Delhi District Court
C.B.I. vs . Sushil Kumar Jain on 17 May, 2014
IN THE COURT OF DINESH KUMAR SHARMA
SPECIAL JUDGE (PC ACT), CBI 01,
SAKET COURTS, NEW DELHI
CC No.11/13
Unique Case ID No.02401R0027221995
C.B.I. Vs. SUSHIL KUMAR JAIN
S/o Late Sh. Hansraj
R/o House No.1018, Sector A,
Pocket B, Vasant Kunj, New Delhi.
RC No. : 5(A)/92ACU(VI)
u/Ss : S.5(1)(e) punishable u/S.5(2) of Prevention of
Corruption Act, 1947.
Date of Institution : 03.01.1995
Received by transfer on : 08.04.2013
Arguments Concluded on : 02.05.2014
Date of Decision : 17.05.2014
Appearances:
Sh. S. Krishna Kumar, Ld. PP for CBI.
Sh. HR Dhamija, Ld. Counsel for accused Sushil Kumar Jain
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 1 of 95
JUDGMENT
1.0 Facts in brief are that pursuant to the preliminary inquiry No. 1(A)/92DLI, CBI registered regular case bearing RC No.5(A)/92 was registered on 31.12.92 against Sushil Kumar Jain, accused herein for the offence u/S.5(2) r/w S.5(1)(e) of POC Act, 1947 and 13(2) r/w S.13(1)(e) of POC Act, 1988.
1.1 Accused SK Jain joined Indian Railways on 17.04.57 and super annuated on 31.03.92 after remaining at senior positions in the various de partment of Indian Railways. Accused SK Jain was married to Asha Jain and two children, daughter Sonya Jain and son Sasha Jain were born on 25.03.64 and 10.04.70, respectively. The check period was fixed from 01.04.83 to 31.03.92 for the purpose of calculation of acquisition of disproportionate assets. CBI took into account the income, assets and expenditure of Mrs. Asha Jain (wife), Ms. Sonya Jain (daughter), Sasha Jain (son) for the purpose of ascertaining the disproportionate assets.
Investigation revealed that accused SK Jain and members of his family were in possession of the following assets at the beginning of the check period i.e. 01.04.83 :
Assets of S.K. Jain and his family members as found at the beginning of the check period i.e. as on 01.04.1983 Sl. No. Particulars Amount 1 Deposit with DDA for booking the flat at Vasant Kunj 15,000.00 CBI Vs. Sushil Kumar Jain CC No.11/13 Page 2 of 95 2 Deposit with Haryana Urban Development Authority (HUDA) 3,409.00 3 Cash in hand with Bank and with brokers 45,309.70 4 Deposit in PPF A/c's 898.00 5 Shares, debentures etc. in the name of S.K. Jain and family members 231,913.48 6 Fiat Car No. BRH - 3005 15,000.00 7 Jewellery of S.K. Jain and family members 46,800.00 TOTAL 358,330.18 Income of the accused and members of his family during the check period was found as follows :
Income of accused and members of his family during the check period Sl. No. Particulars Amount 1 Salary income of SK Jain during April 83 to March 92 242,285.00 2 Salary income of Ms. Sonya (Jain) Tyle D/o S.K. Jain during her service with BHEL during June 87 to March 92 119,135.69 3 House Building Advance received by S.K. Jain from Railways 105,000.00 4 Dividend and interest earned by S.K. Jain his wife Smt. Asha Jain, his daughter Ms. Sonya (Jain) Tyle and his son Sh.
Sasha Jain during April 83 to March 92 624,187.55 5 Interest earned by S.K. Jain and his above said family members from their savings bank A/c's during said check period 14,939.90 6 Interest earned by S.K. Jain and family members from bank fixed deposits 14,191.92 7 Capital gains, i.e. profit on sale of shares etc. earned by S.K. Jain and his said family members during check period 557,252.00 8 Withdrawl from GPF by S.K. Jain 96,000.00 9 Commissions earned by Smt. Asha Jain from UTI, Small savings, etc. 15,020.25 10 Rent received by S.K. Jain & Smt. Asha Jain from their DDA Flat at 1018, Sector - A, Pocket - B, Vasant Kunj, New Delhi. 50,600.00 CBI Vs. Sushil Kumar Jain CC No.11/13 Page 3 of 95 11 Interest received from Delhi Development Authority 2,244.00 12 Income Tax refunds received by S.K. Jain and family members 10,152.00 13 Income from two over drafts A/c's of S.K. Jain and family members 68,928.67 14 Interest earned by S.K. Jain and family members on their PPF A/c's 11,288.00 15 Interest received by S.K. Jain on his NSS A/c 21,321.00 16 Refund received from DDA 29,477.00 17 Refund received from HUDA 3,409.00 TOTAL 1,985,431.98 Investigation revealed that accused and members of his family incurred following expenditure during the check period i.e. 01.04.83 to 31.03.92 :
Expenditure incurred by S.K. Jain and members of his family during the period 01.04.83 to 31.03.92 Sl. No. Particulars Amount 1 Personal expenditure incurred by S.K. Jain and his family members 549,455.85 2 Tax deposited by S.K. Jain & family members 19,924.00 3 Application money sent by Sasha Jain for shares of 'Asian Fuse Gears' 1,000.00 4 Temporary loan given by Ms. Sonya (Jain) Tyle to M/s. Alfa Core Ltd. in F/Y 199192 37,500.00 5 Minimum estimated expenses incurred by S.K. Jain on the marriage of his daughter Ms. Sonya Jain 100,000.00 TOTAL 707,879.85 Investigation revealed that accused SK Jain and members of his family were in possession of the following assets at the end of the CBI Vs. Sushil Kumar Jain CC No.11/13 Page 4 of 95 check period i.e. 31.03.92 :
Assets of Sushil Kumar Jain and his family members as found at the close of check period i.e. as on 31.03.92 Sl. No. Particulars Amount 1 DDA flat No.1018, Sector - A, Pocket - B, Vasant Kunj, New Delhi in the name of S.K. Jain and Smt. Asha Jain 229,500.00 2 Amount paid for purchase of house in Gurgaon from M/s.
UNITECH Ltd. in the names of S.K. Jain, Smt. Asha Jain, Sonya Jain and Sasha Jain. 779,453.00 3 Electric fittings done in the house of S.K. Jain at Vasant Kunj in Feb. / March 92 10,000.00 4 Wooden fixtures including wall done in the house at Vasant Kunj during Aug. 1991 to March 1992. 45,000.00 5 Gyser (purchased in Feb. 92) 1,500.00 6 Credit balance in PPF A/c's of S.K. Jain and his family members 28,624.00 7 Cash in hand, in banks and with brokers of S.K. Jain and his family members 69,862.07 8 Credit balance in NSS A/c of S.K. Jain 152,119.00 9 Fixed deposit / double benefit deposits with banks 11,931.00 10 Shares and securities in the name of S.K. Jain and his family members 1,474,195.00 11 Fiat Car of S.K. Jain 15,000.00 12 Jewellery of S.K. Jain & family members 183,180.24 TOTAL 3,000,364.31 Investigation concluded that accused SK Jain was in possession of disproportionate assets in the sum of Rs.13,64,482/ at the end of the check period.
Sl. No. Particulars Amount
1 Income during the check period 1,985,431.98
2 Expenses during the check period (Less) 707,879.86
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 5 of 95
3 Likely savings during the check period 1,277,552.12
4 Assets at the close of check period 3,000,364.31
5 Assets at the beginning of the check period (Less) 358,330.18
6 Thus, assets acquired during check period 2,642,034.13
7 Disproportionate assets = Assets acquired - likely savings 1,364,482.01
The chargesheet revealed that during the course of the investigation, the accused setup a defence that by virtue of an agreement dated 05.06.91 the first floor rights of house at Garden Home Scheme of M/s. Unitech Limited in South City Block, Gurgaon was sold by his wife Smt. Asha Jain, son Sasha Jain and daughter Sonya Jain to his close relative Sh. Pradeep Gupta and Alka Gupta for Rs.4.5 lakhs and in consideration of same, received the said amount by way of 09 cheques during the period 23.02.91 to 23.11.91. CBI did not believe this plea and found it to be a sham transaction entered into with malafide intention to defraud the law on the ground that accused SK Jain and members of his family had no locus standi to sell the said property to anybody as per terms of agreement between them and the builders company i.e. M/s. Unitech Limited. Accused SK Jain did not sign this agreement whereas he himself was 1/4th owner of the said property and even the possession of the house had not been given to the accused.
Chargesheet revealed that most of the cheques were issued against the equivalent amount of cash for which neither Pradeep Gupta nor accused had any plausible explanation and this transaction was done while the vigilance department of Railways was already conducting an inquiry against the accused and he had submitted his explanation on 27.02.91. CBI CBI Vs. Sushil Kumar Jain CC No.11/13 Page 6 of 95 also did not accept the gift and loans from close relatives to the tune of Rs. 83,380/ and Rs.74,500/ respectively as accused was not able to produce any cogent evidence during the course of investigation. 2.0 Upon chargesheet being filed in the court on 03.01.95 the cognizance was taken on 15.02.95. Copies were duly supplied to the accused and the charges were framed against the accused by my Ld. Predecessor vide order dated 03.09.2002. The order of charge was challenged by the accused before the Hon'ble High Court in criminal revision petition No.1028/02. In the said revision petition, vide order dated 20.02.2004, the Hon'ble High court was pleased to set aside the order on charge dated 03.09.02 and remanded the matter to Spl. Judge to rehear the parties on the question of framing of charge. Pursuant to the directions, the accused was given further opportunity of being heard on the point of charge and my Ld. Predecessor was pleased to order the framing of charge against accused u/S.5(1)(e) punishable u/S.5(2) of POC Act, 1947 vide a detailed order dated 31.05.2005. The charges were accordingly framed u/S.5(1)(e) punishable u/S.5(2) of POC Act 1947 to which the accused pleaded not guilty and claimed trial. This order was also challenged by the accused before the Hon'ble High Court in criminal revision petition No.668/05 However, the Hon'ble High court vide order dated 06.09.05 was pleased to dismissed the revision petition.
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 7 of 95
It is pertinent to mention here that after framing of charge on 03.09.02, my Ld. Predecessor had started recording the prosecution evidence as no stay was granted. The ordersheet reveals that by 23.01.2003, 08 prose cution witnesses had been examined by my Ld. Predecessor. However, there after, the Trial Court record was requisitioned by the Hon'ble High Court. Since the order dated 03.09.02 was set aside by the Hon'ble High Court and the matter was remanded back to the Ld. Spl. Judge for fresh arguments on the charge, fresh charges were framed against the accused vide detailed order dated 31.05.2005, and the trial started denovo w.e.f. 26.09.2005. PROSECUTION WITNESSES 3.0 Prosecution examined 38 witnesses in support of its case. 3.1 PW1 Sh. Johnson, Marketing Executive in M/s. Unitech Limited proved that house No.134, Block K, measuring 420 Sq. mtrs. Was allotted in the joint name of Mrs. Asha Jain, accused SK Jain, Ms. Sonya Jain and Sh. Sasha Jain for a consideration of Rs.15,36,234/. In the cross examination, witness admitted that the receipts Ex.PW1/A4 (colly) were issued in the name of Asha Jain.
3.2 PW2 Sh. Anil Sharma was a witness of the search conducted on 14.01.93 alongwith Mr. Manoj Mishra at Vasant Kunj flat of the accused. The search list and observation memo were proved as Ex.PW2/A and CBI Vs. Sushil Kumar Jain CC No.11/13 Page 8 of 95 Ex.PW2/B. The witness stated that the search was conducted in the presence of accused persons. The witness stated that during search large number of share certificates, Ex.P1 to 1173 were recovered and list of such shares / debentures (Ex.PW2/E1 to E383), Ex.PW2/D was prepared. In the cross examination, it came that the sofa, dining table, chairs and furniture in the bedroom were of normal design and there were no costly item in the house of accused. Witness denied the suggestion that observation memo, Ex.PW2/B was prepared without consulting accused and his wife and value in the said memo were shown on the excessive side.
3.3 PW3 Sh. Prem Nath Khanna, Govt. approved valuer conducted value of certain jewelery on 27.01.93 found in locker no.112 in Oriental Bank of Commerce, Vasant Kunj ; locker No.1546 in Punjab National Bank, Naroji Nagar ; and locker No.309 in Syndicate Bank, IP Estate New Delhi. All the above said lockers were opened by CBI on 27.01.93 in the presence of this witness. Sh. Prem Nath Khanna stated that he had valued the jewelery found in the aforesaid lockers and prepared a valuation report Ex.PW3/D, E and F on the basis of the then prevailing market rate of the govt. In the cross examination, witness admitted that rate of gold in the year 196364 was much less than that of 9394. Witness admitted that he had not recorded the condition and age of the jewelery while evaluating the gold.
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 9 of 95 3.4 PW4 Sh. Bhagwan Dass Suneja proved that Mrs. Asha Jain submitted an application form Ex.PW4/C2 alongwith registration deposit Ex.PW4/C1 of Rs.15,000/ dated 19.02.81. Subsequently, a flat in SFS IV Cat. III in Kishan Ganj area was allotted on 10.03.83 and payments were duly received during the check period 8384. In the cross examination witness admitted that name of accused SK Jain was added as coapplicant subsequently. It also came on record that a sum of Rs.29,477.25 was refunded to the allottee vide cheque no.338822 dated 09.07.86. He also stated that end payment made by party in the aforesaid flat was Rs. 1,97,778.75.
3.5 PW5 Chitra Prasad handed over the documents pertaining to SB Account No.12754 and 11097. The witness has also proved the credit vouchers pertaining to SB Account No.12755, 12756, OD Account No.30467 and OD Account No.30470 in Bank of India, Bahadur Shah Zafar Marg, New Delhi. Witness stated that OD Account No.30467 was in the name of SK Jain, Asha Jain and Sasha Jain. The statement of account of this account has been proved as Ex.PW5/G which reveals that a limit of Rs.79,500/ was sanctioned and the account was opened on 27.09.89. Another OD Account No.30470 for a limit of Rs.75,000/ in the name of SK Jain, Asha Jain, Sasha Jain and Sonya Jain was also opened on 03.08.90. In the cross examination, witness admitted that there was no cash withdrawal in OD Account No. 30470. Witness also admitted that majority of credit in OD account No. CBI Vs. Sushil Kumar Jain CC No.11/13 Page 10 of 95 30467 are by way of clearing and in OD account No.30470 are by way of transfer. It also came in the record that there were 04 debit entries of Rs. 1,67,031/, Rs.1,62,421/, Rs.47,526/ and Rs.1,15,217/ on 06.04.91, 06.07.91, 07.10.91 and 08.01.92, in OD account No.30470. Besides this, there is also a debit entry in favour of M/s. Unitech Limited in the sum of Rs. 1,28,968/ on 07.01.91.
3.6 PW6 Dr. (Mrs.) Jayashree Rana deposed that accused had booked the railway club for two days i.e. 05th and 6th June 1991 for the marriage of his daughter and paid Rs.1700/ as rent.
3.7 PW7 Sh. Bhagwan Sahay the then clerk cum cashier in Punjab National Bank, Naroji Nagar branch had handed over the documents pertaining to FDR Account No.1709 and SB Account No.14301. He also proved the letters Ex.PW7/B and Ex.PW7/C vide which the documents required by the IO during investigation were submitted. 3.8 PW8 Sh. Satish Chander Soni the then Branch Manager, Punjab National Bank, Naroji Nagar also proved the seizure memo Ex.PW7/A, 7/B and 7/C. He also proved the statement of account of A/c No. 1709 in the name of Ms. Asha Jain and SK Jain for the period 15.02.89 to 06.04.91 as Ex.PW8/A. Similarly, statement of account of A/c No.205 in the name of Asha Jain, SK Jain was proved as Ex.PW8/B. In the cross CBI Vs. Sushil Kumar Jain CC No.11/13 Page 11 of 95 examination, witness stated that A/c No.14301 was initially opened in the name of Ms. Sheetal Aggarwal on 06.01.88 and on 15.06.88 the name of Ms. Asha Jain was added.
3.9 PW9 Sh. VK Sharma the then Assistant Supdt. in COFMOW (Central Organization for Modernisation of Workshop), for India Railways proved the salary statement of account for the period February 1991 to March 1992 as Ex.PW9/A. He also placed on record statement of pay allowance and deductions of accused from September 1988 to January 1991. 3.10 PW10 Sh. Denis Barnabas Sr. Manager, BHEL proved the salary income of Ms. Sonya Jain for the month of February 1989 and for the period February 1991 to March 1992 as Ex.PW10/A. In the cross examination, witness admitted that statement Ex.PW10/A was prepared from the salary slips. It also came on record that there are separate claims of the employees for the payments other than salary which are made through supplementary bills, and the same are paid either in cash or transfer to the SB account of the employee or issue of the cheque in favour of the employee. 3.11 PW11 Sh. Shashank Mishra, the then Branch Manager, State Bank of India, Vikas Puri Branch proved the letter dated 12.10.93, Ex.PW11/A, letter dated 15.11.93, Ex.PW11/C, letter dated 02.11.93, Ex.PW11/D and letter dated 30.11.93 Ex.PW11/E, vide which he handed CBI Vs. Sushil Kumar Jain CC No.11/13 Page 12 of 95 over the documents pertaining to SB Account No.1922, SB Account No. 3312, SB Account No.3649 and SB account No.3648 respectively. This witness was primarily regarding transaction of Rs.4.5 lakhs amongst the member of the family of the accused on one hand and members of the family of Pradeep Gupta on the other hand. It is pertinent to mention here that these transactions were through cheques in the name of wife, daughter and son of accused SK Jain.
3.12 PW12 Sh. Lajpat Rai Gupta proved the seizure memo Ex.PW12/A vide which he handed over the documents pertaining to SB Account No.12754, 12755 and 12756, 11097 and OD Account No.30467 and 30470. The witness also stated that he handed over the share certificates of different companies pledged in bank against OD account No.30470. 3.13 PW13 Sh. Prem Prakash Shokeen was also a formal witness who had handed over the file pertaining to the DDA flat. 3.14 PW14 Sh. AK Maurya, Income Tax Officer proved the letter dated 25.10.91, Ex.PW14/A vide which he had submitted the income tax returns and wealth tax returns of Ms. Asha Jain for the AY 199091. He also proved the intimation u/S.143(1)(a). The witness also proved the ITR of Asha Jain and Sasha Jain for the AY 199192 as well ITR of Sasha Jain for CBI Vs. Sushil Kumar Jain CC No.11/13 Page 13 of 95 the AY 199090. In the cross examination witness admitted that ITR for the consecutive years of Asha Jain and Sasha Jain are in continuous order. 3.15 PW15 Sh. JS Ahlawat proved the seizure memo vide which 04 ITRs files of Asha Jain and Sasha Jain pertaining to AY 199293 and 199394 were seized. In the cross examination witness admitted that all the three ITRs, Ex.PW15/C to E have refund orders which shows that assessment of these returns were completed.
3.16 PW16 Sh. Sushil Kumar Sobti and PW17 Sh. Manoj Gupta were dropped by the CBI. The prosecution also dropped PW Brijesh Singh and PW MS Jayant.
3.17 PW18 Sh. DC Bansal Inspector (investigation) Railway Board had handed over service record of the accused.
3.18 PW19 Sh. KK Dogra the then Officer in Oriental Bank of Commerce Vasant Lok branch was the witness to the search of locker No. 112 in the joint name of accused SK Jain, Asha Jain and Sonya Jain. 3.19 PW20 Sh. AK Mittal, the then Director (Vigilance) Railway Board had directed PW18 DC Bansal to handover the documents to CBI. In CBI Vs. Sushil Kumar Jain CC No.11/13 Page 14 of 95 the cross examination witness admitted that he had also forwarded alongwith his letter dated 07.04.92, Ex.PW20/DB to the CBI, the statement of immovable property belonging to the accused in the prescribed form i.e. Statement No.I to V, submitted by the accused to his department, Ex.PW20/DC1 to 9. It also came in the cross examination of this witness that salary details of the accused was given for 69 months as per annexure to letter Ex.PW20/DE.
3.20 PW21 Sh. Sushil Kumar Mehta was posted as Assistant in Parliament Street. He proved the letter Ex.PW21/A vide which the copy of fixed deposit, ledger card/statement of NSS Account No.8700 in the name of accused SK Jain was forwarded to CBI.
3.21 PW22 Sh. BM Patnaik the then Inspector, CBI was member of the team which conducted search at the residence of the accused. BM Patnaik proved his signatures on the search list Ex.PW2/A and on list of shares and debentures Ex.PW2/D, observation memo Ex.PW2/B. This witness had also collected certified copy of statement of account No.2409 in the name of accused SK Jain from Bank of India, Seldah Branch, Calcutta. 3.22 PW23 Sh. Ashok Kumar Aggarwal an official from State Bank of Bikaner and Jaipur, Vasant Kunj proved the signatures of Sh. Subhash Bhatia the then Branch Manager on the letter dated 07.10.93 and CBI Vs. Sushil Kumar Jain CC No.11/13 Page 15 of 95 proved the same as Ex.PW23/A. Vide this letter the documents pertaining to Account No.4682 in the name of SK Jain was submitted to CBI. 3.23 PW24 Ms. Lalnilawni identified the signatures of PK Jain, the then Branch Manager State Bank of India, Asian Games Village, Hauz Khas on letter dated 07.10.93 and proved the same as Ex.PW24/A vide which the documents pertaining to account No.1173 in the name of Sonya Jain were submitted. In the cross examination, it came that account No.1173 was opened to facilitate transfer of salary and other emoluments of BHEL to Ms. Sonya Jain.
3.24 PW25 Sh. SC Verma did not state anything material for the case of the prosecution.
3.25 PW26 Sh. Sujit Kumar Sarkar proved the letter dated 18.11.91 as Ex.PW26/A vide which he forwarded the photocopy of ITR filed by Ms. Sonya Jain for the AY 198889, 198384 and 198283. In the cross examination, witness stated that filing of return by Ms. Sonya Jain for the AY 198283 and 198384 confirmed that she had assessable income for the FY 198182 and FY 198283. The witness also stated that alongwith ITR for AY 198889 Ms. Sonya Jain had also forwarded statement of income calculation for AY 198687 and 198788. He stated that full ITRs were not CBI Vs. Sushil Kumar Jain CC No.11/13 Page 16 of 95 submitted as no income was due in these years. PW26 admitted in the cross examination that returns filed by Ms. Sonya Jain were in continuity. 3.26 PW27 Sh. Mool Chand Jain the then official in State Bank of India, IP Estate branch proved the ledger sheet pertaining to account No.964 of accused SK Jain and proved the same as Ex.PW27/A1. He stated that this account was received by transfer from Alipur Branch of Calcutta in the year 1989. He also proved the ledger sheet pertaining account No.965 in the name of Ms. Asha Jain as Ex.PW27/A2. This account was also received by transfer from Alipur Branch in the year 1989. He also proved the ledger sheet pertaining to account No.966 in the name of Ms. Sonya Jain as Ex.PW27/A3 opened in 1989, PPF account No.1054 of Ms. Sonya Jain as Ex.PW27/A4 opened in the year 1990. The witness also proved the last balance in these accounts as on 31.03.92.
3.27 PW28 Sh. MK Muddappa, the then Inspector (Vigilance), BHEL proved the salary statement of Ms. Sonya Jain for the period March 1981 to January 1991. He stated that statement of salary for earlier period of service was not prepared as during that period she was posted in Hyderabad and figures of that time were not available in Delhi office. The witness also proved the lease particulars as per which the lease rent of Rs.2,200/ of the flat had been paid to accused from April 1990 to September 1991. In the cross examination, the witness admitted that as per lease deed, Ex.PW28/C1 CBI Vs. Sushil Kumar Jain CC No.11/13 Page 17 of 95 the flat was given on lease w.e.f. 25.10.89 jointly by accused SK Jain and his wife Asha Jain. It also came in the cross examination of this witness that he was asked to prepare only salary details of Ms. Sonya Jain whereas he was aware of other payments being made to the employees of BHEL in addition to the salary. The witness admitted that the statement furnished by him to CBI did not reflect other payments which were made during that period to Ms. Sonya Jain by BHEL. He also spelled out various heads under which the payments were made to the employees other than salary. Witness specifically stated that payments which were made separately in addition to her regular monthly salary as per the statement Ex.PW28/B1 to B4 were not included by him in the total emoluments received by Ms. Sonya Jain Tyle for the period as he was not asked to do the same. It also came in the cross examination that at the end of the year, BHEL employees were given a complete statement of all the taxable payments made to employees with details of tax deduction etc. giving the details of regular salary and other emoluments, payments etc. 3.28 PW29 Sh. P. Hari Prasad Rao the then Sr. Manager Syndicate Bank, IP Estate branch was the witness to the search of locker No.309. This witness also proved the documents pertaining to Sh. Venkataramani whose particulars were not available at the time of trial. The documents pertaining to SB Account No.37677 of Asha Jain, SK Jain and Sonya Jain were also CBI Vs. Sushil Kumar Jain CC No.11/13 Page 18 of 95 proved. In the cross examination, witness admitted that this account was received from transfer from Secunderabad.
3.29 PW30 Sh. Ashwin Kumar the then Chief Manager Vysya Bank, Connaught Place, New Delhi proved his letter dated 07.10.93 as Ex.PW30/A vide which he had provided details of interest paid on FDRs lying with the bank to CBI. He also proved the letter dated 14.12.93, Ex.PW30/B vide which he had furnished certain documents to the CBI. Witness also proved the statement of account of Special SB Account No. 121149 for the period 10.08.89 to 06.03.93 as Ex.PW30/C. 3.30 PW31 Sh. SK Arora was the witness regarding search of locker No.112.
3.31 PW32 Sh. SK Upadhayay proved the seizure memo dated 27.01.95, Ex.PW38/A vide which the income tax returns of accused SK Jain for the AY 199091, Ex.PW33/B, AY 199192, Ex.PW33/C were handed over to CBI. It also came in the evidence of this witness that the income tax case of accused was picked up for scrutiny. In the assessment order, Ex.PW32/C4, the total taxable income was considered to be Rs.1,48,150/ against the declared income of Rs.77,590/. In the scrutiny the income of Sasha Jain amounting to Rs.36,501/ was added to the income of accused alongwith income from undisclosed source for meeting household and CBI Vs. Sushil Kumar Jain CC No.11/13 Page 19 of 95 marriage expenses amounting to Rs.20,000/ was also added to the income of the accused. Deductions of Rs.10,000/ claimed u/S.80CCB was disallowed alongwith expenses u/S.57 of the Income Tax Act in the sum of Rs.1,065/ against dividend income was also disallowed. The witness was cross examined at length regarding the assessment.
3.32 PW33 Sh. S. Bhattachari, Income Tax officer, GSW, Mayur Bhawan had handed over the ITR of Ms. Sonya Jain and proved the ITRs for the AY 198990 as Ex.PW33/A1 to A49, for the AY 199091 as Ex.PW33/C2 to C67 and for the AY 199192 as Ex.PW33/D50 to D122. Witness admitted in the cross examination that the above said three returns become a continues series of income tax returns because of the opening balances and closing balances of the various assets given in the assets liabilities statement and these returns are comprehensive and exhaustive. 3.33 PW34 Sh. Puneet Sharma, from M/s. Eon Electric Ltd. formerly known as M/s. Indo Asian Fuse Gear Ltd., proved the letter dated 08.10.93 as Ex.PW34/B. 3.34 PW35 Sh. K. Venkatraman, from Reliance Petro Chemcial Ltd. proved the letter dated 05.06.92 as Ex.PW35/A vide which details of the shares held by accused Sushil Kumar Jain and members of his family were furnished to CBI.
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 20 of 95 3.35 PW36 Sh. Samir Kumar Basu the then Asstt. Manager, Bank of India Seldah, Branch Calcutta, proved the production memo dated 04.02.93 vide which the certified true copy of the statement of account No. 2409 in the name of accused for the period 16.02.78 to 28.02.1989, Ex.PW22/C was handed over to CBI.
3.36 PW37 Sh. SC Arora the then Dy. Chief Vigilance Officer in BHEL proved the letter dated 17.06.92, Ex.PW37/A vide which the salary particulars of Ms. Sonya Tyle for the period May 1987 to January 1989, Ex.PW37/A1 alongwith particulars as to payment of lease amount from the period October 1989 to April 1990, Ex.PW37/A2 and copies of property returns for the year 198889, Ex.PW37/A3 and 199091, Ex.PW37/A4 were furnished. In the cross examination, the witness admitted that salary particulars of Ms. Sonya Jain for the period May 1987, January 1988, April 1988, November and December 1988 were not furnished as the same were not available.
3.37 PW38 Sh. UK Goswami, Addl. SP (IO) deposed on oath that RC No.5(A)/92ACUVI was registered on 31.12.92 and the investigation was entrusted to him by the then SP Sh. Rajender Singh. IO UK Goswami proved in detail the investigation conducted by him. IO stated that during investigation, Sh. AK Mittal, Director Vigilance (Store), Railway Board, CBI Vs. Sushil Kumar Jain CC No.11/13 Page 21 of 95 Ministry of Railways had forwarded Form No.6 in original sent by accused vide his letter dated 07.04.92, Ex.PW20/DB alongwith statement No.I to VI which are Ex.PW20/DC1, DC2, DC3, DC6, DC8 and DC9 and Ex.PW38/E. The investigation officer proved the documents seized by him during the course of investigation. IO proved the photocopy of ITR of accused SK Jain for AY 198485, 198586, 198687, 198788, 198889 and 198990 as Ex.PW38/N1 to N6. He also proved the original ITRs of accused SK Jain for the AY 199091 as Ex.PW32/B, for AY 199192 as Ex.PW32/C and for the AY 199293 as Ex.PW38/D4. The photocopy of ITR of Asha Jain for AY 198485, 198586 and 198990 is Ex.PW38/N8, N9 and N10. ITR of Asha Jain for AY 199091 was also proved as Ex.PW14/B and of AY 199192 as Ex.PW14/C, of AY 199293 as Ex.PW15/C, of AY 199394 as Ex.PW15/D. The wealth tax returns of Asha Jain is proved as Ex.PW38/N12, statement of income tax of Asha Jain for AY 198687 and 198788 was proved as Ex.PW38/N12 and N13. The ITR of Ms. Sonya Jain for the AY 198485 was proved as Ex.PW38/N14, for the AY 198586 as Ex.PW38/N15, for the AY 198889 as Ex.PW26/B. The statement of income for the AY 198687 and 198788 were also filed alongwith ITRs for the AY 198889. The ITRs of Ms. Sonya Jain for the AY 198990 to AY 199293 were proved as Ex.PW33/A1 to A49, Ex.PW33/C2 to C67 and Ex.PW33/D50 to 122 and Ex.PW38/N15.
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 22 of 95
The ITRs of Sasha Jain for the AY 199091, 199192 and 199293, Ex.PW14/E, Ex.PW14/D and Ex.PW15/E, respectively were also proved by the IO.
IO stated that secret letter No.COFMOW/IR/A914 dated 27.02.1991 of accused SK Jain addressed to Sh. JL Kaul, Advisor (Vigilance), Ministry of Railways, Railway Board, New Delhi alongwith 5 annexures (D65), Ex.PW38/U was collected during investigation. copy of service record of accused Ex.PW38/W was also collected and was kept in safe custody of Sh. DC Bansal, Investigating Inspector vide safe custody memo Ex.PW38/V. IO proved the confidential file No.SP/CR/SK Jain/68 (D74) as Ex.PW38/AA vide which accused had sent an intimation to his department regarding his movable assets as on 30.03.73 which included investments in shares in the name of accused SK Jain, Mrs. Asha Jain and Sasha Jain. It also included the intimation to the department as on 31.03.76 which has been proved as Ex.PW38/AB. The intimation of movable assets to the department by the accused and members of his family as on 31.03.79 has been proved as Ex.PW38/AC and intimation regarding movable assets as on 31.03.85 has been proved as Ex.PW38/AD. IO stated that accused could not satisfactorily explain the disproportionate assets accumulated by him during the check period beyond the source of income. It is pertinent to mention here that the examination in chief of PW38 ran into more than 100 pages and it mostly revolved around the details as to the documents seized. CBI Vs. Sushil Kumar Jain CC No.11/13 Page 23 of 95
In the cross examination, IO stated that he had calculated the salary income of the accused on the basis of record submitted by the department which was for the part of the check period and for the remaining period, income has been taken from the Income Tax returns of the accused. IO stated that for entire period, the carry home salary of accused i.e. the salary after deductions has been taken. IO admitted that he had received letter dated 17.05.94 written by accused SK Jain Ex.PW38/D1. He stated that he has taken the personal expenditure of the accused and members of his family from the expenses shown in the respective ITRs. IO also admitted in the cross examination that he took the net after statutory or non statutory deductions. He denied the suggestion that the expenses were calculated twice, firstly while calculating the net salary and secondly in the head of expenditure. It was admitted that income from other sources were calculated as shown in the ITR. The income of the accused and members of his family from dividend were taken as shown in the ITRs of the said persons. IO admitted that there may be miscalculation in the income of dividends which has been shown as Rs.6,24,187.55 and it may be Rs.6,28,468.33. IO admitted that Ms. Sonya Jain daughter of accused had been married in February 1991 and started living with her husband in the matrimonial house. It was also admitted that prior to her marriage she was working as an officer with BHEL and was drawing her salary from BHEL. IO admitted that during investigation it was brought to his notice that Mrs. Asha Jain had been filing Income Tax Returns since 195758. IO also admitted that Mrs. Asha Jain was CBI Vs. Sushil Kumar Jain CC No.11/13 Page 24 of 95 Wealth Tax assessee for the last five years of the check period and this fact came to his knowledge during investigation. He admitted that Sasha Jain also filed ITR for three years. It was admitted that Ms. Sonya Jain (daughter) and Sh. Sasha Jain (son) were major at the time of registration of FIR in this case. IO admitted that during investigation he came to know that all the members of the family of accused had separate and distinguishable income. Strangely, IO stated in the cross examination that it may be correct that in letter dated 17.04.94 accused had revealed the income of members of his family and sources thereof. IO admitted that he had clubbed the income, expenditure and assets of Asha Jain, Ms. Sonya Jain and Sh. Sasha Jain with the income, expenditure and assets of accused SK Jain. In the cross examination conducted on 08.04.2013, IO admitted that he examined the documents which he seized vide search memo (D63) and on page 117 of this document it was mentioned that wife of SK Jain was income tax assessee for 35 years since AY 195758. IO also admitted that in confidential file of accused SK Jain seized from Railway Authorities (D74), accused had intimated to his department about assets of himself and members of his family including wife, son and daughter as on 30.03.73, 31.03.76, 31.03.79 and 31.03.85. He also admitted that on cross checking the assets intimated by the accused, the same were found to be more or less same, as on the dates of intimation to the department. During cross examination, IO examined, confidential file (D74) and income tax returns of the corresponding years and stated that the assets in the both were same. IO admitted that net assets of accused as on 31.03.85 CBI Vs. Sushil Kumar Jain CC No.11/13 Page 25 of 95 were identical in the ITR and intimation to the department. Similar was the position regarding non taxable income of the accused. IO was also confronted that even in the record of other members of the family of the accused, the information given to the department and in the ITRs were identical. In this regard, a specific question put to the IO during cross examination conducted on 18.05.2013 is very material which have not been reproduced herein for the sake of brevity. IO was also cross examined regarding gifts to Sasha Jain and Sonya Jain and an intimation of the same to the department. In the lengthy cross examination in which hundreds of pointed questions were put to the IO, it was clear that IO had selectively relied upon the ITR filed by the accused and the members of his family. IO stated that he had not taken into account the gift to Sonya Jain by her father, mother and maternal grandmother as these are the gifts given amongst the family members and received, generally are equal. IO also did not consider the gift made by accused and his wife to the children on the ground that as income, expenditure and assets of the accused, wife, son and daughter were jointly being considered, there is no point considering gift by one hand to another hand, amongst themselves. IO stated that he has taken 04 members of the family as one unit for their assets and income etc. IO admitted that Smt. Asha Jain has shares and debentures to the extent of Rs.1,16,527.59 at the beginning of the check period. It also came in the cross examination that even as per documents filed by CBI (D74) the financial investment of Asha Jain as on 30.03.73 was Rs.80,095.72 and income during the period CBI Vs. Sushil Kumar Jain CC No.11/13 Page 26 of 95 19591973 was Rs.84,125.23. IO admitted that Smt. Asha Jain had taxable distinct annual income of TENS OF THOUSANDS of rupees for 10 years between 197172 to 198485. IO was pointedly cross examined regarding the shares transaction and the contract notes. IO stated that all assets of each individual member of the family were not totaled separately and the assets and income were added to seem the complete picture of finances of the family. In a specific question No.60 recorded on 20.05.2013, IO admitted that Smt. Asha Jain had been accounting for the source of her assets in the respective income tax returns. IO also admitted that initially the registration money for DDA flat was deposited by Smt. Asha Jain and name of SK Jain was later on added in 1983 after the allotment of the flat to Smt. Asha Jain. In a specific question No.65 put on the same day, IO admitted that 320 and 150 equity shares of reliance were shown transferred as gift to Sasha Jain by accused SK Jain and his wife and 100 shares of Synthetic & Chemicals were shown gifted to him by Sonya Jain, during the said period. IO did not dispute that total value of the above said shares were Rs.84,200/. In reply to question No.71 IO stated that Sh. Sasha Jain has accounted for his purchases in his income tax returns. It is interesting to reproduce Question No.73 regarding household expenses, which reads as under :
"Q.73. Did the household expenses taken by you on the basis of ITR of accused and other members of his family included the following expenses:
i) payments made for consumable items in the kitchen
ii) nonstatutory deductions made by employers for house rent, water charges, electricity charges, lawn maintenance charges, geyser charges, government vehicles, telephone trunk call charges etc. CBI Vs. Sushil Kumar Jain CC No.11/13 Page 27 of 95
iii) payments made for durable items like electrical fitting in the flat, wooden fixtures made and fitted in the flat, geyser etc.
iv) payments made for expenses in functions like the marriage of Miss Sonya Jain.
v) Miscellaneous payments Ans. The personal expenditure shown in the income tax returns of accused and his family members, when totalled, was well within the acceptable norms of taking expenditure in the assets case and thus, it was considered as the household expenditure. However, the expenses on the marriage of Ms. Sonya Jain and the expenditure on capital items were not included in the household expenses."
In regard to the salary income of the accused, it is pertinent to reproduce Q.76, Q.77, Q.78, Q.78A and Q.79.
"Q 76. Were you informed during investigation vide para 3.2 of of Exh PW38/D1 (colly) ie Shri S.K.Jain's letter of 17.05.1994 to you that details of salary of Shri S.K.Jain collected by you from his employer's vide documents D29, D32 & D43 are only from regular monthly salary bills and do not include the payments made through supplementary bills for a number of items and also that these documents do not cover full 108 months of check period from 01.04.1983 to 31.03.1992.? Ans. I had taken all the receipts, received by the accused on account of salary during the check period. Infact, after the receipt of above said letter, I had also sent a communication to the department but I do not remember the contents of the reply from the department. The copy of such communication is not available. The reply of the department dated 24 March 1992, Ex.PW18/C, letter Ex.PW20/DE, was duly taken into account. It is correct that there is no copy of the reply of the department after 17/5/94.
Q.77. Did you come to know during investigation that each of the 9 ITR's of ShriS.K.Jain ie documents 3(a) to 3(i) has salary statement given by the Railways for that year showing therein Gross Salary received by Shri S.K.Jain during the year as also only statutory deductions made by the CBI Vs. Sushil Kumar Jain CC No.11/13 Page 28 of 95 Railways for the provident fund, taxes and house building advance for that year from his gross salary.?
Ans. There are statements as annexures to the ITRs of Sh. SK Jain showing gross salary and deductions like PF /VPF, Group Insurance, Professional Tax and Income Tax deductions. Such statement has been issued by Railways.
Q 78. Did you calculate the total gross salary paid by the Railway Authorities to the accused during the check period? Ans. I have taken into account only the take home salary of the accused and did not take into account the gross pay.
Q. 78A. The take home salary for the check period for Sh. SK Jain taken by you is Rs. 2,42,285/ whereas the salary statements attached with the income tax returns and issued by the Railway Authorities show gross salary of Rs. 7,98,819.35, total statutory deductions Rs. 4,32,940.00 leaving net pay for these 9 years of Rs. 3,65,879.35? Ans. After investigation, I have taken the carry home salary, as per details provided by the Railway Authorities. Certain deductions in their details are not included in the statements attached to the income tax returns and that is why the difference is there.
Q.79. Did you send any request to the Railway Authorities to inform you about the salary paid by them to Sh. SK Jain for the period April '83 to March '85?
Ans. I had requested the department to give the salary details of the complete check period. I do not remember about the communication sent for this specific period.
In regard to the arrears regarding computation of salary income of Sonya Jain, it is pertinent to reproduce Q.80, Q.81, Q.82, Q.83 and Q.84, during the cross examination on 29.07.2013. The same reads as under : CBI Vs. Sushil Kumar Jain CC No.11/13 Page 29 of 95
"Q.80. How have you shown salary of Ms. Sonya Jain Tyle for her BHEL service from May 1987 to March 1992 as Rs. 1,19,135/69p whereas BHEL issued annual Salary statements as available in her CBI filed Income Tax returns Doc D7(c) to D7(g) as Rs.2,23,587/70p, or on what basis you have taken income in the sum of Rs.1,19,135/ for this period ?
Ans. The income details as received from BHEL in respect of Sonya Jain were considered as it included all the deductions to arrive at the net carry home salary, whereas the income tax details as given by BHEL and reflected in document D7(c) to D7 (g) were for the purpose of income tax only and did not reflect the deductions even on account of GPF etc. I have taken into account the net carry home salary.
Q.81. Where have you shown the Pay advances of Rs. 2,400 and Rs. 2,880/ for the months of March 1989 and May 1990 shown in the deductions statements of Doc. D35 enclosures Ex.PW28/B2 & Ex.PW28/B4, relied upon by you for the salary of Ms. Sonya Jain Tyle for the period May 1987 to March 1992?
Ans. It seems to be a calculation error on the part of the department and these two advances of Rs.2400 and Rs.2880 may be added in the income.
Q.82. Where have you shown the salary of 6 months of May 1987, January, April, October to December 1988 of Ms Sonya Jain Tyle missing in Doc D34 enclosure Ex.PW37/A relied upon by you for her salary?
Ans. It is correct that the salary particulars of Sonya Jain for the period May 1987, January, April, October to December 1988 were not supplied by the department and thus left to be taken into account.
Q.83. Did you find during investigation from Ex.PW37/A that Gross Salary payable for the months of July 1987 and December 1987 works out to Rs.2,131/60p and Rs.4,097/38 as against wrongly shown lesser amounts of Rs. 824/20p & Rs.4,025/49 respectively only. Where have you accounted for these shortages?
Ans. It is correct that there is a calculation mistake on the part of BHEL and I have taken the amount as provided by BHEL. Thus the income of Rs.CBI Vs. Sushil Kumar Jain CC No.11/13 Page 30 of 95
2131.60ps and Rs.4097.38ps may be taken instead of Rs.824.20ps and Rs. 4025.49ps.
Q.84. Did you specifically investigate the deficiencies of salary figures as pointed out vide para 3.2 of Ex.PW38/D1 (colly) ie Shri S.K.Jain's letter of 17.05.1994 to you and what did you find?
Ans. I had duly investigated the deficiencies of salary figure as pointed out by the accused and only thereafter, took the figure as per law. I might have called a written query from BHEL regarding this but I do not remember to have receive any reply. It is correct that there is nothing on record."
The perusal of the cross examination would indicate that IO was cross examined at each and every particular. In regard to the rental income it would be advantageous to reproduce question No.102 and its answer recorded during cross examination on 29.07.2013.
"Q.102. Did you find from examination of CBI record itself & Income Tax department duly assessment completed ITR's of Shri S.K.Jain Doc D3(f) to D3(i) and Smt Asha Jain D5(c) to D5(f) that the house rent income by letting out 1018 DDA flat, Vasant Kunj received by them was Rs 88,500/ ie same as given vide para 3.8 of PW38/ D1 letter of Shri S.K.Jain of 17.05.1994 to you?
Ans. The house rent receipt has been taken as Rs.50,600, as informed by BHEL. For some of the period when house was claimed to be let out to someone else, the name and details of tenant were not provided for verification and thus, only Rs.50,600 was taken as rental income. I had not given any written notice to accused to furnish the details of the tenant and the rent receipts. Vol. It was orally asked several times."
In respect of marriage expenses relating to Ms. Sonya Jain, IO admitted that he did not examine any person who had attended the marriage. CBI Vs. Sushil Kumar Jain CC No.11/13 Page 31 of 95 In question No.116 of the same date, accused specifically put the expenses shown in the ITR to the IO and the same was admitted by the IO. IO admitted that he was not aware of the purchase price and sale price of the shares and had merely examined the difference. In regard to the jewelery as shown at the beginning of the check period and at the end of the check period, it would be advantageous to reproduce question no.133 recorded on the same date alongwith its annexures, which reads as under :
"Q133. What is the breakup of this jewellery of Rs.46,800/ amongst Shri S.K.Jain, Smt Asha Jain, Ms Sonya Jain Tyle and Shri Sasha Jain at the beginning of the check period and how did you arrive at your amount of this asset for each entity?
Ans. During the course of investigation, it was found that Smt. Asha Jain had jewelery of Rs.5,300/, Smt. Sonya Jain of Rs.20,500/ and accused SK Jain of Rs.500/. In the year 1985, Sh. Sasha Jain had also shown jewelery of Rs.20,500/ in his possession as on 31.03.85 as per information furnished by accused to his department. This 1985 jewelery was also taken as an assets at the beginning of check period to extend benefit to the accused.
The rate of gold in 1976 was found as Rs.540/ per 10 gm, in 1979 it was Rs.938/ per 10 gm and in 1983 it was Rs.1,760/ per 10 gm and accordingly, the weight of the jewelery of Rs.46,800/ at the above said rates was taken as 74 gms. (1976), 19 gm (1979) and 233 gms (1983), which showed that net weight of the jewelery at the beginning of check period was 326 gms. Jewelery found at the time of search from residence and lockers etc. was weighing 816.6 gms, which showed that total weight 490 gms was acquired during the check period. The average rate of gold during 1983 to 1992 was ascertained as Rs.2,781/ per 10 gm. which showed that the cost of acquisition of 490 gms. Of jewelery during check period was Rs.1,36,380/ and the cost of total jewelery (including at the time of check period) was Rs.1,83,180/."
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 32 of 95
In respect of the breakup of investment in the DDA flat and South City house, IO stated that he cannot tell about the contribution of accused and members of his family as he had clubbed the income, expenditure and assets of SK Jain, Asha Jain, Sonya Jain and Sasha Jain and in respect of the amount of Rs.69,862.07 shown as cash in hand, IO stated that he had taken the same from ITR. In respect of jewelery, accused had stated specifically put Question No.148 on 29.07.2013 and Question No.149, 150, 153 and 154 on 31.08.2013. IO admitted that he had examined Alka Gupta w/o Pradeep Gupta during investigation. IO also stated that he had examined Pradeep Gupta. IO stated that he had not considered the loan taken by Ms. Sonya Jain and Asha Jain as were not found credible. IO stated that he did not examine such persons as they were interested witnesses. IO admittedly did not contact the close relatives who had given such loans despite number being furnished during the course of investigation. IO denied the suggestion that he intentionally clubbed the income, expenditure and assets of accused with those of Smt. Asha Jain, Ms. Sonya Jain and Sh. Sasha Jain, whereas figures were available separately for each of the four persons, only to confuse and to obfuscate the truth that accused SK Jain has no disproportionate assets to his known sources of income. But you have wrongly shown that Sh. S.K. Jain was having disproportionate assets during the cheque period. IO also denied the suggestion that he double counted the cost of Electric Fittings, Wooden Fixtures & Geyser. He also denied the suggestion that he also double counted the cost of assets at the end of the CBI Vs. Sushil Kumar Jain CC No.11/13 Page 33 of 95 check period, the Fixed Deposit of Rs 11,931 in the assets as on 31.03.1992 when the same were already included in the cash & bank balances. It was specifically put to the IO that he failed to understand Tax Planning, Compounding effect of continuous reinvestment of investment returns, Stock Market products & Procedures even after 30 months of his investigation. STATEMENT OF ACCUSED 5.0 In his statement u/S 313 Cr.PC, accused Sushil Kumar Jain stated that H. No. 134, Block K, of Garden Home Scheme of South City 1, was purchased by his wife Smt. Asha Jain, daughter Ms. Sonya Jain and son Sh. Sasha Jain from their own sources of funds which was duly intimated to the department. Accused stated that he was not a copurchaser of the said house and his name was simply added so that in case of any unfortunate eventuality, there are no complications regarding this property. Accused stated that during search, they were asked to sit silently and their signatures were involuntarily taken. The majority of the shares and debenture certificates found were purchased by his wife Smt. Asha Jain, daughter Ms. Sonya (Jain) Tyle and son Sh. Sasha Jain from their own funds before the start of the check period or received as bonus shares on account of such precheck period shares held by each entity. Accused stated that the lockers were opened in joint names for convenience of operation of the locker.
In respect of jewelery found in the locker No.112, accused stated that the jewelery kept in this locker was exclusively belonging to his CBI Vs. Sushil Kumar Jain CC No.11/13 Page 34 of 95 wife Smt. Asha Jain, daughter Ms. Sonya Jain and son Sh. Sasha Jain except for one piece. Accused also stated that originally, the jewellery was given to Smt. Asha Jain at the time of their marriage in May 1963 as stridhan by her parents and her parents in law. Lateron, as part of wealth tax planning, part of the jewellery was gifted by his wife to their daughter Ms. Sonya Jain and son Sh. Sasha Jain in early 1970's. This fact was known to the department and he had intimated the same to the IO vide para 4.5 of his letter of 17/5/94 Ex.PW38/DX1. This fact was also told to the IO and the valuer at the time of search of lockers in the end of January 1993. Accused also stated that only two sovereigns of gold (item No. 2) belonged to him which were received by him in the marriage traditional ceremonies "singing chhand paraga" i.e. a verse just after the phera ceremony in the bride's house and the second one at the time of opening of kangana of bride. Accused further stated that photograph of this jewellery of the locker was taken by the IO at the time of desealing of the lockers as per Court's order dtd. 15/11/07. These photographs have been taken on record by the Court vide its ordersheet dtd. 07/01/08. Further, the list of jewellery and to whom it belonged to was also available in the locker and when desealing of the locker was done and these ownership details / chits can also be seen in the photographs. Accused stated that the jewellery of his daughter Ms. Sonya (Jain) Tyle was in the locker even though she was married because she did not have a locker in her name being busy with her job, as also duties as a newly married girl. Accused stated that PW3 wrongly and incorrectly evaluated the jewelery. CBI Vs. Sushil Kumar Jain CC No.11/13 Page 35 of 95
In respect of jewelery recovered from locker No.1546 and 309, accused took a similar stand. Accused stated regarding DDA Flat that of the total cost was paid by his wife and remaining was paid by him after taking house building advance from the department.
In respect of account No.12754 accused stated that though it was a joint account but it had exclusive transactions of Asha Jain. In respect of account 11097, accused stated that it was a joint account for convenience of operation only. In respect of SB Account No.12755 accused stated that it was primarily of Sasha Jain and this account was made joint account for convenience of operation. In respect of SB Account No.12756, accused reiterated that it was converted into joint account for convenience of operation. However, it had exclusive transactions of Ms. Sonya Jain. Accused stated that OD account No.30467 was a joint account for convenience of operation and debit balance as on 31.03.92 was Rs. 7,693.97. In respect of OD account No.30470 accused reiterated that it was a joint account and was made as a joint account for convenience of operation and the debit balance as on 31.03.92 was Rs. 64,568.37. In respect of pay and allowances for the period February 1991 to March 1992, accused stated that the pay and allowances for the period February 1991 to March 1992 of Rs. 33,954.00 shown here is incorrect. Accused stated that his correct salary income for the period February 1991 to March 1992 as given in the ITRs of the relevant years filed by the CBI in the Court is Rs. 1,42,090/. The retirement benefits as shown in the question are correct. Accused stated that CBI Vs. Sushil Kumar Jain CC No.11/13 Page 36 of 95 PW9 Sh. VK Sharma in his evidence dtd. 30/8/07 has admitted the deficiencies shown in his statement to CBI for this period.
In respect of the salary for the period September 1988 to January 1991, accused stated that the pay and allowances for the period Sept., 1988 to January 1991 shown here is incorrect. Accused stated that his correct salary income for the period Sept. 1988 to January 1991 as given in the ITRs of the relevant years filed by CBI in the court is Rs.2,68,229/. PW9 Sh. VK Sharma in his evidence of 30/8/07 has admitted to the deficiencies shown in his statement to CBI for this period. The salary certificates in the ITRs have also been confirmed by Sh. VK Sharma and also by the IO.
In respect of the salary income of Ms. Sonya Jain, accused stated that the net salary figures shown in the question for his daughter Ms. Sonya Jain Tyle are wrong. The correct salary for the period May 1987 to March 1992 is Rs.2,23,587.70 as given in her ITRs of relevant year filed by the CBI in the Court. PW10 Sh. Bharnabas, PW28 Sh. MK Modappa and PW37 Sh. SC Arora in their evidence of 14/2/08, 22/7/2010 and 4/7/2012 respectively, have admitted to the deficiencies in the documents sent by them to the CBI. They have also confirmed that salary statements as available in these relevant ITRs, are issued by BHEL to its employees.
In respect of registration of FIR, accused stated that this is a false FIR. FIR was registered on 31.12.1992 after 9 month of his retirement on reaching the age of superannuation. There was no official complaint CBI Vs. Sushil Kumar Jain CC No.11/13 Page 37 of 95 against him on which this FIR is based. It was merely based on source information and to help the politician nurturing vendetta.
In respect of salary income of Ms. Sonya Jain for the period February 1989 to January 1991, accused stated that the salary figures for the period February 1989 to January 1991 given in the salary statements Ex.PW28/B1 to B4 are incorrect. PW28 Sh. MK Muddappa in his evidence of 22.07.2010 has clearly brought out the deficiencies of the said statements of Ex.PW28/B1 to B4.
In respect of the rental income accused stated that the BHEL lease rent amount given is correct. However, the full rent amount received by Smt. Asha Jain and accused has clearly been given in para 3.8 of his letter of 17.05.94 Ex.PW 38/D1 to IO. The total rent received was Rs. 88,500/ . The details of total rent received can also be seen in the relevant ITRs of Smt. Asha Jain and from the ITRs of accused, filed in the court by CBI.
In respect of joint account of Asha Jain and Bhola Chaudhary, accused stated that Bhola Chaudhary was their helper at Calcutta. His bank account was opened to inculcate the banking habit in him. The transactions were of the helper Sh. Bhola Chaudhary and were of very small amounts.
Accused stated that he has been falsely implicated by the CBI at the instance of the then Railway Minister Sh. Janeshwar Mishra. Accused stated that he was not carrying out telephonic instructions of Minister's Secretarial staff on his behalf for illegal favours. Accused was completely ignoring such orders of the Minister. Even letters of APS (Asst. Private CBI Vs. Sushil Kumar Jain CC No.11/13 Page 38 of 95 Secretary) and his PA i.e. Director (P.G.) of the Ministry of Railways for undue favours, were ignored by him and the favours communicated in the name of the Minister were not acceded to by him. These letters were just forwarded by him to the Secretary, Railway Board for dealing at Railway Boards level. These letters have been officially filed in the court on 12/1/06 by Sh. Ashok Kumar, Office Supdt. COFMOW/Indian Railways. DEFENCE WITNESSES 5.1 Accused also examined 08 defence witnesses in his defence. 5.1.1 DW1 Parmanand Gupta, cousin of accused deposed on oath that his wife Smt. Tarawanti Gupta gave a loan of Rs.10,000/ in April 1989 and Rs.5,000/ in October 1989 to Smt. Asha Jain on their request for purchase of right shares. The certificates signed by Smt. Tarawanti in this regard were proved as Ex.DW1/A and Ex.DW1B. DW1 also identified the signatures of Smt. Tarawanti Gupta.
5.1.2 DW2 Sh. Naresh Kumar Jain, real brother of accused SK Jain deposed that Asha Jain belonged to a very renowned and rich family of Jalandhar Cantt. and she got lot of jewelery at the time of her marriage. Smt. Asha Jain was also gifted jewelery by her Motherinlaw i.e. mother of accused. DW2 stated that he gave gift of Rs.25,000/ to Sasha Jain in August 1983 and while he was on foreign assignment with Govt. of Iraq he gave another gift of Rs.6000/ in September 1990 after Sh. Sasha Jain was selected CBI Vs. Sushil Kumar Jain CC No.11/13 Page 39 of 95 as a Inter University Badminton Player in the whole of India. The documents in this regard were proved as Ex.DW2/C to Ex.DW2/G. The witness stated that accused was like a fatherly figure to him and he gave the gifts to Sasha Jain out of the gratitude in consideration of the fact that he i.e. DW2 had stayed with the accused during his student life. The witness stated that his grandmother Smt. Parvati Devi, his mother Smt. Tulsan Devi and one of aunt (bua) Smt. Dayawanti lived with him and they all have expired now. The death certificates were proved as Ex.DW2/H1 to H4. The witness stated that Smt. Parvati Devi gave a gift of Rs. 20,000/ on two occasions to Sh. Sasha Jain in December 1987 and July 1988 respectively, and Smt. Parvati Devi gave a certificate to this effect, which was proved as Ex.DW2/J1 and DW2/J2. The witness also deposed regarding the gifts given by Smt. Parvati Devi, Smt. Tulsan Devi and Smt. Dayawanti to Sasha Jain and the loans to Smt. Asha Jain for buying the right shares. The witness stated that they are a close knit family consisting of 04 brothers and they had also landed property. 5.1.3 DW3 Dr. Smt. Meena Gupta niece of accused SK Jain deposed on oath that she gave a loan of Rs.10,000/ on 06.04.89 and Rs. 5,000/ on 29/10/89 and Rs.3,000/ on 14/7/90 to Smt. Asha Jain on her request for buying right shares and also proved certificates to this effect, Ex.DW3/A to C. The witness stated that all the aforesaid loans had been returned to her by Smt. Asha Jain through cheques.
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 40 of 95 5.1.4 DW4 Sh. Ashok Kumar an official from COFMOW proved the letter No.COFMOW/IR/A923 dated 26.02.91 written by accused to Secretary, Railway Board, Rail Bhawan, New Delhi and a note sent to CAO/COFMOW by APS/MOS(Rlys.) dated 22.02.91 as Ex.DW4/A1 and A2. The original of these letters were also produced which were returned after perusal. The witness also produced a letter dated 08.04.91 signed by accused to Secretary, Railway Board, New Delhi and proved the same as Ex.DW4/B. In further examination, the defence witness also proved the communication relating to the case of the accused as Ex.DW4/E, F and G. These documents were pertaining to the transaction of purchase of South City Home.
5.1.5 DW5 Ms. Kaushalya Mamgin produced the copy of the letter passed by Commissioner Smt. Laxmi Prasad on the appeal of accused SK Jain for the AY 199192 and proved the same as Ex.DW5/B. He also deposed that original record had been destroyed.
5.1.6 DW6 Sh. Rajender Kumar Jain younger brother of accused deposed that he had gifted a sum of Rs.5,000/ to his nephew Sh. Sasha Jain in January 1984 purely out of love and affection and also proved the certificate Ex.DW6/A in this regard. He stated that the certificate to this effect was also seized by the IO from the house of the accused which is at page 53 of documents Ex.PW2/DX350 to PW2/DX562.
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 41 of 95 5.1.7 DW7 Smt. Veena Jain, sisterinlaw (Bhabhi of accused) deposed on oath that in the month of January 1984 she gave a gift of Rs. 5,000/ to Sh. Sasha Jain, the son of the accused out of love and affection and she gave a certificate to this effect Ex.DW7/A. The photocopy of which Ex.DW7/B is already part of the document seized from the house of accused (at page 54 of Ex.PW2/DX350 to PW2/DX562).
5.1.8 DW8 Sh. Ajay Aggarwal, Brotherinlaw (brother of wife) of accused SK Jain stated that her sister was married to accused Sushil Kumar Jain on 9/5/1963. Sh. Ajay Aggarwal stated that his father belonged to an affluent trading family in Jalandhar and he himself was at a senior position in govt service and had done his Engineering from Edinborough in 1930. It has been stated that the marriage was performed with pomp and show and his sister Smt. Asha Jain was given 56 gold jewellery sets by his parents and she received 34 jewellery gold sets from the parents of the accused. DW8 stated that his family elders have been giving gifts to the son and daughter of the accused as per tradition, love and affection. He stated that his mother Smt. Laxmi Aggarwal who is aged about 94 years had been giving gifts to Sh. Sasha Jain and Ms. Sonya Jain, son and daughter of the accused, respectively, on different occasions. He also proved the certificate Ex.DW8/D and E in this regard. The photocopies of which Ex.DW8/B & Ex.DW8/C were already part of the documents seized from the house of CBI Vs. Sushil Kumar Jain CC No.11/13 Page 42 of 95 accused (page 55 & 56 of Ex.PW2/DX350 to Ex.PW2/DX562). Sh. Ajay Aggarwal stated that Smt. Sudesh Aggarwal is wife of his elder brother Sh. Ashok Aggarwal, who are residing in USA since 1985. Whenever they used to visit India, they used to visit the house of his sister and Smt. Sudesh Aggarwal gave a gift of Rs. 14,000/ to Sh. Sasha Jain and a certificate in this regard was proved as Ex.DW8/G. The photocopy of which Ex.DW8/F is already part of the document seized from the house of accused (page 59 of Ex.PW2/DX350 to DX562).
The defence witness also proved cash gift of Rs.16,500/ to Sh. Sasha Jain by Sh. Ashok Aggarwal and proved the certificate to this effect Ex.DW8/H. Sh. Ajay Aggarwal stated that his mother Smt. Laxmi Aggarwal also gave a gift of Rs.5,000/ to Ms. Sonya Jain, daughter of the accused, in the month of April 1983 and proved the certificate Ex.DW8/J which was already attached in file Ex.PW38/N14. He also proved the gifts given by Smt. Laxmi Aggarwal to Ms. Sonya Jain in the sum of Rs.15,000/ through a cheque dtd. 6/2/91 on the occasion of her marriage and proved the certificate to this effect as Ex.DW8/K. These gifts were also mentioned in the income tax returns Ex.PW33/D50 to D122 (Colly.). It came in the testimony of this witness that accused was known in their family to have deep knowledge of financial transactions and share market and had been giving advice on financial transactions and regarding the sale and purchase of shares and for making investments to him and other family members. DW8 stated that Sh. Ashok Aggarwal and his wife Smt. Sudesh Aggarwal had given special CBI Vs. Sushil Kumar Jain CC No.11/13 Page 43 of 95 power of attorney in favour of accused Sushil Kumar Jain authorizing him to buy and sell shares on his behalf and invest money in share market and also sign and verify documents and do all other necessary action for completion of the transactions. He also proved the original special power of attorney executed on 6/5/1985 as Ex.DW8/L. ARGUMENTS 6.0 Sh. S. Krishna Kumar, Ld. PP for CBI has submitted that the difference in the calculation in regard to the capital gain / income / profit on the sale of shares etc. during the check period is on account of the fact that accused has shown certain transfer entries of shares within the family and on account of those transfers, the accused is claiming income. The plea of the Ld. PP is that nothing tangible has come to the hands of the accused and members of his family and these entries were effected only to enhance income in the books of the accused so as to account for the ill gotten money.
Sh. UK Goswami, Addl. SP IO submitted that in this case the accused transacted the shares within the family only to build the income in the books/ITR and to save income tax also.
Accused has submitted that infact the method of calculation adopted by him is correct. He has shown in chart Annexure VII capital gain/profit on sale of shares etc. during the check period as Rs.12,61,979.92 and has also shown the cost price of shares sold/gifted or debentures redeemed for Rs.5,78,289.51ps. If we balance the entries of income and CBI Vs. Sushil Kumar Jain CC No.11/13 Page 44 of 95 expenditure shown by the accused to the income shown by the prosecution, the effective difference comes out to Rs.1,26,335/. It is also pertinent to mention here that in the gross assets, the prosecution has shown the assets on account of shares and securities at the end of the check period for a sum of Rs.14,74,195/ whereas, the accused has shown it to be Rs.15,41,484/ (rounded off), thereby enhancing the DA of Rs.67,289/. Therefore, the actual difference can be Rs.1,26,335 - Rs.67,289 that comes out to be Rs. 59,046/. The accused says that infact this Rs.59,046/ approximately is income shown by him on account of the gift/transfer within the family.
Sh. S. Krishna Kumar, Ld. PP for CBI made a detailed arguments and demonstrated with the help of Chart that accused had acquired and was found in possession of the assets which were disproportionate to his known source of income. Ld. PP stated that accused had failed to present any satisfactorily explanation and therefore, is liable to be convicted. Ld. PP has also been assisted by Sh. UK Goswami, Addl. SP, IO of this case. It has been submitted that returns filed by the accused has been dressed up and it has been filed in such a manner that disproportionate assets are being concealed. A question was raised that why so many persons were giving gifts to children of the accused, to which it was submitted that these gifts were only to cover up the ill gotten income and accused manipulated the figure in such a manner so as to screen himself from the offence committed by him. It has been submitted that filing of income tax return does not ipso facto can exonerate the accused. It has been submitted that accused rotated the funds within the CBI Vs. Sushil Kumar Jain CC No.11/13 Page 45 of 95 family and shown to have earned income. Infact these were sham transactions. IO submitted that he has rightly clubbed the income of wife, son and daughter of accused with that of accused as the clubbing was the only option because there was no proper accounting and demarcation between the assets and liabilities of the accused and members of his family. IO submitted that it has duly been proved on record that accused had been transacting money within the family only in order to manipulate the figures. Accused in the garb of tax planning made straneous efforts to hide the ill gotten money.
The plea of the CBI is that they had taken only the net carry home salary of accused and Ms. Sonya Jain. The gross salary has not been taken as it never came into the hands of the accused for the purpose of expenditure or acquiring assets. It has been submitted that only that income has been taken which was available with the accused for the purpose of expenditure and acquiring the assets. The plea of the prosecution is that in pay bill register of the payments include payments made on account of supplementary bills, which shows that IO has taken all payments on account of salary paid to the accused. In the written synopsis filed on behalf of the prosecution, Ld. PP has meticulously explained the documents on record proving the income, expenditure and assets of the accused and members of his family.
Perusal of written synopsis would indicate that most of the figures have been proved by the prosecution with the help of income tax returns of the accused, his wife, son and daughter. However, in regard to CBI Vs. Sushil Kumar Jain CC No.11/13 Page 46 of 95 certain items, IO has not placed reliance upon the income tax returns and has assessed the income at his own. The plea of the IO is that accused and members of his family had shown the income in the ITRs with a motive only to build the assets, whereas, his effort was to ascertain the net income in the hands of the accused and members of his family for the purpose of expenditure, saving and building the assets.
In regard to the expenditure incurred by the accused and members of his family during the check period, IO has totally relied upon the figures shown by the accused and members of his family on account of personal expenditure in the ITRs. However, the written synopsis would indicate that there was no evidence regarding the temporary loan given by Ms. Sonya Jain to M/s. Alfa Care Limited as well the minimum estimated expenditure incurred by accused SK Jain on the marriage of his daughter in the sum of Rs.1 lakh.
In respect of the assets of accused and members of his family at the end of the check period, CBI in the written synopsis has spelled out the different documents proved on record so as to establish the assets at the end of the check period. In regard to the major items as to shares and securities in the name of accused and members of his family, CBI has relied upon the ITRs. In respect of the jewelery, CBI has relied upon the report of valuer PW3 Sh. Prem Nath Khanna. Thus, if we take the wholesome view of the case of the prosecution, it has clubbed the income, expenditure and assets of the accused with the members of his family. The disproportionate assets has CBI Vs. Sushil Kumar Jain CC No.11/13 Page 47 of 95 mainly been made up on the basis of alleged incorrect computing the income on account of salary earned by accused SK Jain and his daughter Ms. Sonya Jain, not taking into account the gifts and loans received by Smt. Asha Jain, Ms. Sonya Jain and Sh. Sasha Jain, valuation of the jewelery at the end of the check period and lastly not taking into account the receipt of Rs.4.5 lakhs in the hands of Smt. Asha Jain, Ms. Sonya Jain and Sh. Sasha Jain from Pradeep Gupta and family.
6.1 Sh. HR Dhamija, Ld. Counsel for the accused submitted that CBI cooked up a false and frivolous case against the accused. The accused is a victim of vendetta of the senior officers and political executives. The accused has unblemished career in the Railways. It was submitted that wife of accused has been an income tax assessee for around 35 years. At the time of framing the accused in the false case, she had an independent income and had build her own assets independent of the accused. The CBI has acted malafidely by adding income and assets of Smt. Asha Jain with the income and assets of the accused. Similarly, Ms. Sonya Jain and Sh. Sasha Jain, children of the accused were independent entities and had build their assets independently on account of regular gifts received by them from their parents, parental grand parents and maternal grand parents. Ld. Counsel submitted that IO malafidely over looked the background of Sh. Sasha Jain and Ms. Sonya Jain and intentionally did not consider the basic fact that in such like families, there is always a practice of giving cash gifts to the CBI Vs. Sushil Kumar Jain CC No.11/13 Page 48 of 95 children by the elders. It was submitted that the fact of clubbing of income, assets and expenditure, was a dishonest decision on the part of the IO and this decision was taken only after the IO realized that no case of disproportionate assets is made out. Sh. Dhamija, Ld. Counsel submitted that it is strange that the income, assets and expenditure of Smt. Asha Jain, Sh. Sasha Jain and Ms. Sonya Jain are under question and being tried, whereas, they have not been given any opportunity of defending the same. It was pointed out that had the IO was of the view that accused illegally parked his money in the name of members of his family then why these persons were not roped into for abatement. It was submitted that bare perusal of the ITRs would show that the expenditure was prominently made by accused being the head of the family and other members of the family had been building their assets with the planning and management. Accused submitted that infact he build the assets as he understood the share market and management of finances very well and he shuffled the income from one member of the family to the other as a part of tax planning and financial management. It was pointed out that the period of 1980 to 1990 was the period when there was huge upsurge in the share market and accused and members of his family accumulated the wealth by virtue of sheer saving and management. Accused had also submitted detailed written synopsis alongwith annexures running into around 100 pages. It was submitted that income and assets of the accused and members of his family has wrongly been clubbed. Accused submitted that he has given satisfactorily explanation of the income and CBI Vs. Sushil Kumar Jain CC No.11/13 Page 49 of 95 assets for himself and members of his family vide his letter dated 15.03.93. Ex.PW38/D1A and letter dated 17.05.94, Ex.PW38/D1 (colly) during the course of the investigation. Accused had also been regularly intimating to his department the details of income and assets and those of the members of his family as on 30.03.73, 31.03.76, 31.03.79, 31.03.85 and 31.01.91 and it was within the knowledge of the IO. The defence submitted that CBI has created an entangled web of incomes, expenditures and assets by randomly and arbitrarily combining these hybrid figures of the accused, his wife, son and daughter. It has been submitted that the investigation of the IO is primarily based on erroneous perception of facts. Ld. Counsel for the accused submitted that the salary figure given by the IO is wholly incorrect as it neither covers full check period nor disclose full emolument received by Ms. Sonya Jain and accused SK Jain. It was pointed out that even prosecution witness PW9 Sh. VK Sharma deposed that statement Ex.PW9/A and Ex.PW9/B were prepared on the basis of monthly salary bill only. It was admitted that besides the monthly salary bills, additional payments were also received by COFMOW employees on account of supplementary bills. It also came in the testimony of PW9 that DA Arrears, honorarium, arrear of pay, shown in Ex.PW9/DA to Ex.PW9/DD have not been included in Ex.PW9/A and Ex.PW9/C. Ld. Counsel submitted that the correct figure has been shown in the document D3(a) to D3(i) i.e. in the ITRs, which works out to Rs. 7,98,819.35ps and out of which there is deduction on account of income tax, provident fund, house building advance recovery of Rs.4,32,940/. It has CBI Vs. Sushil Kumar Jain CC No.11/13 Page 50 of 95 been submitted that the correct way of computing the salary income would be only to take gross salary of the accused and deductions in the expenditure of the accused. Similarly, it has been submitted that the salary figure given by the IO even in the prosecution synopsis is deficient and wrong as it neither covers full check period nor give full emoluments received by Ms. Sonya Jain from BHEL. It was pointed out that even IO admitted in his answer to Q.82 on 29.07.2013 during the cross examination that the salary particulars of Ms. Sonya Jain for the period May 1987, January, April, October to December 1988 were not supplied by the department and thus, left to be taken into account. Statement of PW37 Sh. SC Arora in this regard was also relied upon. The defence has relied upon the testimony of PW10 Sh. Dennis Barnabas, Manager Finance, BHEL and PW28 Sh. MK Muddappa, Insp. Vigilance, BHEL. The defence submitted that IO has wrongly clubbed the income, expenditure and assets of family members with those of accused SK Jain merely because they have been living together during the relevant period. In the written synopsis, it has been submitted by the defence that Io has confirmed in his evidence that he has taken the following items of income, expenditure and assets from their respective income tax returns :
i) Income from Dividends ;
ii) Income from other sources like interest, sale price of shares etc.
iii) Prices of shares purchased and sold
iv) Salary statements from Income Tax returns for Gross Salary for 24 months and then assumed deductions thereof.
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 51 of 95
v) UTI commission
vi) Income tax refunds
vii)Personal and household expenditure
viii)Cash in hand, balances with banks and brokers at beginning of the check period
ix) Shares and debentures at beginning of check period on 01.04.83
x) Cash in hand, balances with banks and brokers at end of check period on 31.03.92
xi) Shares and debentures at the end of check period on 31.03.92 Ld. Counsel submitted that income tax returns filed by the accused and members of his family furnish full financial details like incomes and expenditures during the year, assets at the beginning and end of the relevant FY alongwith details of sources of income and identifiable items of expenditure. It has been submitted that income tax returns filed by accused and members of his family by no imagination can be an afterthought and are fully valid and legally acceptable document. Income tax returns filed by accused and members of his family are exhaustive, comprehensive and in continuum. These returns were diligently checked and then accepted by the concerned authorities.
The testimony of PW26 Sh. SK Sarkar, PW14 Sh. AK Maurya, PW15 Sh. JS Ahalawat and PW33 Sh. S. Bhattachari, all Income Tax Officers, have been relied upon to emphasized that the ITRs filed by the CBI Vs. Sushil Kumar Jain CC No.11/13 Page 52 of 95 accused and members of his family are comprehensive, exhaustive and being in continuum and therefore there is no possibility of the same being manipulated, concocted or created at a later stage.
In respect of income from capital gain i.e, profit on sale of shares etc., it has been submitted that capital gain is not profit on sale of shares. Capital gain is merely a notional figure. This figures is derived from sale price and cost price of a share depending on the period for which the share was held by the seller. This notional figure is then used only to calculate the income tax. Capital gain can be substantially less than the profit on sale of a share. It was submitted that IO failed to ascertain sale price and cost price of shares sold by each of the four members of the family of accused SK Jain separately.
Accused submitted that the effect of taking correct figures of income from Sale, redemption etc. of shares as confirmed by Income tax Officers, i.e. PW26 and PW15 would result in increase in income of Rs. 12,61,979.22 - Rs.5,57,252 = Rs.7,04,727.92 and an increase in expenditure of Rs.5,78,289.51. The defence submitted that the IO has wrongly taken the income on account of rent as Rs.50,600/ instead of Rs.88,500/ and ignored the rent for the part of the period.
The bone of contention is the income from sale of option of first floor rights of house under purchase from M/s. Unitech Limited in Gurgaon to Pradeep Gupta and Alka Gupta has been explained by the defence in the written synopsis. It has been submitted that this property was purchased by CBI Vs. Sushil Kumar Jain CC No.11/13 Page 53 of 95 Smt. Asha Jain, Ms. Sonya Jain and Sh. Sasha Jain in December 1990 and accused had taken permission for the purchase of these house from his employer. Accused submitted that Smt. Asha Jain, Ms. Sonya Jain and Sh. Sasha Jain had given Sh. Pradeep Gupta and Smt. Alka Gupta the option to construct first floor for their residence only after they got possession of the house from Ms. Unitech Ltd. Against this option to construct the first floor, an amount of Rs.4.5 lakhs had been advanced as loan by Gupta's family vide an agreement dated 05.06.91, Ex.PW38/D3. This amount was received through cheques and was deposited in the respective saving bank accounts. It was submitted that IO has wrongly not taken into account these incomes of Rs.1.5 lakhs each of Smt. Asha Jain, Ms. Sonya Jain and Sh. Sasha Jain. It was submitted that though IO recorded the statement of Alka Gupta but did not examine her in the court. Similarly, IO had examined Pradeep Gupta but did not record his statement. IO only in order to prejudice the court stated that before issue of most of the said 09 cheques, a corresponding amount was withdrawn from the accounts of members of the family of accused and the same was deposited in cash in the accounts of family members of Pradeep Gupta whereas, the prosecution has not led any evidence to substantiate this statement. Witness submitted that the documents filed by the CBI shows that the statement of the IO as per answer to Q. No.161 is false and incorrect and that the truth is that 09 cheques for Rs.4.5 lakhs were issued from 3 bank accounts bearing No.19222, 3648, 3649 of Pradeep Gupta's family. Statement of these bank accounts have also been filed by the CBI and proved CBI Vs. Sushil Kumar Jain CC No.11/13 Page 54 of 95 as Ex.PW38/AG, Ex.PW38/AH, Ex.PW11/E2 and Ex.PW11/E1, respectively.
The defence relied upon the testimony of PW11 Sh. Shashank Mishra of State Bank of India and also gave a tabular statement to demonstrate the deposit or withdrawal of amount as reproduced below :
Details of cash deposits in SB Account Nos.19222, 3648 and 3649 and cash withdrawals from A/c No.1160 for clearance of 9 cheques are as under :
Col. 1 Col. 2 Col. 3 Col. 4 Col. 5 Col. 6 Col. 7
Cheque Saving Amount of Amount of Date of Date of Amount of
No. and Bank A/c cheque of cash deposit cash Cash cash
Date from Col.1 in Col. 2 deposit in withdrawal withdrawn
which Col. Bank A/c Col. 2 from A/c from A/c
1 cheque Bank A/c 1160 No.1160
issued. Ex.PW38/ Ex.PW38/
AJ AJ
(in Rs.) (in Rs.) (in Rs.)
184159 19222, 40,000.00 NIL
20.02.91 Ex.PW38/
AG & AH
184162 do 60,000.00 NIL
02.04.91
184170 do 50,000.00 50,000.00 24.08.91 24.08.91 90,000.00
15.08.91
502576 3648, 20,000.00 NIL
05.04.91 Ex.PW11/
E2
502577 do 65,000.00 NIL
12.05.91
502579 do 65,000.00 22,000.00 19.09.91 18.09.91 25,000.00
30.08.91
502601 3649, 20,000.00 NIL
05.04.91 Ex.PW11/
E1
502604 do 65,000.00 65,000.00 06/08/91 05.08.91, 48,000.00
30.07.91 01.08.91 & 45,000.00
30.07.91
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 55 of 95
502605 do 65,000.00 65,000.00 23.11.91 20.11.91 90,000.00
30.09.91
Total 450,000.00
The defence stated that receipt of this income of Rs.1.5 lacs by each of the three purchasers of this house has been clearly shown both in their respective income tax returns and their bank accounts.
The defence submitted that IO has wrongly not taken into account the loans in the sum of Rs.74,500/ from close relatives by Ms. Sonya Jain and Sh. Sasha Jain. It has been submitted that infact the loans as on 31.03.92 of Sh. Sasha Jain was Rs.10,000/ as shown in the ITR for AY 199293, Ex.PW15/E. Similarly, loan of Rs.17,000/ is shown for Ms. Sonya Jain in her ITR for the AY 199293, Ex.PW38/N15. It has been submitted that Ms. Sonya Jain and Sh. Sasha Jain had taken these loans from close relatives for purchase of "right shares" besides having taken loan from Bank of India through two OD Accounts. The defence submitted that the loan taken by Sh. Sasha Jain and Ms. Sonya Jain have duly been returned by cheque after the end of the check period. It has been submitted that the correct amount of loan of Rs.10,000/ and Rs.17,000/ will increase the income of Sh. Sasha Jain and Ms. Sonya Jain by Rs.27,000/. Similarly, it has been submitted that IO has wrongly rejected the loan of Rs.17,000/ taken by Mrs. Asha Jain which has duly been recorded in her ITR, without any reason. The loan taken by Smt. Asha Jain has duly been proved by DW1 Sh. PN Gupta, DW2 Sh. NK Jain and DW3 Dr. Smt. Meena Gupta. These CBI Vs. Sushil Kumar Jain CC No.11/13 Page 56 of 95 loans from close relatives were also shown in intimation of assets by accused SK Jain and members of his family as on 31.01.91 to the Railways vide document D65, Ex.PW38/U. Therefore, the income of Smt. Asha Jain, Ms. Sonya Jain and Sh. Sasha Jain is also entitled to be increased by Rs.17,000/. In regard to the gifts of Rs.83,380/ from close relatives by family members, it has been submitted that IO has wrongly rejected the same. The defence submitted that Ms. Sonya Jain and Sh. Sasha Jain got gifts regularly from their elders as will be seen from Ex.PW38/AD (D74 Railway Confidential File). It has been submitted that Smt. Asha Jain got gifts of Rs.21,000/ besides jewellery and other household articles in her marriage in 1963 as seen in Ex.PW38/AA as streedhan. It has been submitted that fact about receipt of gifts by Ms. Sonya Jain and Sh. Sasha Jain from their parents, maternal grandparents and first uncles including from their NRI accounts was also brought out in the intimation to the competent authority vide accused's letter dated 06.12.85, Ex.PW38/AD (D74).
The defence has relied upon the testimony of DW8 Sh. Ajay Aggarwal, brother of Smt. Asha Jain and proved the gift of Rs.20,000/ to Ms. Sonya Jain by maternal grandmother and gift of Rs.45,500/ to Sh. Sasha Jain by maternal grandmother, maternal Aunt and maternal uncle. Similarly, DW2 Sh. NK Jain also proved the gift to Sh. Sasha Jain in the sum of Rs. 67,080/. Similarly, DW6 and DW7 also proved the gift in the sum of Rs. 10,000/ to Sh. Sasha Jain in January 1984. The defence submitted that Sh. Sasha Jain has also received gifts from his parental and maternal CBI Vs. Sushil Kumar Jain CC No.11/13 Page 57 of 95 grandmothers and uncles as confirmed by defence witnesses. It has been submitted that small amounts of gifts received by Sh. Sasha Jain in FY 198990 and FY 199091of Rs.6,830/ and Rs.5,000/, respectively are shown in his ITRs Ex.PW14/E and Ex.PW15/E, respectively. The defence submitted that similarly, Asha Jain had also received a gift from Smt. Shakuntla Gupta. It has submitted that Smt. Asha Jain being the only daughter of her parents and as she did not take any part of inheritance after the death of her father, liberal gifts were received by her son and daughter from her mother and elder brother.
In regard to the expenditure during the check period as given by CBI, the defence has submitted that there is misrepresentation of personal expenditure given in ITR leading to double counting of expenditure and assets. It has been submitted that IO had not provided any breakup of the personal expenditure of Rs.5,46,456.83 shown by him and he could not given specific items of expenditure included by him in the above personal expenditure. It has been submitted that the personal and household expenses shown in the assets liability statement of each income tax return is arrived at first by aggregating all money receipts, then by subtracting from the sum of all these money receipts the identifiable money payments and the residue left has been shown as "personal and household expenses" of the year.
The accused has also detailed the money payments identified and subtracted from the sum of money receipts. It has been submitted that the CBI Vs. Sushil Kumar Jain CC No.11/13 Page 58 of 95 residues left after deducting identifiable payments from the sum of all money receipts is shown as "personal expenses" and it includes expenses like :
1. payments made for consumable items in the kitchen
2. non statutory deductions if any made by employers
3. payments made for durable items like electrical fitting in the flat, wooden fixtures made and fitted in the flat, Gyser etc.
4. payments made for expenses in social functions like the marriage of Ms. Sonya Jain
5. Miscellaneous payments It has been submitted that marriage expenses of Ms. Sonya Jain and the expenses of durable items are also included in the personal expenses of income tax returns can easily be discerned and recognized from the sharp increase which occurred in the personal expenditure in the two years 199091 and 199192 as seen from the yearwise expenditure.
In respect of the assets of accused and the members of his family, accused has submitted that there is overestimation of value of jewelery at the end of the check period. It has been submitted that the weight of jewelery is not mentioned in any document in the court. It has been submitted that the assumptions made by the prosecution to arrive at the value of jewelery at Rs.1,83,180.24 at the end of the check period show their complete ignorance of the custom that in Indian marriages, particularly in old times, the bride was given by her welltodo parents lots of jewelery and household articles as "Stridhan". It has been submitted that the weight and CBI Vs. Sushil Kumar Jain CC No.11/13 Page 59 of 95 valuation of jewelery of the 3 lockers given by CBI valuer in January 1993 is 796.6 gms and Rs.2,88,750/ respectively. The value of whole of this jewelery was about Rs.6,500/ at the gold prices of 1963, the year of the marriage of Smt. Asha Jain. It has been submitted that the rate of gold on 31.03.76 was Rs.532/ as per Ex.PW3/D2. The defence submitted that there is misrepresentation of cash and bank balances at the end of check period leading to double counting. It has been submitted that the amount of the fixed deposit/double benefit deposit with banks of Rs.11,931/ has already been included in the bank balance as on 31.03.92. The prosecution has merely presumed that this amount of the Fixed deposit/double benefit deposit with banks of Rs.11,931/ is not included in the amount of item no.7. The defence submitted that there is double counting of expenditure on purchase on fittings and construction of fixtures in DDA Flat. The defence has also submitted that IO has mixed up dividend incomes by taking some dividends which are gross dividends and some dividends which are net dividends and some dividends twice. It has also been submitted that there is wrong calculation on account of income from bank interest and bank overdrafts. It has also been pointed out that there is an error of calculation of interest by IO regarding PPF accounts. The defence submitted that significant deviation has occurred in the prosecution figures from actual because of :
(a) Reliance placed by prosecution on documents with incomplete information of salaries ;
(b) Misinterpretation of figures of Income Tax Returns CBI Vs. Sushil Kumar Jain CC No.11/13 Page 60 of 95
(c) Double counting of some expenditure and asset figures
(d) Basing figures merely on assumptions / presumptions without leading any evidence
(e) ignoring figures for important incomes given in income tax returns by mere insinuations instead of any evidence.
Accused has also filed 11 annexures alongwith written synopsis containing details of income and personal expenditure yearwise and entity wise with document ; comparison of incomes, expenditures and assets itemized entity wise and also clubbed for 4 entities in juxtaposition with CBI figures ; and comparison of figures of Incomes/Expenditures/Assets summarized for check period entity wise and clubbed for all 4 entities in juxtaposition with CBI figures.
Accused has given separately the income, expenditure and gross assets of accused to demonstrate that there was no disproportionate assets for accused SK Jain. Accused submitted that initial corpus of Smt. Asha Jain was built by her stridhan and her savings from pay as school teacher as seen in Ex.PW38/AA in Railway Confidential file (D74). The initial corpus of Ms. Sonya Jain Tyle was built by gifts from her parents and grandparents in pre check period 198182 and 198283 as seen from Ex.PW38/DX4 and DX5 i.e ITRs of AY 198283 and 198384, respectively of Ms. Sonya Jain.
In respect of joint bank accounts, it has been submitted that joint bank accounts are for convenience of operation. The ownership of funds and CBI Vs. Sushil Kumar Jain CC No.11/13 Page 61 of 95 utilization of the same in these joint accounts can be found from bank payin slip counterfoils and cheque counterfoils. IO had not utilized the 2500 counterfoils of bank payinslips which he had seized in the search of house of accused SK Jain on 14/15.01.1993. Accused submitted that Smt. Asha Jain and Ms. Sonya Jain had there own assets which were much more than those of accused SK Jain even at the start of the check period on 01.04.83. Assets of Smt. Asha Jain on 01.04.83 were Rs.1,64,334.98ps including share investments of Rs.1,16,528.09ps, as per ITR Ex.PW38/N8. It has been submitted that Ms. Sonya Jain Tyle had assets of Rs.87,820.56ps on 01.04.83 including the share investments of Rs.62,317.75ps, as per ITR Ex.PW38/N14, whereas accused SK Jain had assets of Rs.69,727.25ps on 01.04.83 as per ITR Ex.PW38/N1.
The plea of the defence is that the main assets of accused SK Jain and other 3 entities i.e. Smt. Asha Jain, Ms. Sonya Jain and Sh. Sasha Jain were share investments from beginning to end of check period. There was compounding effect of continuous reinvestment of their returns from share investments by each one of them in further purchase of shares.
Accused stated that despite change in conduct rules, the accused as a matter of abundant precaution continued to report such transactions of his family members and even obtained sanction of the Railways for the house being purchased by his wife, daughter and son from their own sources of funds.
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 62 of 95
Accused submitted that all the 1586 share certificates seized by CBI during the search of the residence of Smt. Asha Jain and accused SK Jain were found by them to be accounted in the ITRs. No asset was found by CBI in their investigation which was not accounted in the ITRs.
Accused submitted that IO has not conducted the investigation fairly. It has been submitted that IO did not take into account the detailed written explanation given by accused vide his letter dated 17.05.94. It has been submitted that the prosecution has failed to explain that if practically all figures of Income, Expenditure and assets are from income tax returns, then why these figures for other three entities have been clubbed with accused SK Jain. It was pointed out that IO in his cross examination and written synopsis confirmed that profit on sale of share and dividends have been taken from Income Tax returns but IO's worksheet for the same and attached as Annexure II and III with prosecution synopsis dated 28.01.2014 do not link these ITRs for all figures. These worksheets are rather muddled and not capable of being verified.
If we peruse the comparison of figures given by CBI and defence, the items which have been disputed are Salary Income of SK Jain and Ms. Sonya Jain, Capital Gain i.e. Profit on Sale of Shares attested during the check period / proceeds received on sale of shares / redemption of debentures, rent received by accused SK Jain and Smt. Asha Jain, Interest earned on PPF Account and refund received from HUDA. Besides this, the defence has submitted that a sum of Rs.4,50,000/ on account of loan CBI Vs. Sushil Kumar Jain CC No.11/13 Page 63 of 95 received against option of first floor rights of house under purchase from M/s. Unitech Ltd. in Gurgaon by Ms. Sonya Jain, Smt. Asha Jain and Sh. Sasha Jain, loans received from close relatives as on 31.03.92 in the sum of Rs.97,000/, gifts received from close relatives during the check period in the sum of Rs.2,38,000/, PPF withdrawal of Rs.6,180/, Intra family gifts received during check period in the sum of Rs.1,03,500/ and Intra family net loans to be returned as on 31.03.92 (since returned) for Rs.3,12,000/ are entitled to be included in the Income of accused.
In respect of remaining figures, there is a marginal difference which may not have huge impact on the disproportionate assets. Interestingly, the defence has shown the expenditure in the sum of Rs. 21,05,331.45ps as compared to the figure of Rs.7,07,897.85 shown as expenditure by the CBI. In this regard, the defence has disputed a sum of Rs. 1,00,000/ shown as estimated expenses incurred by accused on the marriage of Ms. Sonya Jain. Besides this, the defence has submitted that expenditure on account of cost price of shares sold, gifted or debentures redeemed for Rs. 5,78,289.51, contribution to PPF in the sum of Rs.22,400/, contribution deducted by employers towards PF, VPF, Group Insurance etc. in the sum of Rs.2,76,026/, TDS by employer from salary in the sum of Rs.1,12,916.11, repayment of house building advance for Rs.86,139/, TDS from dividends for Rs.21,562/, Intra family gifts given during check period in the sum of Rs.1,03,500/, intra family net loans to be received back as on 31.03.92 CBI Vs. Sushil Kumar Jain CC No.11/13 Page 64 of 95 (since received back) in the sum of Rs.3,12,000/, needs to be added in the expenditure.
It is pertinent to mention here that the figure of Rs.1,03,500/ and Rs.3,12,000/ on account of Intra family gifts given during check period and intra family net loans to be received back as on 31.03.92, respectively, have been shown both in Income and Expenditure and therefore, will have no impact on disproportionate assets. However, it seems that it seems to be an incorrect method of accounting.
In the assets at the end of the check period, the defence has disputed the figure shown on account of electric fittings done in DDA Flat in Vasant Kunj in Feb./ March 92 in the sum of Rs.10,000/ ; wooden fittings including wall cabinets done in the DDA flat in Vasant Kunj during August 91 to March 92 in the sum of Rs.45,000/ ; Geyser purchased in February 92 in the sum of Rs.1,500/ ; and credit balance in the PPF Account in the sum of Rs.28,624/. The defence has also disputed the addition of Rs.11,931/ on account of Fixed deposit/double benefit deposit with bank on the ground that it has already been added in the cash in hand i.e. item no.7 in the list of assets. Another major difference is on account of jewelery. The prosecution has added a sum of Rs.1,83,180.24ps whereas, the accused has stated that this amount has to be Rs.46,800/ as at the beginning of the check period. There is not much dispute as to the assets at the beginning of the check period.
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 65 of 95
The defence has relied upon the following judgment in support of his contentions :
1. Krishnanand Agnihotri Vs. State of MP, AIR 1977 SC 796
2. State of Andhra Pradesh Vs. J. Satyanarayana, 2011 AD (Cr.) SC 456
3. M. Krishna Reddy Vs. State Dy. Superintendent of Police, Hyderabad, AIR 1993 SC 313 ;
4. DSP Chennai Vs. K. Inbasagaran, 2006 (1) Criminal Court Cases 586 (SC)
5. Ashok Tshering Bhutia Vs. State of Sikkim, 2011 (2) Criminal Court Cases 092 (SC)
6. State Inspector of Police Visakhapatnam Vs. Surya Sankaram Karri, 2006 III AD (Cri) (SC) 532.
7.0 Accused has been charged for the offence u/S.5(1)(e) punishable u/S.5(2) of POC Act 1947. It is pertinent to mention here that the charge in this case was framed on 31.05.2005 and check period in this case was 01.04.1983 to 31.03.92.
The present RC was registered in 1992 and already around 22 years have been lapsed. The accused has crossed 89 years of age. I consider that any amendment/modification in the charge at this stage would seriously prejudice the accused. Hence, the court will proceed to decide the case of the prosecution on the basis of charge framed against the accused. CBI Vs. Sushil Kumar Jain CC No.11/13 Page 66 of 95
Section 5(1)(e) punishable u/S.5(2) of POC Act, 1947 corresponding to S.13(1)(e) punishable u/S.13(2) of of POC Act, 1988 reads as under :
"Section 5 : Criminal misconduct in discharge of official duty (1) A public servant is said to commit the offence of criminal misconduct 3
(a) [a] Words "in the discharge of his duties" omitted by the Anti Corruption Laws (Amendment) Act., 1964 (40 of 1964), S. 6 (18121964).
[* * *] [(e) if he, or any person on his behalf is in possession of or has, at any time during the period of his office, been in possession, for which the public servant cannot satisfactorily account, of pecuniary resources or property disproportionate to his known sources of income.]"
The necessary ingredients of Section 5(2) read with Section 5(1)
(e) of POC Act 1947 [equivalent to S.13(2) r/w S.13(1)(e) of POC Act, 1988] are as under :
1) it must establish that the accused is a public servant,
2) the nature, and extent of the pecuniary resources or property which were found in his possession,
3) it must be proved as to what were his known sources of income i.e. known to the prosecution, and
4) it must prove, quite objectively that such resources or property found in possession of the accused were disproportionate to his known sources of income.
7.1 Before proceeding further, I would like to place my deepest sense of appreciation for the prosecution and defence in this case. It was a huge case involving thousands of documents. However, the prosecution and CBI Vs. Sushil Kumar Jain CC No.11/13 Page 67 of 95 the defence both have assisted the court in an extremely professional manner. I would not hesitate to say the the synopsis given by the prosecution and the defence made the task of this court very easy. It is also credible to note here that both prosecution and defence have contested the case in a very dignified manner. The case ultimately boiled down to primarily on the method of accounting. Hardly there was any dispute on the figures. Both the parties did not dispute the figures shown in their written synopsis and therefore, this would help the court in taking the figure directly from the written synopsis of the prosecution and the defence.
The main contention of the defence is that prosecution has illegally and wrongly clubbed the income of wife, son and daughter of accused, whereas, they were having independent income and were separate entities. It is a matter of record that wife, son and daughter of accused were filing separate income tax returns. It has also come on the record and has not been disputed that Smt. Asha Jain nee Ms. Asha Aggarwal had been filing income tax returns even before her marriage. Accused had also been intimating the assets of wife to the department as back as since 1973. Similarly, the intimations had also been sent in 1979 and 1985. Even as per the case of the defence, prominently the income earned by the wife and children of the accused are from transactions of shares, dividend and interest. The accused has also pleaded that his wife has also worked as a Teacher for sometime prior to the check period but no evidence has been brought on record to show any qualification of Smt. Asha Jain. Even Section 64 of the CBI Vs. Sushil Kumar Jain CC No.11/13 Page 68 of 95 Income Tax Act, 1961 provides clubbing of Income to the assessee with the income earned by spouse, minor children etc. The income earned by the spouse can be excluded whether the spouse possess technical or professional qualification and income is solely attributable to the application of his/her technical or professional knowledge or experience. Though, Section 64 is not directly applicable on the present set of facts as it is not the case of the prosecution that Mrs. Asha Jain has earned by way of salary, commission, fee or any other form of remuneration from a concern in which the accused had a substantial interest. However, taking the analogy of Section 64 it can be taken that if there is no apparent technical or professional qualification in the hand of wife of the children of the public servant, the income earned by such wife or children can be clubbed to the income, expenditure and assets of the assessee.
In the present case, the prosecution has also prominently relied upon the ITRs filed by the accused and his children and therefore, even if those income, expenditure and assets are clubbed, it does not seem to be prejudice the accused much. It may again be stated even at the cost of repetition that in the entire family of 4 persons including accused, wife and two children, only the accused was having income from salary and all other were having income from shares and dividends except that of Ms. Sonya Jain who started working in the later part of the check period i.e June 1987. Since prominently the figures are taken from ITRs, I am of the view of that the clubbing of income, expenditure and assets of all the members of the family CBI Vs. Sushil Kumar Jain CC No.11/13 Page 69 of 95 has not prejudiced the accused and rather it has given a complete picture of the income, expenditure and assets of the entire family as a whole.
The accused has also raised serious questions as to the method of accounting adopted by the IO. It has been submitted that the IO has selectively taken the figures from ITRs. The defence submitted that the IO started the investigation with a preconceived notion and he was pre determined to implicate the accused in disproportionate assets case and therefore, he picked up the figures either from ITRs or from the particulars/details furnished by the office.
Perusal of the entire record would indicate that there is substance in the submissions of the defence. In fact, it seems that IO has practically not done any substantial investigation. He merely sent a communication to the department asking for salary details of the accused. It is pertinent to mention here that even he could not collect the salary details of accused and his daughter Ms. Sonya Jain for the complete check period. IO has taken the salary income partly on the basis of details furnished by the office and partly on the basis of ITRs. Similary, for income from shares and dividends, interest earned from the bank etc., IO has again relied upon ITRs. The defence has rightly submitted that even the IO did not care to physically check the transactions in the bank with the help of vouchers which he had seized during the search of the house of the accused and he merely adopted the figures given in the ITRs.
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 70 of 95 7.2 The prosecution made excellent arguments and filed a detailed written synopsis at the culmination of the trial. However, unfortunately they did not conduct such a detail and meticulous investigation at the time when it was required. Yet, the premium of defective or faulty investigation cannot be given to the accused and the court is required to evaluate the case in its entirety so as to reach to the conclusion whether the offence is made out or not.
8.0 The prosecution has charged the accused for having in possession of disproportionate assets in the sum of Rs.13,64,482/ at the end of the check period. It is worth to note here that mere possession of assets by a public servant is not an offence. The public servant may have disproportionate assets also but for that he will have to give a satisfactorily explanation and if he fails to do the same, then he is liable to be convicted for the offence u/S.5(1)(e) of POC Act, 1947.
The plea of the accused in this case is that the IO has computed the income wrongly which is the main reason for showing the accused in possession of disproportionate income. The plea of the prosecution is that accused was in possession of the assets in the sum of Rs.3,58,330.18ps at the beginning of the check period. The defence has not disputed this. As per Annexure X filed by the defence alongwith written synopsis, the accused has stated that he alongwith members of his family were in possession of assets in the sum of Rs.3,57,582/. The difference is very marginal and therefore, I CBI Vs. Sushil Kumar Jain CC No.11/13 Page 71 of 95 consider that there would be no purpose of making any discussion on the same.
8.1 Now coming to the Income of the accused and members of his family during the check period i.e. 01.04.83 to 31.03.92.
1) Salary Income of accused SK Jain w.e.f. April 1983 to March 1992 As per chargesheet, the prosecution has stated that accused had earned a salary income in the sum of Rs.2,42,285/. In order to prove this, the prosecution has examined PW9 Sh. VK Sharma and PW20 Sh. AK Mittal. The prosecution has also proved documents Ex.PW20/D, Ex.PW9/A, Ex.PW9/C. However, it is a matter of record that the salary for the period April 1983 to March 1985 has been taken from the ITR filed by the accused. The case of the prosecution is that they had taken the net carry home salary of the accused. The case of the prosecution is that they have taken only that amount which came in the hands of the accused for the purpose of making any expenditure or acquiring any assets. The plea of the accused is that the IO has adopted the wrong method. He has suggested that the correct method is that gross salary earned by the accused has to be taken and then all deductions have to be shown in the expenditure. The accused has filed Annexure I showing the gross income and deductions thereon. On the face of it, it is seen that there should not be any difference if the gross salary is shown in the Income and all the deductions are shown in the expenditure or CBI Vs. Sushil Kumar Jain CC No.11/13 Page 72 of 95 only the net income is shown in the Income of an individual. However, in the present case, apparently, there is a difference. The gross income of the accused during the check period as per salary statement issued by the department filed alongwith ITR during the check period is Rs.7,98,819.35 and the deductions during this period on account of PF, VPF, GEIS, TDS, HBA comes to Rs.4,32,940/. Thus, the net salary comes to Rs.3,65,879.35. In comparison to this, the prosecution has shown the salary during the check period as net salary in the sum of Rs.2,42,285/. Thus, there is a difference of Rs.1,23,593.34ps. The case of the prosecution is that there were some other deductions also, which have not been shown by the accused in ITRs. It is a golden principle that the prosecution is duty bound to prove its case beyond reasonable doubt. The accused has shown the figures from the ITRs and salary statement issued by the department. If the prosecution was of the view that there were some deductions which have not been shown by the accused then it was for them to prove that salary shown by the accused in the ITRs is incorrect. It is strange to note that prosecution itself has taken the part of the salary income from the ITRs itself. It is also worth to note that the ITR filed by the accused has duly been accepted by the Assessing Officer and there is nothing on the record to suggest that accused has shown inflated income in the ITRs. However, I consider that instead of showing deductions separately in the expenditure, which would only increase the volume of the case, the net salary of the accused after deducting deductions from gross salary can be taken into account which comes to Rs.3,65,879.39ps. CBI Vs. Sushil Kumar Jain CC No.11/13 Page 73 of 95
2) Salary Income of Ms. Sonya Jain from June 87 to March 92 The prosecution has shown salary income of Ms. Sonya Jain from June 87 to March 92 as Rs.1,19,135.69. In this case also, the case of the prosecution is that they have taken net carry home salary of Ms. Sonya Jain. However, the defence on the basis of ITRs has submitted that Ms. Sonya Jain earned a gross salary in the sum of Rs.2,23,587.70ps and during this period, there were deductions of Rs.19,392/ on account of PF etc., Rs.22,749.11 on account of TDS & Misc., which comes to Rs.42,141.11ps. Thus, the net salary earned by Ms. Sonya Jain during the check period comes out to Rs.1,81,446.59ps.
3) House Building Advance received by accused SK Jain from Railways The prosecution has shown the income in the sum of Rs.
1,05,000/ in this regard which has not been disputed by the defence. Therefore, this is taken as Rs.1,05,000/ for the purpose of calculating Income.
4) Dividend and Interest earned during April 1983 to March 92 The prosecution has shown a sum of Rs.6,24,187.55ps to have been earned as dividend and interest during the check period. The defence has submitted that the income under this head during the check period is Rs. CBI Vs. Sushil Kumar Jain CC No.11/13 Page 74 of 95 6,28,468.33ps. The defence has given separate figures of the dividend and interest earned by the accused and members of his family alongwith TDS deducted. Thus, there is a difference of Rs.4,280.78ps. This was put to the IO specifically during the cross examination and he had admitted that there may be some error of calculation. Since the defence has given the exact figure and IO has also admitted that there may be some error, it would be in the interest of justice to take the figure as suggested by the defence i.e. Rs. 6,28,468.33ps.
5) Interest earned from SB Accounts during check period ; and
6) Interest earned from Fixed deposit during check period The prosecution has shown the income of Rs.14,939.90ps and Rs.14,191.92ps as interest earned from SB Accounts and on Fixed deposits. The prosecution has proved this on the basis of testimony of IO, PW2 Sh. Anil Sharma, PW22 Sh. BM Patnaik, PW30 Sh. Ashwin Kumar, PW29 Sh. P. Hari Prasad Rao, PW7 Sh. Bhagwan Sahay and PW24 Ms. Lalnilawni. Similarly, the interest earned by the accused and members of his family during the check period has been proved by PW30 Sh. Ashwin Kumar, PW12 Sh. Lajpat Rai Gupta and PW8 Sh. Satish Chander Soni. Interestingly, the accused has claimed that he earned Rs.25,500.97 as interest from SB and Fixed deposits during the check period. Thus, the accused has shown that he had lesser income to the tune of Rs.3,630.85. In view of the CBI Vs. Sushil Kumar Jain CC No.11/13 Page 75 of 95 plea of the accused himself, the income from SB Account and Fixed deposits is taken as Rs.25,500.97. It is pertinent to mention here that the accused has shown some amount of fairness while even presenting the figures which are detrimental to his interest.
7) Capital Gain / profit on sale of shares etc. The prosecution has shown a sum of Rs.5,57,252/ as capital gain i.e. profit on sale of shares earned by accused and members of his family during check period. The prosecution has taken this amount from the ITR. The accused has disputed the method of calculation and has submitted that the method adopted by the IO is incorrect. Accused submitted that the correct method would be to show the entire income from sale discharge of shares in the income part and then to show cost price of shares sold in the expenditure part. The case of the prosecution is that accused has earned a profit in the sum of Rs.1,19,794/ from the shares transaction. However, the plea of the accused is that he had income of Rs.2,55,932.60 during the check period. The case of the accused is that the cost price of these shares (Rs. 1,05,157.10) has to be shown in the expenditure to have been incurred during the check period. (Rs.2,55,932.60 - Rs.1,05,157.10 = Rs.1,50,775.50). If we compare the figures of the prosecution and the defence, there is a difference of Rs.30,981.50 (Rs.1,50,775.50 - Rs.1,19,794 = Rs.30,981.50). CBI Vs. Sushil Kumar Jain CC No.11/13 Page 76 of 95
Accused has taken this figure from ITR. The prosecution also claimed to have picked the figures from ITR. However, it has not been explained either by the party that what is the reason of the difference between the two. It was for the prosecution to prove on record that how and on what basis they have arrived on a figure as claimed by them in the chargesheet. The method adopted by accused seems to be more credible and being based on ITRs may be taken. Thus, on the same analogy, the share income of Smt. Asha Jain can be taken as Rs.3,93,721.71 - Rs.1,03,428.41 = Rs.2,90,293.30. In case of Smt. Asha Jain, the prosecution has taken a figure of Rs.2,59,916 and therefore, in this case also, there is a difference of Rs.2,90,293.30 - Rs. 2,59,916 = Rs.30,377.30.
In the similar fashion, the income of Ms. Sonya Jain in this regard would be Rs.3,57,790 - Rs.1,93,489 = Rs.1,64,301/. The prosecution has shown a figure of Rs.1,45,057. Thus, in this case also there is a difference of Rs.1,64,301 - Rs.1,45,057 = Rs.19,244/. Adopting the same method, the income of Sh. Sasha Jain would be Rs.2,54,535.61 - Rs.1,76,215 = Rs.78,320.61. The prosecution has shown the figure of Rs.32,485. Thus, in this case also, there is a difference of Rs.78,320.61 Rs.32,485 = Rs. 45,835.61.
Thus, the total income under this head would be Rs.6,83,690.41 and it would result into an increase in income for a sum of Rs.1,26,438.41. It is worth to note that in disproportionate assets case, the IO or the court is not required to work as an accountant and the accounting has CBI Vs. Sushil Kumar Jain CC No.11/13 Page 77 of 95 to be done in the simple manner. The duty of the investigating agency is also to explain the accounting done by them in a clear and simply method. In the present case, it seems that IO possibly in anxiety to reach to some conclusion, lost into the entangled web of the figures and ended up in making the case confusing and beyond understanding.
8) Withdrawal from CPF by accused SK Jain The prosecution has taken the figure of Rs.96,000/ and the same has not been disputed by the defence. Hence, the same is taken as such.
9) Commissions earned by Smt. Asha Jain from UTI, small savings etc. The prosecution has taken this figure as Rs.15,020.25ps whereas, the accused has submitted that actual income on this account was Rs.13,443.50. Thus, in view of the plea of the accused himself, the income under this head can be taken as Rs.13,443.50. Therefore, it would amount in reducing the income from Rs.15,020.25 - Rs.13,443.50 = Rs.1,576.75.
10) Rent received by SK Jain and Smt. Asha Jain from DDA Flat No. 1018, Sector A, Pocket B, Vasant Kunj, New Delhi.
The prosecution has stated that accused and his wife has earned a sum of Rs.50,600/ as rent during the check period. However, the plea of the defence is that they have earned a rent in the sum of Rs.88,500/ during CBI Vs. Sushil Kumar Jain CC No.11/13 Page 78 of 95 the check period. It is not disputed that in the ITR, the accused has shown the rent earned during the check period in the sum of Rs.88,500/. The plea of the IO was that accused could not give any satisfactorily evidence regarding the rent earned beyond Rs.50,600/ during the check period. The plea of the accused is that he has shown the amount earned on account of rent in the ITRs. However, during the trial also, the accused did not produce any document to show that actual rent was earned by him was Rs.88,500/. Therefore, in view of the fact that the documentary evidence is only regarding Rs.50,600/, there is no reason to enhance the income to Rs. 88,500/.
11) Interest received from DDA The prosecution has shown a sum of Rs.2,244/ towards the interest received from DDA. The accused has not disputed the same. Hence, the same is taken as such.
12) Income Tax Refund received The prosecution has shown a sum of Rs.10,152/ received on account of Income Tax Refund. However, accused has shown a sum of Rs. 9,885/ under this head. In view of the plea of the accused himself, this amount will be taken as Rs.9,885/ which would result in reducing the income in the sum of Rs.10,152 - Rs.9,885 = Rs.267.
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 79 of 95
13) Income from two Overdraft Accounts The prosecution has shown an income of Rs.68,928.67 on account of two overdraft accounts. It is a matter of record that accused had availed two overdraft accounts i.e. 30467 and 30470 during the check period. The case of the prosecution is that the debit balance in this account at the end of the check period was Rs.72,262.30 and this had also incurred an interest of Rs.3,367. The accused has suggested that total debit balance has to be taken in income and interest be shown in the expenditure. However, I consider that it would not make any difference and therefore, the figure shown by the prosecution in the sum of Rs.68,928.67 can be taken as it is.
14) Interest earned on PPF Account The prosecution has shown a sum of Rs.11,288/ as income on account of interest earned on PPF Account. The accused has disputed the same on the basis of wrong calculation. It has been submitted that as per ITR, the gross contribution towards PPF was in the sum of Rs.22,400/. Withdrawal during this period is Rs.6,180/ and therefore, end contribution to PPF is Rs.16,220/. The plea of the accused is that the withdrawal in the sum of Rs.6,180/ may be shown in the income and contribution in the sum of Rs.22,400/ may be shown in the expenditure. However, IO has calculated in a different manner. As per prosecution, they have simply calculated the interest earned on the PPF during the check period and have shown credit CBI Vs. Sushil Kumar Jain CC No.11/13 Page 80 of 95 balance in PPF account at the end of the check period in the assets. I consider that the method adopted by the IO is more plausible and therefore, the figure suggested by the IO in the sum of Rs.11,288/ may be taken as such.
15) Interest earned on NSS The prosecution has shown a sum of Rs.21,321/ as interest earned on NSS. However, the accused as shown a sum of Rs.20,119/. Thus, in view of the accused himself, this can be taken as Rs.20,119/ which would result in the deduction of income in the sum of Rs.1,202/.
16) Refund received from DDA The prosecution has shown a sum of Rs.29,477/ as refund from DDA. Accused has also not disputed this figure. Hence the same is taken as such.
17) Refund received from HUDA The prosecution has shown a sum of Rs.3,409/ as refund from HUDA. However, the accused has shown Zero amount under this head. Since accused himself has shown that there was no refund. Hence, no income is taken under this head.
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 81 of 95 8.2 Now coming to the most controversial part of the case of the prosecution and the defence.
18) Loans received against option for first floor rights of Unitech house being purchased by Mrs. Asha Jain, Ms. Sonya Jain and Sh. Sasha Jain The IO has not accepted the money received by Smt. Asha Jain, Sh. Sasha Jain and Ms. Sonya Jain from Pradeep Gupta and others in the sum of Rs.4,50,000/ against option to construct first floor after the possession is received from M/s. Unitech Ltd. The case of the prosecution is that this was sham transaction and Pradeep Gupta and Alka Gupta had issued cheques against the cash payment made by accused and members of his family. During arguments also, IO stated that the perusal of the bank account would show that the cash payments were made by the accused and members of his family and against those payments cheques were issued by Pradeep Gupta and Alka Gupta. However, the plea made by the prosecution only remained to be plea as they did not lead any evidence to show that the cash deposited in the account of Pradeep Gupta and Alka Gupta were made by the accused or members of his family. The payments were made by cheques and entries were duly reflected in the bank account statements. The burden was on the prosecution to prove that these transactions are the sham transactions. The defence has heavily relied upon the statement of Alka Gupta recorded by IO during the course of investigation, where she had specifically stated that her husband and SK Jain had entered into an understanding under which, on CBI Vs. Sushil Kumar Jain CC No.11/13 Page 82 of 95 getting possession of Unitech house accused SK Jain will transfer first floor rights of this house to her husband for Rs.4.5 lacs.
The defence has submitted that Alka Gupta was cited as PW12 but she was not examined by CBI for the reasons best known to them. Rather the defence has relied upon the testimony of PW11 Sh. Shashank Mishra and demonstrated in the written synopsis which has not been reproduced herein for the sake of brevity to show that the transactions were genuine and there was nothing to suggest that the cash was deposited by the accused or members of his family. These transactions have also duly been shown in the ITRs. It is settled proposition that the court is required to appreciate the evidence independently and without any preconceived notion. If there are documents on record then merely by saying that it is a sham transaction would not discharge the burden of the prosecution. I consider that the prosecution has failed to prove this and therefore, Rs.4,50,000/ as income of Smt. Asha Jain, Ms. Sonya Jain and Sh. Sasha Jain by cheque from Pradeep Gupta and Alka Gupta, is accepted. It is also worth to note that accused has declared this transaction at all possible forums.
19) Loans from close relatives The IO has also not accepted the loan from close relatives in the sum of Rs.97,000/ having been received by Smt. Asha Jain, Ms. Sonya Jain and Sh. Sasha Jain. The plea of the accused is that these loans were taken to service the share portfolios and other capital account. It is pertinent to mention CBI Vs. Sushil Kumar Jain CC No.11/13 Page 83 of 95 here that these loans were taken by the accused in or around 1991 and 1992. I consider that this timing is very relevant which arises the suspicion, hence, the same cannot be accepted.
20) Gifts received from close relatives during check period CBI in its chargesheet has also not accepted the same as false income of Ms. Sonya Jain and Sh. Sasha Jain. In the chargesheet, the breakup of the gift received has not been shown. The plea of the accused is that these gifts were given in a normal way by the elders. The accused has also pleaded the background of his family and the family of his wife. Accused submitted that these gifts have duly been intimated to the department and have also been shown in the ITR. The plea of the accused is that IO has wrongly and illegally rejected these gifts despite the fact that the details of these gifts alongwith affidavits were given in the ITR. The defence has relied upon the testimony of DW8 Sh. Ajay Aggarwal to prove the total gifts of Rs.20,000/ to Ms. Sonya Jain and Rs.45,000/ to Sh. Sasha Jain and similarly, the defence has relied upon the testimony of DW2 to prove the gifts for the sum of Rs.87,080/ to Sh. Sasha Jain. The defence has also relied upon the testimony of DW6, DW7 to prove the gifts of Rs.5,000/ each. The plea of the accused is that Sh. Sasha Jain had also received a gift of Rs.20,000/ from his NRI paternal cousin uncle Sh. Sanjiv Gupta on 29.05.87 and certificate of the donor is duly placed on record. Sh. Sanjit Gupta being NRI could not come in the court for evidence. Similarly, gift received by Sh. Sasha Jain in FY 198990 and FY 199091 of Rs.6,830/ and CBI Vs. Sushil Kumar Jain CC No.11/13 Page 84 of 95 Rs.5,000/ respectively, which have duly been shown in the ITRs, Ex.PW14/E & Ex.PW15/E and similarly for FY 198586, 198687, 198788, 198889. These small amount of gifts added upto Rs.5,600/, Rs.11,440/, Rs.2,300/ and Rs. 9,250/, respectively, and these have duly been shown in the ITRs. It has also been stated that Smt. Asha Jain had received a gift of Rs.15,000/ from her sisterinlaw Smt. Shakuntla Gupta on 30.12.1990, which has duly been shown in her ITR. The plea of the prosecution is that these are sham transactions and accused has shown these gifts only to cover up illgotten money.
While appreciating the evidence, the court is required to take a pragmatic view. It has to be kept in mind that in Indian family the elders keep on giving gifts to the children. It is also a normal practice to give the gifts to the daughters, even after marriage by her parents. It is irrespective of the age of the daughter and the number of years of marriage. However, the fact of these gifts coupled with the written instruments raises some suspicion or eyebrow. Normally in the family when gifts are given such documents are not executed, but then it was for the prosecution to prove that these were sham transactions and the documents produced by the accused are forged or fabricated. The prosecution has tried to simply discharge its onus by saying that Smt. Asha Jain, Ms. Sonya Jain and Sh. Sasha Jain had not received any gift. I consider that IO adopted a short cut method instead of investigating the case into the depth in this aspect. In view of the figures on record and the defence evidence on oath which has also remained unshaken, there is no reason for the court to reject CBI Vs. Sushil Kumar Jain CC No.11/13 Page 85 of 95 the sum of Rs.2,38,000/ as proved by the defence on record on account of gifts.
21) PPF Withdrawal Accused has shown a sum of Rs.6,180/ as income towards withdrawal from PPF Account. However, this has already been discussed while discussing item No.14 i.e. Interest earned on PPF A/c. Hence, the same cannot be accepted.
22) Intra family gifts given during the check period
23) Intra family Net loans to be received back as on 31.03.92 (since received back) Accused stated that income of Rs.1,03,500/ and Rs.3,12,000/ be added. Even as per the case of the accused, the same were returned back during the check period itself. Since the income, assets and expenditure of all the members of family has been clubbed, there would be no purpose of taking this figure.
Expenditure 1) Personal Expenditure incurred
IO has taken a personal expenditure incurred during the check period on the basis of ITRs. The defence has also taken the expenditure incurred on the basis of ITR and the figure comes out as Rs.5,50,074.83 which seems to CBI Vs. Sushil Kumar Jain CC No.11/13 Page 86 of 95 be a correct figure and therefore, is taken as personal expenditure having been made during the check period.
2) Tax deposited The prosecution has shown a sum of Rs.19,924/ towards tax deposited during the check period. The accused has also not disputed the same. Hence, the same is taken as it is.
3) Application money sent by Sasha Jain for shares of Asian Fuse Gears Prosecution has examined PW34 Sh. Puneet Sharma from M/s. Eon Electric Ltd. formerly known as M/s. Indo Asian Fuse Gear Ltd. and he proved the allotment of 1000 shares to Sh. Sasha Jain.
4) Temporary loan given by Ms. Sonya Jain to M/s. Alpha Core Ltd.
in FY 199192 The prosecution has shown a sum of Rs.37,500/ in respect to this item however, CBI has not led any evidence in this regard. Since the prosecution has failed to prove the expenditure, it cannot be taken into account for the purpose of computing the DA.
5) Minimum estimated expenditure incurred by accused SK Jain on the marriage of his daughter Ms. Sonya Jain IO has taken a minimum estimated expenditure incurred by SK Jain on the marriage of his daughter is Rs.1 lakh. The accused has disputed this CBI Vs. Sushil Kumar Jain CC No.11/13 Page 87 of 95 amount that in the absence of any material or evidence on record this figure cannot be taken into account. The plea of the accused is that this amount is already included in personal expenditure shown in the ITR. It is not in dispute that Ms. Sonya Jain got married during the check period on 06.02.1991. I consider that IO has taken a conservative view. However, in the absence of any evidence on record i.e; oral or documentary, it would be unjust to take a sum of Rs.1 lakh as marriage expenses. The court cannot presuppose any fact. In criminal trial it is for the prosecution to prove beyond reasonable doubt.
Thus, the expenditure incurred by the accused and members of his family during the check period comes to Rs.5,70,998.83ps. Assets
1) DDA Flat No.1018, Sector A, Pocket B, Vasant Kunj, New Delhi No dispute has been raised in respect of this. Hence, the same is taken as it is.
2) Amount paid for purchase of house in Gugaon from M/s. Unitech Ltd.
In respect of this also, no dispute has been raised. Hence, the same is taken as it is.
3) Electric Fittings done in the DDA Flats in Vasant Kunj in
Feb./March 92
4) Wooden fittings including wall cabinets done in the DDA Flat in
Vasant Kunj during August 91 to March 92
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 88 of 95
5) Geyser purchased in Feb. 1992
The prosecution has added a sum of Rs.10,000/, Rs.45,000/ and Rs.1,500/ (Total Rs.56,500/), respectively towards above mentioned items, on the basis of observation memo. However, no documentary or oral evidence has been led in this regard. In the absence of any evidence on record these amounts cannot be included in the assets of the accused. Hence, the amount of Rs. 56,500/ is excluded from Assets.
6) Credit Balance in the PPF Account The prosecution has duly proved that at the end of the check period there was a credit balance of Rs.4,420/ in PPF A/c No.964 of accused SK Jain, Rs.15,941/ in PPF A/c No.965 of Smt. Asha Jain, Rs.4,951/ in PPF A/c No.966 of Sh. Sasha Jain and Rs.3,312 in PPF A/c No.1054 of Ms. Sonya Jain. The prosecution has duly proved on record the statements of these accounts, Ex.PW27/A1 to A4. Thus, I consider that prosecution has duly proved the credit balance in PPF Accounts in the sum of Rs.28,624/.
7) Cash in Hand, in Banks and with brokers of SK Jain and members of his family In respect of this also, no dispute has been raised. Hence, a sum of Rs.69,862.07 be added in the Assets.
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 89 of 95
8) Credit balance in NSS A/c of SK Jain In respect of this also, no dispute has been raised. Hence, a sum of Rs.1,52,119/ be added in the assets of the accused.
9) Fixed deposit/double benefit deposit with bank The prosecution has relied upon this on the basis of documents Ex.P1174 and Ex.PW2/F. However, the plea of the accused is that this amount has already been included in cash in hand. There is nothing on record to suggest that this amount is included in Cash in hand and furthermore, the accused has duly accepted this document. Hence, the same is accepted. Thus, the sum of Rs.11,931/ be included in the assets.
10) Shares and securities The prosecution has taken this figure on the basis of the ITRs and has duly proved the same by way of documents Ex.PW2/E1 to E383, Ex.PW12/F1 to F24 and Ex.P1 to P995. It is apparent that largely documents have been admitted by the defence in this regard and therefore, the figure shown by the prosecution in the sum of Rs.14,74,195/ is taken as Assets.
11) Fiat Car No.BRH 3005 The prosecution has shown a figure of Rs.15,000/. The accused has also not disputed the same. Hence, the same is taken as it is. CBI Vs. Sushil Kumar Jain CC No.11/13 Page 90 of 95
12) Jewellery of SK Jain and members of his family The accused has disputed this amount of jewelery. However, the prosecution has proved on record the valuation report. The prosecution has added a sum of Rs.1,83,180.24ps on account of the jewelery at the end of check period. The prosecution has relied upon the valuation report of PW3 Sh. Prem Nath Khanna. The plea of the prosecution appearing during the cross examination of IO wherein in a specific reply to question No.133, IO stated as under :
"Q133. What is the breakup of this jewellery of Rs.46,800/ amongst Shri S.K.Jain, Smt Asha Jain, Ms Sonya Jain Tyle and Shri Sasha Jain at the beginning of the check period and how did you arrive at your amount of this asset for each entity?
Ans. During the course of investigation, it was found that Smt. Asha Jain had jewelery of Rs.5,300/, Smt. Sonya Jain of Rs.20,500/ and accused SK Jain of Rs.500/. In the year 1985, Sh. Sasha Jain had also shown jewelery of Rs.20,500/ in his possession as on 31.03.85 as per information furnished by accused to his department. This 1985 jewelery was also taken as an assets at the beginning of check period to extend benefit to the accused.
The rate of gold in 1976 was found as Rs.540/ per 10 gm, in 1979 it was Rs.938/ per 10 gm and in 1983 it was Rs.1,760/ per 10 gm and accordingly, the weight of the jewelery of Rs.46,800/ at the above said rates was taken as 74 gms. (1976), 19 gm (1979) and 233 gms (1983), which showed that net weight of the jewelery at the beginning of check period was 326 gms. Jewelery found at the time of search from residence and lockers etc. was weighing 816.6 gms, which showed that total weight 490 gms was acquired during the check period. The average rate of gold during 1983 to 1992 was ascertained as Rs.2,781/ per 10 gm. which showed that the cost of acquisition of 490 gms. Of jewelery during check period was Rs.1,36,380/ and the cost of total jewelery (including at the time of check period) was Rs.1,83,180/."
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 91 of 95
Ld. PP has argued that accused has acquired jewelery during the check period. However, the prosecution has failed to bring any evidence on record to this. The prosecution has also not proved the quantum of jewellery at the end or beginning of the check period. The reply given by the IO during cross examination cannot be taken as sufficient for this purpose. The accused has given a plausible explanation. It has also to be kept in mind that in such families to which the accused belonged, there is a tradition of keeping heavy jewellery with the ladies. In absence of any specific evidence placed on record by the prosecution regarding acquisition of jewellery during the check period, the explanation offered by the accused seems to be more plausible and reliable and hence, the figure given by accused i.e. Rs.46,800/ is taken as it is. Conclusion 9.0 In view of the above findings, the Income of the accused and members of his during the check period has been proved as follows :
Sl. No. Particulars Amount
1 Salary income of SK Jain during April 83 to March 92 365879.39
2 Salary income of Ms. Sonya (Jain) Tyle D/o S.K. Jain during her service with BHEL during June 87 to March 92 181,446.59 3 House Building Advance received by S.K. Jain from Railways 105,000.00 4 Dividend and interest earned by S.K. Jain his wife Smt. Asha Jain, his daughter Ms. Sonya (Jain) Tyle and his son Sh. Sasha Jain during April 83 to March 92 628,468.33 5 Interest earned by S.K. Jain and his above said family members from their savings bank A/c's during said check period 25,500.97 6 Interest earned by S.K. Jain and family members from bank fixed deposits 7 Capital gains, i.e. profit on sale of shares etc. earned by S.K. 683,690.41.00 Jain and his said family members during check period CBI Vs. Sushil Kumar Jain CC No.11/13 Page 92 of 95 8 Withdrawal from GPF by S.K. Jain 96,000.00 9 Commissions earned by Smt. Asha Jain from UTI, Small savings, etc. 13,443.50 10 Rent received by S.K. Jain & Smt. Asha Jain from their DDA Flat at 1018, Sector - A, Pocket - B, Vasant Kunj, New Delhi. 50,600.00 11 Interest received from Delhi Development Authority 2,244.00 12 Income Tax refunds received by S.K. Jain and family members 9,885.00 13 Income from two over drafts A/c's of S.K. Jain and family members 68,928.67 14 Interest earned by S.K. Jain and family members on their PPF A/c's 11,288.00 15 Interest received by S.K. Jain on his NSS A/c 20,119.00 16 Refund received from DDA 29,477.00 17 Income from option for first floor rights of Unitech House 450,000.00 18 Gifts received from close relatives during check period 238,000.00 TOTAL 2,979,970.86 Similarly, total expenditure which has been proved is as follows :
Sl. No. Particulars Amount 1 Personal expenditure incurred by S.K. Jain and his family members 550,074.83 2 Tax deposited by S.K. Jain & family members 19,924.00 3 Application money sent by Sasha Jain for shares of 'Asian Fuse Gears' 1,000.00 TOTAL 570,998.83 Similarly, total Assets acquired by the accused and members of his family during the check period, as has been proved, are as follows :
Sl. Particulars Amount
No.
1 DDA flat No.1018, Sector - A, Pocket - B, Vasant Kunj,
New Delhi in the name of S.K. Jain and Smt. Asha Jain 229,500.00
2 Amount paid for purchase of house in Gurgaon from M/s.
UNITECH Ltd. in the names of S.K. Jain, Smt. Asha Jain, Sonya Jain and Sasha Jain. 779,453.00 3 Credit balance in PPF A/c's of S.K. Jain and his family 28,624.00 CBI Vs. Sushil Kumar Jain CC No.11/13 Page 93 of 95 members 4 Cash in hand, in banks and with brokers of SK Jain and his family members 69,862.07 5 Credit balance in NSS A/c of S.K. Jain 152,119.00 6 Fixed deposit / double benefit deposits with banks 11,931.00 7 Shares and securities in the name of S.K. Jain and his family members 1,474,195.00 8 Fiat Car of S.K. Jain 15,000.00 9 Jewellery of S.K. Jain & family members 46,800.00 TOTAL 2,807,484.07 10.0 Thus, the accused was having in possession of disproportionate assets as follows :
Sl. No. Particulars Amount
1 Income during the check period 2,979,970.86
2 Expenses during the check period (Less) 570,998.83
3 Likely savings during the check period 2,408,972.03
4 Assets at the close of check period 2,807,484.07
5 Assets at the beginning of the check period (Less) 358,330.18
6 Thus, assets acquired during check period 2,449,153.89
7 Disproportionate assets = Assets acquired - likely savings 40,181.86
10.1 In Krishnanand Agnihotri Vs. State of MP, AIR 1977 SC 796,
the Apex Court found that against an aggregate surplus income of Rs. 44,383.59 which was available to the appellant during the period in question, the appellant possessed total assets in the sum of Rs. 55,732.25. The assets possessed by the appellant were thus, found in excess of the surplus income available to him. However, since the excess was comparatively small - less than 10% of the total income of Rs. 1,27,715.43, the Apex Court did not think it right to hold that the assets found in the possession of the appellant were disproportionate to his known sources of income, so as to justify the raising of presumption. Similarly, CBI Vs. Sushil Kumar Jain CC No.11/13 Page 94 of 95 in Ashok Tshering Bhutia Vs. State of Sikkim, 2011 (4) SCC 402, the Apex Court after taking into account all the evidence, found that only a sum of Rs. 2.7 lakhs remains unexplained. The Supreme Court inter alia held that the alleged unexplained income is marginal / paltry sum which every government employee can save every year. In the present case the extent of disproportionate income is meagre which is not sufficient to record the conviction. 10.2 In view of the above findings, accused Sushil Kumar Jain is acquitted of the charge u/S.5(1)(e) punishable u/S.5(2) of POC Act, 1947.
Accused is on bail. Surety is discharged. Bail bond / surety bond cancelled. Original documents of surety, if any, on record may be returned against proper acknowledgment.
11.0 File be consigned to Record Room.
Announced in Open Court (Dinesh Kumar Sharma)
on 17.05.2014 Spl. Judge (PC Act) : CBI
Saket Courts : New Delhi
CBI Vs. Sushil Kumar Jain CC No.11/13 Page 95 of 95
CC No.11/13
CBI Vs. Sushil Kumar Jain
RC No.5(A)/92
17.05.2014
Present : Sh. S. Krishna Kumar, Ld. PP for CBI
Accused on bail is present with Sh. HR Dhamija, Advocate Vide separately announced judgment, accused Sushil Kumar Jain is acquitted of the charge u/S.5(1)(e) punishable u/S.5(2) of POC Act, 1947.
Accused is on bail. Surety is discharged. Bail bond / surety bond cancelled. Original documents of surety, if any, on record may be returned against proper acknowledgment.
In terms of section 437(A) Cr.P.C., accused Sushil Kumar Jain is directed to furnish bail bond in the sum of Rs.20,000/ each with one surety each in the like amount to appear before the Hon'ble High Court as and when court issues notice in respect of any appeal or petition filed against this judgment. Such bail bonds shall be in force for 6 months.
File be consigned to Record Room.
(Dinesh Kumar Sharma) Spl. Judge (PC Act), CBI : 17.05.2014 CBI Vs. Sushil Kumar Jain CC No.11/13 Page 96 of 95