Delhi District Court
2.2002 To 31.07.2002 vs . on 28 March, 2023
IN THE COURT OF MOHD. FARRUKH,
SPECIAL JUDGE (P C ACT) (CBI)-11,
ROUSE AVENUE COURT COMPLEX, DELHI
CC No. 380/19
RC No. 7A/06/CBI/ACU-II/ND
U/s 13(2) read with 13(1)(e) of Prevention of Corruption Act and
Section 109 of IPC
CNR No.: DLCT11-001483-2019
Central Bureau of Investigation (CBI)
vs.
1. Balbir Sharma (Accused No.1)
S/o Sh. Jai Narayan Sharma
2. Smt. Bala Devi Sharma (Accused No.2)
S/o Sh. Balbir Sharma
3. Narender Sharma (Accused No.3)
S/o Sh. Ram Narayan Sharma
4. Ravinder Sharma (Accused No.4)
S/o Sh. Ram Narayan Sharma
5. Vinod Kumar (Accused No.5) {Expired}
S/o Late Sh. Suraj Bhan
6. Rajender Singh (Accused No.6) {Expired}
S/o Sh. Phool Singh
7. Khushi Ram (Accused No.7) {Expired}
S/o Pandit Gurudas Ram
8. Ashok Kumar (Accused No.8)
S/o Sh. Khushi Ram
9. Vinay Kumari (Accused No.9)
W/o Sh. Deen Dayal
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 1
10.Shiv Narayan Sharma (Accused No.10)
S/o Sh. Ganpat Ram
11.Suraj Bhan (Accused No.11) {Expired}
S/o Sh. Hazari Lal
12.Santosh Sharma (Accused No.12)
W/o Ramesh Kumar Sharma
13.Surender Prasad Sharma (Accused No.13)
S/o Late Shri Satya Narayan
14.Onkar Singh Chauhan (Accused No.14) {Expired}
S/o Sh. Bakhtawar Singh
15.Shri Ram Yadav (Accused No.15)
S/o Ram Nath Yadav
16.Om Prakash Yadav (Accused No.16)
S/o Jai Narayan Yadav
17.Shyam Lal (Accused No.17)
S/o Sant Lal
18.Dalu Singh (Accused No.18)
S/o Ram Chander Singh
19.Mahadev Prasad (Accused No.19) {Expired}
S/o Rameshwar Dayal
20.Hari Prasad (Accused No.20) {Expired}
S/o Mukund Ram
21.Niranjan Lal (Accused No.21) {Expired)
S/o Late Sh. Ravi Dutt
22.Ram Mehar (Accused No.22)
S/o Sh. Rameshwar
23.Dharam Chand (Accused No.23)
S/o Manphool
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 2
24.Gopi Ram Kaushik (Accused No.24) {Expired}
S/o Banwari Lal
25.Suresh Kumar (Accused No.25)
S/o Ram Prasad
26.Om Prakash (Accused No.26)
S/o Ram Prasad
27.Dharmender (Accused No.27)
S/o Bahadur Singh
28.Sunil Sharma (Accused No.28)
S/o Umed Singh
29.Dinesh Kadiyan (Accused No.29)
S/o Mange Ram
30.Ram Avtar Sharma (Accused No.30)
S/o Jai Narayan Sharma
31.Rajender Sharma (Accused No.31)
S/o Shadi Ram
32.Ram Avtar (Accused No.32)
S/o Mam Chand
33.Ram Mehar Sharma (Accused No.33) {Approver}
S/o Bansi Ram
Date of FIR : 05.07.2006
Date of filing of charge-sheet : 19.09.2009
Arguments concluded on : 22.03.2023
Date of Judgment : 28.03.2023
Appearance
For Prosecution : Sh. Avanish Kumar Chand, Ld. P.P.
for the CBI
For accused persons : Sh. Manu Sharma, Ld. Counsel for
accused No. A-1 to A-26; A-30 to
A-32
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 3
: Sh. Naresh Kumar Sharma, Ld.
Counsel for accused No. A-27, A-28
& A-29
JUDGMENT
1. The assets of a public servant are stated to be disproportionate if these exceed his/her known sources of income (including expenditure incurred) and public servant is liable to be prosecuted for the offence of criminal misconduct U/s 13(1)(e) punishable U/s 13(2) of Prevention of Corruption Act, 1988 (hereinafter referred to as 'PC Act'). If such public servant has entered in conspiracy with non-public servants or if such non-public servants have abetted an offence U/s 13 (1)(e) of PC Act, 1988 which the public servant commits, such non-public servants are also liable to be prosecuted and punished along with public servant for the offence under section 109 of the Indian Penal Code (hereinafter referred to as 'IPC') read with section 13 (1) (e) of PC Act.
CASE OF PROSECUTION
2.The case of prosecution unfolded from charge sheet is that accused no.1 Balbir Sharma (A-1), while working in Nehru Yuva Kendra Sangathan (hereinafter referred as 'NYKS') as Youth Coordinator during the period from 01.02.2002 to 31.07.2002 acquired huge assets and pecuniary resources/properties both movable and immovable, grossly disproportionate to his known sources of income in his own name and in the name of his spouse, Bala Devi Sharma by corrupt or illegal means or otherwise CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 4 by abusing his position as public servant and he could not satisfactorily account for its acquisition. It is alleged that wife of A-1, Bala Devi Sharma (A-2) actively abetted A-1 in commission of the offence by entering into criminal conspiracy with her husband A-1 and assisted him in amassing wealth disproportionate to his known sources of income. The charge-sheet further alleged that accused No. 3 to 33 also actively assisted A-1 by depositing his ill- gotten money in their respective Bank accounts and, thereafter, handing over the said amount either to him or his wife and thus, they abetted the offence U/s 13 (1)(e) of PC Act read with Section 109 IPC.
3.A-5, A-6, A-7, A-11, A-14, A-19, A-20, A-21 & A-24 expired during pendency of present case and proceedings against them stood abated. A-33, Ram Mehar was granted pardon vide order dated 01.10.2010.
FACTUAL MATRIX
4. Source information led to the registration of First Information Report (hereinafter referred to as 'FIR') bearing RC No. 7A/06/CBI/ACU-II/ND dated 05.07.2006 by the CBI against A-1, Balbir Sharma, who was working as Youth Coordinator in 'NYKS'(an autonomous body under the Ministry of Youth Affairs and Sports) on the allegation that there had been spurt in his immovable and movable properties during the period 01.02.2002 to 31.05.2003 disclosing him possessing assets to the tune of around Rs. 1.10 Crores, disproportionate to his known source of income for which he could not give any CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 5 satisfactory explanation. It is alleged that huge deposits in his Bank account during the period 2002-2003 are highly suspicious. Thus, the aforesaid FIR was registered for offence U/s 13(2) read with Section 13(1)(e) of the PC Act.
5. During the course of investigation of the aforesaid FIR, it was found that on 28.02.2002, A-1 opened a saving Bank A/c No. 1572 with Delhi State Cooperative Bank Ltd., Shahabad, Daulatpur, Delhi, with initial cash deposit of Rs. 500/-. Thereafter, between the period from 28.02.2002 to 31.07.2002, he made various deposits aggregating to Rs. 1,11,29,541.33/- in the aforesaid Bank account. It was also found that there was an unusual spurt in his property holdings during the period from 01.02.2002 to 31.07.2002 and as such, this period has been taken as check period. Investigation revealed that he was found to be in possession of assets of Rs. 1,19,39,951/- during the check period.
6.As per the charge-sheet, A-1 acquired immovable property i.e. Flat No. A-4, 6 Aurangzeb Road, New Delhi by taking over M/s Prithvi Traders Ltd. (hereinafter referred to as 'M/s PTL') vide Memorandum of Understanding (hereinafter referred to as 'MoU') dated 20.06.2002, the payment of which was made by him through his Bank account and Bank account of his wife A-2 and the said payment was made between 01.02.2002 to 31.07.2002 and thus, check period was reduced from original check period of 01.02.2002 to 31.05.2003. It is alleged that in order to purchase the above mentioned assets, Balbir Sharma had CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 6 purportedly shown that he and his wife had obtained loan from their various relatives while in reality, that cash was deposited in Bank accounts of relations / friends allegedly by A-1 and, thereafter, either drafts or cheques were immediately issued in the name of A-2 and the said drafts/cheques were deposited in her Bank account and the above mentioned amounts were used for making payment to M/s PTL. It was found during investigation that the following relatives / persons, namely, (1) Narender Sharma (A-3); (2) Ravinder Sharma (A-4); (3) Vinod Kumar (A-5); (4) Rajender Singh (A-6); (5) Khushi Ram (A-7); (6) Ashok Kumar (A-8); (7) Vinay Kumari (A-9); (8) Shiv Narayan Sharma (A-10); (9) Suraj Bhan (A-11) (since expired); (10) Santosh Sharma (A-12) ; (11) Surender Prasad Sharma (A-13); (12) Onkar Singh Chauhan (A-14); (13) Sh. Shri Ram Yadav (A-15); (14) Om Prakash Yadav; (A-16) ; (15) Shyam Lal (A-17); (16) Dalu Singh (A-18); (17) Mahadev Prasad (A-19) ; (18) Hari Prasad (A-20); (19) Niranjan Lal (A-21) (since deceased); (20) Ram Mehar (A-22); (21) Dharam Chand (A-23); (22) Gopi Ram Kaushik (A-24); (23) Suresh Kumar (A-25); (24) Om Prakash (A-26); (25) Dharmender (A-27); (26) Sunil Sharma (A-28); (27) Dinesh Kadiyan (A-29); (28) Ram Avtar Sharma (A-30); (29) Rajender Sharma (A-31); (30) Ram Avtar (A-32) ; (31) Ram Mehar Sharma (A-33), had provided loan to Bala Devi Sharma (A-2) during the check period, though they were not capable of providing any such loan and as such they abetted the commission of CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 7 crime. The aforesaid accused were related to Balbir Sharma (A-1) and Bala Devi Sharma (A-2) in the following manner :
S. No. Category of loanee Names of loanee
1. Blood Relations of Balbir (i) Rajender Sharma (Uncle) Sharma (ii) Ramavtar Sharma (Brother)
2. Blood Relations of wife (i) Narender Sharma (Brother in law)
(ii) Ravinder Sharma (Brother in law)
(iii) Late Ram Narayan Sharma (Father in law)
3. Other relatives of wife (i) Rajender Singh, Asadpur Khera
(ii) Vinod Kumar, Asadpur Khera
(iii) Ram Mehar, Asadpur Khera
(iv) Khushi Ram, Ahri
(v) Ashok Kumar, Ahri
(vi) Shiv Narayan Sharma, Badala
(vii) Santosh Sharma, Noona Majra
(viii) Vinay Kumari, Mohammedpur
4. Relatives from (i) Gopi Ram Kaushik, Bapora village Bapora (ii) Suresh Kumar, Bapora where Balbir was (iii) Om Prakash, Bapora brought up
5. Friends of relatives i. Ram Mehar, Pur ii. Dharam Chand, pur
6. Relatives due to (i) Mahadev Prasad, Basal marriage of sister of marriage of sister Balbir Sharma Balbir Sharma or their (ii) Shree Ram Yadav friends (iii) Om Prakash Yadav
(iv) Shyam Lal, Basai
(v) Dalu Singh
(vi) Hari Prasad,
(vii) Niranjan Lal, Bohu Jhollery
7. Friends of Ravinder, (i) Dinesh Kadiyan, Advocate Brother in law (ii) Sunil Parashar, Advocate
(iii) Dharmendra, Advocate
8. Cousins of Bala Devi (i) Ram Avtar
(ii) Late Fam Murty Bhardwaj
9. Other persons. (I) Onkar Singh Chauhan, Retired married in village Bapora CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 8
(ii) Surendra Prasad, Ex Serviceman
(iii) Shanti Devi Gugnani, mother of J.L. Gugnani, who sold flat to Balbir Sharma
7.The aforesaid accused persons and others had allegedly extended loans to A-2 as per the following details :
S. From whom received Bank through which Date of receipt of Amount (in No. received loan Rs.)
1. Narendra s/o Ram PNB Machhroulli 10.05.02 DD 450,000/-
Narayan VPO A/c No. 5592 No.534564
Asadpur Khera,
Jhajjar
01.06.02 Ch. No. 300,000/-
683841
16.06.02 Ch. No. 300,000/-
683842
Jhajjar Coop Bank, 21.05.02 300,000/-
Machhroulli A/c No. 009541
1643
2. Ravinder Sharma s/o Jhajjar Coop Bank 18.06.02 100,000/-
Ramnarayan VPO Machhroulli A/c No.
Asadpur Khera, 1657
Jhajjar
3. Vinod Kumar s/o PNB Machhroulli 21.05.02 200,000/-
Suraj Bhan, Asadpur A/c No. 6876 Ch. No. 683791
Khera, Jhajjar
25.05.02 100,000/-
Ch. 683792
4. Rajender Singh Jhajjar Coop Bank, 10.05.02 DD 450,000/-
s/o Sh. Phool Singh Machhroulli, A/c No.534564 VPO Asadpur Khera No. 84 21.05.02 Ch. 100,000 001795
5. Khushi Ram PNB, Machhroulli, 16.05.02 300,000/-
s/o Sh. Phool Singh A/c No. 2157 No.534569 Asadpur Khera
6. Ashok Kumar PNB Machhroulli, 16.05.02 400,000/-
s/o Sh. Khushi Ram, A/c No. 5812 No.534568 VPO Ahri Jhajjar
7. Vinay Kumari SBI, Bawal 24.05.02 400,000/-
w/o Deen Dayal Mohammendpur, PO Natchana, Bawal
8. Shiv Narayan Sharma SBI, Bhiwani A/c 28.05.02 235,000/-
s/o Ganpat Badala, No. 31724 Kayala Bhiwani CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 9
9. Suraj Bhan SBI, Charkhi Dadri 20.05.02 500,000/-
s/o Hazari Lal, VPO 367292
Imlota, Charkhi Dadri
10. Smt. Santosh Sharma Draft 666450, SBI, 17.06.02 100,000/-
w/o Sh. Ramesh Kr. Bahadurgarh
Sharma, Village
Noona Manjra,
Bahadurgarh, Jhajjar
Draft 524902 19.06.02 25,000/-
14.06.02 200,000/-
11. Surendra Prasad SBI, Vidyadhar 17.05.02 979594 250,000/-
s/o 25, Murli Nagar, Nagar, Jaipur
Jaipur
12. Onkar Singh SBI South Industrial 12.06.02 No. 250,000/-
s/o Bakhtwar Singh Estate Branch, 310377
Plot No. 48, Bahiraon Jaipur
Nagar, Hatwara Road,
Jaipur A/c No.52516
13. Shri Shreeram Yadav Cash 25.04.02 350,000/-
S/o Ram Lal Yadav
r/o VPO Basai,
Khudana Basai,
Mahendergarh
14. Shri Om Prakash S/o Cash 25.04.02 350,000/-
Jai Narain, Village
Basai, Mahendergarh
15. Shri Shyam Lal S/o Cash 25.04.02 350,000/-
Rattan Singh, Village
Basai, Mahendergarh
16. Dalu Singh S/o Ram Cash 25.04.02 350,000/-
Chander, Village
Basai, Mahendergarh
17. Shri Mahadev S/o Cash 25.04.02 400,000/-
Late Rameshwar
Dayal, Village Basai,
Mahendergarh
18. Hari Prasad S/o Cash 26.04.02 350,000/-
Mukund Ram, Village
Chhappar, Bhiwani
19. Shri Niranjan Lal s/o Cash 26.04.02 350,000/-
Late Ravi Dutt,
Village Bahu Jhajjar
20. Ram Mehar S/o Haryana Gramin 10.05.02 515736 250,000/-
Rameshwar, VPO Bank, Bhiwani,
Bhiwani Khera
21. Dharam Chand S/o -do- 10.05.02 515737 500,000/-
Manphool, VPO
Bhiwani
22. Gopi Ram S/o Haryana Gramin 10.05.02 155504 365,000/-
Bhanwar Lal, VPO Bank, Bapora
Bapora, Bhiwani A/c
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 10
No. 2177
23. Suresh Kumar S/o -do- 10.05.02 515740 500,000/-
Ram Prasad, VPO
Bapora, Bhiwani A/c
No. 2337
24. Om Prakash S/o Ram Haryana Gramin 10.05.02 515741 500,000/-
Prasad, VPO Bapora, Bank, Bapora,
Bhiwani A/c No. 4975 Bhiwani
25. Dharmendra S/o PNB Kathmandi, 19.06.02 100,000/-
Bahdur Singh, 380/34, Rohtak
Janta Colony, Rohtak
26. Sunil Sharma S/o PNB Kathmandi, 07.06.02 50,000/-
Umed Singh, 843/34 Rohtak Ch. 884394
or 243/34, Vijay
Nagar, Rohtak
27. Dinesh Kadiyan S/o SBI, MDU, Rohtak 07.06.02 100,000/-
Mange Ram, 43/30 Ch. 295467
Vijay Nagar, Rohtak
28. Ram Avtar Sharma SBI, MDU, Rohtak 12.06.02 45,000/-
S/o Jai Narayan Ch. 420894
Sharma, Raipur,
Chhatisgarh
SBI, MDU, Rohtak 12.06.02 48,000/-
Ch. 420893
29. Rajender S/o Shri SBI, MDU, Rohtak 12.06.02 45,000/-
Shadi Ram, Jhinjhar, Ch. 420895
Jhajjar
30. Ram Avtar S/o Mam Machhroulli 10.06.02 50,000/-
Chand, VPO Goochi, Ch. 103702
Jhajjar
31. Ram Murtty Bhardwaj SBOP, Mini Sectt. 15.06.02 75,000/-
S/o Mam Chand, VPO Rohtak Ch. 134879
Goochi, Beri Jhajjar
32. Ram Narayan S/o 29.04.02 (not 300,000/-
Ishri Sahai VPO legible)
Asadpur Khera,
Jhajjar. A/c No. 5160
(not legible) 500,000/-
09.06.02 (not 200,000/-
legible)
33. Ram Mehar s/o Bansi SBI Patoda, Jhajjar 28.05.02 400,000/-
Ram VPO, Asadpur
Khera, Jhajjar A/c No.
11540
Total 11,188,000/-
8.It is alleged that no satisfactory explanations were given by CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 11 the aforesaid persons i.e. A-3 to A-33 as to how they came in possession of such huge amount at the time of providing loan to A-2 as their Bank accounts reflect that before or after the check period, there was no such money transactions in their respective Bank accounts.
9.The investigation further revealed that A-1 was having immovable assets at the beginning of check period i.e. 01.02.2002 in the shape of residential house, agricultural land etc. and movable assets amounting to Rs. 72,250/-. However, at the end of check period, A-1 was having movable assets of Rs. 1,63,637.94/- and shares in M/s PTL amounting to Rs. 29,04,243/- and immovable assets of Flat No. A-4, 6 Aurangzeb Road, New Delhi.
10.The assets both movable and immovable owned by A-1 Balbir Sharma and found in name of his family members at the beginning of check period i.e. 01.02.2002 and at the end of check period i.e. 31.07.2002; his income and expenditure during the said check period as mentioned in the charge-sheet are as under :-
(i) Immovable Assets at the beginning of check period S. No. Name of property Place where situated Mode of acquisition
1. Residential house Village Bapora, Gifted/inherited from his Bhiwani maternal grand faather
2. Agricultural land Do Do
3. 1/3rd share in a Station Read, Purchased in 1988 piece of land for Raigarh, Chattishgarh residence
4. 1/4th share in Ram Niwas Talkies Purchased in 1996 residential property Road, Raigarh, Chattishgarh CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 12
5. 7000 sq. ft. Vacant Village Pancri Pani, purchased on 10.07.2001 piece of land Raigarh
(ii) Movable Assets at the beginning of check period Sl. No. Description of Date of Amount Remarks Assets acquisition
1. Geyser 1990 1,000 Inventory Item
2. Semi Automatic 2001 5000 do LG Washing Machine
3. Refrigerator Akai 2001 7000 do
4. Kitchen Utensils 1990 onwards 2000 do
5. Ceiling fan 2000 500 do
6. Wooden co. 1986 800 do
7. Three steel 1990 2000 do Almirah
8. Cloths in Almirah 2000 onwards 5000 do
9. Wall clock 1990 100 do
10. Three brief cases 2000 onwards 900 do
11. Bed with mattress 1995 1200 do
12. Steel almirah in 1975 150 do drawing room
13. Three seater sofa 1985 1000 do
14. Corner Table 1980 100 do 15 TV 21" Samsung 2000 3000 do
16. Ceiling Fan & 2000 500 do Tube light
17. Eleven wall 1980 500 do paintings
18. Wooden cot with 1980 500 do mattress in verandah
19. Cooler local 2001 2000 do
20. Fair Car no. CG 13 1989 35000 do ZD 1252
21. Balance in SB do account in SBI (ADB) Raigarh
22. Balance in SBI do Kaker Total 72,250 CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 13
(ii) Assets at the end of the check period i.e. on 31.07.2002 S. Assets Name of In the Acquisitio Amount Remarks No. Bank name of n year
1. Gyser 1990 1000 Inventory items
2. Semi 2001 5000 do automatic LG Washing Machine
3. Refrigerat 2001 7000 do or Akai
4. Kitchen 1990 2000 do utensils onwards
5. Ceiling fan 2000 500 do
6. Wooden 1986 800 do cot
7. Three steel 1990 2000 do Almirah
8. Clothes in 2000 5000 do Almirah onwards
9. Wall Clock 1990 100 do
10. Three 2000 900 do Brief cases onwards
11. Ceiling fan 2002 700 do
12. Bed with 1995 1200 do mattresses
13. Steel 1975 1200 do almirah in drawing room
14. Three 1985 1000 do seater Sofa
15. Corner 1980 100 do table
16. TV 21" 2000 8000 do Samsung
17. Ceiling fan 2000 500 do and tube light
18. Eleven 1980 500 do wall paintings
19. Wooden 1980 500 do cot with CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 14 matress in verandah
20. Cooler 2001 1000 do locak
21. Fiat Car 1989 35000 do no. CG 13 ZD 1252
22. Fixed PNB Bala 02.05.200 20000 do Deposit Mahroli Devi 2
23. Fixed Delhi Balbir May 2002 15,000 do deposit Coop Sharma Bank
24. Balance Delhi Balbir 796.67 Statement a/c no. Coop ank Sharma of account.1572
25. Balance in SBI Balbir 1,033.6 Statement a/c Samaypur Sharma of account.
01190/050 Delhi 857
26. Balance in Delhi Bala 2,192.67 Statement a/c 1602 coop Devi of account.
Bank
27. Balance in PNB Bala 800 Statement a/c 6906 Machroli Devi of account.
28. Balance in Coop Bala 50,865 Statement a/c no. bank Devi of account.
1642 Marchroli
Total 163,637.94
(iii) Shares of M/s Prithvi Traders Ltd. Purchased by Sh. Balbir Sharma and Bala Devi Sharma Sl. No. Payment made to Date of payment Mode of Amount paid whom payment
1. J.L. Gugnani 17.06.02 DD 534581 400,000
2. J.L. Gugnani 18.06.02 Ch. 4067 200,000
3. M/s Swastik 21.05.02 Ch. 269917 712,800 Polywearing
4. Kundan Lal 21.05.02 269,918 421,200 Gugnani
5. J.L. Gugnani 26.06.02 269,920 825,600
6. Raj Kumari 29.06.02 269,915 234,900
7. Sunita Gugnani 23.05.02 269,137 25,000
8. Yashpal Gugnani 23.05.02 269,140 11,843
9. Suman Gugnani 23.05.02 269,138 32,400
10. Deepa Gugnani 13.05.02 269,139 40,500 CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 15
(iv) Immovable Assets Payment made for purchase of Flat No. A-4 at 6, Aurangzeb Road, New Delhi during check period from 01.02.2002 to 31.07.2002 S. No. Particulars Date of Amount in Expenditure Rs.
1. Payment made to M/s Prithvi Traders (P) Ch. No. 004064 800,000 Ltd., New Delhi towards the cost of Dated 22.05. property Flat No. A-4, 6 Aurangzeb Road, New Delhi
2. Payment made to M/s Prithvi Traders (P) Ch. No. 607824 550,000 Ltd., New Delhi towards the cost of Dated 10.06.02 property Flat No. A-4, 6 Aurangzeb Road, New Delhi
3. Payment to M/s Prithvi Traders (P) Ltd., DD No. 534574 800,000 New Delhi towards the cost of property Dt. 30.05.02 Flat No. A-4, 6 Aurangzeb Road, New Delhi
4. Payment to M/s Prithvi Traders (P) Ltd., Ch. No. 269914 2,19,757.33 New Delhi towards the cost of property Dated Flat No. A-4, 6 Aurangzeb Road, New 16.05.2002 Delhi
5. Payment to M/s Prithvi Traders (P) Ltd., Ch. No. 266911 1,500,000 New Delhi towards the cost of property Dated Flat No. A-4, 6 Aurangzeb Road, New 29.05.2002 Delhi
6. Payment to M/s Prithvi Traders (P) Ltd., Ch. No. 269919 750,000 New Delhi towards the cost of property Dated Flat No. A-4, 6 Aurangzeb Road, New 18.06.2002 Delhi
7. Payment to M/s Prithvi Traders (P) Ltd., Ch. No. 269134 1,000,000 New Delhi towards the cost of property Dated Flat No. A-4, 6 Aurangzeb Road, New 23.04.2002 Delhi
8. Payment to M/s Prithvi Traders (P) Ltd., Ch. No. 269135 2,000,000 New Delhi towards the cost of property Dated Flat No. A-4, 6 Aurangzeb Road, New 28.04.2002 Delhi
9. Payment to M/s Prithvi Traders (P) Ltd., Ch. No. 269136 2,500,000 New Delhi towards the cost of property Dt. 07.05.2002 Flat No. A-4, 6 Aurangzeb Road, New Delhi
10. Payment to M/s Prithvi Traders (P) Ltd., Ch. No. 270751 6,160.33 New Delhi towards the cost of property Dated 19.05.02 Flat No. A-4, 6 Aurangzeb Road, New Delhi CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 16 Assets at the beginning of check period = 72,2500.00 Assets at the end of check period = 1,63,637.94 + 1,21,01,917.66 + 2,904,243 = 1,51,69,798.60 Assets acquired during check period = 1,51,69,798.60 - 72,250 = 15,097,548.60
(v) Income from Salary, agriculture, tuition etc. of Shri Balbir Sharma and his wife Smt. Bala Devi Sharma S. No. Source of Income From Period of Amount whom Income of Income received
1. Net Salary during check period Office 01.02.02 to 84,305 30.07.02
2. Income mentioned in IT return House 2002-03 33,100 of Smt. Bala Devi Sharma of Search FY 2002-03
3. Income from Agricultural as -do- 2001-02 17,500 mentioned in IT Return of AY 2002-03
4. Income mentioned in IT Return -do- 2002 13,300 of Smt. Bala Devi Sharma of AY 2001-02 (average income of 2 months) Total 1,48,205
(vi) Funds received during check period by Shri Balbir Sharma / Smt. Bala Devi Sharma S. No. From whom received Bank through Date of Amount in which received receipt of Rs.
loan
1. Shanti Devi Gugnani r/c HSBC, 21.06.02 5,00,000/-
Chanakya Puri Barakhamba 471165
Road, Delhi
2. Vijaya Bank, 691,485 12,50,000/-
Barakhamba
Road, Delhi
3. 691,483 12,50,000/-
Total 30,00,000/-
(vii) Income from other sources
S. No. From whom received Date of receipt of Amount in
loan Rs.
1. Amount received in a/c No. 1602 26.06.02 49,000/-
of Bala Devi
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 17
Total 49,000/-
Total income = 1,48,205 + 30,00,000 + 49,000 = 31,97,205
(vii) General Expenditure S. No. Expenditure Amount
1. Payment made to LIC Chhatisgarh 1575
2. Telephone bill payment at Raigarh of phone 4103 No. 24805
3. 13rd expenditure of gross salary on 33,930 maintenance of kitchen, clothings cosmetics, etc. Total 39,608 Total income = 39,608
11.The assets of worth Rs. 11,939,951/- alleged to have been amassed by A-1 during the check period i.e. 01.02.2002 till 31.07.2002, are allegedly disproportionate to his source of income and the same were calculated in the following manner :
Summary Assets at the beginning of the check period A 72,250 Assets at the end of the check period B 15,169,798 Assets acquired during check period (B-A) C 15,097,548 Income During Check Period D 3,197,205 Expenditure during check period E 39,608 Likely savings during check period (D-E) F 3,157,597 Disproportionate Assets G 11,939,951 Percentage of Disproportion 374.4%
12.In order to explain the assets in her hands, A-2 stated that she had obtained loan from various persons who are her relatives or known to her. However, during investigation, it is revealed that the said relatives were not in a position to CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 18 pay such huge amount at the relevant time. The other defence taken by A-1 is that his grandmother gave him Rs.
5,00,000/- in cash few days prior to her death, however, no intimation of the said receipt, was submitted by him to his office as per the case of prosecution. The other accused explained that they had extended loans from their respective income to A-2 and Balbir Sharma never deposited any amount in their respective Bank Accounts and the said loans were subsequently repaid by A-2. The Investigating Officer found no force in the explanations proffered by A-1 and A-2 and concluded that A-1 had come in possession of assets disproportionate to his known sources of income to the tune of Rs. 11,939,951/- during the check period i.e. 01.02.2002 to 31.07.2002 and A-2 and other accused persons i.e. A-3 to A-33 actively abetted him in commission of offence U/s 13(1)(e) of PC Act.
13.Sanction for prosecution of A-1 was obtained. After completion of the investigation, the charge-sheet was filed by the CBI before the Court concerned on 19.09.2009 against A-1 to A-33 for the offences U/s 109 IPC r/w Section 13(2) r/w 13(1) (e) of PC Act, 1988 and substantive offences thereof.
CHARGE
14.Upon perusal of the charge-sheet and after taking cognizance of the offences mentioned therein, all the accused were summoned vide order dated 31.10.2009. Thereafter, upon their appearance, copies of the charge- sheet were supplied to them in compliance of Section 207 CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 19 Cr.P.C. Detailed Order dated 19.02.2011 on charge was passed by Ld. Predecessor of this Court, wherein it was observed that there is prima-facie case U/s 13(2) read with Section 13(1)(e) of PC Act against accused Balbir Sharma and U/s 109 IPC read with Section 13(2) & Section 13(1)
(e) of PC Act against other accused persons.
15.In pursuance to the aforesaid order on charge, charges were framed against the accused persons on 23.03.2011 as under :
(i) charge for offences U/s 13(2) read with Section 13(1)(e) of PC Act against Balbir Singh (A-1) ; and
(ii) charge for offences U/s 109 IPC read with Section 13(2) read with Section 13(1)(e) of PC Act, 1988 against other accused persons except accused Niranjan Lal Sharma and Suraj Bhan, against whom the proceedings were abated upon their deaths. Accused Ram Mehar was granted pardon vide order dated 01.10.2010 by the Court.
Accused persons against whom, charges were framed, pleaded not guilty and claimed trial.
ADMISSION OF DOCUMENTS
16.During the course of trial, A-2 Bala Devi, A-7 Khushi Ram, A-9 Vinay Kumari, A-10 Shiv Narayan Sharma, A- 12 Santosh Sharma, A-13 Surender Prasad Sharma, A-14 Onkar Singh Chauhan, A-20 Hari Prasad, A-24 Gopi Ram Kaushik and A-30 Ram Avatar Sharma, have not disputed the authenticity and genuineness of the documents and admitted D-41 to D-89, D-96, D-97, D-98, D-103, A-106, D-107, D-108, D-109, A-154, D-155, D-156, D-165 to D-
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 20 170, D-211, D-243 to D-254, D-65 to D-270, D-86 to D- 292, D-301 to D-308, D-310 to D-323, D335 to D-347, D- 358, D-359, D-360, D-365 to D-368, D-374 to D-380 & D- 383 to D-398 during admission and denial of documents.
PROSECUTION EVIDENCE
17.To connect the arraigned accused persons with the offence charged, the CBI examined (51) fifty one witnesses in total. PW 1 Rajesh Kumar, PW 2 Narender Singh Khatri, PW 3 Arun Oberoi, PW 4 Vinod Kumar Bansal, PW 5 Ram Singh Nainwal, PW 7 Gopi Chand, PW 8 Amitabh Sharma, PW 9 Jai Narain, PW 11 Shyam Sunder Khurana, PW 12 Om Prakash, PW 13 Mannu Ram Meena, PW 14 S.K. Malhotra, PW 15 Parambir Singh Tanwar, PW 16 Bhupinder Singh Maan, PW 28 Karamvir Rangi, PW 34 Dharamvir Rana, PW 35 Ashok Kumar Arora, PW 36 Kailash Chand Meena, PW Manish K.S. Chauhan, PW 42 H.R. Dogra, PW 46 R.K. Kapoor are officers/officials of different Banks who deposed about different transactions that took place in Bank Accounts of accused Balbir Sharma (A-1) and his wife Bala Devi Sharma (A-2) and other accused persons.
18.PW 6 J.L. Gugnani deposed that M/s PTL was owned by him besides his family members and the aforesaid Company was also having ownership of Flat No. A-4, 6 Aurangzeb Road, New Delhi. He deposed regarding sale of M/s PTL to accused Balbir Sharma, his wife and his father-in-law vide Memorandum of Understanding (MoU) dated 21.06.2002 (Ex. PW 6/A).
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 21
19.PW 10 Dharam Singh Saini deposed that he was in business of stamps sales/vending and sold stamps papers of different denominations in the name of Narender Kumar, Ram Narain, Raghbiro and Ravinder.
20.PW 17 C.J. Singh, PW 18 K. Prasad, PW 20 Anil Kumar Dogra, PW 21 Neelam and PW 31 H.D. Simte are officers/officials from Income Tax Department, who deposed regarding ITR(s) of M/s PTL, Bala Devi Sharma (A-2) and Balbir Sharma (A-1) respectively.
21.PW 22 Chander Pal, PW 23 Raja Ram, PW 24 Dinesh Kumar, PW 25 Surender Kumar, PW 27 Jai Prakash, Sh. Dharampal are Patwaries who deposed about the land belonging to Khushi Ram ; two sons of Sh. Ram Narain, namely, Narender Kumar and Ravinder Kumar ; three sons of Sh. Ram Prasad, namely, Suresh, Dayanand and Om Prakash ; sons of Sh. Mukund Lal, namely, Hari Prasad, Sri Niwas, Jagdish Prasad, Satya Devo and Harbans ; sons of Sh. Rajender Singh, namely, Tarun Kumar, Deepak and Nitin ; Kanwar Singh and Om Prakash. They also deposed about crops sown, their prices and income from other sources.
22.PW 26 Durga Shankar Meena and PW 41 Pushkar Lal Gupta are officials from Post Office, Jaipur who deposed about deposits, saving A/c, RD and TD etc. in the name of Onkar Singh Chauhan and Ramwati and Surendra Prasad and Savitri Devi.
23.PW 19 Prakash Vaidya, PW 20 Sh. J.P.S. Negi and PW 47 Suresh Verma are officers/officials of Nehru Yuva Kendra CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 22 Sangathan (NYKS) who deposed regarding employment/salary of A-1.
24.PW 30 is Sailesh Director General of NYKS who deposed that he received a request from CBI alonwith investigation report and documents for sanction of prosecution of A-1 Balbir Sharma by the investigating authority. He testified that he after examination of all the documents, relevant facts and circumstances in this matter, formed prima facie opinion after considering that this was a fit case for according of sanction for prosecution of accused Balbir Sharma for the offences detailed therein. He accordingly accorded the sanction order (Ex. PW 30/A) against A-1 Balbir Sharma.
25.PW 32 Naveen Bhandari, Manager from LIC Housing Finance Limited, Jaipur deposed regarding loan of Surender Pal Sharma and Ravinder Sharma.
26.PW 33 Rajiv Kumar, a Chartered Accountant deposed regarding auditing of the accounts of M/s PTL from March, 2003 till 2005.
27.PW 38 Habi Ekka deposed regarding his visit alongwith his helper Rajender Netram and CBI officials to the house of accused Balbir Sharma and witnessed Obversation Memo dated 10.07.2006 (Ex. PW 38/A).
28.PW 39 J.P. Roy Chowdhury - Assistant Registrar of Companies in West Bengal deposed regarding records of M/s PTL.
29.A-33 Ram Mehar Sharma is approver who was granted pardon by the Court vide order dated 01.10.2010 and he CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 23 was examined by the Prosecution as PW 43.
30.PW 44 R.S. Rana - GEQD deposed that he had examined the documents sent by SP of CBI to Laboratory of GEQD vide letter dated 12.11.2008 and gave his report dated 12.06.2009 (Ex. PW 44/A).
31.PW 51 Sh. Arun Sharma the then SP, CBI deposed about registration of FIR D-1 (Ex. PW 48/A) on 05.07.2006 on the basis of a reliable information received from source regarding disproportionate assets of A-1 Balbir Sharma, the then Youth Coordinator, NYKS, posted in Chattisgarh and, thereafter, investigation was entrusted to Sh. S.S. Yadav, the then Inspector of said branch.
32.PW 48 retired Inspector S.S. Yadav deposed regarding conducting investigation of the case alongwith Sh. Arun Sharma, the then SP and remained posted as Inspector in the ACU-II Branch of CBI, New Delhi from 2002 to 2007 and Sh. Arun Sharma was their SP in ACU-II Branch of CBI, New Delhi in year 2006. He had worked with SP Arun Sharma for about two and half years. He conducted investigation of this case alongwith him.
33.PW 49 Retired Assistant Commandant Dalip Singh Rawat deposed that investigation of the present case was transferred to him on 01.02./2008 on the orders of SP CBI of the branch from Sh. A.B Choudhary, the then Inspector of ACU-II branch of CBI and that investigation was transferred from him to Inspector A.B. Chaudhary, AC-II, CBI on the directions of SP of the branch as he was repatriated to his parent department on completion of his CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 24 term on 31/08/2008.
34.PW 50 Vipin Kumar deposed that he remained posted as Inspector CBI in AC-I Branch, CBI New Delhi from April 2005 to 27/12/2013 and investigation of this case was transferred to him from IO Sh A.B. Choudhary, the then Inspector CBI, AC-I Branch on the order of Branch SP on 15.04.2009.
35.After examining the aforesaid witnesses, on the statement of Ld. Public Prosecutor for the CBI, the prosecution evidence was closed.
STATEMENTS OF ACCUSED PERSONS
36.Thereafter, statements of the accused persons under Section 313 Cr.P.C. were recorded wherein all the incriminating evidence on record were put to them to which they pleaded their innocence and stated that they have been falsely implicated in the present case.
37.In their respective statements U/s 313 Cr.P.C. accused Balbir Sharma (A-1) and Bala Devi Sharma (A-2) stated that CBI had manipulated the present case against them by suppressing the facts and reducing check period. It is stated that during the original check period, most of the loan were returned by them and A-1 had also sent intimation to his office. CBI collected the Bank statements and vouchers in respect of loan received and for repayment of loan but they did not forward the vouchers of returning the loan to the Court in order to suppress the true facts from the Court and CBI had scrupulously removed the seizure memo/forwarding letters so that the Court might CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 25 not come to know about returning of the loan. However, IO during cross-examination in mark PW 50/DA, had admitted the fact of returning the loan and if these facts had been disclosed in the charge-sheet, there would not have been any case against them or other accused persons.
38.In his statement U/s 313 Cr.P.C. accused Narender Sharma (A-3) stated that CBI had manipulated the present case against him by suppressing the facts and reducing check period as during the original check period, the loan amount of Rs. 3,23,000/- was returned to him by A-2 and the same was not disclosed by CBI despite having the voucher and Bank statement. He stated that CBI had also not conducted any investigation regarding his various sources of income despite the fact that he had disclosed the same to CBI. He further stated that all the income and expenditure of the agriculturist are in cash which could be verified from the practices prevailing in the society and the said facts had been misrepresented to fabricate a case against them.
39.In his statement U/s 313 Cr.P.C. accused Ravinder Sharma (A-4) and Shiv Narayan Sharma (A-10) stated that CBI had manipulated the present case against them and did not conduct investigations regarding their income from various sources.
40.In his statement U/s 313 Cr.P.C. accused Rajinder Singh (A-6), Ashok Kumar (A-8), Vinay Kumari (A-9), Santosh Sharma (A-12), Surender Prasad Sharma (A-
13), Shri Ram Yadav (A-15), Om Prakash Yadav (A-16) CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 26 and Dalu Singh (A-18) stated that CBI had manipulated the present case as the loan amount of Rs. 5,00,000/-, 4,00,000/-, 4,00,000/-, 325,000/-, 2,50,000/-, 3,50,000/-, 3,50,000/-, 3,50,000/- were returned to them, but the same were not disclosed by the CBI despite having the vouchers and Bank statements.
41.Accused Ram Mehar (A-22), accused Dharam Chand (A-23), accused Gopi Ram (A-24), accused Suresh Kumar (A-25), accused Om Prakash (A-26), accused Ram Avtar Sharma (A-30), accused Rajender Sharma (A-31) and accused Ram Avtar (A-32) stated that CBI had manipulated the present case against them and did not conduct any investigation regarding their income from various sources.
42.Accused Dinesh Kadian (A-29), accused Dharmender (A-27) and accused Sunil Sharma (A-28) stated that they are innocent and have been falsely implicated in this case. They stated that they gave friendly loan of Rs. 1,00,000/-, Rs. 50,000/- and Rs. 1,00,000/- respectively to Bala Devi Sharma who is real sister of their friend, namely, Ravinder Sharma, who was practicing Advocate with him and later on the said amount was returned by her to them.
43.Statement U/s 313 Cr.P.C. of A-5 Vinod Kumar, A-7 Khushi Ram, A-14 Onkar Singh, A-16 Om Prakash Yadav, A-19 Mahadev Prasad, A-20 Hari Prasad were not recorded as they had expired during the course of trial and proceedings were abated against them.
44.A-1, A-3, A-4, A-6, A-8, A-9, A-10, A-13, A-15, A-16, CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 27 A-17, A-22, A-23, A-24, A-25, A-26 & A-31 opted to examine witnesses in their defence and remaining accused did not opt to lead DE.
DEFENCE EVIDENCE
45.In total thirty three witnesses have been examined in defence by accused persons. A-1 Balbir Sharma, examined five witnesses as under :
(1) Ravindra Singh (DW 1), Assistant Director from NYKS who produced office copy of order dated Memorandum No. NYKS/G&V:vigilance/2018-19/742 dated 02.01.2019 (Ex. DW-1/A) asked by the competent authority in the disciplinary proceedings against A-1 Balbir Sharma and also the inquiry report dated 30.07.2018 vide No. NYKS/koonerjs/2018-19/001 (Ex. DW1/B). (2) Ram Vilas Sharma (DW2) deposed regarding treating A-1 Balbir Sharma as their son by their maternal grand parents, namely, Sh. Rulia Ram and Smt. Nathia. He further deposed that Sh. Rulia Ram executed a Will in favour of A-1 Balbir Sharma, wherein he had bequeathed his 15 acres agricultural land at Bhapoda Village and also movable assets in favour of A-1 Balbir. Rulia Ram expired and after her demise, the aforesaid agricultural land of 15 acres was transferred in the name of A-1 Balbir Sharma on the basis of the Will executed by Rulia Ram ; (3) Uma Kant Pandey (DW 3), Accountant from NYKS produced the summoned record i.e. photocopy of second page (Ex. PW 29/DA) of inward register of NYKS, Regional office for the year 2003-04. He deposed Ex. PW CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 28 29/DA, was issued by his Director on the application of A-1 Balbir Sharma and he processed the said application.
He also deposed regarding photocopy of letter dated 10.04.2003 part of Ex. PW 29/DA given by A-1, for which the entry was made in the aforesaid register. (4) Naveen Kumar (DW 4) Tax Assistant from Income Tax Department, Civic Centre, New Delhi produced the summoned records as available in the computer system in the office for the assessee Jay Narain Sharma for the Assessment year 2001-2002, 2003-04 and 2005-06 {Ex. DW4/A (colly)}.
(5) Anand Mohan Rabra (DW 5), an Advocate by profession, was shown a gift deed (Daan Patra) dated 10.06.2000 (Ex. DW5/A) and after seeing the same, he stated that the same was written and signed by him on the request of Smt. Nathia (grand maternal mother of A-1 Balbir Sharma) W/o late Sh. Ruli Ram Sanda and at that time, Smt. Nathia was in the full state of mind when she requested him for writing the gift deed and on the said date, in his presence, Smt. Nathia Devi gave Rs. 5 lakhs to Balbir Sharma who received it.
46.A-3 & A-4 Naveen Sharma and Ravinder Sharma, examined Vijay Kumar (DW 6) in their defence who deposed that he knew A-3 Narender Sharma and A-4 Ravinder Sharma since his childhood and deposed regarding income of A-3 & A-4 from agriculture, dairy business, by selling the calfs of the buffaloes, income from rent of two tractors and supplying watter to other farmers CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 29 on their request. He also deposed that he knew Ram Mehar Sharma (A-33) who was also residing in the same village and he after his retirement in the year 1996-97, started cultivating the land on sharing basis with other land owners and also used to lend the money on interest basis to the people of the area.
47.A-6 Rajender Sharma examined three witnesses in his defence as under :
(1) his son Nitin Sharma (DW 7) deposed about his employment status in 2001 and produced his salary certificate (Ex. DW7/B); his experience certificate (Mark DW7/X) issued by his company ; photocopy of his income tax return along with Form-16 for the year 2004-05 (Mark DW7/X-1). He further deposed regarding his sister earning around 4000/- pm while working in private sector and his father having one tractor, thrasher, cultivator, three tubewells at our agricultural land in the village in 2001 ; (2) Zile Singh (DW 8) deposed regarding taking the property of A-6 Rajinder Singh on lease in 1999 vide registered lease agreement dated 17.03.98 (Ex. DW8/DA) at yearly rent of Rs. 30,000/-. He further testified that He also used to pay Rs. 20,000/- p.a to A-6 for the use of his other agricultural land adjoining the land for which Ex.
DW8/DA was executed for his ingress and egress to the property which he had taken on lease.
(3) his son Tarun Kumar (DW 9) who deposed that used to earn 4000/- to 4500/- per month by carrying goods from place to place from his own truck bearing No. HR46 3878.
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 30 He produced certified copy of award in MACT Case no. 24/99 MACT Jhajjar (Mark DW9/X). He deposed regarding income of his father from agricultural and milk produce ; rent from tractor @ Rs. 500/- per hour and used to earn around Rs. 50-60,000/- per year from the same and supplying water from three tubewells to different farmers in the village earning around Rs. 25-30,000/- per year from them and from cultivation on the rented land earning Rs. 2- 2.5 lacs per year and earning Rs. 1.5-2 lacs per year from other produces in the shape of vegetables or animal fodder from our agricultural land.
48.A-8 Ashok Kumar has examined two witnesses in defence as under :
(1) Pawan Kumar Yadav as DW 1/A-8 posted as Dy.
Manager from PNB Machhrauli, Jhajjar, Haryana, who produced a letter dated 15.02.2020 (Ex. DW1/A-8/1) duly signed by his Sr. Manager wherein it had been mentioned that Bank has no records available of statement of account bearing No. 5812 for the period from 01.04.98 to 31.03.03 ;
(2) Ashok Kumar Singh as DW 2/A-8 posted as Sr. Auditor with Principal Controller of Defence Accounts, (PCDA), K Kamraj Marg, New Delhi and produced photocopy of the pension payment order dated 28.09.1998 (Ex. DW2/A-8/1) bearing No.5/064265/98(Army) of Ashok Kumar and forwarding letter dated 12.02.2021 (Ex. DW2/A-8/2) regarding the same.
49.A-9 Vinay Kumari has examined two witnesses in defence CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 31 as under :
(1) Rishi Kumar as DW 1/A-9 resident of Village Mohd. Pur, Tehsil Bahwal, Dist. Rewari, Haryana who deposed regarding her income in 2001-02 from tailoring and also had dairy business and that of her husband working as tea seller in Delhi as well as their income from agricultural produces of themselves and from cultivation on the land of others.
(2) Somvir as DW 2/A-9 posted as Patwari who produced the summoned record of property bearing Khewat No. 122 Khatauni No. 131 and 132 and Khewat No. 125 Khatauni No.135 having total area of around seventeen and half acres is entered in the Jamabandi Book for the year 2001-2002 {Ex. DW-2/A-9/B (Colly)} and as per the records, approximately 1.5 acre was in the name of Deen Dayal situated in the revenue estate of village Mohmad Pur Mazra. He also produced the summoned record of property bearing Khewat No. 11 Khatauni No. 12 and Khewat No. 21 Khatauni No.22 Khewat No. 84 Khatauni No. 92 having total area of around five acres is entered in the Jamabandi Book for the year 2001-2002 {Ex. DW-2/A-9/C (Colly)} and as per the records, approximately 1.75 acres was in the name of Deen Dayal situated in the revenue estate of Village Asra Ka Mazra.
DW 2/A-9 deposed that as per the records, Deen Dayal was himself cultivating the land.
50.A-10 Shiv Narayan Sharma has examined two witnesses in defence as under :
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 32 (1) Prem Narain as DW 1/A-10 resident of Village Badala, Dist. Bhiwani, Haryana, Numberdar of the village deposed that he used to get allowances from the Govt. He deposed regarding income of joint family of A-10 from agricultural produce, milk produces and giving tractor on rent and there was no actual distribution of the income amongst the family ;
(2) Sunil Kumar as DW 2/A-10 - a Patwari produced the original summoned record. As per the summoned record the property bearing Khewat No.8, 18, 63, 76,79 & 89 {Ex. DW2/A-10/B(colly) (OSR)} total area of 39 acres and 18 marlas are entered in the jamabandi book for the year 2001-02 in the name of late Sh. Ganpat & Hari Pal Sons of late Sh. Mam Chand and also of late Sh. Hardwari Lal. As per the records late Mam Chand and late Hardwari Lal are the sons of late Sh. Ganga Dutt.
51.A-13 Surender Prasad Sharma has examined one witness in defence i.e. Ashok Kumar Jangid as DW 1/A-13 who produced statement of account pertaining to saving account bearing No. 01190009894 in the name of A-13 Surender Prasad Sharma for the period from 04.11.2000 to 28.12.2021 (Ex. DW1/A-13/A) coupled with certificate U/s 2A of the Bankers' Book of Evidence Act (Ex. DW1/A-13/B). He deposed that as per record, the Bank does not have records of the cases prior to November, 2000.
52.A-15 Shri Ram Yadav has examined four witnesses in defence as under :
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 33 (1) Yashpal Singh as DW 1/A-15 R/o Village & PO Bassai, Distt. Mahendergarh, Haryana who deposed that he knew A-15 Shree Ram Yadav since his childhood as he resides nearby their house in aforesaid village. He deposed that initially Shree Ram Yadav joined Armed forces and thereafter had joined Defence Services Core and after that he became agriculturist. A-15 has two sons, one is in Army and the other one is working with some company. He further deposed that in the year 2001-02, A-15 was an agriculturist and having 5-6 acres of land in his name.
DW1/A-15 further deposed about income of A-15 from agricultural produces as well as sowing of different types of pulses and cereals in two seasons i.e. once in the month of November and secondly in in 2000-2002. He deposed about income of A-15 from selling the agricultural produce from the two crops in a year at Rs. 35,000-40,000/- per acre per year after deducting the expense and income from the byproducts like animal fodder and around Rs. 4000- 5000/- per acre per year. He further deposed about A-15 having one tubewell on sharing basis in 2001 and was supplying water to other farmers on their request, earning around Rs. 25,000/-30,000/- p.a. He further deposed that A-15 was also earning Rs. 4,000/-05,000/- by trees at his agricultural land. He further deposed about income of A-15 from animal husbandary as well as by selling buffaloes and their offsprings. He further deposed that A-15 used to sell and purchase buffaloes and was earning around Rs. 1 lac per annum from the same.
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 34 (2) Saurabh Sharma as DW 2/A-15 who produced statement of account pertaining to saving account bearing No. 01190114641 in the name of A-15 Ram Yadav for the period from 03.04.2001 to 11.10.2003 (Ex. DW2/A-15/A) coupled with certificate U/s 2A of the Bankers' Book of Evidence Act (Ex. DW2/A-15/B).
(3) Manudev as DW 3/A-15 who produced the record of Sale Deed No. 52 dated 16.04.2001 relating to property bearing No. Kevat No. 231, Khatoni No. 411, Killa No. 118/19/5-16, 20/2/3/-7 admeasuring 4 kanal and 11 marla sold by Ram Avtar (Ex. DW 3/A-15/A) ; record of Sale Deed No. 2329 dated 19.11.2001 relating to property bearing No. Kevat No. 301, Khatoni No. 300, Killa No. 33/20/2/1-18, 21/1/4-15, 34/24/2, 2-4, 25/6-8 admeasuring 14 kanal and 15 marla sold by Smt. Munni devi (Ex. DW 3/A-15/B) ; record of Sale Deed No. 198 dated 11.05.2001 relating to property bearing No. Kevat No. 301, Khatoni No. 380, Killa No. 33/20/2, 1-18, 21/1, 4-8, 34/25/6-8, 24/2, 2-4 admeasuring 14 kanal and 15 marla sold by Mahender Singh (Ex. DW 3/A-15/C) and record of Sale Deed No. 778 dated 31.05.2002 relating to property bearing No. Kevat No. 195, Khatoni No. 373 and 374, Killa No. 12 rakba 72 11 marla 80/1451 also bearing Kevat No. 423 Khatoni No. 675 5 rakba 23 kanal 8 marla admeasuring 7 kanal and 18 marla sold by Santosh Bai (Ex. DW 3/A-15/D).
(4) Mukesh Kumar Singh working as Defence Security Crops, Kannur, Kerala who produced the summoned CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 35 record, as per which record of Ex. Nayak Shri Ram are not available/ traceable in the office, however, he produced the final statement of account for the period from 01.09.2002 to 31.12.2002 alongwith covering letter (Ex.DW4/A-15/2 (colly).
53.A-16 Om Prakash Yadav has examined one witness in defence i.e. Yashpal Singh as DW 1/A-16 - an agriculturist who knew A-16 Om Prakash Yadav since his childhood being co-villager who deposed regarding income of A-16 from selling the agricultural produce at Rs. 35,000- 40,000/- per acre per year after deducting the expense from his total land 14-15 acres ; from the byproducts like animal fodder and around at Rs. 4000-5000/- per acre per year in 2000-2001. He also deposed regarding income of A-16 by supplying water to other farmers on their request and earning around Rs. 60-70,000/- p.a. in 2001 as well as income of A-16 at Rs. 08-10,000/- by trees at his agricultural land. He also deposed regarding A-16 being engaged in the business of animal husbandary having 4-5 buffalos and their calfs and earning Rs. 1 Lakh per year by selling and purchasing buffaloes as well as earning Rs.60- 70,000/- per annum by renting of the tractor and ploughing instruments in 2001.
54.A-17 Shyam Lal has examined two witnesses in his defence as under :
(1) Yashpal Singh as DW 1/A-17 that he was retired from BSF, thereafter, he became agriculturist and he knew A-17 Shyam Lal since his childhood being co-villager. He CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 36 deposed regarding agricultural income of A-17, income from animal fodder, supplying water to other farmers on their request in the year 2001, was supplying watter to other farmers on their request, by trees at his agricultural land, animal husbandary and sale and purchase of buffaloes.
(2) Saurabh Sharma as DW 2/A-17.
55.A-22 Surender Prasad Sharma has examined two witnesses in his defence as under :
(1) Gyani Ram as DW 1/A-22 deposed that he was an agriculturist and was knowing A-22 Ram Mehar since his childhood being co-villager. He deposed about income of A-22 from selling the agricultural produce ; byproducts like animal fodder ; dairy business and selling milk and milk products in the local market ; selling calf of the buffaloes he had kept and income from selling one buffalo for Rs. 62,000/- in the year 2001 ; from rent of the tractor and ploughing instruments ; supplying watter to other farmers on their request and by selling the trees of Seesam at his agricultural land.
(2) Narender Singh as DW 2/A-22 deposed as Patwari deposed about the property bearing Khewat No. 52, 53, 54, 310 and 338 having total area 23 acres approximately entered in the Jamabandi Book for the year 2001-2002 {Ex. DW-2/A-22/A (Colly)} in the name of Ram Mehar, Shamsher and Ramvir who are brothers.
56.A-23 Ram Mehar has examined three witnesses i.e. Gyani Ram in his defence as under :
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 37 (1) DW-1/A-23 Sh. Gyani Ram being co-villager of A-
23 Dharam Chand deposed regarding income of A-23 from agricultural products ; dairy business ; sale of milk and milk products in the local market ; sale of the offsprings of the buffaloes he had kept ; supplying watter to other farmers on their request and byproducts of agricultural produce.
(2) Narender Singh as DW 2/A-23 - Patwari summoned record produced Khewat No. 8, 9, 10 and 16 having total area 2.25 acres entered in the Jamabandi Book Ex. DW- 2/A-23/B (Colly) for the year 2001-2002 in the name of Dharma @ Dharamvir, Jaiveer and Manphool. (3) Narender as DW 3/A-23 - posted as Patwari produced original jamabandi book for the period 1998-99 and 2018-19 and original girdawari register for the period from 1999-2004, as per which, property bearing No. 162/1/2 admeasuring 6 kanal, 9/2 admeasuring 4 kanal, 21/2 admeasuring 4 kanal and 8 marla is entered into the Jamabandi book for the year 1998-99 and 2018-19 in the name of Sh. Dharama S/o Manphool. He exhibited the photocopies of both the documents viz copies of jamabandi for the period year 1998-99 and 2018-19 as Ex.DW3/A-23/1 (colly) and copies of girdawari register for the period 1999 to 2004 as Ex. DW3/A-23/2 (colly).
57.A-24 Dharam Chand has examined one witness in defence i.e. Anil Kumar as DW 1/A-24 Statement of DW- 1/A-24 Sh. Anil Kumar, an agriculturist/Ex-Servicemen and also doing the business of renting the cars knowing CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 38 A-24 Gopi Ram since his childhood, deposed regarding income of A-23 from agricultural products ; dairy business ; sale of milk and milk products in the local market ; sale of the offsprings of the buffaloes he had kept ; supplying watter to other farmers on their request and byproducts of agricultural produce. He also deposed that A-24 used to get pension from his department.
58.A-25 Gopi Ram Kaushik and A-26 Om Prakash has examined one witness each in defence i.e. Anil Kumar as DW 1/A-25 & DW 1/A-26.
59.DW-1/A-25 Sh. Anil Kumar deposed regarding income of A-25 & A-26 from agricultural products ;dairy business ; sale of milk and milk products in the local market ; sale of the offsprings of the buffaloes they had kept ; supplying watter to other farmers on their request and byproducts of agricultural produce.
60.A-31 Rajender Sharma examined one witness in defnece i.e. Laxman Dass as DW 1/A-31 posted as Patwari produced original summoned record {Ex. DW-1/A-31/B (Colly)}, as per which, the property bearing Khewat No. 210 Khatauni No. 272 having total area of around six acres is entered in the Jamabandi Book for the year 2001-2002 in the name of Rajender Prasad and he was cultivating the land himself.
61. Thereafter, defence evidence were closed at the request of accused persons.
ARGUMENTS
62.Both the prosecution and accused persons filed their CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 39 respective written submissions. Oral arguments were addressed over multiple dates. Prosecution opened the final arguments highlighting the assets allegedly acquired by accused Balbir Sharma, the role of other accused persons as abettors and how the said assets were 'disproportionate' to the known sources of income of accused Balbir Sharma. Prosecution arguments were followed by the detailed defense submissions. Prosecution was also given an opportunity for rebuttal arguments. ARGUMENTS ON BEHALF OF PROSECUTION
63.It is argued by Ld. PP for CBI that the prosecution has succeeded in proving beyond reasonable doubt that accused No. 1 amassed assets disproportionate to the known sources of his income and other co-accused being his wife (A-2), friends and relatives (A-3 to A-33) intentionally aided and conspired amongst themselves in commission of the said offence, and therefore, they are liable to be convicted U/s 13 (2) and Section 13 (1) (e) P.C. Act, 1988 read with Section 109 IPC. It is submitted that, it has been proved by adducing evidence by prosecution that accused No.1 alongwith accused No. 2, purchased share in M/s PTL, amounting to Rs. 29,04,243/- and they made payments of Rs. 1,21,01,917.66 towards the cost of the immovable property of the company. It is submitted that prosecution has also proved that accused No. 3 to accused No. 33 being friends and family members of accused No. 2, received an amount totaling to Rs. 1,41,88,000/- in their respective Bank accounts from A1 CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 40 and thereafter, the said amount was withdrawn by them and given to accused No. 2 during the check period from 01.02.2002 to 31.07.2002. It is submitted that looking into the income, salary and expenditure of accused No. 1 and accused No. 2 as calculated, accused No. 1 was in possession of disproportionate assets to the tune of Rs. 11,939,951/- which comes to 373.4 %.
64.It is submitted that the contention of the accused that the original check period of 16 months was probably reduced to 7 months by the prosecution to prove its case is unmerited, as it is no longer res-integra that it is the prerogative of the prosecution to fix the duration of check period and the accused cannot agitate about the reduction of duration of check period. It is submitted by Ld. PP for CBI that the accused No. 1 on the strength of exoneration in departmental proceedings, cannot claim that he did not commit any offence of being in possession of disproportionate assets to his known source of income. It is submitted that law is well settled that the findings in departmental enquiry have no bearing on the criminal prosecution.
65.Ld. PP for CBI to buttress his arguments regarding check period, has relied upon the judgment of the Hon'ble Supreme Court in State of Maharashtra v. Pollonji Darabshaw Daruwalla; MANU/SC/0294/1987 and submitted that looking into the evidence adduced before this Court, the accused persons are liable to be convicted for the offence for which they have been charge sheeted.
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 41
ARGUMENTS ON BEHALF OF ACCUSED
PERSONS EXCEPT A-27, A-28 & A-29
66.Per contra, Ld. Counsel on behalf of A-1 and A-2 have vehemently refuted the aforesaid submissions of Ld. PP for the CBI, submitting inter alia that the prosecution has miserably failed to prove any of the charges against accused persons. It is argued that FIR was registered straightway without conducting any preliminary enquiry as mandated in law. It is submitted that accused No. 1 and his wife accused No. 2 invested in M/s PTL through purchase of shares after taking various loans from their friends and relatives from April to June 2002 and also extended loan to the aforesaid company. However, subsequently they were not able to carry on the arrangements and therefore, received back all the loans by March 2003 i.e. within the original check period as per FIR. It is submitted that the prosecution has deliberately reduced the check period from 16 months to 5 months, which is contrary to the settled law, as per which the prosecution cannot reduce the check period at it's whims and fancies to prosecute the accused who could have explained the alleged disproportionate source of income during the check period. It is argued that if the investigation had been conducted by the prosecution regarding the assets of the accused persons during the original check period, the entire factum pertaining to the transactions would have come on record exonerating the accused from the charges.
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 42
67.It is further contended that for extending loan to PTL, accused No. 1 obtained the funds from different sources being: (i) Advance for sale of land (received from accused No. 15 to accused No. 21) and (ii) a loan from one Shanti Gugnani; accused No. 2 received the funds from(i) several loans from close relatives and friends (accused No. 3 to accused No. 14 and accused No. 16 to accused No. 33); (ii) gift of Rs. 10 lacs received from her father Sh. Ram Narayan; and (iii) loan of Rs. 5 lacs from Shanti Devi Gugnani. It is submitted that the accused persons have proved the aforesaid transactions by examining the witnesses in defence.
68.It is submitted that the loan extended to PTL was received back from the said company by March 2003 by accused No. 1 and accused No. 2 and accused No. 1 returned the advance related to sale of land due to cancellation of the agreement in 2002, as well as the loan taken by her from her close relative and friends during the same period and by the end of March to April 2003, the investment of accused No. 1 remained at Rs. 65,500/- and investment of accused No. 2 remained at Rs. 27,94,500/- and the same only pertained to the shares purchased by them.
69.It is submitted that as per MoU dated 21.06.2002 (Ex. PW-6/B) executed between M/s PTL as a first party and accused No. 1, 2 and Jai Narain Sharma (father of A-1) as second party, it was for taking over the control, ownership and management of PTL with its assets and liabilities and not for purchase of immovable property. Ld. CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 43 Counsel for accused No. 1 contended that purchasing share in a Private Ltd. Company does not tantamount to purchasing immovable property as immovable property remains the property of the Company. It is submitted that Flat in question has been purchased in the name of PTL in the present case the same cannot be attributed to accused or his family members. Even, PW-6 Sh. J.L. Guglani, erstwhile director of PTL, in his deposition admitted the suggestions given to him in his cross-examination that the aforesaid MoU is not in regard to sale or purchase of any property and no separate documents had been executed in regard to the property in question of Aurengzeb Road for his transfer prior or after the MoU. It is argued that the company has a separate legal entity and there is no document showing transfer of title, either to A-1 or A-2. It is submitted that Investigation Officer who was examined as PW-48, in his deposition admitted that no documents showing title of the aforesaid property in the name of A-1 and A-2 surfaced in his investigation. It is argued that since the accused No. 1 never acquired any immovable property of M/s PTL, he was not mandated to take prior permission for purchasing share in the immovable property.
70.It is submitted that A-1 and A-2 made a payment of Rs. 29,04,243/- to erstwhile share holders of M/s PTL and thereafter, a loan of Rs. 1,21,01,917.66 was given by A-1 to A-2 to PTL to enable it to discharge its existing loan liability towards departing share holders. It is submitted that the balance sheet of M/s PTL (Ex. PW-6/J-4) reflects CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 44 as unsecured loan of Rs. 1,12,89,917.33 towards PW-6 Sh. J.L. Guglani in the books of account and both of accused No. 1 and accused No. 2, paid unsecured loan to PW-6. The aforesaid loan amount was subsequently repaid by M/s PTL to A-1 and A-2 and the said amount was utilized by them to pay their respective loans. It is submitted that M/s PTL received the aforesaid funds to repay A-1 and A-2 from Calcutta based company which invested Rs. 2.12 Crores in PTL between 19th December 2002 to 29 March, 2003 (Ex. PW 50/DB and Ex. PW 2/B). It is argued that the Investigation Agency has incorrectly projected the loan amount given by A-1 and A-2 as payment towards acquisition of property after suppressing the aforesaid transactions by reducing the cheque period from 16 months to 6 months.
71.It is submitted that order dated 16.09.2014 and 04.12.2014 by Predecessor of this Court pursuant to the the application of accused persons Under Section 91 Cr.P.C, directed the prosecution to produce certain documents seized by them during the investigation but not supplied. It is submitted that the said documents amply demonstrate the repayment of loans within the original cheque period and thus the prosecution has conducted biased investigation.
72.It is argued by Ld. Counsel for A-1 that sanctioning authority, while granting sanction to the prosecution against A-1 vide Ex. PW-30/A, has not applied his mind and the same has been granted mechanically without appreciation of the facts and circumstances of the case. It CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 45 is submitted that A-1 has duly intimated his department vide letter dated 10.04.2003 (Ex. PW 29/DA) about taking of loan from his wife, friends and relatives and thereafter repaying the same. It is submitted that subsequently, in departmental enquiry initiated against him, he had duly brought the material evidence before Enquiry Officer and no charge of commission of any misconduct was proved against him and he was completely exonerated vide Enquiry report dated 30.07.2018 (Ex. PW-1/B). It is submitted that the aforesaid documents of Enquiry Officer and facts and circumstances of the case were not at all taken into consideration by sanctioning authority and therefore, the sanction order is faulty and thus the accused are entitled to be acquitted on this score alone.
73.It is argued that no charges against A-3 to A-26 and A-30 to A-32 are proved against them as the loan obtained by A-1 and A-2 from the aforesaid accused persons were repaid/returned by 2003 vide various acknowledgements proved on record. It is submitted that the loan to A-3, A-4, A-5 and A-10 were returned subsequently as they themselves admitted the said return of their respective loan amount in their respective statements U/s 313 Cr.P.C.
74.It is contended by Ld. Counsel for A-1 that reliance placed by the prosecution on the photocopy of report of immovable property of A-1 is misplaced as the same has not been proved in accordance with law. It is submitted that the documents is only loose sheet which is purportedly "Annexure A" of a documents and the primary document CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 46 has not been filed creating doubts to the origin of the said document which is unsigned. It is submitted that M/s PTL was acquired by accused in June 2002 forming part of Financial Year 2002-2003 whereas Ex. PW 29/D is for the Financial Year 2002 -2004 and further on the bottom of the said document, it is written as Boondi, Rajasthan while A- 1 was transferred to Boondi, Rajasthan in February-March 2004 (Ex. PW 29/B).
75.It is further contended that Ex. PW 29/B, does not resemble format provided to him by NYKS, Headquarter vide letter dated 17.08.2006. It is submitted that even PW- 19 Prakash Vaidya, Assistant Director, NYKS in his testimony deposed that prior to note sheet dated 04.07.2007 (Ex. PW 29/DG), there is no reference of any NIL immovable property return of accused Balbir Sharma in the note sheet and he had expressed his inability to locate the original of Ex. PW 19/D from the record. He deposed that he had not seen original of Ex. PW 19/D as he handed over the same to the CBI. However, Ld. PP for CBI has submitted that no seizure memo/statement regarding seizure Ex. PW-19/D is available on record.
76.It is submitted that even PW-29 Sh. J.P. Negi, Zonal Director of NYKS could not tell the source of Ex. PW-29/D and deposed that he could not tell from the note sheet of the personal file of accused Balbir Sharma whether Ex. PW-29/D was existing prior to the registration of the case and further deposed that he had no idea who had given Ex. PW-29/D to CBI. On the basis of aforesaid CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 47 statements, it is argued by Ld. Counsel for accused No. 1 that the case of the prosecution is replete with contradiction which have not been explained by the prosecution. It is submitted that A-1 and A-2 took over only the control and management of M/s PTL through purchase of its share which does not constitute to acquire any immovable property and thus accused No. 1 was under
no objection to make any disclosure to his department i.e. NYKS and that is why accused was finally exonerated by disciplinary committee of NYKS vide final order dated 02.01.2019 Ex. PW-1/A.
77.It is submitted that at the relevant time when A-1 purchased share in M/s PTL, he was under no obligation to seek prior permission or subsequent approval to purchase shares as CCS Conduct Rules cast no obligation on A-1 to intimate the same to NYKS. It is submitted that even PW- 29 Sh. J.P.S. Negi, Dy. N.Y.K.S in his testimony expressed his ignorance as to whether since 1998 till 2005, there was no practice of filing of return of movable or immovable property in the office. It is submitted that there was neither proforma nor any practice prior to 2003, that is why, there is observation in the personal file of A-1 regarding non compliance with requirement of filing of return assets.
78.It is argued that A-1 and A-2 have meticulously explained the source of funds by producing cogent material and documents and there is no asset amassed by A-1 disproportionate to his known source of income.
ARGUMENTS ON BEHALF OF ACCUSED CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 48 Nos. A-27, A-28 & A-29
79.Sh. Naresh Kumar Sharma, Ld. Counsel for the accused No. 27, 28 and 29 has argued that accused persons are close friends of accused No. 4 Ravinder Sharma who is the brother of accused No 2 Bala Devi Sharma since the time of studying together for LLB. It is submitted that in June 2002, accused Ravinder Kumar Sharma (A-4) approached them for monetary help for his sister Bala Devi Sharma (A-2) for the period of one/two years and at his request, they extended the loan amount of Rs. 1,00,000/-, Rs. 50,000/- and Rs. 1,00,000/- respectively to A-2. It is submitted that the said loan to accused No. 2 Bala Devi Sharma was debited from their respective Bank accounts in June 2002 and subsequently she returned the said loan in March 2003 through Bank transaction. It is submitted that the accused persons explained to the deceased IO, Sh. A.B. Chaudhary about the source of their income from the legal practice, however, he did not verify those facts. It is submitted that even substituted IO's S.S.Yadav, D.S.Rawat and Vipin Kumar did not conduct any investigation with regard to the explanation given by the accused and the said fact was admitted by them in their respective testimonies before this Court. It is submitted that since the accused have been practicing Advocates, they received professional fee majorly in cash and in 2002, no UPI was available and only bank transaction through cheque /DD/challan was available.
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 49
80.It is submitted that CBI had only filed the statement of account of accused No. 27 and 28 only for such period which suited them but they did not file the bank statement prior to check period or post the check period which demonstrates that handsome transaction of the amount was being done by the accused during the said period. It is submitted that there is no evidence adduced by the prosecution incriminating the aforesaid accused persons therefore they are entitled to be acquitted.
81.All of the aforesaid arguments and contentions shall be taken up while returning the findings.
APPRECIATION AND EVALUATION OF EVIDENCE AND FINDINGS
82.I have heard the rival submissions of the parties, have gone through the written submissions filed by them, scanned through the evidence adduced by the prosecution and defence and considered the relevant rules and law applicable to the present case.
REGISTRATION OF FIR SANS PRELIMINARY ENQUIRY & DEFECTS IN INVESTIGATION
83.At the outset, it was argued by Ld. Counsel for accused persons that registration of FIR straightway without conducting any preliminary enquiry is impermissible in the eyes of law. It is further argued that before lodging the present FIR, had the CBI done his homework properly, neither any FIR would have been registered nor any investigation would have been conducted. It is submitted that the CBI/Investigating Agency was very much aware of the factum of repayment of loans by A-1 Balbir Sharma CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 50 and his wife A-2 Bala Devi Sharma to co-accused after receiving the amount from the investment in M/s PTL but no investigation was conducted on this aspect. It is further argued that the Investigating Officer examined Sh. S.K. Aggarwal, Chartered Accountant regarding investment made by him in M/s PTL in February-March, 2003 and during the course of investigation, he revealed that he invested Rs. 2 Crores in M/s PTL. It is further argued that the Investigating Officer failed to conduct investigation with regard to the vouchers showing return of Rs. 50 Lakhs by M/s PTL to A-1 Balbir Sharma. It is further argued that the Investing Officer PW 48 admitted in his testimony that he did not analyse transfer of Rs. 9,97,475 on 02.03.2003 from M/s PTL to A-2 Bala Devi Sharma and cheques showing payment of Rs. 18.85 Lakhs by M/s PTL to A-2 and deposit slip showing payment of Rs. 30,60,757.33/- by M/s PTL to A-2 Bala Devi Sharma. It is further argued that the Investigating Officers have also not examined the solvency of A-3 to A-33 and simply added the loans extended by them to A-2 in the income of A-1 without establishing any nexus between A-1 & A-2 and A-3 to A-33.
84.Per contra, Ld. Public Prosecutor for CBI has vehemently objected to the aforesaid submissions submitting that no preliminary enquiry is required to be conducted prior to registration of FIR and it is not for the Prosecution to account for the disproportionate assets but it is the burden on the accused to discharge the same and, therefore, the CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 51 aforesaid submissions are required to be rejected. With regard to investigation, it is submitted that proper investigation was conducted by CBI prior to filing of charge sheet.
85.I have given my anxious consideration to the rival submissions and perused the relevant rules and law.
86.Ld. Counsel for the accused has failed to point out any specific provision in the CBI Manual which makes it mandatory for CBI to conduct preliminary enquiry in all cases before proceeding to register the FIR. Chapter IX of the Manual relates to the preliminary enquiry and perusal of the same would make it amply clear that it is not a sine qua non in all cases. Paragraph 9.1 of the said Chapter is very material in this regard as it categorizes the cases in which preliminary enquiry has to be resorted to. The said paragraph reads as under :-
"When, a complaint is received or information is available which may, after verification as enjoined in this Manual, indicate serious misconduct on the part of a public servant but is not adequate to justify registration of a regular case under the provisions of Section 154 Cr. PC., a Preliminary Enquiry may be registered after obtaining approval of the Competent Authority. Sometimes the High Courts and Supreme Court also entrust matter to Central Bureau of Investigation for enquiry and submission of report. In such situations also which may be rare, a 'Preliminary Enquiry' may be registered after obtaining orders from the Head Office. When the verification of a complaint and source information reveals commission of a prima facie cognizable offence, a Regular Case is to be registered as is enjoined by law. A PE may be converted into RC as soon as sufficient material becomes available to show that prima facie there has been commission of a cognizable offence. When information available is adequate to CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 52 indicate commission of cognizable offence or its discreet verification leads to similar conclusion, a Regular Case must be registered instead of a Preliminary Enquiry. It is, therefore, necessary that the SP must carefully analyse material available at the time of evaluating the verification report submitted by Verifying Officer so the registration of PE is not resorted to where a Regular Case can be registered.
(Emphasis supplied)
87.It is clear from the perusal of the aforesaid paragraph that a preliminary enquiry is to be resorted to only when the complaint or the information received by CBI indicates serious misconduct on the part of the public servant but the said complaint or the information is not adequate to justify registration of a regular case. However, when information available is sufficient to indicate commission of cognizable offence or its discrete verification leads to similar conclusion, regular case must be registered instead of a preliminary enquiry.
88.In corruption cases, preliminary enquiry may be resorted to prior to registration of FIR in appropriate cases particularly when facts are either incomplete or hazy so that the public servant is not unfairly harassed adversely effecting his morale in particular and the cadre in general. However, there is no inflexible rule of law that the registration of FIR straightaway in corruption cases without resorting to preliminary enquiry would vitiate the ensuing prosecution. Preliminary inquiry is not mandatory in such cases when the information is accurate. Reference is made to the judgment in the case of State of Telangana v. Managipet alias Managipet Sarveshwar Reddy, (2019) 19 SCC 87 CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 53 where the Hon'ble Supreme Court observed as under:-
"The preliminary inquiry warranted in Lalita Kumari v. State of U.P., (2014) 2 SCC 1: (2014) 1 SCC (Cri.) 524] is not required to be mandatorily conducted in all corruption cases. It has been reiterated by this Court in multiple instances that the type of preliminary inquiry to be conducted will depend on the facts and circumstances of each case. There are no fixed parameters on which such inquiry can be said to be conducted. Therefore, any formal and informal collection of information disclosing a cognizable offence to the satisfaction of the person recording the FIR is sufficient."
89.Having regard to the above settled law and discussion, this court is of the view that holding of preliminary enquiry in all corruption cases is not mandatory and when the source information is found by CBI to be credible and reliable disclosing commission of cognizable offence, it can directly register FIR without holding preliminary enquiry. In the instant case, the CBI has found the source information to be credible, adequate and reliable and therefore, it did not commit any illegality by not holding a preliminary enquiry before registering a regular case. The act of CBI in directly registering the FIR is in consonance with Chapter (ix) of the CBI Manual and the same cannot be assailed.
90.Now coming to the question of defects in the investigation raised by Ld. Counsel for accused; it is well settled law that accused cannot take advantage of defective investigation and more so in the present case where the Investigating Agency was not under an obligation to conduct mini trial in order to investigate unaccounted CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 54 disproportionate assets of accused persons. The Investigating Agency in the cases of disproportionate assets, would conduct the investigation only with regard to sources of income of accused known to them and not about the source of income known only to accused. Furthermore, no prejudice has been caused to the accused for not conducting the investigation during the entire original check period with regard to his known sources of income as he had opportunity to prove the same during the course of trial of the present case and, thus, the objection with regard to defects in registration of FIR, raised by accused persons, is without any merit.
LAW INVOLVED IN THE PRESENT CASE
91.The case of the prosecution, in brief, is that accused, Balbir Sharma, being public servant, during the period from 01.02.2002 to 31.07.2002, committed an offence by acquiring assets, movable and immovable properties to the extent of Rs. 11,939,951/- which are disproportionate to his known source of income and which is punishable under section 13(2) read with section 13(1) (e) of PC Act, 1988. It is the further case of prosecution that accused A-1 was found in possession of pecuniary resources/properties in his name as well as in the name of his wife A-2 during the aforesaid period, for which he could not satisfactorily account for. Further case of prosecution is that A-2, wife of A-1 and other accused persons A-3 to- A-33 abetted the commission of said offence by entering into conspiracy with A-1 to acquire the properties movable and immovable CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 55 in his name by using the money provided by A-1. Accused persons, thus, are alleged to have committed offences, punishable under Section 13(2) r/w 13(i)(e) of the PC Act 1988 and under Section 109 IPC read with section 13(2) read with Section 13(1)(e) of PC Act, 1988.
92.The relevant Section 13 (1) (e) of PC Act, reads as under :
"13. Criminal misconduct by a public servant -
(1) A public servant is said to commit the offence of criminal misconduct,-
(a) xxxxx
(b) xxxxx
(c) xxxxx
(d) xxxxx
(e) if he or any person on his behalf, is in possession 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.
Explanation. - For the purposes of this section, "known sources of income"means income received from any lawful source and such receipt has been intimated in accordance with the provisions of any law, rules or orders for the time being applicable to a public servant."
93.To substantiate a charge under Section 13(1)(e) of the Act, the prosecution must prove the essential ingredients namely :
(i) the accused is a public servant;
(ii) the nature and extent of the pecuniary resources or property which were found in his possession;
(iii) it must be proved that as to what were his known sources of income i.e. known to the prosecution;
(iv) it must prove quite objectively that such resources or property found in possession of the accused were disproportionate to his known sources of income.
(v) public servant is unable to account for such disproportionate assets.
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 56
94.Once the said ingredients are satisfactorily established, the offence under Section 13 (1)(e) of the Act is complete. The initial burden of proving aforesaid ingredients no (i) to (iv) is on the prosecution to establish that the accused had acquired the property disproportionate to his known sources of income. The Hon'ble Supreme Court of India in Krishnanand vs. State of M.P. [(1977) 1 SCC 816] held that 10% of the disproportionate assets need to be deducted in arriving at the finding that the public servant had disproportionate assets. In an appropriate case deduction could be extended upto 15% and if so extended, the accused must be held to be not in possession of any disproportionate assets. It is only after the prosecution has proved the requisite ingredients, the burden to prove ingredient (v) of satisfactorily accounting for the possession of such resources or property shifts on the accused as mere acquisition of property does not constitute an offence under under Section 13(1) (e) of the Act but it is the failure of the accused to satisfactorily account for the assets that makes the position as offending the law. Thus, first it has to be examined whether prosecution has succeeded in discharging its burden to prove the possession of disproportionate assets by the public servant beyond his known sources of income.
PUBLIC SERVANT AND SANCTION
95.Section 19 (1) of the PC Act postulates that no court shall take cognizance of offence punishable U/s 7, 11, 13 and 15 of P.C. Act alleged to have committed by public servant CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 57 except with the previous sanction of the Competent Authority. The legislature, in its wisdom has made the satisfaction of the sanctioning authority essential to validate an order granting sanction to provide safeguard to public servant from frivolous and vexatious litigation.
96.In the present case, it is not disputed that accused No. 1, Balbir Sharma had been a Public Servant being District Youth Co-coordinator working in 'NYKS' during the relevant time and therefore sanction as per the mandate of section 19 of P.C. Act was required to be obtained to prosecute him for commission of offence U/s 13(2) r/w 13(1) (e) P.C. Act. As per the case of prosecution, sanction U/s 19 of P.C. Act was obtained vide sanction order dated 23.07.2009 (Ex. PW-30/A) which order has been proved by PW-30 Sh. Shailesh, Director General, 'NYKS' who was the Competent Authority to accord sanction. The aforesaid sanction order has been assailed by the defence on the ground that same is defective due non-application of mind by sanctioning authority who accorded sanction in mechanical manner without taking into consideration the material/documents produced by A-1 before the Investigating Officer. Ld. Defence counsel has not raised any objection regarding competence of the authority who granted sanction in the present case and only aspect that is required to be scrutinized is, whether the order granting sanction is valid in law.
97.The Hon'ble High Court of Delhi in Jaswant Singh Vs. State of Punjab: AIR 1988 SC 124 while considering the CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 58 validity and fact of sanction given U/s 6(1) of old P.C.Act 1947 (corresponding to section 19 of the amended PC Act, 1988) held that order according sanction must reflect that sanctioning authority considered the evidence before it and after consideration of the facts of the case, sanctioned the prosecution and unless the matter could be proved by other evidence, the sanction order itself must reflect the facts to indicate that sanctioning authority had applied its mind to the material/documents, facts and circumstances of the case. The Hon'ble Supreme Court in State of Maharastara through CBI Vs. Mahesh G. Jain: (2013) 8 SCC 119, after analyzing the previous judgments, culled out the principle of law relating the sanction. Relevant portion of the said Judgment is reproduced here:-
"13. From the aforesaid authorities the following principles can be culled out:-
(a) It is incumbent on the prosecution to prove that the valid sanction has been granted by the sanctioning authority after being satisfied that a case for sanction has been made out.
(b) The sanction order may expressly show that the sanctioning authority has perused the material placed before him and, after consideration of the circumstances, has granted sanction for prosecution.
(c) The prosecution may prove by adducing the evidence that the material was placed before the sanctioning authority and his satisfaction was arrived at upon perusal of the material placed before him.
(d) Grant of sanction is only an administrative function and the sanctioning authority is required to prima facie reach the satisfaction that relevant facts would constitute the offence.
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 59
(e) The adequacy of material placed before the sanctioning authority cannot be gone into by the court as it does not sit in appeal over the sanction order.
(f) If the sanctioning authority has perused all the materials placed before him and some of them have not been proved that would not vitiate the order of sanction.
(g) The order of sanction is a pre-requisite as it is intended to provide a safeguard to public servant against frivolous and vexatious litigants, but simultaneously an order of sanction should not be construed in a pedantic manner and there should not be a hyper-technical approach to test its validity."
(emphasis supplied)
98.Keeping in view the aforesaid principles it is to be examined whether the order of sanction granted by the sanctioning authority withstands scrutiny of law or not. This court perused, analyzed and examined the sanction order Ex. PW-30/A which reflects that entire material was placed before the sanctioning authority and the said material was examined by it before according sanction. The sanctioning authority was made available the statements, calculations and defence of the accused and after considering the same, it came to the conclusion that accused No. 1, has been found in possession of assets disproportionate to his known source of income to the tune of 373% of his income and he did not intimate about the same within one month of the receipt of the loan to the department as per rules and regulations and his explanation regarding his income and his wife obtaining loans from various relatives, was not found satisfactory and thus the sanction U/s 19 (1) (C ) of the Act for his prosecution has CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 60 been accorded.
99.The contention of the Ld. Counsel for Accused No. 1 that approval of sanction is defective for non consideration of material and explanation of accused, is denuded of any substance as the Sanctioning Authority is obliged only to apply his mind to the relevant facts and circumstances while examining the issue of grant of sanction for prosecution as held by the Hon'ble Supreme Court but it does not mean that while examining the said aspect, the Sanctioning Authority has to himself evaluate the materials/ evidences by conducting a mini trial prior to according sanction to come to a conclusion of guilt before grant of sanction. The opportunity which is to be afforded to the accused under Section 13(1)(e) of the 1988 Act of satisfactorily explaining about his assets and resources is before the court when the trial commences and not at an earlier stage.
100. Furthermore, it is well established that a mere error, omission or irregularity in sanction is not considered to be fatal unless it has resulted in a failure of justice or has been occasioned thereby. In the absence of anything to show by the accused that any defect or irregularity in granting sanction to prosecute him, caused a failure of justice, the plea is without any substance.
101.Considering the sanction order in the light of record of the case and settled law, this Court has no hesitation to come to the conclusion that sanction has been duly granted by the Competent Authority.
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 61 CHECK PERIOD
102.Section 13 (1) (e) of P.C. Act postulates possession by public servant of unaccounted pecuniary resource or property disproportionate to his known sources of income 'at any time during period of his office'. In the case of V.K.Puri Vs. Central Bureau of Investigation, (2007) 6 SCC 91, the Hon'ble Supreme Court has observed;-
"In a case involving Section 13(1)(e) of the 1988 Act, what is necessary is as to whether keeping in view the period in question, commonly known as check period, the public servant has acquired wealth which is disproportionate to his known sources of income."
103.This expression does not mean that it is the period right from the inception of the service of a public servant. It means at any particular period of the service of a public servant but the period fixed or selected shall not be too small. In the present case, as noted above, the initial check period mentioned in the FIR is w.e.f. 01.02.2022 to 31.05.2003, however, after conclusion of investigation, the aforesaid check period was reduced to 01.02.2022 to 31.07.2002. The reasons/explanation given in the charge sheet for the curtailment of the said check period is that A- 1 acquired main assets i.e. Flat No. A-4 at 6 Auregnzeb Road, New Delhi vide MoU dated 20.06.2002 during the reduced check period and various payments for this flat was made by A-1 through his and his wife's bank accounts and the last payment was made in July 2002 and, therefore, check period has been reduced to 31.07.2002 from 31.05.2003.
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 62
104.Ld. Defence Counsels have contended that the investigating agency can not reduce check period at its whims and fancies against settled law. It is contended that the investigating agency has malafidely reduced the check period as the accused persons had succeeded in explaining the alleged disproportionate assets during original check period. Ld. Counsel for the accused has placed heavy reliance upon the Judgment of the Hon'ble High Court of Delhi in Ashok Kumar Kapoor vs. Central Bureau of Investigation: MANU/DE/0648/2019 submitting that in the said case, the check period less than 10 years was not considered to be sufficient and the recovered cash was not considered to be disproportionate to the known source of public servant/accused. Per contra, it is argued by Ld. PP for CBI that fixing of the check period is within the domain of the investigating agency and the accused has no say in it.
105.The Hon'ble Supreme Court in the case of State of Maharashtra v. Pollonji Darabshaw Daruwalla; MANU/SC/0294/1987 held that in order to establish that a public servant is in possession of pecuniary resources or property disproportionate to his known sources of income, it is not imperative that the period of reckoning be spread out for the entire stretch of anterior service of the public servant. It was also observed that the choice of the period must necessarily be determined by the allegations of fact on which the case of prosecution is founded and rest. However, the period must be such as to enable a true and CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 63 comprehensive picture of the known sources of income and the pecuniary resources and property in possession of the public servant either by himself or through any other person on his behalf which are alleged to be so disproportionate. In the facts and circumstances of that case, the Supreme Court observed that a ten years period cannot be said to be incapable of yielding such a true and comprehensive picture.
106.Judicial precedents elucidating the duration of check period have consistently held that the the public servant should not insist upon the investigation agency to cover his/her entire tenure of his employment as check period. Nevertheless, it is also settled law that the duration of check period should not be too small to cover comprehensive picture of known sources of income and pecuniary resources of the public servant. No doubt, it is the prerogative of the prosecution to select the check period but such discretion cannot be exercised arbitrarily. The check period selected by the prosecution shall cover a reasonable period of time. The period shall not be very small and arbitrarily chosen by the investigating officer to project acquisition of wealth by a public servant. In view of the settled law, now it is to be examined whether the check period in the present case is so small that it cannot project comprehensive picture of the case or whether fixation of small period will enure to the advantage of accused to the extent of exonerating him on this score alone.
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 64
107.Ld. Counsel for the accused has vociferously argued placing reliance on the judgment of Hon'ble Delhi High Court in Ashok Kumar Kapoor (supra) that mere fixation of small check period by investigation agency will exonerate the accused from the charges of amassing disproportionate assets. It is well established that a decision is only an authority for what it actually decides and only its ratio is of the essence and not every observation found therein nor what logically follows from the various observations made in it. The ratio of any decision must be understood in the background of the facts of that case as a little difference in facts or additional facts may make a lot of difference in the precedential value of a decision. The following words of Lord Denning in the matter of applying precedents have become locus classicus :-
" Each case depends on its own facts and a close similarity between one case and another is not enough because even a single significant detail may alter the entire aspect, in deciding such cases, one should avoid the temptation to decide cases (as said by Cordozo) by matching the colour of one case against the colour of another. To decide therefore, on which side of the line a case falls, the broad resemblance to another case is not at all decisive."
108.The law in Quinn vs. Leathem (1901) A.C. 495, was propounded that every judgment must be read as applicable to the particular facts proved or assumed to be proved, since the generality of the expressions which may be found there, are not intended to be expositions of the whole law but govern and are qualified by the particular CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 65 facts of the case. The Hon'ble Supreme Court in Bharat Petroleum Corporation Ltd. and Anr. v. N. R. Vairamani and Anr., AIR 2004 SC 778 had observed :-
" Court should not place reliance on decisions without discussing as to how the factual situation fits in with the fact situation of the decision on which reliance is placed. Observations of Courts are neither to be read as Euclid's theorems nor as provisions of the statute and that too taken out of their context. These observations must be read in the context in which they appear to have been stated. Judgments of Courts are not to be construed as statutes. To interpret words, phrases and provisions of a statute, it may become necessary for judges to embark into lengthy discussions but the discussion is meant to explain and not to define. Judges interpret statutes, they do not interpret judgments. They interpret words of statutes; their words are not to be interpreted as statutes.
(Emphasis Supplied)
109.In view of aforesaid exposition of law, judgement in Ashok Kumar Kapoor (supra) cannot be applied to the present case unmindful of the facts involved herein. In the said case, the Hon'ble High Court noted infirmity in the prosecution case with regard to the recovery of Rs. 8 lakhs from the locker in the joint names of accused and his mother-in-law where the mother-in-law of the accused was claiming the locker belonging to her exclusively and was found the first holder of the said locker and it was also found that the rent of the said locker was being paid from her account. The Hon'ble High Court has further noted that the said fact was brought to the knowledge of CBI by the mother-in-law of the accused by filing an application claiming that the cash recovered from the said locker, belonged to her and during the trial of the said case, the CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 66 said cash not produced before the Court. In that eventuality, the Hon'ble High Court disbelieved the case of the prosecution and found infirmities in the said case. Aforesaid facts, as noted above, are not applicable to the facts and circumstances of the present case and thus reliance of accused on the said judgement is misplaced.
110.The contention of Ld. Counsel for A-1 is that, had the original check period of about 16 months been considered for investigation about the assets of A-1 by the Investigating Officer, the entire picture with regard to assets of accused would have been crystal clear and charge sheet would have not been filed in the present case as A-1 had explained entire sources of income alleged to be disproportionate to his known source of income. The submission of Ld. Counsel for A-1, at the first blush, appears to be attractive, however, the same is not grounded in law as the burden to prove 'known sources of income' of the accused is on him and he can very well discharge the said burden during the course of trial by leading evidence. A-1 might have made submissions/disclosure to the Investigating Officer as to his alleged sources of income, but the same, strictly, would not be evidence in the case. If the prosecution failed to disclose all the sources of income of the accused, it is always upon him to prove those other sources of income which were not taken into account or brought into evidence by the prosecution. The submissions of Ld. Counsel for accused that before registration of the offence an opportunity ought to have CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 67 been given to the accused to explain the sources of funds for acquiring and possessing the assets, is without any substance. The procedure to be followed in the course of investigation with regard to the explanation/statement of the accused-public servant does not contemplate the consideration of the explanation in the nature of mini trial even before the charge sheet is filed. Once the income of the accused-public servant charged is revealed, such accused is required to explain the source of it and satisfactorily account for such income. It may be done at the stage of investigation by the accused by putting forth his explanation before investigating agency and if the investigation agency failed to consider or considered incorrectly his explanation, accused gets another opportunity to satisfactorily account for the assets during trial.
111.In view of the aforesaid settled law with regard to the check period, applied to the facts and circumstances of the present case, this court has no hesitation to hold that no prejudice has been caused to the accused due to reduction in the check period from about fifteen months to seven months as the accused had ample opportunity during trial to satisfactorily account his source of income and he availed the said opportunity by putting forth his case and adducing evidence in his defence.
112. Now it is to be examined whether accused No.1 acquired any disproportionate assets beyond his known source of income during check period and if the answer is in the CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 68 affirmative, whether he has succeeded in discharging his burden to account the same on the basis of preponderance of probability.
WHETHER THE PROSECUTION HAS SUCCEEDED IN PROVING THE DIFFERENT ENTRIES OF INCOME, ASSETS, EXPENDITURE ETC. AS DELINEATED IN THE CHARGE SHEET.
113.In the instant case, the check period as per the charge sheet is w.e.f. 01.02.2022 to 31.07.2002 during which period accused No.1 allegedly amassed disproportionate assets as per statements and calculations contained in charge sheet. It is the case of the Prosecution that accused No. 1 Balbir Sharma was having movable assets of Rs. 72,250/- (at the beginning of check period) and of Rs. 1,63,637.94/- (at the end of check period) as mentioned in tabular form in para No. 10(ii). It is the further case of Prosecution that accused No. 1 Balbir Sharma was found in possession of five immovable properties at the beginning of check period as shown in table in para No. 13(i).
114.In order to prove movable assets allegedly possessed by accused No. 1 Balbir Sharma, the Prosecution has examined PW 38 Habil Ekka, who identified his signature on Observation Memo (Ex. PW 38/A) showing movable assets in possession of A-1 Balbir Sharma. He deposed that on 10.07.2006, he participated in the raid conducted by CBI at the house of accused No. 1 Balbir Sharma and identified Balbir Sharma with other co-accused in the CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 69 Court. He further deposed that Observation Memo dated 10.07.06 (Ex. PW 38/A) was prepared at house of accused Balbir Sharma in his presence on which he had signed. He further deposed that the rates and dates of acquiring articles mentioned in Ex. PW 38/A were disclosed by accused Balbir Sharma on query of CBI team.
115.PW 38 withstood the test of cross-examination conducted on behalf of accused and he did not waiver. Accused No. 1 Balbir Sharma did not bring anything contrary to the aforesaid memo and thus, it is found that accused No. 1 Balbir Sharma was in possession of movable assets amount to Rs. 72,250/- at the beginning of check period and that of Rs. 1,63,637.94/- at the end of check period.
116. It is the case of the Prosecution that accused No. 1 Balbir Sharma and accused No. 2 had purchased shares in M/s PTL as shown in table in para No. 13 (iii) for which payments were made to J.L. Gugnani, M/s Swastik Polywearing, Kundan Lal Gugnani, Raj Kumari, Sunita Gugnani, Yashpal Gugnani, Suman Gugnani and Deepa Gugnani between 13.05.2002 to 29.06.2002 either through demand draft or cheques. To prove the aforesaid payments, the Prosecution has examined PW 6 J.L. Guggani. He deposed that he had bought/acquired M/s PTL, a Company from one Mr. Poddar and the said Company owned Flat No. A-4, 6 Aurangzeb Road, New Delhi and accordingly, they became the owner of the said flat. He further deposed that the said Company was owned by him besides his CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 70 family members and it was later on, sold to A-1 Balbir Sharma after 5-6 years of him acquiring the Company. He deposed that all the shares in the Company had been sold to A-1 Balbir Sharma and an MoU dated 21.06.2002 (Ex. PW 6/A) was executed. He deposed that total sale consideration was Rs. 1.20 Crores and shares of the Company valuing Rs. 30,00,000/-, were also bought by the buyers led by A-1 Balbir Sharma and all the assets and liabilities of M/s PTL had been sold to the buyer led by A-1 Balbir Sharma. PW 6 also deposed regarding receipt of various payments from the second party led by A-1 Balbir Sharma with regard to sale of M/s PTL. PW 6 J.L. Gugnani further deposed regarding receipt of cheques/drafts in his name and in the names of his family members towards transfer of shares.
117.PW 5 Ram Singh Nainwal, Bank Official deposed that draft voucher (D-235) (Ex. PW 5/C1) whereby a draft for Rs. 4,00,000/- was issued in the name of A-2 Bala Devi Sharma, preceded by deposit of Rs. 4,00,000/- in cash vide deposit voucher (Ex. PW 5/C2) which entries (Point X) are reflected in the Statement (Ex. PW 5/B) on 28.05.2002. He further deposed that since the amount of draft was heavy, therefore, debit voucher (Ex. PW 5/E) was prepared against the draft issued.
118.The aforesaid two witnesses were cross-examined by accused persons and nothing could be elicited in their cross-examination not to believe their versions. Thus, the CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 71 Prosecution has succeeded in proving payments made by A-1 and A-2 to M/s PTL for purchase of shares of M/s PTL alongwith its Flat No. 4, 6 Aurangzeb Road, New Delhi as shown in para No. 13.
119.The income from salary, agriculture, tuition etc. of A-1 Balbir Sharma and his wife A-2 Bala Devi Sharma aggregating Rs. 1,48,205/- including salary of A-1 during check period i.e. 01.02.2002 to 31.07.2002 shown in para No. 13 (v) was proved by PW 47 Suresh Verma, Accountant of NYKS and PW 18 K. Prasad and PW 31 H.D. Simte from Income Tax department and they were not cross-examined by accused. Thus, the above mentioned total income of Rs. 1,48,205/- of A-1 & A-2 stands proved.
120.With regard to funds of Rs. 25,00,000/- received by A-1 and Rs. 5,00,000/- by A-2 during check period from Shanti Devi Gugnani as shown in table in para 13 (vi), Prosecution examined PW 6 J.L. Gugnani who deposed that the aforesaid amounts were given to A-1 & A-2 as friendly loans by her mother, Smt. Shanti Devi Gugnani and the aforesaid loan amounts were repaid by A-1 & A-2. No cross- examination of the witness was conducted on this aspect by accused persons disputing the aforesaid transactions. Hence, there is no dispute with regard to receiving of the aforesaid amounts in Bank accounts of A- 1 & A-2 as friendly loan.
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 72
121.The Prosecution has also added Rs. 49,000/- to the income of A-2 Bala Devi Sharma as received in her Bank account on 26.06.2002 and payment of general expenditure of Rs. 39,608/- has also stood proved.
122.Thus, the Prosecution has succeeded in proving different entries of income and expenditure of A-1 and A-2 and the same have also not been disputed by the accused persons. As per the case of the prosecution, A-1 was having disproportionate assets to the tune of Rs. 11,939,951/- while the case of the accused is that the said amount has wrongly been shown his assets as he and his wife availed various loans from their near and dear ones to purchase shares in M/s PTL and extend loan to it and the said amount was subsequently returned to them by the Company.
WHETHER ACCUSED ACQUIRED ANY IMMOVABLE PROPERTY DURING CHECK PERIOD
123.The case of the prosecution, as noted above, is that the accused no.1 being public servant besides acquiring movable assets during the check period, has also acquired immovable property of Flat No. 4, 6 Aurangzeb Road, New Delhi. Per contra contention of accused no. 1 is that the he did not acquire any immovable property at any point of time during the check period as he and his wife only purchased shares in PTL and the Flat in question is the property of the said company. It is argued by Counsel for 1 & 2 that it is settled law that shareholder acquires a right to CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 73 participation in the profit of the company only and he does not acquire any interest in the assets of the Company. It is further argued on behalf of accused Nos. 1 & 2 that the MoU dated 21.06.2002 (Ex. PW-6/B), does not confer any right, title and interest in the said property on accused Nos. 1, 2 and Sh. Jay Narain. It is argued that Mr. J.L. Guglani who executed the aforesaid MoU on behalf of M/s PTL in the capacity of erstwhile Director, was examined as PW-6 and in his testimony and he deposed that "It is correct that the MOU is not in regard to sale or purchase of any property". It is further argued that Inspector S.S. Yadav, Investigating Officer examined as PW-48 in his cross examination testified no documents showing any title of immovable property in the name of A-1 and A-2 had surfaced during his investigation. It is argued that even, in the findings of enquiry report dated 30.07.2018 (Ex. DW-1/B), the inquiry officer while exonerating the accused No. 1, held that there was no evidence from prosecution regarding transaction of sale/purchase/transfer of Flat No. 4, 6 Aurangjzeb Road, New Delhi or any other immovable assets by accused or his family or relatives and thus, prosecution has failed to establish purchase/sale/transfer of any immovable property by accused or his wife or his family. It is further argued by learned Counsel for accused No. 1 that since the accused has already been exonerated in departmental enquiry on the charge of acquisition of immovable property, the said findings cannot be reopened now.
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 74
124.Ld. PP for CBI submits that since the accused No. 1, and his family members i.e. his wife A-2 and his father have purchased majority of shares of M/s PTL, they are owners of the assets of the Company, if the corporate veil is lifted and thus accused No. 1 is liable to be prosecuted for acquisition of immovable property without prior sanction of his employer.
125.This Court has given thoughtful consideration to submissions of the rival parties and perused the law.
126.The contention of Learned Counsel for accused No. 1 that the findings recorded by Enquiry Officer cannot be reopened is without any merit as it is settled law that exoneration in departmental proceedings would have no bearing on the criminal proceedings. The Hon'ble Supreme Court of India in case of Noida Entrepreneurs Association Vs. Noida and others, (2007) 10 SCC 385 has held that the purpose of departmental inquiry and the prosecution are different and have distinct aspects as criminal prosecution is under offence for violation of a duty, the offender owes to the society or for breach of which law has provided that the offender shall make satisfaction to the public, whereas the departmental inquiry is to maintain discipline in the service and efficiency of public service. It is also observed that the inquiry in departmental proceedings relates to the conduct of breach of duty of the delinquent official for punishing for his misconduct which are defined under the relevant CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 75 statute and rules. Further in State of Rajasthan v. B.K. Meena (1996) 6 SCC 417, the Hon'ble Supreme Court has drawn a distinction between the two proceedings stating that the objective of the two proceedings is completely distinct from each other, for in disciplinary proceedings, question is whether the accused is guilty of such conduct as would merit his removal from service or a lesser punishment, as the case may be, whereas in the criminal proceedings question is whether offence registered against him under PC Act and IPC are established and, if established, what sentence should be imposed upon him. Hence, the standard of proof, mode of enquiry and the rules governing such enquiry and trial in both the cases are entirely distinct and different.
127.In view of the aforesaid law findings of departmental authority exonerating accused, would not be considered as binding on criminal court or having any persuasive force in criminal proceedings, for its settled law that findings on fact recorded even by Civil Court do not have any bearing on the criminal case and vice versa. On the same analogy, the findings arrived at in the departmental proceedings by Enquiry Officer will have no bearing on the merits of the case before the Criminal Court. While holding so, this Court is fortified by the judgment of the Hon'ble Madhaya Pradesh High Court in Rajendra Kumar Gautam v. State of M.P. 2021 SCC On Line MP 5843, wherein the Court was considering the question of quashing of FIR/charge- sheet against public servant who was accused of taking CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 76 bribe and charged for offence under Sections 7 and 20 of PC Act while he was exonerated in departmental proceedings of the charges enquired by enquiry officer. The pending criminal trial against him was not quashed by the Hon'ble High Court observing as under :-
"30. ........ There was neither any occasion for the departmental authorities to examine the aspect of violation of provisions of the PC Act, the presumption clause, etc. in the departmental inquiry nor their findings can be read to hold that no contravention of provisions of the Act, namely, the PC Act is established. In the domestic enquiry, the culpability of petitioners was examined on the touchstone of conduct rules based on limited evidence produced in the enquiry. In the criminal case, the court will examine the evidence in the light of provisions of the PC Act. The court is empowered to summon witnesses and, in their absence, issue warrant to secure their presence for the purpose of recording their statements in order to separate the wheat from chaff."
(emphasis supplied)
128.Thus in view of settled law, mere exoneration of accused No.1 in departmental proceedings would not conclude that he did not acquire any immovable property, for criminal proceedings would adjudge the accused person on the scale of whether the offence under the PC Act was established or not on the basis of evidence.
129.The case of A-1 as noted above is that neither he nor his family member acquired any immovable assets of M/s PTL as the property belong to the Company and not to its share holders. It is no longer res-integra that the interest of a shareholder in the Company either individually or collectively does not amount to more than a right to participate in the profits of the company. The company is a CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 77 juristic person and is distinct from the shareholders as laid down by the House of Lords in 1897 in the leading case of Salomon v. Salomon & Co. (1897) A.C. 22 and ever since this decision is being followed. However, in the course of time, the doctrine that the corporation or a company has a legal and separate entity of its own, has been subjected to certain exceptions by the application of the fiction that the veil of the corporation can be lifted and its face can be examined in substance. While it is not necessary to refer to all of those exceptions, the relevant exceptions applicable to the present case are "when the corporate personality is being blatantly used as a cloak for fraud or improper conduct". [Gower: Modern Company Law -- 4th Edn. (1979) at p. 137.] and "where the protection of public interests is of paramount importance or where the company has been formed to evade obligations imposed by the law "Pennington: Company Law - 5th Edn. 1985 at p. 53), and in these eventualities, the Court will disregard the corporate veil. The legal position as discerned from the pronouncements of Superior Courts is that in a case where the corporate personality has been obtained by certain individuals as a cloak or a mask to prevent tax liability or to divert the public funds or to defraud public at large or to defeat and circumvent the provisions of law or for some illegal purposes etc., to find out as to who are those beneficiaries who have proceeded to prevent such liability or to achieve an impermissible objective by taking recourse to corporate personality, the CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 78 veil of the corporate personality shall be lifted so that those persons who are so identified are made responsible. In order to find out as to who are the persons responsible personally when the veil is lifted, it would be wholly irrelevant as to whether such person is a Director or a promoter shareholder or otherwise of the company since the purpose of lifting the veil is to find out the person/s who is/are operating behind the corporate personality for his/their personal gains. Such person may be individual or group of persons belonging to a family or relatives or otherwise a small group collected with a common objective of achieving some illegal, immoral or improper purpose etc.
130.Learned author L.C.B. Gower in his "Principles of Modern Company Law" 4th Edition, has also given such illustrations where the veil of a corporate body has been pierced and has enumerated the same as fraudulent trading, mis-description of company, and taxation mattes where the statute require etc. "... In the nutshell, the doctrine of lifting of veil or piercing the veil is now a well established principle which has been applied from time to time by the Courts in India also. There is no doubt about the proposition that whenever the circumstances so warrant, the corporate veil of the company can be lifted to look into the fact as to whose face is behind the corporate veil who is trying to play fraud or taking advantage of the corporate personality for immoral, illegal or other purpose which are against public policy. Such lifting of veil is also has to implemented whenever a statute so provided. However, it is not a matter of routine affair. It needs a detailed investigation into the facts and affairs of the company to find out as to whether the veil of the corporate CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 79 personality needs to be lifted in a particular case. After lifting the veil, in a case where it is so required, it is not always that the Directors would automatically be responsible but again it is a matter of investigation as to who is/are the person/s responsible and liable who had occasioned for application of said doctrine.
81. ...............In fact whenever the veil is to be pierced, it would mean that somebody, individual or group of individuals,' have obtained the shell of corporate personality as a pretext or mask to cover up a transaction or intention of those individual/individuals is neither legal nor otherwise in public interest. In effect the attempt of those individuals have to be shown akin to fraud or misrepresentation. The legal personality of the corporate body thus can be ignored in such cases since it is well-settled that fraud vitiates everything and, therefore, the benefit of legal personality obtained by someone for purposes other than those which are lawful or even if lawful but not otherwise permissible, the corporate personality being the result of such fraudulent activity would have to be discarded but not otherwise. ......."
(emphasis supplied)
131.The Courts have shown themselves willing to "lift the veil", or "peeping behind the veil", or "penetrating the veil", or "extending the veil" or/and "ignoring the veil"
where the device of incorporation is used for some illegal or improper purposes. Keeping in mind, the aforesaid settled law, it is to be examined whether the purchase of shares of PTL by A-1, his wife A-2 and his father thereby taking control and management of the aforesaid company by being appointed as Director thereof is, in fact, a genuine transaction or a sham, smokescreen and camouflage to defeat and circumvent the provisions of law.
132.A bare look at MoU dated 21.06.2002 (Ex. PW-6/B) CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 80 reflects that it was executed between M/s PTL as First Party and accused, his wife and his father Jay Narayan, as Second Party for taking over the control and management of PTL with all its assets and liabilities as per recital. The said memorandum further recites that PTL solely and wholly owns and possesses immovable property bearing Flat No. A-4, 6, Aurengzeb Road, New Delhi acquired through Agreement to Sell dated 20.12.1993. The prosecution has succeeded in proving that the aforesaid three persons i.e. A-1, A-2 and Jay Narayan, father of A-1, acquired full control of PTL vide MoU dated 21.06.2002 (Ex. PW-6/B). A-1 and A-2 have not denied in their respective statements under section 313 Cr. PC that they did not acquire shares in the aforesaid company along with Jay Narain. It is proved that A-1, acquired 250 preferential shares and 500 equity shares, while A-2 acquired 34,500 equity shares and 100 shares were acquired by the father of A-1. The prosecution has succeeded in proving that A-1 purchased the shares of M/s PTL for an amount of Rs. 1,09,743/- while A-2 purchased shares for Rs. 27,94,500/- totaling to Rs. 2,904,243/-. Besides the aforesaid payment made in lieu of purchasing shares by A-1 and A-2, they had also made a payment of Rs. 55,06,160.33 and Rs. 65,95,757.33 respectively totaling to Rs. 121,01,917.66.
133.The case of the A-1 and A-2 is that they simply purchased shares of M/s PTL and subsequently extended loan to it for discharging its liability and did not acquire any immovable property, is not credit-worthy as both of them acquired CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 81 substantial shares of the company and there was no other share holder in the company besides A-1, A-2 and his father. It has also come on record that company was not having any business as no contra evidence were adduced by the accused persons. Even PW-6, Mr. J.L. Guglani, the erstwhile Director of PTL in his testimony volunteered to depose that "The company has no other business except the property in question". He further deposed that the sale consideration was Rs. 120 Crores and shares of the company of a value of Rs. 30 lakhs were also bought by buyers led by accused Balbir Sharm and all assets and liabilities of M/s PTL were sold to the buyers led by accused Balbir Sharma. He further deposed that out of 35,750 shares, 1250 shares were subscribed and transferred to A-1.
134.After analyzing of the aforesaid evidence, it is evident that M/s PTL was not dealing in any business and it was having only an immovable property i.e. Flat No. A-4, 6, Aurengzeb Road, New Delhi. Thus, purchase of shares of aforesaid company by accused, his spouse and his father, was not just acquisition and taking over of any business of the company but in fact was a transfer of only asset of the company i.e. Flat through 100% of transfer of share holding to them. M/s PTL did not have any other asset except this flats at Aurangzeb Road, New Delhi and was not involved in any business activity implying that the Flat of this company was intended to be sold by the erstwhile Director who owned and controlled the entire CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 82 issue and paid up capital of this company. In the light of these facts it is not a case where the erstwhile director simply intended to transfer the shares of a particular company, but through this MoU, he intended to transfer the immovable property in favour of A1, A2 and his father. If this MoU is viewed in the light of these facts, one would certainly find that it is not a simple sale of shares, but is indeed sale of immovable property. It is a fit case where the Corporate veil is required to be lifted in order to discern the true nature of acquisition of the company. A-1, in collusion with his wife and his father in the garb of taking over company, in fact, purchased the immovable property of PTL. Reliance placed by A-1 on the departmental proceedings to contend that he had not acquired any immovable property, is misplaced and not tenable in law.
135.In view of the aforesaid discussion and conspectus of evidence analyzed above, this Court has no hesitation to conclude that A-1 and his family members (A-2 his wife and his father Jay Narain) have acquired immovable assets i.e. Flat No. A-4, 6, Aurengzeb Road, New Delhi. WHETHER ACCUSED Nos. 2 to 33 HAVE COMMITTED OFFENCE U/s 109 IPC READ WITH SECTION 13 (1) (e) of P.C. Act
136.As the per the case of the prosecution as noted above, A-2 to A-33 are non public servants being private individuals and have been charged for the offence U/s 109 IPC read with 13 (1) (e) of P. C. Act for intentionally abetting A-1 to CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 83 amass unaccounted disproportionate assets. The abetment includes instigating, engaging in conspiracy and intentional aid. Private individuals may very well be prosecuted for such offence as held by Hon'ble Supreme Court in case titled P. Nallammal V. State; (1999) 6 SCC 559 that the kith and kin of the public servant can be prosecuted along with public servant for the offence under section 109 of IPC read with Section 13(1)(e) of the PC Act. In clear terms, it has been held that a non-public servant, if has abetted any of the offence, which the public servant has committed, he/she can be made liable for being tried along with the public servant. However caution has been given by the Hon'ble Supreme Court that merely because some of the disproportionate assets stand in the name of the non-public servants, without any element of abetment by them, they cannot be prosecuted with the public servant for the mere reason that they are related to the public servant.
137.In view of the aforesaid position, the prosecution has to prove the requirement with specific reference to the materials collected that A-2, who happens to be the wife of A-1, the public servant and other accused persons related to A-1 and A-2, had abetted him in acquisition of disproportionate assets so as to be prosecuted along with him in the case for possession of disproportionate assets by him. In a criminal case, it is a basic principle that it is the prosecution which has to prove its case beyond reasonable doubt either through direct evidence or circumstantial CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 84 evidence. Direct evidence is direct proof of a fact such as testimony by a witness about what that witness personally saw or heard or did. Circumstantial evidence is indirect evidence; that is, it is proof of one or more facts from which one can find another fact and some inferences are drawn. When interference from basic facts is not balanced or guided, it may lead to conjectures and surmises or speculations. In the case of Maharashtra State Board of Secondary and Higher Secondary Education v. K.S. Gandhi and others, (1991) 2 SCC 716, the Hon'ble Supreme Court observed as under :
"In our considered view inference from the evidence and circumstances must be carefully distinguished from conjectures or speculation. The mind is prone to take pleasure to adapt circumstances to one another and even in straining them a little to force them to form parts of one connected whole. There must be evidence direct or circumstantial to deduce necessary inferences in proof of the facts in issue. There can be no inferences unless there are objective facts, direct or circumstantial from which to infer the other fact which it is sought to establish. In some cases the other facts can be inferred, as much as is practical, as if they had been actually observed. In other cases the inferences do not go beyond reasonable probability. If there are no positive proved facts, oral, documentary or circumstantial from which the inferences can be made the method of inference fails and what is left is mere speculation or conjecture."
(Emphasis supplied)
138.Suspicion, howsoever, strong cannot substitute for proof. Mere conjectures or suspicions cannot substitute the legal proof. In the case of Ashish Batham v. State of M.P., (2002) 7 SCC 317, the Hon'ble Supreme Court observed as under : -
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 85 "Courts dealing with criminal cases at least should constantly remember that there is a long mental distance between "may be true" and "must be true" and this basic and golden rule only helps to maintain the vital distinction between "conjectures" and "sure conclusions" to be arrived at on the touchstone of a dispassionate judicial scrutiny based upon a complete and comprehensive appreciation of all features of the case as well as quality and credibility of the evidence brought on record".
(Emphasis supplied)
139.In the case of G. Parswanath v. State of Karnataka :
(2010) 8 SCC 593, the Hon'ble Supreme Court observed as under:-
"circumstantial evidence is evidence of relevant facts from which, one can, by process of intuitive reasoning, infer about the existence of facts in issue or factum probandum. In dealing with circumstantial evidence there is always a danger that conjecture or suspicion lingering on mind may take place of proof. Suspicion, however, strong cannot be allowed to take place of proof and, therefore, the court has to be watchful and ensure that conjectures and suspicions do not take place of legal proof".
(Emphasis supplied)
140.Thus in case of circumstantial evidence, there must be a chain of evidence so complete as not to leave any reasonable ground for the conclusion consistent with the innocence of the accused and must show that in all human probability the act must have been done by the accused.
141.In the backdrop of aforesaid settled law, it is required to be examined whether prosecution has succeeded in proving its case against A-2 to A-32 on the basis of direct or circumstantial evidence. It is pertinent to mention here that A-5, A-6, A-7, A-11, A-14, A-19, A-20, A-21 & A-24 CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 86 expired during the pendency of the trial and proceedings against them stood abated. Furthermore, A-33 was tendered pardon vide order dated 01.10.2010. However this Court is required to examine whether the aforesaid persons were having any benami money of A-1.
142.As noted above, the prosecution calculated the disproportionate assets of primary accused Balbir Sharma by adding the assets of his wife, A-2. It has been alleged that accused Balbir Sharma held/created disproportionate assets in his own name as also in the name of his 'dependent' wife. The prosecution, therefore, clubbed income, assets and expenditure of A-2 during the check period to arrive at a figure of Rs. 11,939,951/- of alleged disproportionate assets of A-1. The prosecution proceeded on the assumption that whatever 'assets' of accused A -2 were created during the check period, were financed by accused Balbir Sharma. Thus prosecution has to prove as a threshold requirement that A-2 Bala Devi Sharma was 'dependent' on A-1Balbir Sharma and as such all of her assets created during the check period, can be said to have been financed/sourced by accused Balbir Sharma alone. This Court will assess whether prosecution has been able to lead any reliable evidence to link the creation of assets of accused Bala Devi Sharma with the alleged ill-gotten money of accused Balbir Sharma.
143.As per case of the Prosecution, A-2 Bala Devi Sharma purchased 34500 shares in M/s PTL for Rs. 27,94,500/-
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 87 and subsequently, purchased its sole asset i.e. Flat No. 4, 6 Aurangzeb Road, New Delhi alongwith A-1 and made payment of Rs. 65,95,757.33/-. Thus, she had the assets / income of Rs. 93,90,257.33/- and the said amount belongs to A-1 while case of A-2 is that the aforesaid amount was taken by her as loan from various persons i.e. amount of Rs. 5,00,000/- from Smt. Shanti Devi Gugnani and Rs. 10,00,000/- as gift from her father, Rs. 76,88,000/- from A-3 to A-14 and A-22 to A-33 and Rs. 1,21,724/- was her income as reflected in her ITRs.
144.So far as the loan of Rs. 5,00,000/- alleged to have been extended by Shanti Devi Gugnani to her is concerned, the prosecution in the charge-sheet has shown payment of Rs. 5,00,000/- to A-2 on 21.06.2002. PW 6 J.L. Gugnani deposed that his mother Smt. Shanti Devi Gugnani had extended the aforesaid loan to A-2 Bala Devi Sharma through her S.B. A/c No. 051499515006 in HSBC Barakhamba Road, New Delhi vide cheque No. 471155 (Ex. PW 3/B), however, it was deposed by PW 3 Arun Oberoi that as per the Statement of Account on 24.06.2022, there was a debit of Rs. 5,00,000/- vide cheque No. 471155 and this amount was again credited, implying that initially the cheque was dishonored and, thereafter, it was cleared. He further deposed that since the narration of cheque No. 471155 (Ex. PW 3/B) drawn on 21.06.2002 was incomplete, he was unable to state whether the said cheque was honoured or not. There is no cross- examination on behalf of A-2 disputing the receipt of Rs. 5 CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 88 Lakhs from Smt. Shanti Devi Gugnani. Further more, when a specific question was put to A-2, Bala Devi Sharma in her statement U/s 313 Cr.P.C. regarding the aforesaid amount, she stated that the same is a matter of record and further stated that the said amount was returned to Shanti Devi subsequently. The said fact was also testified by PW 6 Sh. J.L. Gugnani, son of Smt. Shanti Devi in his deposition dated 15.05.2012. Furthermore, PW 6 J.L. Gugnani, son of Smt. Sunita Devi Gugnani deposed that the said amount of Rs. 5,00,000/- was subsequently returned and the Prosecution did not cross-examine him on this aspect. Thus, the explanation proffered by A-2 that the said amount was repaid to Shanti Devi Gugnani is established.
145.With regard to defence taken by A-2 that she was gifted a sum of Rs. 10,00,000/- by her father, the prosecution in the charge-sheet itself has shown that Sh. Ram Narain i.e. father of A-2 had gifted Rs. 10,00,000/- to her in three installments by transferring it to Bank Account of A-2 on different dates. Sh. Ram Narain was neither made accused nor witness by the prosecution for the reasons best known to them, however, the fact remains that as per the case of the prosecution itself, payment of Rs. 10,00,000/- was credited to the Account of A-2. The prosecution has failed to establish by leading any positive, direct or circumstantial evidence that the said money was the benami amount of A-1.
146.It is the further case of prosecution that A-2 received CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 89 average income of Rs. 13,300/- for two months during check period in F.Y. 2001-02 and average income of Rs. 33,300/- for four months during check period in F.Y. 2002- 03 totaling to Rs. 46,600/-. However, as per the case of the defence, A-2 received income of Rs. 1,21,724/- during the check period as reflected in ITR of A-2. Perusal of ITRs of A-2 for the Financial Year(s) 2001-2002, 2002-2003 & 2003-2004 reflects that during the original check period i.e. 01.02.2002 to 31.05.2003 as per the FIR, A-2 has income of Rs. 1,25,966/-. Since original check period is being considered for explanation of A-2, income of A-2 during the original check period comes to Rs. 1,25,966/- in the present case.
147.Now it is to be examined whether the amount of Rs. 76,88,000/- received by her from A-3 to A-14 and A-22 to A-33 is in fact the money of A-2 as alleged by the prosecution. The findings on the aforesaid issue shall also prove whether the aforesaid accused persons had actively abetted the accused No.1, being public servant by depositing his ill-gotten and unexplained money in their respective Bank accounts and thereafter purportedly extending loan to A-2 as claimed by the prosecution. Thus, the case of the prosecution against aforesaid accused persons is that they were holding benami money of accused No. 1. It is alleged that some of the aforesaid accused persons got opened their Bank accounts during the check period and deposited specified amount and thereafter extended loan to A-2. It is further alleged that CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 90 some of the accused persons were not having such huge amount prior to check period but during check period, there is spurt in the deposition of the money in their respective Bank accounts and subsequently withdrawal within a week and extension of loan to A-2. It is the case of prosecution that the aforesaid circumstances are of vital importance to be taken note of to link A-1 with the aforesaid money in the hands of accused persons.
148.One of the ingredients of any benami assets is the source of money, which should come from the accused to the alleged benamidar to create the asset in question. The onus lies on the prosecution to prove that the asset in question is a benami property. In order to prove its case, the prosecution has relied upon the different entries of deposits and withdrawals made in the respective accounts of the accused persons during certain period on relevant dates. The prosecution has proved on record the deposit and withdrawal slips to corroborate the same. However, the deposit and withdrawal slips demonstrate that those have been not been filled up by A-1 and/or A-2 or someone on their behalf.
149.Besides the aforesaid material or evidence, there is no evidence against accused A-3 to A-33 linking them to the allegations that said monies were deposited in their respective accounts by and on behalf of A-1. The prosecution was required to prove by leading positive evidence whether A-1 siphoned of his ill gotten money to the accused persons. The material to implicate someone as CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 91 a conspirator acting in concert with a public servant alleged to have committed misconduct under the PC Act, or alleged to have amassed assets disproportionate to a public servant's known sources of income, thus, has to be on firm ground. Ordinarily, presumption of law is that the apparent state of fact is real unless contrary is proved and, therefore, the burden of proving that a transaction is sham or that the person in whose name the property stands, is not real but is only benamidar for another, is on the prosecution. In the present case there is no material to show that A-1 made deposits in question in the Bank accounts of accused and/or regarding benami nature of transactions. Only circumstance against the accused persons is that they are somewhat related to either A-1 or A-2. It has to be examined whether this fact in itself is sufficient to convict the accused for abetting public servant for conspiracy.
150.In the case law reported as K. Goverdhan vs. State of A.P., 2001(4) CCR 224 (A.P), where in a disproportionate assets case, it was alleged that certain properties had been purchased by the accused public servant as benami properties in the name of some of his relatives, it was held that in the absence of any direct evidence, mere bald assertion that these relatives had no sources of income which had not been borne out by record and the fact that some cheques were issued by the accused in the names of such relatives did not lead to any inference that the said properties were benami for the benefit of the accused. It CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 92 has been further held by the Hon'ble High Court that :
"The mere fact that the ostensible owner had no source of income in itself would not lead to any inference that the property in question was purchased with the income of a particular person. The absence of any source of income to the ostensible owner would merely indicate that the property might have been acquired with the income flowing from some one else. As to who that some one else is a matter of evidence and proof. That circumstance cannot lead to an inference that the property in question was acquired with income from the accused person. It is a matter of evidence and not a matter of mere inference though the evidence may not be direct and may consist of circumstantial evidence. It was held that in the instant case, no circumstantial evidence of a definitive character had been placed on record to lead to an inference that it was the income of the accused which financed purchase of the alleged benami properties."
(emphasis supplied)
151.In the case law reported as Udai Nath Mathur vs. State of Rajasthan, 2000(1) Raj LR 640 (Raj), it has been held by the Hon'ble High Court as under:-
"Where the prosecution alleges that certain properties are the benami properties of the accused, the burden is on the prosecution to prove that they are the benami properties of the accused. This burden is to be strictly discharged by adducing legal evidence of a definite character which would either directly prove the fact of benami or establish circumstances unerringly and reasonably raising an inference of that fact. It is not enough merely to show circumstances which might create suspicion because the Court cannot decide on the basis of suspicion. It has to act on legal grounds established by evidence. No absolute formula or strait jacket formula can be laid down to constitute a benami transaction. The conduct of the parties has to be considered in dealing with benami transaction. Title has to be looked, considering nature of possession of the alleged benami property after its purchase. The source from which purchase money came in the hands of purchaser and the motive for giving transaction as benami, have also to be seen".
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 93 (emphasis supplied)
152.The principles laid down by the Hon'ble Courts in the aforesaid cases clearly indicates that when a property (movable or immovable) is in the name of another person, it is for the prosecution to establish either by the direct evidence or through circumstantial evidence that such property was purchased or held by the other person as benami from the funds of such Government employee. The live financial link/ nexus has to be established between the ill-gotten money of public servant and assets of non public servant. If there is absence of any source of income of the ostensible owners, it cannot implicate public servant or non public servants. Merely because two persons have some links or relations, money deposited by one in his account may not be termed as the money deposited by another. There should be something more than that. There should be some legally admissible clinching evidence to conclude that the amount shown in the name of 'A' in his bank account, in fact, belongs to 'B'. In light of the aforesaid settled law, it is to be examined whether the loan monies extended by A-3 to A-14 and A-22 to A-33, to A-2 is in fact the ill-gotten monies of A-1 which were routed through the aforesaid accused persons to the Account of A-2.
153.It is the case of the prosecution that A-3 who is the brother of A-2, extended loan of Rs. 13,50,000/- on four occasions to A-2 during the period 10.05.2002 to CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 94 16.06.2002 and he could not explain the source of the said income and, therefore, it should be presumed that the said amount is ill-gotten money of A-1. A-3 in his statement U/s 313 Cr.P.C. stated that he received income of Rs. 23,30,000/- from various lawful sourcesduring the check period. In support of his version, he examined DW 6 who deposed about income of A-3 under different heads to show that he was having sufficient income with him during the aforesaid period to extend the aforesaid loan to A-2. The said witness was cross-examined by the prosecution but nothing came out in his cross-examination to disbelieve his testimony. A-3 has succeeded in proving on the basis of preponderance of probability that he was having sufficient income with him to extend the aforesaid loan to A-2. The prosecution has failed to prove any link of A-1 with the amount of Rs. 13,50,000/-. The contention of Ld. PP for CBI that the said amount was deposited in Bank Account of A-3 by A-1 during the check period and inference be drawn that it belongs to A-1, is devoid of merit as the said fact only falls within the domain of suspicion which cannot take the place of proof.
154.Now, coming to the allegation against A-4 Ravinder Sharma to the effect that he provided an amount of Rs. 1,00,000/- to his sister i.e. Smt. Bala Devi Sharma after withdrawing it from a Bank account opened by him during the check period raising suspicion that the said amount pertains to A-1. Accused Ravinder Sharma during his statement U/s 313 Cr.P.C stated that he had given loan of CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 95 Rs. 1,00,000/- to A-2 Bala Devi Sharma (his real sister) on her request which was repaid by her to him later on. He further deposed that the said loan was taken for some business activity to be initiated by her husband. DW-6 Sh. Vijay Kumar deposed that A-4 was having substantial income from the agriculture production from his 70 acre ancestor land. The prosecution has failed to discredit the aforesaid witness. The only circumstances against A-4 pointed out by the prosecution is that he opened a Bank account during the check period and deposited Rs. 1,00,000/- and thereafter withdrew the same to extend loan to A-2. The said circumstance does not connect A-1 with the amount of Rs. 1,00,000/- and to conclude on the basis of the aforesaid circumstances that the money belonged to A-1, would be a far-fetched conclusion.
155.Further accusations against A-4 by the prosecution is that he deposited Rs. 4,00,000/- in the Bank account of approver Ram Mehar (earlier A-33) and the said amount was in fact the black money of his brother-in-law (A-1). No evidence except the bald statement of Ram Mehar was adduced by the prosecution to prove the said allegation.
156.In Haricharan Kurmi and another v. State of Bihar [AIR 1964 SC 1184], the Constitution Bench of the Hon'ble Apex Court while dealing with statement of approver against co-accused person, held that in dealing with a case against an accused person, the Court cannot start with the confession of a co-accused person; it must begin with other evidence adduced by the prosecution and CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 96 after it has formed its opinion with regard to the quality and effect of the said evidence, then it is permissible to turn to the confession in order to receive assurance to the conclusion of guilt which the judicial mind is about to reach on the said other evidence. It was further held that the confession of a co-accused person cannot be treated as substantive evidence and can be pressed into service only when the Court is inclined to accept other evidence and feels the necessity of seeking for an assurance in support of its conclusion deducible from the said evidence.
157.Thus, the law laid down by the Hon'ble Supreme Court is that confessional statement of co-accused, though is relevant U/s 30 of the Evidence Act but it is not the evidence in the strict sense of the term U/s 3 of the Evidence Act and such statement can be used only to lend assurance of the prosecution case after the case is established by other independent evidence. In the present case as noticed from the evidence adduced by prosecution, there is no material to connect A-1 with the deposit of money in the bank accounts of Ram Mehar and thus his statement as approver is not required to be relied.
158.However assuming argue endo that besides the statement of approver, there is evidence to link A-1 and A-2 with the money in the bank account of Ram Mehar, it is being examined whether the prosecution has succeeded to lend assurance from the testimony of Ram Mehar to prove the aforesaid allegations against A-1 and A-2. For that purpose, the statement of approver Ram Mehar is required CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 97 to be evaluated. PW-43 Ram Mehar Sharma who was originally arraigned as 33rd accused, expressed his willingness to give statement u/s 164 Cr.P.C and the same was recorded by Ld. MM on 30.06.2018. Thereafter, CBI/prosecution moved an application dated 29.05.2010 for grant of pardon to accused Ram Mehar Sharma before Ld. predecessor of this Court on 01.10.2010 and his statement and the statement of IO were recorded on the same day. Vide order dated 01.10.2010, after considering the facts and circumstances of the case, coupled with request of the investigating agency regarding need and necessity of the evidence against accused persons, pardon was tendered to accused Ram Mehar Sharma.
159.Thereafter, Ram Mehar Sharma was examined as PW-43 before this Court as an approver. In his testimony, he deposed that he was retired employee of Gujarat State Transport Corporation and on 26.05.2022, Sh. Ravinder Sharma who is the son of his paternal uncle and was probably practicing at Tis Hazari Courts as an Advocate, met him at his house at his native village and told him that his real sister wanted to convert some black money into white. He further testified that being relative, on his permission, Ram Mehar Sharma deposited a sum of Rs. 4 lakhs in cash in his SBI Bank account on 28.05.2002. It is stated that deposit form of the said sum was filled by accused Ravinder Sharma and he has only signed on the same. It is further deposed that on the same day, draft of Rs. 4 lakhs from his aforesaid account was got prepared in CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 98 the name of M/s Balaji and the form of the same was filled by Ravinder Sharma upon which, he had singed and thereafter Ravinder Sharma obtained such draft from the bank. He further deposed that on around 17.04.2003, accused Ravinder Sharma told him that new Bank account was got opened in his name in Corporation Bank Machhrauli Branch, Jhajjar, Haryana and subsequently, his signature were obtained on account opening form by the Bank official when he was taken to the aforesaid Bank by Sh. Ravinder Sharma. He further deposed that on 17.04.2003, he signed on the form for withdrawal of the amount of Rs. 4 lakhs from his Bank account and the said sum was taken by Narender Sharma, real brother of Sh. Ravinder Sharma. He identified his signatures on the aforesaid documents.
160.The said witness/approver was cross examined by Neeraj Arora, Ld. Counsel for accused except accused no. 27, 28 and 29. In his cross examination, he admitted the suggestion given to him that he had filed Civil case before the Court at Jhajjar against Ram Narain, father of accused No. 2 & Ors. However, he denied the suggestion that he had dispute with Ravinder Sharma and his father with regard to the suit property. He admitted the suggestion given to him that he had paid a sum of Rs. 1,15000/- to arrive on compromise to get the compromise decree. He admitted the document Ex. PW-43/D and deposed that the said agreement was entered into between the signatories and was duly executed and on the basis of the same, the CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 99 aforesaid Civil suit was decreed. He denied the suggestion given to him that he had deposited Rs. 4 lakhs on 28.05.2022 in his bank account and the said amount was from his superannuation benefit. He admitted that his son had sent the complaint to Police Post, Kullaha District, Jhajjar raising apprehension/threat from Ram Narain and his family in 2003.
161.On the basis of aforesaid testimony, it is argued by Ld. PP for CBI that approver PW-43 has corroborated the case of the prosecution to prove that accused Ravinder Sharma had entered into a conspiracy with accused No. 1 and 2 to conceal the ill gotten money of accused No. 1. Per contra, Ld. Counsel for the accused submitted that the alleged episode of converting Rs. 4,00,000/- black money into white is based on alleged interaction of Ram Mehar with A-4 and he never met A-1 and A-2 at any point of time and thus deposition of Ram Mehar is based on hearsay and the same is not admissible in evidence. Furthermore, it is argued that no reliance can be placed upon the testimony of Ram Mehar Singh who was earlier an accused and subsequently turned approver malafidely as he had dispute with family of A-2 and his entire deposition was given by him in order to settle score with the family of A-2. It is submitted that Ram Mehar admitted in his cross examination that there was a property dispute between their families and for resolving the same, he had to pay a sum of Rs. 1,15,000/- to the family of A-2. It is further argued that hand writing expert did not opine that CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 100 deposit /withdrawal slip and draft slip were filled up by Ravinder Sharma. On the basis of aforesaid submissions, it is submitted by Ld. Counsel for the accused that the testimony of PW-43 does not advance the case of the prosecution.
162.This Court has given conscious consideration to the rival submissions of the parties and the settled law with regard to the admissibility of the confessional statement of approver.
163.As noted above, the statement of Ram Mehar Singh, co- accused, is not evidence in its strict sense U/s 3 of the Evidence Act as the same can only be relied upon only to lend assurance or to corroborate the case of the prosecution and therefore this Court must necessarily look for some other independent evidence which can connect the accused No. 1 with the offence U/s 13 (1) (e) P.C. Act i.e. for amassing disproportionate assets. In the instant case, upon the evaluation of evidence including the testimony of approver Ram Mehar, it is found that prosecution has failed to establish any no link of depositing Rs. 4 lakhs and preparation of demand draft by accused Ram Mehar Singh with accused No. 1. At the most, the statement of co- accused Ram Mehar Singh indicates that the deposition of Rs. 4,00,000/- and preparation of demand draft were at the instance of accused Ravinder Sharma but it does not prove that A-1 had ever entered into any conspiracy or abetted the offence with Ram Mehar Singh at any point of time. Furthermore, the prosecution has failed to prove that the CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 101 deposit/withdrawal slips and draft slips were filled up by A-4 as the report of handwriting expert does not give any opinion on this aspect. Thus, for want of any corroborative material/evidence to prove the offence of abetment on the instigation of A-1, no reliance can be placed on the confessional statement of approver Ram Mehar for the purpose of proof of any act of alleged conspiracy and abetment with A-1.
164.Furthermore, testimony of Ram Mehar Singh is not reliable and failed to inspire confidence of this Court as in his cross examination, he admitted that civil dispute between him and family members of accused No. 2 arose and the same culminated in passing of consent decree and Ram Mehar had to give Rs. 1,15,000/- as a compromise amount to the family of accused No. 2. The possibility of Ram Mehar Singh falsely implicating A-1 and A-2, cannot be ruled out as his testimony might be actuated to settle scores with the family of A-2.
165.The Hon'ble Supreme Court of India in Swaran Singh Rattan Singh vs. State of Punjab [AIR 1957 SC 637], has held that though the approver is undoubtedly a competent witness under the Evidence Act, the appreciation of his evidence has to satisfy double test, namely that his testimony must show that he is a reliable witness and further that his evidence must receive sufficient corroboration.
166.Having considered the facts and circumstances of the case and applying to the law, this Court has no hesitation to CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 102 conclude that the prosecution is miserably failed to prove that A-4 acted in collusion and connivance with A-1 and abetted the offence of concealing disproportionate assets of A-1.
167. Now coming to the case of the Prosecution against A-27, A-28 and A-29, it is alleged that they extended loan of Rs. 1,00,000/-, Rs. 50,000/- and Rs. 1,00,000/- each and the said monies are benami monies of A-1. Per contra, their case is that they were having acquaintance with A-4 Ravinder Sharma since their college days when they were doing LLB. It is their defence that A-4 approached them for monetary help for her sister and they provided loan to A-2 from their respective Bank Accounts in June, 2002 and subsequently, A-2 returned the aforesaid loan amounts in March, 2003 through the Bank transactions. It is their further defence that the aforesaid loan was extended by them to A-2 from their independent incomes of fees from their practice as Advocates and other sources of family income. It is submitted that the relevant documents were provided to IO during the investigation but no investigation was conducted by the IO to verify the said documents.
168. Perusal of testimony of IO Vipin Kumar discloses that he had not verified / investigated earning or financial capacity of A-27 to A-29. Statements of Accounts of A-27 & A-28 were produced on record in which various transactions are reflected prior and post check period. The Prosecution has failed to establish any link of the monies extended by them CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 103 as loan to A-2 with A-1 and accused persons have succeeded in probabilising their defence that at the relevant time, they were having their financial capacity to extend the said loans to A-2 and the Investigating Agency had admittedly not conducted any investigation on that aspect.
169.With respect to the loan extended to A-2 by A-5 to A-14 and A-22 to A-26, A-29 to A-32, they succeeded in proving that they were having sufficient income to extend loan to A-2 as testified by witnesses examined by them. The allegation of prosecution that the monies in Bank Accounts of the aforesaid accused persons, were deposited by A-1 is not proved by any positive evidence. Upon analysis of the evidence adduced by the prosecution, this court has no hesitation to conclude that prosecution has miserably failed to lead any evidence to show that the deposits in the accounts of aforesaid accused persons were by and on behalf of A-1. Further more, the accused persons, in their respective statements U/s 313 Cr.P.C, have specifically stated that they extended loan to A-2 out of their independent incomes either from agriculture land and/or from various other sources. In addition to the aforesaid statements, accused persons have also examined various witnesses including Revenue Officers, in their defence to prove that they were independent entities having independent source of income and the loan were extended by them to A-2, out of their hard earned money and subsequently, the said monies were returned by the A-2.
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 104 The accused has probablised the defence from the circumstances obtaining on record which gives inference that they were having their independent identities as is evident from testimonies of the Revenue Officers and other witnesses. Furthermore, even if it is presumed argue endo that the aforesaid accused persons have failed to prove their independent source of income, this cannot be sole ground to implicate them merely on the basis of their having some links or relations with A-2. In the case of State of Karnataka and Ors. Vs. Selvi J. Jayalalitha and Ors. (2017) 6 SCC 263, circumstances were different because in that case there were witnesses to depose before the court that they deposited cash in the banks under the direction of the accused.
170.In view of the aforesaid discussion and assessment of evidence in the backdrop of settled law, this Court finds that the Prosecution has failed to prove that the amount of Rs. 76,80,000/- extended by A-3 to A-14 and A-22 to A-33 to A-2 Bala Devi Sharma was the ill-gotten and unexplained money of A-1 and thus, the Prosecution has failed to prove that the said accused persons had abetted or entered into conspiracy with A-1 in committing offence U/s 109 IPC read with Section 13(2) and Section 13 (1)(e) of PC Act, 1988. Consequently, it also follows that the aforesaid amount received by A-2 having not been found the benami money of A-1, A-2 has not committed any offence in abetting A-1 to conceal his alleged disproportionate assets to the extent of aforesaid amount of CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 105 Rs. 76,88,000/-.
171.The Hon'ble Supreme Court in a series of decisions has laid down the guidelines in finding benami nature of transactions. In case titled as Krishna Nand Vs. State of Madhya Pradesh; (1977) 1 SCC 816 where it was contended that the amount lying in the Fixed Deposit in the name of wife of accused was in reality the assets of the accused and she was only a benami of the accused, the Hon'ble Supreme Court of India disposed of that contention holding as under :-
"26........It must be remembered that the fixed deposit stood in the name of Shanti Devi and the burden, therefore, lay on the prosecution to show that Shanti Devi was a benaminar of the appellant. It is well settled that the burden of showing that a particular transaction is benami and the appellant owner is not the real owner always rests on the person asserting it to be so and this burden has to be strictly discharged by adducing legal evidence of a definite character which would either directly prove the fact of benami or establish circumstances unerringly and reasonably raising an inference of that fact. The essence of benami is the intention of the parties and not unoften, such intention is shrouded in a thick veil which cannot be easily pierced through. But such difficulties do not relieve the person asserting the transaction to be benami of the serious onus that rests on Mm, nor justify the acceptance of mere conjectures or surmises as a substitute for proof. (Vide Jayadayal Poddar v. Mst. Bibi Hazra [1974]2SCR90). It is not enough merely to show circumstances which might create suspicion, because the Court cannot decide on the basis of suspicion. It has to act on legal grounds established by evidence. Here, in the present case, no evidence at all was led on the side of the prosecution to show that the monies lying in fixed deposit in Shanti Devi's name were provided by the appellant and howsoever strong may be the suspicion of the court in this connection, it cannot take the place of proof. It must, therefore, be held that the prosecution has failed to show that the sum of Rs. 11,180/- lying in fixed CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 106 deposit in Shanti Devi's name belonged to the appellant".
(emphasis supplied)
172. In Jastinder Singh Vs. State, 2001 Cr. LJ 11, the accused challenged his conviction for amassing disproportionate assets. Ld. Trial Court had included certain amounts with regard to Bank Accounts and Fixed Deposit of his wife in the income accused. It was contended that merely because money in the account of his wife was deposited by her, it cannot be taken as his asset. It was further contended that the presumption that the amount deposited by his wife in her account, did not pertain to her, without any evidence in his support was contrary to law as presumption is that Bank Account is operated by the account holder or her attorney or some other person on her behalf and there was no evidence before Ld. Trial Court to come to a finding that it was his wife who had taken the money from him and deposited the same in her account.
173.In these facts and circumstances obtaining therein, the Hon'ble High Court after relying upon the various Judgements of the Hon'ble Supreme Court of India held that the initial onus lies on the prosecution to prove its case with the amount of rigors and certainty beyond reasonable doubt and the defence can prove its case by proving a preponderance of probability. It was held that for the purpose of proving defence plea accused can rely on the admissions made by the prosecution or on the documents filed by the prosecution and the prosecution cannot drive CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 107 any strength or support form the weakness of the defence. It was held that in the absence of any reasoning or material whatsoever, adding the deposits in the bank account of the wife of accused to the disproportionate assets of the accused was totally erroneous and the same had to be excluded.
174.The Hon'ble Supreme Court of India in the case of DSP Chennai V. K. Inbasgaran; (2006) 33 OCR 300 (SC) has held that when there is joint possession between the wife and husband, or father and son and if some of the members of the family are involved in amassing illegal wealth, unless there is categorical evidence to believe that this can be read in the hands of the husband or as the case may be, it cannot be fastened on the husband or the head of the family.
175.The principles laid down by the Hon'ble Superior Courts are clearly indicating that whenever it is alleged that a particular money transaction is benami or the money in fact belongs to the public servant and not to the person holding it, it is for the prosecution to establish either by direct evidence or through circumstantial evidence that the said money is sourced with the funds of such Government employee.
176.In view of the aforesaid settled law applying to the facts and circumstances of the present case as delineated above and on the basis of evaluation of evidence, this Court has no hesitation to conclude that prosecution has failed to prove that Rs. 76,88,000/- extended as loan by A-3 to A-4 CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 108 and A-22 to A-33 was the Benami money of A-1. The prosecution has further failed to prove that loan of Rs. 5,00,000/- extended by Smt. Sunita Devi Gugnani to A-2 and subsequently returned by A-2 ; gift of Rs. 10,00,000/- given by father of A-2 to her and income of Rs. 46,600/- of A-2 were the monies of A-2
177.In view of the aforesaid facts and circumstances, the prosecution has failed to prove Rs. 93,90,257.33/- in the hands A-2 was the benami money of A-1 routed through A-3 to A-14 and A-22 to A-33 and consequently has failed to prove that they abetted A-1 in commission of offence U/s 13 (1)(e) of PC Act.
178.Now coming to accusations against A-15 to A-21, it is the case of the Prosecution that A-15 Shriram Ram Yadav ; A- 16 Om Prakash Yadav, A-17 Shyam Lal, A-18 Dalu Singh, A-20 Hari Prasad and A-21 Niranjan Lal paid Rs. 3,50,000/- each and A-19 Mahadev paid Rs. 4,00,000/- in cash totalling to Rs. 25,00,000/- to A-1 Balbir Sharma during the check period and the said amount belonged to him and thus, A-15 to A-21 also abetted A-1 in his concealment of his disproportionate assets and thus, committed offence U/s 13 (1)(e) of PC Act read with Section 109 IPC. Per contra, the case of A-1 is that he entered into an Agreement to Sell with A-15 to A-21 in respect of his agricultural land inherited from his maternal grandfather at Village Bopara, Bhiwani, Haryana for consideration of Rs. 50 Lakhs out of which Rs. 25 Lakhs were paid in advance on 24.04.2009 by the aforesaid CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 109 accused persons. The fact that A-1 inherited the aforesaid land from his maternal grandfather is not disputed by the Prosecution. More further, DW 2 Ram Vilas Sharma in his testimony recorded on 12.07.2019, testified that the aforesaid agricultural land was inherited by A-1. During cross-examination of IO PW 50, when the aforesaid Agreement to Sell was confronted with him, he showed his ignorance. The said Agreement to Sell was filed by the Prosecution alongwith the charge-sheet, however, the Prosecution has not tendered the said Agreement to Sell in its evidence. It is settled law that the document filed by the Prosecution alongwith the charge-sheet, can be relied upon by the accused to his advantage, even if the same has not been tendered in evidence by the Prosecution. Furthermore, A-15 to A-17 in their statement U/s 313 Cr.P.C. has stated that they paid the advance amount to A-1 Balbir Sharma to acquire immovable property through Agreement to Sell (Ex. PW 50/DX) dated 26.04.2002 duly executed but due to some unavoidable reasons, the aforesaid Agreement to Sell could not be completed and got cancelled and A-1 Balbir Sharma returned their money on cancellation of Agreement to Sell. A-15 also examined Yashpal Singh (DW 1/A-15) who deposed that A-15 was having sufficient independent income during the relevant time and Saurabh Sharma (DW 2/A-15) produced Statement of Account of A-15 for the period period from 03.04.2001 to 11.10.2003. Manudev (DW 3/A-15) produced the land record and Mukesh Kumar Singh CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 110 (DW 4/A-15) produced final statement of account for the period from 01.09.2002 to 31.12.2002. A-16 and A-17 (since deceased) also examined Yashpal Singh (DW 1/A-16) in their defence and he deposed that A-16 and A-17 were having sufficient income during the relevant time. A-17 also examined Saurabh Sharma (DW 2/A-17) who produced statement of joint Bank account of A-17 with Gyanwati showing sufficient balance in the account to pay to A-1 in lieu of sale consideration of the land to be purchased from A-1. With regard to the aforesaid monies paid by the aforesaid accused persons, the Prosecution has not adduced any evidence that the said monies were the benami monies of A-1. A-15, A-17 and A-18 in their statements have already stated that the amounts paid by them in respect of Agreement to Sell for purchase of land from A-1, were returned by A-1 as the said sale transaction could not be materialised due to some unavoidable reasons. Moreover, A-16, A-19, A-20, A-21 have expired and proceedings against them stood abated. Prosecution has failed to prove that the said Agreement to Sell was a shame or smokescreen to conceal the ill gotten money of A-1.The Prosecution has failed to establish that the amount of Rs. 25,00,000/- belongs to A-1 and the aforesaid accused persons abetted him in concealment of the said amount.
WHETHER ACCUSED No. 1 ACQUIRED ANY DISPROPORTIONATE ASSETS CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 111
179.To bring out the case of disproportionate assets against accused No. 1, the prosecution is required to prove on record following points:
• Assets possessed by him before the check period. • Assets possessed by him during and at the end of check period. • Income earned by him during the check period • Expenditure incurred by him during the check period.
180.The calculation of disproportionate asset is done in the following manner :
• Firstly the assets acquired during the check period are calculated by deducting assets existing at the beginning of check period from the assets existing at the end of the check period. • The expenditure incurred during the check period is added to the assets acquired during the check period. • From this sum, income earned during the check period is deducted and whatever remains, are the assets disproportionate to the known sources of income and accordingly, percentage of DA is calculated.
181.As per the case of the prosecution, A-1 Balbir Sharma acquired assets disproportionate to his known source of income in his name and in the name of his wife (A-2) and father. The prosecution alleged that whatever assets were in the hands of his wife (A-2) were in fact the assets created during the check period with the active financial assistance of A-1 and thus the income /assets of A-2 were clubbed with the income/assets of A-1 As noted above, while appreciating the evidence in respect to A-2, it has been found that she was not having any assets of A-1 in her possessions. The assets of A-2 as shown by the Investigating Agency in the charge-sheet were created by her after she obtained loan from various CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 112 accused persons who were having their independent incomes and thus, her income and assets cannot be clubbed with incomes and assets of A-1.
182.As per case of the Prosecution in the chargesheet, A-1 Balbir Sharma purchased 1250 shares of M/s PTL for amount of Rs. 1,09,743/- and subsequently, made payment of Rs. 55,06,160.33/- for purchase of Flat No. A-4, 6 Aurangzeb Road, New Delhi. In addition to above, he was shown to be in possession of amount of Rs. 2,36,666/- as income from his salary and agricultural land. As per the charge-sheet upon segregation of assets of A-1 from A-2, A-1 was found in possession of assets amounting to the amount of Rs. 57,36,666/- during the check period.
183.Section 13 (1)(e) of P.C.Act as noted above, makes the act of Public Servant criminal for possessing pecuniary resources or property disproportionate to his known source of income. What is 'known source of income' has been provided in the explanation to Sec. 13 (1)(e) as per which, for source of income to qualify as 'known source of income', it is essential that it should satisfy the following two conditions namely;
(i) it should be a lawful source of income and,
(ii) the receipt of income from such source, should have been intimated in accordance with provision of any law rules or orders for the time being applicable to the public servant concerned.
184.As a natural corollary, it follows:-
(a) any income received from a source which is not lawful cannot be considered for inclusion in the expression known sources of income for the purposes of Section 13 (1)(e) of the said Act, even if such an income was actually received by the concerned public CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 113 servant;
(b) any income, even though received from lawful source, cannot likewise be considered for inclusion in the expression known sources of income for the aforesaid purposes, if the receipt of such income has not been intimated in accordance with the provisions of any law, rules or orders for the time being applicable to the public servant concerned .
185.Recently the Hon'ble Supreme Court in State through Deputy Superintendent of Police vs. R. Soundirarasu and Ors., MANU/SC/1103/2022 while elucidating the explanation of section 13 (1) (e) of PC Act, has held as under :-
"37. Referring to the first part of the expression "known sources of income" in N. Ramakrishnaiah v. State of A.P. 2009 Crl.L.J. 1767, this Court observed as under:
15. The emphasis of the phrase "known sources of income" in Section 13(1)(e) (old Section 5(1)(e)) is clearly on the word "income". It would be primary to observe that qua the public servant, the income would be what is attached to his office or post, commonly known as remuneration or salary. The term "income" by itself, is classic and has a wide connotation. Whatever comes in or is received is income. But, however, wide the import and connotation of the term "income", it is incapable of being understood as meaning receipt having no nexus to one's labour, or expertise, or property, or investment, and being further a source which may or may not yield a regular revenue. These essential characteristics are vital in understanding the term "Income". Therefore, it can be said that, though "income" in receipt in the hand of its recipient, every receipt would not partake into the character of income. For the public servant, whatever return he gets of his service, will be the primary item of his income. Other income which can conceivably be income qua the public servant will be in the regular receipt from (a) his property, or (b) his investment. A receipt from windfall, or gains of graft crime or immoral secretions by persons prima facie would not be receipt for the "known source of income" of a public servant.
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 114
38. The above brings us to the second part of the explanation, defining the expression "such receipt should have been intimated by the public Servant" i.e. intimation by the public servant in accordance with any provisions of law, Rules or orders applicable to a public servant.
Xxxxxxx
41. While the expression "known sources of income"
refers to the sources known to the prosecution, the expression "for which the public servant cannot satisfactorily account" refers to the onus or burden on the Accused to satisfactorily explain and account for the assets found to be possessed by the public servant. This burden is on the Accused as the said facts are within his special knowledge. Section 106 of the Evidence act applies. The explanation to Section 13(1)(e) is a procedural Section which seeks to define the expression "known sources of income" as sources known to the prosecution and not to the Accused. The explanation applies and relates to the mode and manner of investigation to be conducted by the prosecution, it does away with the requirement and necessity of the prosecution to have an open, wide and rowing investigation and enquire into the alleged sources of income which the Accused may have. It curtails the need and necessity of the prosecution to go into the alleged sources of income which a public servant may or possibly have but are not legal or have not been declared. The undeclared alleged sources are by their very nature are expected to be known to the Accused only and are within his special knowledge. The effect of the explanation is to clarify and reinforce the existing position and understanding of the expression "known sources of income" i.e. the expression refers to sources known to the prosecution and not sources known to the Accused. The second part of the explanation does away with the need and requirement for the prosecution to conduct an open ended or rowing enquiry or investigation to find out all alleged/claimed known sources of income of an Accused who is investigated under the PC Act, 1988. The prosecution can rely upon the information furnished by the Accused to the authorities under law, Rules and orders for the time being applicable to a public servant. No further investigation is required by the prosecution to find out the known sources of CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 115 income of the Accused public servant. As noticed above, the first part of the explanation refers to income received from legal/lawful sources. This first part of the expression states the obvious as is clear from the judgment of this Court in N. Ramakrishnaiah (supra).
42. Thus, it is evident from the aforesaid that the expression "known source of income" is not synonymous with the words "for which the public servant cannot satisfactorily account." The two expressions connote and have different meaning, scope and requirements.
xxxx
46. The second contention canvassed on behalf of the Accused persons that every bit of information in regard to the assets had been intimated to the Income Tax Authorities and the documents in regard to the same should be sufficient to exonerate the Accused persons from the charges is without any merit. In other words, the contention that the High Court rightly took into consideration the aforesaid for the purpose of discharging the Accused persons from the prosecution is without any merit and erroneous more particularly in view of the decision of this Court in the case of Thommandru Hannah Vijayalakshmi @ T.H. Vijayalakshmi (supra).
(Emphasis supplied)
186.Thus, the explanation and law settled in this regard places burden on the accused to satisfy twin conditions; lawful source of his income and intimation of the same in accordance with provision of law/rules/orders/circular for the time being applicable to him. The accused has to discharge his onus to prove these two conditions on the basis of preponderance of probability. The aforesaid twin conditions must be read conjunctively and the public servant besides proving receipt of income from lawful source has further to satisfy the intimation thereof to his employer as per the conditions of service of his CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 116 employment and to Tax Authorities under Income Tax Act. As an obvious corollary, on one hand, income from legally forbidden source cannot be considered at all and on the other income from any lawful sources, cannot be taken into account unless its existence is duly proclaimed by public servant under relevant service rules and tax statute.
187.Thus first, it is to be examined whether the accused No. 1 being public servant has received any income from any sources forbidden by law. The Court while discussing and analyzing the evidence in respect of loan amount extended by A-3 to A-14 and A-22 to A-33 to A-2, has found that Prosecution has failed to establish that the loan amounts extended to A-2 by them was in fact the ill-gotten money of A-1 or that the same were deposited in their respective bank accounts by A-1 or on his behalf and/or by any of his family members including A-2. Thus, the extension of loan by those accused persons to A-2 is held to be not obtained from any unlawful source. In these facts, circumstances and evidence on record, it is held that A-2 to A-32 have not abetted A-1 in commission of the alleged crime. It has further been held that other monies found in her possession also do not belong to A-1 and thus, the amount of Rs. 93,90,257.33/- can not be clubbed with the assets of A-1.
188.Now coming to the case of A-1, his defence is that the amount of Rs. 57,36,666/- attributed to him by the prosecution in the charge sheet was possessed by him during the check period as he received Rs. 25 Lakhs on 24.04.2002 from A-15 to A-21 as part sale consideration in CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 117 respect of his agricultural land, Rs. 25 Lakhs as loan from Smt. Shanti Devi Gugnani, Rs. 5 Lakhs as gift received from his grandmother vide Ex. PW 5/A and Rs. 2,36,666/- received as salary and income from his agricultural land. It is further the case of A-1 that M/s PTL returned the aforesaid amount to A-1 between 22.03.2003 to 31.03.2003 as reflected in his statement of Bank Account (Ex. PW 2/B) and, thereafter, he returned Rs. 25 Lakhs to A-15 to A-21 and Smt. Shanti Devi Gugnani through Bank transactions as shown even in the charge sheet and thus it is contended that he was not having disproportionate assets to his known sources of income.
189.The explanation by A-1 that he received Rs. 25 Lakhs from A-15 to A-21 as part sale consideration in respect of his agricultural land is found satisfactory as while appreciating evidence against A-15 to A-21 who were also made accused by the Prosecution for abetement of offence, it is held that they had entered into the said Agreement to Sell and made payment of Rs. 25 Lakhs to A-1 from their respective independent incomes from various sources. Hence, the Prosecution has failed to establish that the said amount pertains to A-1 as subsequently he returned the said amount to A-15 to A-21 when the transaction could not fructify. He also returned Rs. 25 lakhs to Smt. Shanti Devi Gugnani through bank transactions after M/s PTL returned the aforesaid amount to him. A-1 has also been able to prove on record that amount of Rs. 5 Lakh was gifted to him by his grandmother vide gift deed Ex. PW CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 118 2/B. Thus, A-1 has succeeded in proving that amount of Rs. 57,36,666/- was created by him from lawful sources as explained above.
190.However, in order to succeed to account alleged disproportionate assets, accused No. 1, has further to prove that he had duly communicated to his employer about the receipt of the loan amount and/or acquisition of movable and immovable properties within the stipulated time as prescribed in rules applicable to him.
191.The contention of Ld. Counsel for accused No. 1 to 26 and 30 to 32 Sh. Abhir Dutt is that in the present case, A-1 has duly intimated his employer vide letter dated 10.04.2003 (Ex. PW 29/DA) about his and his wife's acquisition within the original check period as per FIR and therefore he has satisfactorily explained his known source of income. Per contra, learned Public Prosecutor for CBI submits that intimation is belated in contravention of CCS (Conduct) Rules applicable to A-1. It has been further contended by learned Public Prosecutor of CBI that no intimation regarding acquisition of immovable property was given and Income Tax Returns filed by A-1 also do not reflect about the aforesaid acquisition by A-1. Learned counsel for aforesaid accused persons have further submitted that even if no intimation has been given to the department regarding the acquisition/transaction by public servant, no criminal liability can be fastened upon him for non-intimation to his employer as the same may only amount a misconduct warranting disciplinary measures CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 119 against him. To buttress his arguments, he has relied upon the judgment of the Hon'ble Supreme Court of India in Ashok Tshering Bhutia v. State of Sikkim, (2011) 4 SCC 402, Virender Singh v. CBI, 2010 SCC and Sripada Gauda v. State, 2012 SCC. Per contra, learned Public Prosecutor for CBI submits that condition of intimation by public servant in accordance with provision of law, rules or orders applicable to him, is also required to be satisfied by him to account for his known source of income and if no such intimation is given, the acquisition/income shall be considered unlawful.
192.I have heard the submissions of the parties and have gone through the Judgments relied upon by learned counsel for the defence and the relevant rules applicable to public servant.
193.The Central Civil Services (Conduct) Rules, 1964 (hereinafter referred to as 'CCS (Conduct) Rules') were applicable to Accused No. 1 and he did not deny the applicability of the said Rules to him in trial. In fact, J.P.S. Negi (PW 29) from NYKS in his testimony deposed that the said Rules came in force in their department in 1998. Accused No. 1, being public servant of NYKS was under
the mandate follow the said Rules. Now, it is to be examined as to what are the Rules which were required to be complied by accused No. 1 during check period.
194.As per Rule (3) of Rule 13 of CCS (Conduct) Rules, a Government Servant and his family members have been prohibited to accept any gift without sanction of the CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 120 Government, if the value exceeds of Rs. 1500/- in case of Government Servant holding in Group-A or Group-B post and Rs. 500/- in case Government Servant holding Group- C and Group-D post. As per Sub-Rule 1 of Rule 15, the Government servant has been restricted from engaging directly or indirectly in any kind of trade or business except with the permission of the Government. The public servant cannot start a business in his name as long as he is in service under the government. Any family member can run any business with their name but the government officer shall not use his/her authority to aid that business. Rules further prohibit a government employee from holding the office of the director of a private company. Clause 5 of Sub-rule 1 of Rule 15 prohibits a government employee from being a part of the management of a private company. The rationale behind this rule is that a person who is employed by the government for the service of the public must not divert his focus and attention from his job as a person cannot concentrate on two jobs simultaneously and achieve excellence at both the jobs. Another reason behind this rule is both the jobs of director and government servant pays remuneration. A government employee cannot hold two office of profit at the same time. Therefore, this rule prohibits a government employee from being a director in a private company. Rule 16 (1) provides that no Government servant shall speculate in any stock share or other investment. Rule 16 (4) (I) prohibits lending and borrowing except under certain contingencies. It is CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 121 reproduced as under:-
(i) No Government Servant shall, save in the ordinary course of business with a Bank or public limited company, either himself or through any member of his family or any other person acting on his behalf.
(a) lend or borrow or deposit money, as a principle or an agent to, or from or with, any person or firm or private limited company within the local limits of his authority or with whom he is likely to have official dealings or otherwise place himself under an pecuniary obligation to such person or firm or private limited company; or
(b) lend money to any person interest or in a manner whereby return in money or in kind is charge or paid.
Provided that a Government Servant may give to or accept from a relative or a personal friend a purely temporary loan of a small amount free of interest, or operate credit account with a bona fide tradesman or make an advance of pay to his private employee :
Provided further that nothing in this sub-rule shall apply in respect of any transaction entered into by a Government servant with the previous sanction of the Government.
Rule 18 of Central Civil Services (Conduct) Rules, 1964 :
Movable, immovable and valuable property (1) (i) Every Government servant shall on his first appointment to any service or post submit a return of his assets and liabilities, in such form as may be prescribed by the Government, giving the full particulars regarding -
(a) the immovable property inherited by him, or owned or acquired by him or held by him on lease or mortgage, either in his own name or him the name of any member of his family or in the name of any other person;
(b) shares, debentures and cash including bank deposits inherited by him or similarly owned, acquired, or held by him;
(c) other movable property inherited by him him or similarly owned, acquired or held by him; and
(d) debts and other liabilities incurred by him directly or indirectly.
(ii) Every Government servant belonging to any CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 122 service or holding any post included in Group 'A' and Group 'B' shall submit an annual return in such form as may be prescribed by the Government in this regard giving full particulars regarding the immovable property inherited by him or owned or acquired by him or held by him on lease or mortgage either in his own name or in the name of any member of his family or in the name of any other person.
(2) No Government servant shall, except with the previous knowledge of the prescribed authority, acquire or dispose of any immovable property by lease, mortgage, purchase, sale, gift or otherwise either in his own name or in the name of any member of his family:
Provided that the previous sanction of the prescribed authority shall be obtained by the Government servant if any such transaction is with a person having official dealings with him.
(3) Where a Government servant enters into a transaction in respect of movable property either in his own name or in the name of the member of his family, he shall, within one month from the date of such transaction, report the same to the prescribed authority, if the value of such property exceeds Rs.
20,000/-, in case of Government Servant holding any class-I or Class-II post or Rs. 15000/-, in case of Government Servant holding any class-III or Class-IV post:
Provided that the previous sanction of the prescribed authority shall be obtained by the Government servant if any such transaction is with a person having official dealings with him.
[Sub-rule (3) amended vide the Central Civil Services (Conduct) Amendment Rules, 2011] (4) The Government or the prescribed authority may, at any time, by general or special order, require a Government servant to furnish, within a period specified in the order, a full and complete statement of such movable or immovable property held or acquired by him or on his behalf or by any member of his family as may be specified in the order. Such statement shall, if so required by the Government or CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 123 by the prescribed authority, include the details of the means by which, or the source from which, such property was acquired.
(5) The Government may exempt any category of Government servants belonging to Group C or Group D from any of the provisions of this rule except sub-
rule (4). No such exemption shall, however, be made without the concurrence of the Cabinet Secretariat (Department of Personnel).
Explanation I. - For the purposes of this rule - (1) the expression "movable property" includes-
(a) jewellery, insurance policies, the annual premia of which exceeds [two months basic pay of the Government servant], shares, securities and debentures.
[For the letters, figures and words Rs.10,000, or one- sixth of the total annual emoluments received from Government, whichever is less, the words two months basic pay of the Government servant, substituted vide the Central Civil Services (Conduct) Amendment Rules, 2011 - Notification No. G.S.R. 370 (E). 9th May, 2011, F.No. 11013/8/2009-Estt(A)] ;
(b) all loans, whether secured or not, advanced or taken by the Government servant;
(c) motor cars, motor cycles, horses or any other means of conveyance; and
(d) refrigerators, radios radiograms and television sets.
"Prescribed authority" means-
(a) (i) the Government, in the case of a Government servant holding any Group A post, except where any lower authority is specifically specified by the Government for any purpose;
(ii) Head of Department, in the case of a Government servant holding and Group B post;
(iii) Head of Office, in the case of a Government servant holding any Group C or Group D post;
(b) in respect of a Government servant on foreign service or on deputation to any other Ministry or any other Government, the parent department on the cadre of which such Government servant is borne or the Ministry to which he is administratively subordinate CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 124 as member of that cadre.
Explanation II.- For the purpose of this rule 'lease' means, except where it is obtained from, or granted to, a person having official dealings with the Government servant, a lease of immovable property from year to year or for any term exceeding one year or reserving a yearly rent.
195.In the backdrop of the aforesaid relevant Rules applicable to Accused No.1 being public servant, it is to be examined whether accused he has contravened any of the aforesaid Rules and acquired immovable and movable assets and failed to communicate about the same to his department.
196.As per rule 13(3) of CCS (Conduct) Rules, as reproduced above, accused Balbir Sharma being a Government Servant, was required to obtain sanction from his department prior to accepting gift of Rs. 5 lakhs from his grandmother vide gift deed Ex. PW-5/A dated 10.06.2000, however, he did not obtain any such sanction. Likewise, he was also required to seek prior sanction from his department in respect of loan of Rs. 10 lakhs received by his spouse A-2 from his father as he would have been very much aware of such gift in favour of his wife by his father.
197.Furthermore, he engaged himself directly in the business of M/s PTL in the capacity of its Director in contravention of rule 15 of CCS (Conduct) Rules. He also contravened Rule 16 (4) (1) by purchasing shares in M/s PTL, and therefore, extending loan to it. He has also contravened rule 18(3) by not intimating his department within one month from entering into transaction of movable property (in the present case) receiving loan of Rs. 25 lakhs from CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 125 Smt. Shanti Devi Gugnani, thereafter, extending loan of Rs. 55,03,160.33 to M/s PTL. As per Rule 18 as reproduced above, accused Balbir Sharma, being public servant was required to give intimation to his department prior to acquisition of any immovable property. He alongwith his family members i.e. his wife (A-2) and his father acquired immovable property i.e. Flat No. A-4, 6, Aurangzeb Road, New Delhi, however there is no previous communication by him to his department and thus he is in flagrant violation of sub rule (2) of Rule 18.
198.Prosecution has succeeded in proving that A-1 and A-2 had received substantial amount from A-3 to A-33 and thereafter invested in PTL. The said fact has not been denied by A-1 and A-2 however, it is submitted by Ld. Counsel for the accused that A-1 was under no obligation to communicate the same to his department as CCS Conduct Rules were not applicable to him prior to 1998 and even thereafter, from 1998 till 2003, there was no practice of filing return of immovable and movable properties in his office and the same was admitted by PW- 29 Dy. Director in his testimony. It is submitted that no proforma for disclosure of the movable property prior to 2003 in the personal file of the accused was found and prior to registration of the case, no adverse observations for non compliance of the aforesaid requirement was found mention in his personal file.
199.The aforesaid submission of A-1 is considered in the light of the evidence brought on record. It was incumbent upon CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 126 him to prove the non- applicability of CCS Conduct Rules to him during the check period in the present case. However, he failed to lead any evidence to the effect that such practice was not prevalent in his department till 2003. Even otherwise, he cannot claim benefit of his own wrong in not intimating the department about the receipt of movable property when he was so bound as per his service conditions. In fact, PW-29 Dy. Director NYKS testified that CCS Conduct Rule were made applicable to the department from 1988 and thus, the accused was under
obligation to file the return of movable property which he admittedly failed to do so.
200.In addition to it, the borrowing and lending by the accused are in violation of Rule 4(1) of Rule 16 of Rules as the same is neither in ordinary course of business nor with a Bank or Public Ltd. Company as provided. Further more, accused is also in violation of Rule 15 (1) (a) and (c ) of Rule 15 of Rules as he being public servant engaged himself directly in the trade or business by being Director of M/s PTL. Accused has also violated Rule 16 (1) as he had speculated in shares and investment of M/s PTL.
201.Thus, the accused being public servant is contravention of aforesaid rules as provided in CCS (Conduct) Rules, however, it is to be examined whether violation of the aforesaid rules entails any consequences for him to attribute disproportionate assets to him in terms of Section 13 (1) (e) of the P.C. Act
202.The Hon'ble Supreme Court in Ashok Tshering Bhutia CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 127 (supra) where accused who was facing trial for commission of offence U/s 13(2) r/w Section 13(1) (e) of the P.C. Act, submitted requisite information belatedly giving full details of the properties acquired and possessed by him, it was held as under :-
"35. For the sake of argument, even if it is assumed that the form required to be filled up under Rule 19 of the Rules 1981 was mandatory and the appellant failed to fill up the same, for the reason that the form had never been prescribed under the Rules 1981, and he ought to have declared the same on plain papers, as he did on instructions of the superior authority after lodging of the FIR against him, the document Ext.D-4 could not be rejected merely on the ground that it had been submitted after the lodging of the FIR. Not filling up the form under the mandatory requirement of Rule 19 of Rules 1981 may render the appellant liable for disciplinary proceedings under service jurisprudence, but that itself cannot be a ground for rejection of the said documents in toto without examining the contents thereof. In this regard, we are of the considered view that the courts below have committed a grave error and the contents thereof should have been examined.
36. Not filling up the form under the mandatory requirement of Rule 19 of Rules 1981 may render the appellant liable for disciplinary proceedings under service jurisprudence, but that itself cannot be a ground for rejection of the said documents in toto without examining the contents thereof. In this regard, we are of the considered view that the courts below have committed a grave error and the contents thereof should have been examined."
(Emphasis supplied)
203.Ratio of the aforesaid Judgment was followed by the Hon'ble High Court of Karnatka in Sripada Gauda (supra) where the Special Judge after placing reliance an explanation Section 13(1) (e) of P.C. Act refused to include those amounts not disclosed by public servant in the CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 128 annual assets and liability statement of the particular years and convicted the accused U/s 13(1) (e) r/w 13(2) of the P.C.Act. The Hon'ble High Court framed the question to the effect "whether this lapse on the part of the accused in not reporting the incomes derived by sale of the properties as evidenced by registered documents, should be a sole ground to ignore he voluminous evidence placed by the accused in this regard, which would indicate that the accused had accounted for the monies received by him ? After relying on para 40 of the Judgment in Ashok Tshering Bhutia, it was held as under:-
"28. The Apex Court in Ashok Tshering Bhutia's case, had an occasion to deal with an almost identical case. In the said case, an employee of the Sikkim Government was charged of acquiring assets disproportionate to his known source of income during certain check period. As per the Conduct Rules framed by the Sikkim Government, Government servant was required to submit the assets and liability statement on his first appointment and also at the end of closing of every financial year giving full particulars. In that case, the public servant had not complied with the sald requirement. Therefore, his contention regarding certain acquisitions and pecuniary advantages received by him, which had not been reported to the disciplinary authority as required by the Conduct Rules were not accepted. Dealing such a situation, the Apex Court has held thus in para 40 :
40. The contention of the respondents regarding non-compliance with the 1981 Rules adversely affecting the evidentiary value of Ext. D-4 must be rejected for at least two reasons.-
(i) The Rules 1981 are not rules of evidence. The admissibility and probative value of evidence is determined under the provisions of the Indian Evidence Act, 1872. These rules are merely service CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 129 rules by which government servants in Sikkim are expected to abide. Consequently, the respondent has not been able to provide any cogent reason why the contents of Ext. D-4 should be disregarded; and
(ii) Rule 19(i) of the Rules 1981 does undoubtedly require government servants to on first appointment to any service or post and thereafter at the close of every financial year submit to the government the return of their assets and liabilities. However, it is to be noted that the said rule envisages that public servants will submit such returns in a prescribed form. Despite being repeatedly questioned by this Court, the respondents were unable to produce such form. Thus, it cannot be said that the appellant did not comply with the said rule as in the absence of such a form it was impossible for him to have done so (through no fault of his own). In any event, failing to submit such returns even if there had been no such a form, would make the appellant liable to face the disciplinary proceedings under the service rules applicable at the relevant time. The provisions of the Rules 1981 cannot by any stretch of imagination be said to have the effect of rendering evidence inadmissible in criminal proceedings under the PC Act 1988.
Thus, in such fact situation, the appellant could not be fastened with criminal liability for want of compliance with the said requirement of the Rules.
29. Thus from the above law enunciated by the Apex Court, it is clear that failure to submit the annual assets and liability statement may make the public servant liable to face disciplinary proceedings under the Service Rules applicable to such public servant, but such failure on the part of the public servant cannot have the effect of rendering the evidence placed by him with regard to the pecuniary advantages received by him as inadmissible in criminal prosecution lodged under the provisions of the Prevention of Corruption Act. The Apex Court has clearly held that in such fact situation, the accused cannot be fastened with criminal liability for want of compliance of said requirement, since the Conduct Rules are not rules of evidence."
(Emphasis supplied) CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 130
204.Furthermore, the Hon'ble High Court of Delhi in Virender Singh (supra) has held that explanation to Section 13(1) (e) of the P.C. Act does not enact or create an absolute prohibition / bar to curtail the right of the accused public servant to satisfactorily account for both the assets disclosed and not disclosed by public servant in trial before the Court.
205.In view of the aforesaid settled law while applying to the facts and circumstances of the present case, where the fact that A-1 did not intimate about the acquisition of immovable property i.e. Flat at Aurengzeb Road by him and his family members ie, his spouse, A-2 and his father, may be a misconduct, however, he was within his right to adduce evidence before this Court to show the lawful source for creation of the aforesaid assets. The Prosecution has failed to prove that NIL report (Ex. PW 29/D) alleged to have been submitted by accused to his department regarding his status of immovable proper as the same was only a photocopy and the Prosecution has failed to trace original of the same. The said document was not even found in official record of the department. As disclosed above, A-1 has succeeded in showing that he alongwith his wife and father entered into MoU with regard to M/s PTL and made payment out of lawful sources. A-1 Balbir Sharma has duly intimated to his department vide letter dated 10.04.2003 (Ex. PW 29/DA) about his various transactions and transactions of his wife A-2. Though the CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 131 said intimation was belated, however, same was within the original check period i.e. 01.02.2002 to 31.05.2003 as mentioned in FIR. Admittedly, the department has not taken any action against A-1 Balbir Sharma for the belated intimation. The accused has contravened other rules applicable to him but he could only be proceeded departmentally for the said contraventions and the non- communication (in respect of acquisition of immovable property) and belated communication (in respect of taking loan, gift and part sale consideration amount) have no bearings upon his accounting of assets in terms of explanation of 13(1) (e) of P.C. Act.
206.In view of the aforesaid facts and circumstances and evidence having come on record, A-1 has succeeded in accounting the alleged disproportionate amount of Rs. 57,36,666/- in his hands. It is pertinent to mention here that amount of Rs. 2.12 Crores as per details contained in Ex. PW 50/DB was received as share application money by M/s PTL during the period 19.12.2002 to 29.03.2003. PW 50 in his cross-examination deposed that the said fact of Rs. 2.12 Crores came to his knowledge in the investigation, however, no investigation was conducted by him on this aspect as the said amount was beyond the check period.
207.The Prosecution has failed to prove beyond reasonable doubt that A-1 was having disproportionate assets from any unlawful source during the check period as A-1 has been able to demonstrate on the basis of preponderance of CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 132 the probability that the alleged amounts in his hands were in respect of part sale consideration received from A-15 to A-21; loan received from Smt. Shanti Devi Gugnani, gift received from his grandmother and income received from his salary and agricultural land.
CONCLUSION
208.In view of the aforesaid discussion and evidence brought on record by the Prosecution and the accused persons, the Prosecution has failed to prove beyond reasonable doubt that A-1 Balbir Sharma has acquired any disproportionate assets during the check period i.e. 01.02.2002 to 31.07.2002 (as per the charge-sheet) as he has satisfactorily explained about acquiring his assets within the original check period i.e. 01.02.2002 to 31.05.2003 and he was within his rights to explain the same in accordance with law. The Prosecution has also failed to prove that money in the hands of A-2 to A-33 were benami money/assets of A-1.
209.The Prosecution has further failed to prove that A-2 to A-33 have abetted A-1 in commission of offence U/s 109 IPC read with Sections 13(2) and 13(1)(e) of PC Act, 1988. A-5 Vinod Kumar, A-6 Rajender Singh, A-7 Khushi Ram, A-11 Suraj Bhan, A-14 Onkar Singh Chauhan, A-19 Mahadev Prasad, A-20 Hari Prasad, A-21 Niranjan Lal and A-24 Gopi Ram Kaushik have already expired during pendency of present case and proceedings against them stood abated. A-33 Ram Mehar was granted pardon vide order dated 01.10.2010.
CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 133
210.Hence, A-1 Balbir Sharma is acquitted under Section 13(1)(e) punishable U/s 13(2) of PC Act, 1988. A-2 Bala Devi Sharma, A-3 Narender Sharma, A-4 Ravinder Sharma, A-8 Ashok Kumar, A-9 Vinay Kumari, A-10 Shiv Narayan Sharma, A-12 Santosh Sharma, A-13 Surender Prasad Sharma, A-15 Ram Yadav, A-16 Om Prakash Yadav, A-17 Shyam Lal, A-18 Dalu Singh, A-22 Ram Mehar, A-23 Dharam Chand, A-25 Suresh Kumar, A-26 Om Prakash, A-27 Dharmender, A-28 Sunil Sharma, A-29 Dinesh Kadiyan, A-30 Ram Avtar Sharma, A-31 Rajender Sharma and A-32 Ram Avtar are also acquitted of the charges under Section 109 IPC r/w 13(1) (e) punishable U/s Section 13(2) of PC Act, 1988.
211.Ahlmad/Judicial Assistant is directed to page and book- mark the file so as to enable digitization of the entire record.
212.File be consigned to record room after necessary compliance.
(Announced in the open Court today i.e. 28.03.2023) (MOHD. FARRUKH) Special Judge (PC Act) (CBI)-11, Rouse Avenue Court Complex, New Delhi CC No.380/19 CBI Vs. Balbir Sharma & Anrs. Page 134