entitled to acquittal if he can account for honest possession of property which has been proved to have been recently stolen (see illustration (a) to section 114 of the ). The rule of law is that if there 469 is a prima facie explanation of the accused that he came by the stolen goods in an honest way	 the inference of guilty knowledge is displaced. This is based upon the well established principle that if there is a doubt in the mind of the court as to a necessary ingredient of an offence	 the benefit of that doubt must go to the accused. But the Legislature has advisedly used the expression "satisfactorily account". 	 The emphasis must be on the word " satisfactorily "	 and the Legislature has	 thus	 deliberately cast a burden on the accused not only to offer a plausible explanation as to how he came by his large wealth	 but also to satisfy the court that his explanation was worthy of acceptance. Another argument bearing on the same aspect of the case	 is that the prosecution has not led evidence to show as to what are the known sources of the appellant 's income. In this connection	 our attention was invited to the evidence of the Investigating Officers	 and with reference to that evidence	 it was contended that those officers have not said	 in terms	 as to what were the known sources of income of the accused	 or that the salary was the only source of his income. Now	 the expression " known sources of income " must have reference to sources known to the prosecution on a thorough investigation of the case. It was not	 and it could not be	 contended that " known sources of income " means sources known to the accused. The prosecution cannot	 in the very nature of things	 be expected to know the affairs of an accused person. Those will be matters " specially within the knowledge" of the accused	 within the meaning of section 106 of the Evidence Act. The prosecution can only lead evidence	 as it has done in the instant case	 to show that the accused was known to earn his living by service under the Government during the material period. The prosecution would not be justified in concluding that travelling allowance was also a source of income when such allowance is ordinarily meant to compensate an officer concerned for his out of pocket expenses incidental to journeys performed by him for his official tours. That could not possibly be alleged 470 to be a very substantial source of income. The source of income of a particular individual will depend upon his position in life with particular reference to his occupation or avocation in life. In the case of a	 Government servant	 the prosecution would	 naturally	 infer that his known source of income would be the salary earned by him during his active service. His pension or his provident fund would come into calculation only after his retirement	 unless he had a justification for borrowing from his provident fund. We are not	 therefore	 impressed by the argument that the prosecution has failed to lead proper evidence as to the appellant 's known sources of income. It may be that the accused may have made statements to the Investigating Officers as to his alleged sources of income	 but the same	 strictly	 would not be evidence in the case	 and if the prosecution has failed to disclose all the sources of income of an accused person	 it is always open to him to prove those other sources of income which have not been taken into account or brought into evidence by the prosecution. In the present case	 the prosecution has adduced the best evidence as to the pecuniary resources of the accused person	 namely	 his bank accounts. They show that during the years 1947 and 1948	 he had credit at the banks	 amounting to a little over Rs. 91	000. His average salary per mensem	 during the relevant period	 would be a little over Rs. 1	100. His salary	 during the period of the two years	 assuming that the whole amount was put into the banks	 would be less than one third of the total amount aforesaid	 to his credit. It cannot	 therefore	 be said that he was not in possession of pecuniary resources disproportionate to his known sources of income. It was next contended that the burden cast on the accused by sub s.(3) of section 5 of the Act	 was not such a heavy burden as lies on the prosecution positively to prove all the ingredients of an offence. In that connection	 reference was made to a number of decisions	 particularly Rex vs Carrbriant(1)	 to the effect (1) 	 referred to under article 3907 at p. 1511 in Archbold Criminal Pleading Evidence and Practice '	 34th Edn. 471 that the onus of proof lies on the accused person to show that a certain proved payment was in fact not a corrupt payment	 but that the burden is less heavy than that which	 ordinarily	 lies on the prosecution to prove its case beyond all reasonable doubt. Reference was also made to Otto George Gfeller vs The King (1)	 Hate Sing Bhagat Singh vs State of Madhya Bharat (2) and Regina vs Dunbar(3). In our opinion	 those decisions do not assist the appellant in the present case. In this case	 no acceptable evidence	 beyond the bare statements of the accused	 has been adduced to show that the contrary of what has been proved by the prosecution	 has been established	 because the requirement of the section is that the accused person shall be presumed to be guilty of criminal misconduct 'in the discharge of his official duties " unless the contrary is proved. " The words of the statute are peremptory	 and the burden must lie all the time on the accused to prove the contrary. After the conditions laid down in the earlier part of sub section (3) of section 5 of the Act	 have been fulfilled by evidence to the satisfaction of the court	 as discussed above	 the court has got to raise the presumption that the accused person is guilty of criminal misconduct in the discharge of his official duties	 and this presumption continues to hold the field unless the contrary is proved	 that is to say	 unless the court is satisfied that the statutory presumption has been rebutted by cogent evidence. Not only that	 the section goes further and lays down in forceful words that " his conviction therefore shall not be invalid by reason only that it is based solely on such presumption. " Lastly	 it was argued that when the section speaks of the burden being on the accused person to prove the contrary	 it must mean adducing evidence to disprove the charge. The argument proceeds that as in the present case	 the facts and circumstances mentioned in the charge had not been proved	 the accused person must be acquitted as having disproved the charge with reference to the particular cases of bribery which had been held not proved. In our opinion	 there is a (1) A.I.R. 1943 P.C. 211. (2) A.I R. (3) 472 fallacy in this argument. The finding of the High Court and the court below	 is that the prosecution had failed to adduce sufficient evidence to prove those particular facts and circumstances of criminal misconduct within the meaning of section 5(1)(a) of the Act	 but the failure to bring the charge home to the accused under section 5(1)(a)	 does not necessarily lead to the legal effect contended for. As soon as the requirements of sub section (3) of section 5 have been fulfilled	the Court will not only be justified in making	 but is called upon to make	 the presumption that the accused person is guilty of criminal misconduct within the meaning of section 5(1)(d). In order to succeed in respect of the charge under section 5(1)(a)	 the prosecution has to prove that the accused person had accepted or obtained or agreed to accept or attempted to obtain from any person any gratification by way of bribe within the meaning of section 161 of the Indian Penal Code. That charge failed because the evidence of P.W. 9 was not accepted by ' the High Court or the trial court. The charge under section 5(1)(d) does not require any such proof. If there is evidence forthcoming to satisfy the requirements of the earlier part of sub section (3) of section 5	 conviction for criminal misconduct can be had on the basis of the presumption which is a legal presumption to be drawn from the proof of facts in the earlier part of the sub section (3) aforesaid. That is what has been found by the courts below against the accused person. Hence	 the failure of the charge under cl. (a) of sub section (1) of section 5	 does not necessarily mean the failure of the charge under section 5(1)(d). In our opinion	 the judgment of the High Court is correct	 and the appeal is	 accordingly	 dismissed. If the accused is on bail	 he must surrender to his bail bond. Appeal dismissed.

Summary:
The appellant was put up on trial on charges under sections 5(1)(a) and 5(1)(d) of the Prevention of Corruption Act	 1947. Payments of particular sums by way of bribe were not proved against him. But the High Court	 holding that the appellant 's bare statements from the dock unsupported by any other acceptable evidence could not satisfactorily account for the large deposits standing to his credit in his bank accounts raised the presumption under section 5(3) of the Act and held him guilty of criminal misconduct in the discharge of his official duty under section 5(1)(d) of the Act	 concerning the conviction and sentence passed on him by the 462 special Magistrate. It was contended on behalf of the appellant that the charge relating to specific instances of bribery having failed	 the contrary to the presumption under section 5(3) Of the Act should have been held as established and in absence of any finding that his statements were false it should have been held that the charge against him had not been proved beyond all reasonable doubt. Held	 that section 5(3) of the Prevention of Corruption Act did not create a new offence but only laid down a rule of evidence that empowered the Court to presume the guilt of the accused in certain circumstances	 contrary to the well known principle of criminal law that the burden of proof was always on the prosecution and never shifted on to the accused. The Legislature by using the expression " satisfactorily account " in section 5(3) of the	 Act	 cast the burden on the accused not only to offer a plausible explanation as to how he came by the large wealth disproportionate to his known sources of income	 but also to satisfy the court that his explanation was worthy of credence. Consequently	 cases under the general law where it had been held that the accused could be exonerated if he offered a plausible explanation could have no application. The expression " known sources of income " used in that section referred to such sources of income as became known to the prosecution as a result of the investigation and could not mean those that were witthin the special knowledge of the accused	 and it was no part of the duty of the prosecution to lead evidence in that regard. Where the prosecution fulfilled the conditions laid down by the earlier part of section 5(3) Of the Act	 the statutory presumption had to be raised and it would be for the accused to rebut the same by cogent evidence. Rex vs Carrbriant	 	 and Otto George Gfeller vs The King	 A.I.R. (30) ; Hate Singh Bhagat Singh vs State of Madhya Bharat	 A.I.R. 1953 S.C. 468 and Regina vs Dunbar	 	 held inapplicable. The failure to substantiate a charge under section 5(1)(a) of the Act on evidence would not necessarily mean an acquittal in respect of a charge under section 5(1)(d) of the Act. If the requirements of the earlier part of section 5(3) were established by evidence	 conviction for criminal misconduct under section 5(1)(d) based on the presumption under section 5(3) Of the Act would be perfectly valid in law.