Delhi District Court
"Cbi vs . B.R. Malhotra" And The Case Of The Said ... on 13 January, 2016
IN THE COURT OF SHRI AJAY KUMAR JAIN:
SPECIAL JUDGE (PC ACT) : CBI - 01:
NEW DELHI DISTRICT : PATIALA HOUSE COURT :
NEW DELHI
In re :
CC No. 43/10
Case ID No. 02403R00020032003
RC No. DAI2001 A0024
U/s 13(2) r/w 13 (1) (e) of PC Act, 1988
Central Bureau of Investigation
Versus
Sanjeev Sehgal
S/o Sh P.L. Sehgal
R/o E246, GKII, New Delhi
Date on which chargesheet was filed : 28.02.2003
Date on which charges were framed : 24.08.2007
Date on which arguments concluded : 08.01.2016
Date on which judgment pronounced : 13.01.2016
APPEARANCES:
Sh. J.S. Wadia, learned Spl. PP for CBI
Sh. H.K. Sharma, Ld. counsel for accused Sanjeev Sehgal
CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 1 to 84
J U D G M E N T:
1. Truth without roots is hypocrisy, or manipulation, or say decoration.
2. Prosecution case, as per chargesheet filed in brief is that the present FIR (Ex.PW19/A) is registered on the basis of written complaint lodged by Sh S.C. Bhalla, Inspector CBI in pursuant to search conducted at the residence of accused Sanjeev Sehgal on 25.08.2000 in connection with RC no. 41A2000. It is alleged in the FIR that accused Sanjeev Sehgal while working as a Junior engineer, Building Department, MCD, had amassed assets in his name, in the name of his family members to the tune of Rs. 51.01 lacs which prima facie found to be disproportionate to his sources of income. The assets includes his wife's shares in property no. E246, GKII and M1 NDSE, RBI bonds, bank balances, household articles, jewellery etc.
3. It is further alleged in the FIR that accused Sanjeev Sehgal joined MCD as Junior Engineer in May 1981, and since then worked in various departments of MCD including Building Department, Works Department, Project Department, Coordination Wing, Headquarter etc and at the time of registration he was posted at MCD, Lajpat Nagar.
4. During investigation, it is also revealed that Sanjeev Sehgal born in the year 1960 and his late father Sh P.L. Sehgal retired from government service in 1985 and was doing business till his death in 2001. It is also revealed that Smt. Krishna Sehgal was partner in father's business and one CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 2 to 84 of his brother Sh Rajeev Sehgal presently doing business in leather goods, living jointly at E246, GKII, which was purchased in the joint name of P.L. Sehgal, Rajeev Sehgal and Mala Sehgal in the year 1995. It is also found in investigation that Sanjeev Sehgal married to Mala Sehgal in 1985 having two school going daughters namely Aditi Sehgal and Apeksha Sehgal. It is also alleged in the chargesheet that though Mala Sehgal claiming to be filing income tax returns since the year 1987 but no such copy was produced by her during investigation. And one of the income tax assessment order found during the search but that does not through light / corroborate any alleged source of income of Mala Sehgal, however it is also found that accused intimated his office that his wife having independent income and filing separate income tax returns but accused had not given any such details regarding the sources of such income. Thus, the claim of independent income of Mala Sehgal has been rejected on the ground of vagueness and being an after thought.
5. It is further alleged in the chargesheet that accused though joined the MCD in the year 1981 but most of the assets mentioned in FIR acquired after 1990, therefore the check period is taken from 1990 till the date of search operation ie, 25.08.2000. Accordingly, income, expenditure and assets of the accused were calculated as mentioned below:
A. INCOME
6. During the investigation, the salary particulars of Sh. Sanjeev Sehgal has been collected from the various departments of MCD and the same have CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 3 to 84 been compiled as below. (The net take home salary has been taken into account for the calculations.)
(i) Total take home salary prior to the check period i.e., from Rs. 1,62,230,00 March 1981 to December 1989
(ii) Total take home Salary during check period i.e. from 01.101.90 Rs.7,18,905.00 to 31.07.2000
(iii) Rental income received in the name of Smt. Mala Sehgal by Rs.14,93,500.00 hiring out 360 Sq. feet of basement space of M1, NDSEII, New Delhi to Grindlays Bank from July 1994 to the end of check period.
(iv) Total interest received on the bank accounts in the name of Rs.39,250.00 accused & his wife A/c no 13274 (PNB), 25459240, 25464012 & 25464023 (all Grindlays Bank).
(v) Interest received on the RBI relief bonds in the name of the Rs. 3,07,990.00 accused and his wife
(vi) Interest received on investment in UTIMIP97 Scheme No. Rs.1,33,000.00 70259 and 70260 in the name of Apeksha and Aditi Sehgal
(vii) Dividents received on SBI Mutual Fund MMIS, in the name of Rs.32,400.00 Apeksha Sehgal.
(viii) Survival benefit payments received on LIC Policy no. Rs. 9,000.00 05267716 in the name of Sanjeev Sehgal Total Income Rs. 27,34,045.00 (Rs. 1,62,230.00, the salary received prior to the check period not included.) CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 4 to 84 B EXPENDITURE
(a) Non verifiable expenditure, calculated @ 1/3 rd of the total Rs. 2,39,635.00 salary of the accused, during the check period
(b) Expenditure incurred by the accused, on account of school fees Rs. 1,64,920.00 paid on behalf of Apeksha and Aditi to M/s Springdales School, Dhaula Kuan.
(c) The expenditure incurred on telephone No. 6453759 in the name Rs. 31,858.00 of Mrs. Mala Sehgal by way of bills paid.
(d) Premium paid on LIC policy no. 050267716 in the name of Sh. Rs.18,274.00 Sanjeev Sehgal
(e) The membership fee and annual subscriptions paid to M/s New Rs.36,955.00 Friends Club Ltd., by Mrs. Mala Sehgal, during the check period
(f) Stamp duty paid by Mrs. Mala Sehgal for purchasing share Rs.48,800.00 portion of E246, GKII vide regd., sale deed dated 13.08.93.
(g) Stamp duty paid by Mrs. Mala Sehgal for purchase of 360 Sq. Rs.31,680.00 feet space in M1, NDSEII vide regd., sale deed dated 27.07.94.
Total Rs.5,72,122.00 C. ASSETS ACQUIRED BY THE ACCUSED & FAMILY (i) The registered value of 1/4th share portion of property E246, Rs.6,10,000.00
GKII, purchased in the name of Mrs. Mala Sehgal on 13.08.93 from Sh. A.S. Mahal, which included front portion of the first floor with terrace, one bed room & bathroom.
(ii) The registered value of 360 Sq. ft. of space in the basement Rs.3,96,000.00 of M1, NDSEII, purchased in the name of Mrs. Mala Sehgal on 27.07.94 from M/s Aggarwal Developers Pvt. Ltd vide a registered sale deed.
CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 5 to 84
(iii) The total face value of the RBI Relief Bounds Nos. Rs.12,75,000.00 DH0003068, DH003069, DH2095, & DH12944, purchased by Sanjeev Sehgal, in his own name and in the names of Mala Sehgal and Apeksha Sehgal, in the year 1998.
(iv) Balance amount in the SB A/c no. 13274 in the name of Sh. RS.1,12,662.00 Sanjeev Sehgal, with PNB, NDSEI, New Delhi, as on 25.08.2000
(v) Balance in A/c no. 25464012, in the joint name of Aditi Rs,1,32,524.00 Sehgal & Mala Sehgal, with Grindlays Bank, NDSEII, as on 25.08.2000
(vi) Balance in A/c no. 25464023, in the joint name of Apeksha Rs.1,72,545.00 Sehgal & Mala Sehgal, with Grindlays Bank, NDSEII, as on 25.08.2000
(vii) Balance in A/c no. 25459240, in the joint name of Mala Rs.4,85,650.00 Sehgal, with Grindlays Bank, NDSEII, as on 25.08.2000
(viii) Investments made in SBI Mutual FundMagnum monthly Rs.30,000.00 Income Scheme91, in the name of Apeksha Sehgal represented by Mala Sehgal, vide folio Nos. 629607 dated 27.04.91 and 611237 dated 20.04.91
(ix) Investments made in UTIMIP97 Sheme in the name of Aditi Rs. 40,000.00 Shegal , Membership no. 70259 and Apeksha, No. 70260, both under the guardianship of Mala Sehgal. Total holding 4000 units @ Rs. 10/ pr unit.
(x) Approximately value of the household articles observed Rs.3,47,790.00 during the searches on 25.08.2000 on the ground floor of E246, GKII, found to be occupied by the accused Sanjeev Sehgal & family (As per observation Memo dated 25.08.2000) excluding item no. 55).
(xi) The approximate cost of construction in E246, GKII as per Rs.10,13,365.00 the technical evaluation report, pertaining to 1/4th share of Mrs. Mala Sehgal.
CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 6 to 84 Total Rs.46,15,536.00 D Calculation of DA 1 Total income of the accused & his wife during the check RS.27,34,045.00 period 2 Total expenditure Rs.5,72,122.00 3 Likely savings (12) Rs.21,61,923.00 4 Likely savings at the beginning of check period (Total income Rs.1,08,150.00 at the beginning of check period minus non verifiable expenses @ 1/3rd of the income).
5 Total likely savings(3+4) Rs.22,70,073.00 6 Total assets during the check period Rs.46,15,536.00 7 Disproportionate assets (DA) (65) Rs.23,45,463.00 8 Percentage of DA to the total income 85.78%
7. On completion of investigation, CBI found that accused could not explain satisfactorily about his disproportionate assets of Rs. 23.45,463/ which are 85.78% excess in his income from known sources, therefore, he has committed an office u/s 13 (2) r/w 13(1)(e) of PC Act, 1988. The necessary sanction for prosecution has been obtained from the competent authority.
8. The present chargesheet was filed in the court on 28.02.2003.
Consequently, accused was summoned by this court vide order dated 20.03.2003. However, during proceedings, an application dated CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 7 to 84 29.05.2003 u/s 294 Cr.P.C (Ex.PW20/DX1) calling upon the CBI to admit or deny the documents filed by the accused. Alongwith this application, the accused filed the assessment orders, income tax returns of his wife Mala Sehgal. Pursuant to this, a letter undated shown to be received by IO Praveen Ahlawat on 12.09.2003 (Ex.PW20/DX13) written by Mala Sehgal, wife of the accused in which she stated that she was informed by her husband that certain information about her source of income/ receipts during the check period (01.01.1990 to 25.08.2000) required for this case. She by this letter apprised that she was working from April, 1993 to March 1994 with RP Tele Circuits, having purchased National Saving Certificates and the yearly interests accrued on these NSC's were shown in the yearly balance sheets. She also stated about the gifts received from her father, maternal uncle P.K. Khanna, Rajeev Khanna, N.K. Tandon, and also disclosed about her PPF account 985 with State Bank of India. Thereafter, again she wrote a letter dated 22.10.2003 (Ex.P/34, D67) and informed IO that revision of ratable value in relation to property E246, GKII, New Delhi for additions made to said property was submitted by her father in law on 31.03.1996 vide diary no. 8851. She also informed IO vide letter dated 03.10.2003 (Ex.P33) that she furnished the information and details about her computation of income, balance sheets and details of the income of her minor children needed for cross verifying and determining the source of her income and receipts during CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 8 to 84 the check period.
9. Reply dated 08.09.2003 to the application dated 29.05.2003 u/s 294 Cr.P.C filed by the IO Praveen Ahlawat (Ex.PW20/DX2) in which he stated that the search conducted on 25.08.2000 in connection with investigation of RC no. 41A/2001, at residence of Sanjeev Sehgal did not lead to recovery of ITR returns filed by Smt. Mala Sehgal however, only photocopies of assessment orders related to assessment year 199596 and 19992000 in the name of Mala Sehgal recovered. Accused Sanjeev Sehgal was arrested on 28.02.2001 and during PC remand his statement was recorded though he claimed that his wife has independent source of income and filing the income tax returns but he did not provide any details regarding the source of income of his wife. His wife Mala Sehgal was also examined and her statement was also recorded by IO though she claimed to having being working and filing income tax return, she did not provide further details regarding her employment and source of income. Inspector Rajender Singh from income tax department was examined u/s 161 Cr.P.C and he stated before the IO that department was not able to trace the IT returns of Mala Sehgal though produced the IT returns of father, mother and brother of the accused. Subsequently, a letter of request was also sent to concerned Additional commissioner of income tax for providing the income tax returns filed by Mala Sehgal, however department kept pleading for non availability of IT returns of Smt. Mala Sehgal.
CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 9 to 84
10. It is further stated in this reply by the IO that ample opportunities were given to Sanjeev Sehgal and Mala Sehgal to disclose about the sources of income but they did not provide such details, however accused gave a written reply dated 28.08.2002 that he has been intimating his department from time to time about the acquisition of properties in writing. It is also stated in the reply by IO that alongwith this application, accused included the income earned by his wife during the check period and also claimed substantial receipts by means of gifts received from brother of wife of the accused, however during investigation she stated that she has only 3 sisters and not told about any brother staying abroad. Further, stated that property returns did not disclose the gifts received from the brother and income tax returns enclosed with this application do not reflect the receipts of such gifts. The PPF accounts documents also not found during search nor she intimated about the investment in NSC.
11. Consequent to this, another reply dated 17.12.2003 (Ex.PW20/DX3) was filed by the IO Praveen Ahlawat by which he sought time from the court to make inquiries from IT department and other private companies. On 19.03.2004, Ld. Counsel for CBI submitted before the court that they do not want to file the reply to the application u/s 294 Cr.P.C though they have already filed the reply and the court observed that CBI can't be compelled to file the reply, thereafter, the admission denial of the document conducted by IO of the documents filed by the accused.
12. During admission denial over the application u/s 294 Cr.P.C, IO Praveen CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 10 to 84 Ahlawat (PW20) admitted the salary certificate of Sampark Sales (Ex.PW20/B1), other salary certificates of Sampark Sales (Ex.PW20/B2 and Ex.PW20/B3), salary certificates of RP Tele Circuits (Ex.PW20/B4, Ex.PW20/B5 and Ex.PW20/B7), salary certificates of Tinna Enterprises (Ex.PW20/B6, Ex.PW20/B9), form 16 issued by Tinna Enterprises (Ex.PW20/B8), letter dated 19.11.1990 of Amarnath, father of Mala Sehgal showing the giving of draft of Rs. 5000/ as a token of affection to Mala Sehgal (Ex.PW20/B10). Three cheques of Rs. 251/ each given as gift by Sh P.K. Khanna (Ex.PW20/B11, Ex.PW20/B12 & Ex.PW20/B13).
13. For some of the documents, IO admitted the genuineness but details are not admitted, these includes income tax return for assessment year 200102 (Ex.PW20/DX10), ITR for assessment year 20002001, assessment order of AY 19992000, ITR of AY 19992000, ITR of AY 199899, assessment order AY 199899, ITR of AY 199798, ITR of AY 199697, assessment order of AY 199697, ITR of AY 199596, assessment order of AY 199596, ITR of AY 199495, assessment order of AY 199495, ITR of AY 199394, assessment order of AY 199394, ITR of AY 199293, assessment order of AY 199293, ITR of AY 199192, assessment order 199192, ITR of AY 199091, assessment order of AY 199091, assessment order of AY 20012002.
14. IO not admitted some documents which includes balance sheet of Mala CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 11 to 84 Sehgal as on 31.03.2001, balance sheet of Mala Sehgal as on 31.03.2000, balance sheet of Mala Sehgal as on 31.03.1999, balance sheet of Mala Sehgal as on 31.03.1998, balance sheet of Mala Sehgal as on 31.03.1997, balance sheet of Mala Sehgal as on 31.03.1996, balance sheet of Mala Sehgal as on 31.03.1995, balance sheet of Mala Sehgal as on 31.03.1994, balance sheet of Mala Sehgal as on 31.03.1993, balance sheet of Mala Sehgal as on 31.03.1992, balance sheet of Mala Sehgal as on 31.03.1991, balance sheet of Mala Sehgal as on 31.03.1990, letter dated 26.07.1993 written by NK Tandon to Mala Tandon regarding sending a suitable gift of Rs. 9 lacs from NRE account No. 5528, affidavit dated 18.02.1994 of N.K. Tandon in this regard, Form regarding declaration under remittances in foreign exchange (immunity scheme 1991) of Mala Sehgal of 2500 US $ (Rs.64,470), 3200US$ (Rs.82,494), 8000US$ (2,06,310/) showing the date of receipts as 23.12.91, 28.01.1992 and 30.11.1991 respectively. Letter dated 18.12.1991 written by N.K. Tandon to Mala Sehgal sending the draft of (2500 +5000+5000= 12,500/) in US dollars for Aditi, daughter of Mala Sehgal, letter dated 23.01.1992 written by N.K. Tandon to Mala Sehgal sending a small draft amount of 3200 US$ to Mala Sehgal, letter dated 27.11.1991 is the sending of drafts of 8000 US$ and 8400 $ in favour of Mala Sehgal and Apeksha Sehgal by N.K. Tandon, salary certificate of Mala Sehgal for the period April to May 1990 for a total sum of Rs. 4800/ issued by Wilson Enterprises, salary certificate of Mala Sehgal from December 89 to March, 90 @2400/ per month totalling 9600/ of CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 12 to 84 Wilson Enterprises. Salary certificate of Mala Sehgal from April, 89 to November, 89 @2400/ per month from Mayur Enterprises, notarized gift deed dated 18.06.1989 of giving of Rs. 20,000/ through cheque by Anil Kohli to Mala Sehgal out of love and affection, notarized gift deed dated 06.09.1989 of giving of Rs. 20,000/ through cheque by Lalit Kumar to Mala Sehgal out of love and affection.
15. Thereafter, an application dated 27.04.2004 u/s 91 Cr.P.C (Ex.PW20/DX4) filed by the accused for direction to CBI to place on judicial record all the documents received by CBI u/s 91 Cr.P.C from income tax authorities, banks and other authorities, reply dated 15.07.2004 to this application was filed. CBI in this reply pleaded that the documents received from bank, income tax authorities and other authorities during the verification of application dated 29.05.2003 (ie, U/s 294 Cr.P.C) of the accused are not relevant and same were collected for the purpose of verification. After verification CBI admitted or denied the documents filed by the accused.
16. During proceedings, IO filed a report dated 23.03.2005 (Ex.PW20/DX77) regarding acquiring of assets by Mala Sehgal, Apeksha Sehgal and Aditi Sehgal in which IO stated before the court that as per directions of this court he has investigated the fact whether the accused aided Smt. Mala Sehgal, his children namely Apeksha Sehgal and Aditi Sehgal in acquiring properties, RBI bonds etc, investigations made and chronological list detailing the assets and expenditures have been CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 13 to 84 prepared enclosed with this reply, and further submitted that Smt. Mala Sehgal acquired the properties detailed therein out of her own savings and her own source of income. Moreover, the assets acquired in the name of children from their own bank accounts.
17. Pursuant to this, written arguments/synopsis dated 06.07.2005 were filed by the accused in which he alleged that Smt. Mala Sehgal is a separate legal entity and the properties in the name of Mala Sehgal should not have been included in the assets of the accused specially when there is no direct/ indirect evidence and further there are no documents to show that the accused has in any way contributed financially in the acquisition of the properties under reference by Smt. Mala Sehgal. He further alleged that despite the query of this court, CBI has not been able to show that the accused ever financially aided Smt. Mala Sehgal in acquisition of the properties acquired by her. He further alleged if this contention is not accepted then the entire income of Mala Sehgal should have been included while calculating the income of his family. It is further submitted, however CBI did not consider the income accrued to Mala Sehgal during the check period from Wilson Enterprises, Mayur Enterprises, Tinna Enterprises, RP Tele Circuits, Sampark Sales, rental income, income from various sources such as tuition, interest on bank account, interest of national saving certificates , interest on PPF, foreign currency received in the form of dollars for an amount of Rs. 3,53,274/ from her brother in financial year 199192 and Rs. 9 lacs from her brother CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 14 to 84 in financial year 199394. It is also emphasized that Mala Sehgal is a separate legal entity having sources of income in acquiring the properties and filing the income tax returns which are also on judicial record. Thus, all the assets and properties in her name and children should be excluded.
18. The reply dated 23.07.2005 (Ex.PW20/DX78) was filed by the IO Praveen Ahlawat to the written arguments/ synopsis dated 06.07.2005 in which he alleged that the properties in the name of Mala Sehgal was included in the assets of the accused after calculating the income, assets and expenditure of Smt. Mala Sehgal. The income of Mala Sehgal was very less as compared to her assets and it is presumed that the assets acquired in the name of Smt. Mala Sehgal are acquired from the unlawful income of the accused. It is further submitted that the properties mentioned cannot be excluded from the consideration while calculating the assets of the accused because the assets were acquired by illegal income of the accused in the name of his wife. It is further submitted that the salary income from Wilson Enterprises and Mayur Enterprises cannot be verified. Furthermore, the gift receipts of Mala Sehgal from the relatives in the huge amounts have not been admitted because the purpose behind the gifts have not been verified. Further, it is a matter of defence evidence. The IO, however, admitted the salary incomes from Tinna Enterprises, RP Tele Circuits, Sampark Sales and profit shares from Sampark Sales, and rental income from M1, NDSEII. The income from CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 15 to 84 interest from bank accounts, NSC's and PPF account filed by the accused lateron also admitted. Therefore, as per the new development the fresh DA was calculated in this reply (Ex.PW20/DX78) as under:
19. As per the new developments the DA calculated is as follows:
1 Total income of the accused and his wife during the check Rs.27,34,045/ period 2 Total expenditure Rs. 5,72,122/ 3 Likely saving (12) Rs. 21,61,923/ 4 Likely saving at the beginning of check period (total income Rs.1,08,150/ at the beginning of check period minus non verifiable expenses @ 1/3 rd of the income) 5 Total likely saving (3+4) Rs.22,70,073/ 6 Total assets during the check period Rs.46,15,536/ 7 Disproportionate assets (DA) (65) Rs.23,45,463/ 8 Percentage of DA 85.78 % 9 Income of Smt Mala Sehgal verified after filing of charge Rs.603,674/ sheet 10 Assets of Smt. Mala Sehgal verified after filing of charge Rs.6,38,391/ sheet.
11 Total income of the accused and his wife during the check Rs.33,37,719/ period after verification.
12 Total expenditure Rs.5,72,122/ 13 Likely saving (910) Rs.27,65,597/ CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 16 to 84 14 Likely saving at the beginning of check period (total income Rs.1,08,150/ at the beginning of check period minus non verifiable expenses @ 1/3rd of the income ) 15 Total likely saving(11+12) Rs28,73,747/ 16 Total assets during the check period after verification. Rs.52,53,927/ 17 Disproportionate assets (DA) (1413) Rs.23,80,180/ 18 Percentage of DA 71.31 %
20. Rejoinder dated 31.08.2005 to this reply (Ex.PW20/DX78) was filed by the accused in which he alleged that there is no evidence oral or documentary, direct or indirect to show the properties in question were acquired by means of illegal income of accused and his wife and neither there is any evidence on record that these properties are benami. Further, the income from Wilson Enterprises and Mayur Enterprises were included in ITR which are part of judicial record. It is further submitted in this rejoinder that IO in his reply dated 08.09.2003 in this court requested that accused Sanjeev and his wife may be directed to cooperate with further investigation and supply relevant facts and details to CBI. Consequent to which, wife of accused submitted computation of income, balance sheets and details of income and receipts of her minor children during check period on 03.10.2003. However, IO not admitted the sources of income disclosed therein. It is also submitted in this rejoinder that Mala Sehgal was subjected to scrutiny in income tax department u/s 143(3) of the Income Tax Act and thereafter, her own sources of income was CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 17 to 84 accepted and the copy of assessment order was also filed for reference. It is also submitted that Mala Sehgal wife of accused is separate legal entity and having her own personal sources of income and income tax assessee and filing income tax return even before search of the house.
21. A brief comparative chart dated 05.07.2007 (Ex.PW20/DX80) of income, expenditure, assets reflected in chargesheet and additional documents, statement of witnesses was filed by the accused in which he prayed that the income of the accused excluding the expenditure and assets is more , therefore, accused be discharged. A verification report dated 06.08.2007 (Ex.PW20/DX65) was filed by the IO Praveen Ahlawat in which he stated that accused Sanjeev Sehgal has submitted the written submissions on 05.07.2007 relating to the income of his family members and the Hon'ble court directed the CBI to verify the details of opening and closing of bank account pertaining to Apeksha Sehgal and Aditi Sehgal and also tally the entries of these account with the balance sheets filed with the income tax department. And as per this report, all the entries of bank accounts have been found tallied with the respective balance sheets.
22. However, after hearing of the arguments on charge, this court vide order dated 21.08.2007 found that there is sufficient material to frame the charge against the accused for offence punishable u/s 13(2) r/w 13(1)(e) of PC Act, 1988. Accordingly, charges were framed on 24.08.2007 to which accused pleaded not guilty.
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23. This order of framing of charge was challenged accused in the Hon'ble High court of Delhi, however the revision petition against this order stands dismissed by the Hon'ble High court vide order dated 31.03.2011 on the ground that this revision petition is not maintainable.
24. After framing of charge, Ld. PP for CBI sought admission denial of the documents from accused on 12.11.2007 before prosecution evidence to which Ld. Defence counsel not objected and admission denial of the documents conducted.
25. The accused during admission denial admitted the documents related to his salary (D1 to D10) (Ex.P12 to P19), accused also admitted the property return file (earlier exhibited as P1) reflecting the intimation that his wife received monitory gifts by relatives and her miner daughter etc. and personal file and service book of the accused showing intimation of property transactions RBI bonds etc. (D11 and D12) (P20 and P21). Accused also admitted house tax file reflecting the acquisition and subsequent construction of E246 GKII and fixation of ratable value, building plans of building E246, GKII, New Delhi, sale deed in respect of front portion of first floor and terrace of house no. E246, GKII in favour of Mala Sehgal and sale deed in favour of Mala pertaining to 360 sq.ft. in M1, NDSE PartII, New Delhi. (D13 to D17) (Ex.P8 to P11). Accused also admitted the statement of SB account no. 13274 PNB in his name, RBI relief bonds in his name, letter of datamatix pertaining to CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 19 to 84 Magnum 13 income scheme, UTI MIT 97 scheme, Springdale School fees, LIC policy of Sanjeev Sehgal, New Friends club regarding membership fee and subscription paid, MTNL bill in the name of Mala Sehgal, statement of Raj Kishan Gupta U/s 161 Cr.PC regarding salary of Mala (D18,D23, D24, D26 to D31, D36) (Ex.P3, P4, P5, P22, P23, P6, P24, P7, P25 to P28). Accused also admitted income tax records of Mala Sehgal (D43 to D48)(Ex.P37). Accused also admitted the statement of H.S. Negi u/s 161 regarding the salary of Mala, statement of Rajiv Sehgal u/s 161 regarding salary and profit shares in M/s Sampark sales, letter of Mala dated 12.09.2003 regarding proof of salary of Mala, NSC, received gifts on different dates from relatives, PPF account, letter of Ms Mala Sehgal dated 23.09.2003 with refund order, letter of Mala dated 03.10.03 with photocopy of computation of income, balance sheet and details of income of minor children, letter of Mala sehgal dated 22.10.03 in relation to the information of ratable value of property no. E246, GK PartII, letter of Mala dated 20.01.04 informing IO that brother NK Tandon was available in India for examination, letter of Mala dated 23.07.07/ 24.07.07 giving details of bank accounts in the name of two daughters alongwith copies of statement and original passbook. (D61 to D69) (Ex.P29 to P36, P38).
26. During proceedings accused filed an application dated 11.11.2011 u/s 91 Cr.P.C alleging therein that the prosecution case is listed for cross CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 20 to 84 examination of PW10 Rajender Singh who in his statement u/s 161 Cr.P.C dated 25.07.2002 stated before CBI that he has produced the income tax returns of PL Sehgal, Krishna Sehgal and Rajeev Sehgal for assessment year 20002001, however due to rearrangement of areas of records the income tax return of Mala Sehgal and Sanjeev Sehgal not traceable and during the course of further investigation letter dated 21.07.2003 was sent by CBI pertaining to verification of income tax record of Mala Sehgal for the assessment year 199091 to 20002001 and requested to summon all the documents regarding the income tax returns of Mala Sehgal as well as PL Sehgal,Krishna Sehgal and Rajeev Sehgal. Thereafter, another application dated 09.04.2012 u/s 91 Cr.P.C filed by the accused calling the income tax returns of Mrs. Mala Sehgal from period 01.04.2000 to 31.03.2001 seized by CBI vide seizure memo 25.08.2000 and certified copies of ITR's of PL Sehgal, Krishan Sehgal and Rajeev Sehgal. In reply to the same (mark PW20/D1), Inspector Pankaj Vats from CBI placed on record the IT returns of Mala Sehgal and copies of ITR's of PL Sehgal and Krishna Sehgal.
27. Another application u/s 91 Cr.P.C dated 25.05.2012 was filed by the accused calling upon the CBI to produce the notices u/s 91 Cr.P.C issued by P. Balachandran to Standard Chartered Bank (notice dated 07.08.2000 & 04.08.2002), income tax officer ward no.23 (notice dated 03.01.2000), notice u/s 160 Cr.P.C to ward no. 23 (notice dated 06.02.2002), Syndicate CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 21 to 84 Bank (notice dated 01.10.2002), additional commissioner range 32 (notice dated 25.07.2002), Syndicate Bank (notice dated 17.03.2005 and 11.07.2007), Standard Chartered Bank ( notice dated 11.08.2007), PNB Lajpat Nagar (notice dated 19.02.2007 and 13.08.2007), FRRO (notice dated 16.12.2003) and to the Manager SBI, GKI (notice dated 23.08.2003). In response to this, CBI filed reply (mark PW20/D2). In that reply, CBI stated that documents mentioned at sl. no.2 & 3 are not traceable ie, notice u/s 91 Cr.P.C given by P.Balachandran to income tax officer, ward no.23 dated 03.01.2000 and notice u/s 160 Cr.P.C issued by P. Balachandran to Income tax officer, ward no. 23. However, lateron during the proceedings, the notice u/s 160 Cr.P.C dated 06.02.2002 in original is produced before the court alongwith the letter written on behalf of Superintendent of Police to the Additional commissioner, Income Tax for producing the copies of income tax return filed by Mala Sehgal being assessed in ward 12(3) since 1990.
28. Another application dated 11.09.2012 u/s 91Cr.P.C filed by the accused for summoning the records of RC no. DAI2000A0041 of case titled "CBI Vs. B.R. Malhotra" and the case of the said file was summoned consequent to this.
29. Mala Sehgal (wife of the accused), Krishna Sehgal (mother of accused), Meenu Sehgal (wife of brother of accused ), Rajeev Sehgal (brother of accused) and Amarnath (father in law of accused) have written letters dated 21.07.2003, 09.02.2004, 09.02.2004,. 09.02.2004, 09.02.2004 to IO CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 22 to 84 PW20 Praveen Ahlawat (Ex.PW20/DX81 to Ex.PW20/DX85) after filing of the chargesheet and the same were put to PW20 Praveen Ahlawat in cross examination.
30. Prosecution for substantiating its case examined 21 prosecution witnesses, and five court witnesses were examined. The summary details of their deposition is mentioned as under:
31. CW1 to CW5 are witnesses from income tax department, who proved income tax record of Mala Sehgal.
32. PW1 V.S. Sharma, Additional Commissioner (Engineering) proved the sanction order Ex.PW1/1.
33. PW2 Murugeasan, Sr. Scientific Officer, Ministry of Defence as an independent witness, witnessed the search conducted at H.No. E246, GK II, New Delhi and deposed that list of the items found in the house were made, and the same is exhibited as Ex.PW2/A.
34. PW3 Q. Javed, Executive Engineer, MCD, PW5 Madhu Vig, UDC, office of Executive Engineer Project, South Zone, MCD, PW7 Bashir Ahmed, PW8 I.T. Tilihani, proved the salary record and produced the personal file of the accused.
35. PW4 Uma Shankar Verma, manager PNB proved the payment of Rs. 9 lacs through cheque to Smt. Mala Sehgal.
36. PW6 Ramesh Chand Aggarwal proved the sale deed Ex.PW6/A dated 27.07.1994 in respect of portion bearing private no. B on the basement CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 23 to 84 floor having super area 360 sq. fts. in favour of Mala Sehgal at M1, South Extension, partI, New Delhi for a sum of Rs. 3,96,000/. In cross examination he also stated that he has paid Rs. 1,35,000/ through cheque to Mala Sehgal as the same was earlier received by them as security equivalent to 6 months rent from ANZ Grindlays Bank and monthly rent of premises was Rs. 22,500/.
37. PW9 C.B. Goel, Assistant from LIC proved the LIC policy through status report (Ex.PW9/A) in the name of Sanjeev Sehgal for a sum of Rs. 15,000/.
38. PW10 Rajender Singh Inspector in the office of ITO ward32(3) proved the letter dated 02.09.2003 (Ex.PW10/A) addressed to CBI in respect of assessee Mala Sehgal for the assessment year 19971998, 199394, 199293 bearing signature of ITO Rajesh Dhingra. He also proved letter dated 15.09.2030 (Ex.PW10/B) regarding the information forwarded in respect of assessee Mala Sehgal for assessment year 199091 & 199192. In cross examination he stated that he cannot tell that the letter of IT return verification was sent by Praveen Ahlawat on 25.08.2003.he also stated that he had seen his statement u/s 161 Cr.P.C dated 25.08.2002, however stated he cannot tell whether he had handed over the said letter to IO on the day of recording of his statement and the copy of said letter is mark PW10/DY.
39. PW11 Kanwar Singh Assistant Manager, Reserve Bank of India CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 24 to 84 proved the RBI relief bonds for Rs. 75,000/, Rs.2,75,000/, Rs.3,50,000/, Rs.5,75,000/ in the name of Apeksha, Sanjeev Sehgal, Aditi Sehgal and Apeksha Sehgal (the bonds are Ex.PW11/D1 to D4).
40. PW12 Bhagat Singh, Administrator, Springdales School proved the letter regarding statement of fees and transportation charges paid in respect of Ms. Apeksha Sehgal and Aditi Sehgal upto 31.01.2001(Ex.PW12/A and Ex. PW12/B).
41. PW13 Sh B.R. Kakda, Accounts officer of New friends Club proved the membership enrolment fees and membership monthly subscription in the name of Smt. Mala Sehgal at New Friends Club (Ex.PW13/B).
42. PW14 Surender Kumar, UDC, Sub Registrar office proved the sale deed dated 13.08.1993 (Ex.P10) in respct of part of property Greater Kailash PartII (front portion on the first floor with terrace and above comprising of one bedroom with attached bathroom) in favour of Mala Sehgal for a consideration of Rs.6,10,000/ and for execution of the same sale deed stamp paper for Rs. 48,800/ in the name of Mala Sehgal had been used.
43. PW15 Sunder Kumar Arora proved the statement of accounts of Mala Sehgal, Aditi Sehgal, Apeksha Sehgal.
44. PW16 Kishan Singh proved the statement of telephone bill (Ex.PW16/A) in respect of telephone no. 6453759 in the name of Mala Sehgal.
45. PW17 Rakesh Dutt valued the cost of construction at the instance of IO CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 25 to 84 of the property in GKII and submitted his report Ex.PW17/A and found that the cost of construction for the portion of Mala Sehgal comes around 10.94 lacs.
46. PW18 Anand Navani Architect prepared the building plan of property no. E246, GKII. The said building plan was exhibited as Ex.PW18/A.
47. PW19 Inspector SC Bhalla sated that in August 2000 he was posted an an Inspector in Anti corruption Branch, CBI and DSP M.S. Singhal was IO in RC no. 41A/2000 and a search warrant u/s 165 Cr.P.C in the said case was endorsed to him to conduct search at H.No. E246, GKII, New Delhi of accused Sanjeev Sehgal, JE MCD. He conducted the search on 25.08.2000 alongwith team members including independent witnesses and searched the entire property floor by floor and completed the observation memo for ground floor (Ex.PW2/A) and the details of property found on first floor and second floor (Ex.PW19/B). He also stated after completion of scrutiny of the documents in February 2001, he submitted the complaint to SP consequent to which the present FIR RC No. 24A/2001 was registered against the present accused (Ex.PW19/A).
48. PW20 SI Praveen Ahlawat stated that the investigation of present case handed over to him from Inspector P Balachandran and when the case was handed over to him, the investigation in the matter was already over and the request of sanction of prosecution was pending before the competent authority. After receipt of the sanction, he sought approval from higher CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 26 to 84 officials, thereafter filed the chargesheet in this case on 28.02.2003 (Ex.PW20/A). Further during proceedings, he conducted the admission denial fo the documents in the court on 19.03.2004 on an application u/s 294 Cr.P.C moved by the accused. In cross examination he stated it is correct that during further investigation he had sent notices to bank and private companies. He further stated that he has filed the verification report dated 06.08.2007 (Ex.PW20/DX65) after verifying the documents. This witness in cross examination stated to have verified the various account statements and entries tallied through the balance sheets.
49. PW21 A. Balachandran, Initial IO stated that he was entrusted the investigation of present case and, thereafter he recorded the statement of witnesses, collected the documents, conducted valuation of share of property of accused Sanjeev Sehgal through Rakesh Dutt. In cross examination he stated that he has recorded the statement of Mala sehgal, PL Sehgal, Krishna Sehgal, Rajeev Sehgal and Meenu Sehgal u/s 161 Cr.P.C during investigation.
50. Accused in his statement u/s 313 Cr.P.C raised the plea that he was falsely implicated and in defence examined DW1 Anil Sharma, office Superintendent, CBI and DW2 Govind Kanojia, Officer Punjab National Bank. Through DW1 accused proved the circulars regarding standardised procedure for investigation into assessment of wealth possessed by public servant, selection of check periods and procedure to be followed in CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 27 to 84 investigation of cases of disproportionate assets and measures for its improvement. Through DW2, accused proved the time duration in encashing the foreign currency drafts/ cheques.
51. The gist of arguments of Ld. Spl. PP for CBI is that the entire income tax records and the huge gifts received by the wife and children of the accused are all the illegal money and by this manner accused converted the black money into white money. Ld. Special PP further submits that accused avoided to prove the purpose behind the gifts etc. of lacs of rupees through the evidence before the court because in cross examination the real object of transactions could be surfaced.
52. Ld. Counsel for accused on the other hand submitted that there is no evidence on record that any money travelled from the accused to his wife and children and all the receipts of money received by his wife and children, are transacted through bank and duly assessed by the income tax authorities. Ld. Counsel for the accused further submitted that he has informed even about the gifts and income of his wife to his department and has not concealed anything from his department. Ld. Counsel further submitted that the income tax records were duly proved. Ld.defence counsel submits that no case of disproportionate assets made out against the accused. Ld. Counsel besides oral arguments also filed in writing the summary of final arguments dated 21.11.2005, short synopsis with list of prosecution witnesses and exhibited documents, further filed the rebuttal arguments dated 02.01.2016 on behalf of the accused Sanjeev Sehgal. CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 28 to 84
53. Arguments heard. Record perused.
54. Apex court in "Mohan Singh Vs. State of MP, AIR 1999 SC 883", held that effort should be made to find the truth, this is the very object for which courts are created. One has to comprehend the totality of the facts and circumstances as spelled out through the evidence depending upon the facts of each case.
55. Therefore, it is the duty of the court to to find out the truth and truth is not to be found from mere form but also through substance and underlying purpose. The court in present type of cases has to analyse the true object of the transactions while appreciating the evidence on record.
56. The main contention of the Ld. Counsel for accused is that wife of the accused has independent earning, and there is nothing proved on record that accused in any manner aided his wife in amassing the assets found in her name and the minor children. Ld. Counsel submits that entire income of the wife and the children is duly assessed by the income tax authorities and all the transactions primarily are through bank accounts. Ld. Counsel also contended that as the prosecution could not connect any flow of money from accused to his wife and children therefore, their income and assets cannot be clubbed with that of the accused. Ld. Counsel also submitted that the income of the accused is found more than the expenses and the assets, thus no offence of disproportionate assets proved against the accused. Ld. Counsel also submitted another proposition that even if the income of the wife and the children clubbed with the income of the CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 29 to 84 accused, then in that case also, total the income will exceed the expenditure plus assets, and no case of disproportionate assets case made out against the accused.
57. At the outset, it is found from the record that no amount of money travelled from the accused to the wife and children in purchase of assets. It is just on the basis of presumption, keeping in view the meagre salary income of Mala Sehgal and the huge gifts given by the relatives to the wife and the children, the prosecution presumed that the assets in the name of wife and children are purchased through the illegal income of the accused.
58. Ld. Counsel for the accused submitted that no such presumption could be raised. Ld. Counsel submits that to prove the benami transaction the prosecution has to led positive evidence. In this regard ld. Counsel for the accused relied upon the judgment of Apex court in case titled "Jay Dayal Poddar Vs. Bibi Hazara & Ors. (AIR1974 SC 171)". In this case the apex court held that the burden of proving a particular sale benami is on the person who asserts and the said burden to be discharged strictly by adducing legal evidence of a definite character which would either directly prove the fact of benami or establish circumstances unerringly and reasonably raising inference of the fact. Apex court in "Krishnanand Agnihotri Vs. State of MP, AIR 1997 SC 796" held that in respect of benami transactions the burden has to be discharged by adducing legal evidence of definite character, similarly, in case of "M. Krishna Reddy Vs. CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 30 to 84 State, 1992(4) SCC 45", it was held that in respect of benami transactions burden of proof lies on the prosecution.
59. There is no dispute to the fact that there is no direct evidence to infer the fact that accused in any way contributed in the assets obtained in the name of wife and children. However, the sources of income of the wife and the minor children creates doubt over their independent income, particularly in view of the fact the accused did not choose to examine himself or his wife or his relatives who has gifted lacs of money to the wife and the children. Delhi High Court in case titled "Rekha Rani Vs. CBI (Crl. MC 4402/2014 dated 05.10.15)" held if the assets of the wife of the govt servant are more than known sources then it would be presumed that she earns the said money illegally. Apex court in in case titled "State of Tamilnadu Vs. N. Suresh Ranjan & Ors.(Crl. Apeal no. 2223/2014 dated 06.01.2014 )" held that the mere fact that the property in the name of the income tax assessee itself cannot be a ground to hold that it actually belongs to such an assessee. In case, such a proposition is accepted then in their opinion it will lead to disastrous consequences and it will give opportunity to public servant to amass property in the name of known persons, pay income tax on their behalf and put themselves out of the mischief of the law. Madhya Pradesh High court in case titled "Permanand Kedarnath Jha Vs. State of MP,1999 SCC online MP 130", held that mere declaration of property does not amount to showing that it CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 31 to 84 was acquired from known sources of income. Madras High court in case titled "M.S. Kappuswami Vs. State,1992 Cr.L.J 56", held that the benami transactions (Prohibition) Act and the Prevention of Corruption Act operate in different fields. It cannot be said on the basis of provisions of the former that government servant cannot be asked to explain the source for the fixed deposits found in the name of his wife and unmarried daughter.
60. Apex court in case titled "K. Ponnu Swamy Vs. State of Tamilnadu (Crl.
Appeal 759/2001 dated 21.07.2001) 2001 Cr.L.J 3960 (SC)", in following paragraphs held as under:
"Mr. Rao has seriously assailed the Judgments of the Trial Court and the High Court. He submitted that it has been established in the High Court that Accused No. 1 himself did not have any pecuniary resources or properties disproportionate to his known sources of income. He submitted that the prosecution has miserably failed to show that the properties standing in the names of Accused Nos. 2 and 3 were held by them on behalf of Accused No. 1. He submitted that it was for the prosecution to prove beyond reasonable doubt and by means of legal evidence that these were Benami properties of Accused No. 1. Mr. Rao submitted that Accused No. 4 had been acquitted by the High Court on the ground that the prosecution has not investigated into his personal source of income. He submitted that, therefore, it could not be presumed that CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 32 to 84 Accused No. 4 had no personal source of income. He submitted that Accused No. 4 was the nephew of the Appellant and, therefore, out of love and affection he had gifted the properties to Accused Nos. 2 and 3. He submitted that it was the prosecution to establish by legal and cogent evidence that the gifts were not genuine and that these were not the properties of Accused Nos. 2 and 3. He submitted that as the prosecution had miserably failed to discharge the burden and prove that the properties were held benami by Accused 2 and 3 on behalf of Accused 1 neither the Trial Court nor the High Court could have convicted Accused No. 1 under Section 13(1)(e) read with Section 13(2) of the Prevention of Corruption Act.
In support of his submission Mr. Rao relied upon the authority of this Court in the case of Krishnanand v. State of M.P. reported in (1977) 1 SCC 816 In this case this Court has held as follows:
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 circumstance unerringly and reasonable 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 him, nor justify the acceptance of mere conjecture or surmises as a substitute for proof. It is not enough merely to show circumstances which might CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 33 to 84 create suspicion, because the court cannot decide on the basis of suspicion. It has to act on legal grounds established by evidence."
There can be no dispute with the legal proposition. However, let us see what is meant by "Proved". Section 3 of the Evidence Act defines "Proved" as follows:
" "Proved". A fact is said to be proved when, after considering the matters before it, the Court either believes it to exist, or considers its existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it exists."
Further, Section 114 of the Evidence Act reads as follows:
"114. Court may presume existence of certain facts. The Court may presume the existence of any fact which it thinks likely to have happened regard being had to the common course of natural events human conduct and public and private business, in their relation to the facts of the particular case."
Thus the fact is said to be proved when after considering the matters before it, the Court believes it to exist, or considers its existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it exits. In coming to its belief the Court may presume existence of any fact which it thinks likely to have happened having regard to the natural course of event, human conduct and public and private business, in relation to the facts of each case. Now, let us see the facts of this case. The prosecution has established beyond a reasonable doubt, that prior to the check period Accused Nos. 1, 2 and 3 had no real source of income, except some meager incomes, i.e. Accused No. 1 only earned a small salary as a Lecturer and Accused Nos. 2 had small agricultural and other income. Accused No. 3 being a student had no real source of income. Prior to the check period the financial condition of the family was such that Accused No. 1 could not even repay his small debts. The creditors had to recover their amounts CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 34 to 84 by filing suits and executing decrees. We are presuming that Accused No. 4 had independent income. However prior to the check period Accused No. 4 had not been afflicted by any love and affection and had not made any gifts to any member of the family of the Accused No. 1. Prior to the check period Accused No 4 did not even extend help to pay off the small debts of Accused No. 1 even after the decrees had been passed against Accused No. Yet suddenly, during the check period, i.e. when Accused No. 1 is a Minister, Accused No. 4 donates large sums of money to Accused Nos. 2 and 3. The natural presumption, considering the common course of natural events and human conduct is that Accused No. 1 would have used his nephew Accused No. 4 to transfer his (Accused No 1s) monies to Accused Nos. 2 and 3. This is the supposition which any prudent man under these circumstances would act upon considering the natural course of events. The Trial Court and the High Court thus rightly took this as proved by legal evidence. The prosecution having established by legal evidence that the monies were transferred by Accused 1 to Accused Nos. 2 and 3 through Accused No. 4 and that these were monies of Accused No. 1 in the hands of Accused Nos. 2 and 3, it was for the Appellant to satisfactorily account for the gifts. He could have done so by showing that even before the check period Accused No. 4 had made gifts of substantial amounts. It has not been claimed by Accused 2 and/or 3 and/or 4 that before the check period also Accused No. 4 had made any such gifts. It is also not their case that after the check period gifts were made. Thus the Trial Court and the High Court were right in not believing the case of gifts supposedly made out of a sudden brust of love and affection. Both the Trial Court and the High Court were right in convicting Appellant. As we are told that the State is going to file an appeal against the acquittal of Accused Nos. 2 and 3 we are not making any comments thereon".
61. Thus, in view of the above proposition if evidence on record suggest that wife and children has no sufficient income to CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 35 to 84 amass huge assets found in their name then it can be presumed or inferred that assets are obtained from the ill gotten money of the accused.
62. Before proceeding further, let me analyse the income and receipts of the accused Sanjeev Sehgal, Mala Sehgal (his wife) and Apeksha Sehgal and Aditi Sehgal (minor children).
63. The primary source of income of the accused Sanjeev Sehgal is the salary while working as a Junior Engineer in MCD. The salary income of the accused prior to the check period as per prosecution case is proved to be Rs.1,62,230/. Thereafter, the salary of the accused during the check period (01.01.1990 to 25.08.2000) is found to be Rs. 7,18,905/. However, on considering the statements of PW3, PW7, PW8, PW5, and as per the summary of final arguments dated 21.11.2015 filed by the accused, the net salary of the accused is proved to be 7,30,025/. The prosecution has also added Rs. 14,93,500/ rental income from basement space at M1, NDSE PartII, which cannot be added and this aspect is dealt in subsequent paras.
64. The prosecution as per chargesheet have given a total interest on bank accounts in the name of accused and his wife ie, account No. 13274(PNB, NDSE), a/c no. 25464012 & 25464023 (All Grindlays Bank) upto Rs. 39,250/. However, CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 36 to 84 the interest on the salary account 13274 (PNB) of the accused as per the admitted document P3/D18, P20/D11 and D11 Ex.P20 as well as D18/P3 comes out to Rs. 23,643 + Rs. 53,089 + 18,843.20 +19,0110 = 1,14,410/. Thus, the total interest income as per the salary account comes about Rs. 1,14,410/. This calculation is also made by the accused in his summary of final arguments dated 21.11.2015. Thus, the total interest income in the salary account of the accused comes out to Rs. 1,14,410/.
65. As per coloumn A(v) of chargesheet (Ex.PW20/A) interest received by the accused on RBI Relief Bonds in the name of accused and his wife is Rs. 3,07,990/, however at this stage I am calculating only the income over the interest received on the RBI bonds of Rs. 2.75 lacs (Ex.PW11/D2) held by the accused. Accused in his summary of final arguments calculated the said interest to the tune of Rs. 68,750/. This calculation is on the basis of the statements of PW8, PW11 and PW20 the connected documents to the same are D12/EX.PW21A and Ex.PW8/DA. Therefore, the interest income of the accused over the RBI relief bonds of Rs.2.75 lacs in his name is found to Rs. 68,750/. Thereafter, the income received of Rs. 9000/ upon survival benefit payments on LIC policy Rs.9000/. CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 37 to 84 Income of Mala Sehgal (wife):
66. As per chargesheet, the prosecution found the assessment order regarding the income of the wife of the accused during the investigation but it could not be verified. As per reply dated 08.09.2003 to the application u/s 294 Cr.P.C (Ex.PW20/DX2), neither the accused nor his wife during investigation produced the proof of the income of the wife nor the income tax returns. However, after filing of the chargesheet, the wife of the accused sent the representations to the IO (Ex.PW20/DX13, Ex.PW20/DX20). Further, the accused has filed the documents alongwith application u/s 294 Cr.P.C (Ex.PW20/DX1) regarding the income of the wife of the accused. The same were admitted/ denied by the IO PW20 Praveen Ahlawat before this court on 19.03.2004 as already mentioned in the preceding paragraphs.
67. As per the written synopsis dated 06.07.2005 filed by the accused, the income of Mala Sehgal is Rs. 9600/ from Wilson Enterprises from December 1989 to March 1990 @2400/ pm, of Mayur Enterprises from April 1989 to November 1989 @2400/pm ie, 19,200/, salary from Wilson Enterprises Rs. 9600/ ie, from April 90 to May 1990 for two months @ 4800/ pm, salary from Tinna enterprises from June 1990 to March CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 38 to 84 1991 for Rs. 30,315/, and then from 01.04.91 to 30.03.1992 for Rs. 45,100/, and further from 01.04.92 to 30.11.92 for Rs. 30,800/, then from RP Tele Circuits from December 92 to March 93 for Rs. 16,000/, and from 01.04.93 to 31.03.94 for Rs. 47,870/. IO during admission denial has admitted the salaries received from Tinna Enterprises and RP Tele circuits, however not admitted the salaries received from Wilson enterprises and Mayur Enterprises. The total amount of salary proved in favour of Mala Sehgal from Tinna Enterprises is Rs. 30,315 + 45,100 +30,800 = 1,06,215/. And salary amount from RP Tele circuits is Rs. 16,000 + 47,870 = 63,870/. The total income of salary from Tinna Enterprises and RP tele circuits is Rs. 1,06, 215 + 63,870 = 1,70,085/ . This is the salary income of the wife shown from her intermittent working between 1989 to 1994.
68. The service record of Mala Sehgal appears on the face somewhat suspicious because she is found to be working for short durations in various companies one after and another, and her dates of salaries start from the 1st day of the month to the last day of the month. It is unnatural if there is such a frequent change in the services then all the time the petitioner will join on the first day of every month in every company. The entire service record in the various companies appears to be a CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 39 to 84 calculated device for income tax purposes.
69. PW20 (IO) in cross examination stated he could not verify the income from Wilson Enterprises and Mayur Enterprises. Accused has not taken any steps to prove the same by producing the officials of these companies or his wife, and only took the plea that it was shown in the balance sheet of his wife. Furthermore, these salary incomes were not disclosed to the police during investigation prior to filing charge sheet. The onus is on the accused to prove the income from Wilson and Mayur Enterprises positively but accused not able to prove the same, therefore the benefit of income from Tinna Enterprises and RP Tele circuits could only to be given to the accused. Thus, the total salary income for which the benefit is given to the accused as a salary of Mala Sehgal till 1994 from Tinna Enterprises and RP tele circuits is Rs. 1,70,085/.
70. Thereafter, the accused relied upon the salary income as a partner in Sampark Sales from 01.10.1998 till 24.08.2000. These documents verified by the IO after filing application u/s 294 Cr.P.C and admitted the same. The Sampark Sales is a partnership company of his brother Rajeev Sehgal. It is a family firm. The salary income as drawn from Sampark Sales from 01.10.1998 to 31.03.1999 is Rs. 30,000/ @ 5000/pm , then from 01.04.1999 to 31.03.2000 for a total of Rs. 60,000/, CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 40 to 84 then from 01.04.2000 to 25.08.2000, she earned Rs. 20,000/, thus the total salary received from Sampark Sales till 25.08.2000 from Sampark Sales is Rs. 30,000 + 60,000+ 20,000 = Rs. 1,10,000/.
71. In written arguments/ synopsis dated 06.07.2005, accused submitted that Mala Sehgal his wife also received profit shares from M/s Sampark Sales w.e.f from 18.05.1998 and she made profit withdrawal of Rs. 29,905/ during the period of 18.05.1998 to 31.03.1999 and Rs. 38,164/ during the period 01.04.1999 to 30.03.2000 and Rs. 25,890/ during the period 01.04.2000 to 31.03.2001, therefore the total profit share from Sampark Sales in favour of Mala Sehgal is Rs.29,905 + 38,114 + 25,890 = 93,909/.
72. Mala Sehgal is shown to be working in various companies between 1989 to 1994, and then she drawn salary and profits from the partnership company of the family (ie, Sampark Sales). The vocation of Mala Sehgal working in various companies though appears to be only for the purpose of income tax, however as per the prosecution as IO verified the same, thus benefit of salary drawn from Tinna Enterprises, RP Tele circuits and Sampark Sales given to Mala Sehgal. This verified salary of the wife is thus considered as a legal income. Thus, the total income of Mala Sehgal towards salary and profit share CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 41 to 84 in Sampark Sales during check period is found Rs. 1,70,085 +1,10,000 + 93,909 = 3,73,994/.
73. Mala Sehgal also claimed income from tuitions during the entire check period ie, from 1989 till 2000. She claimed tuition income of Rs. 6000/ per annum from 1989 to 2000 (as per Ex.PW20/DX1D) and Rs. 24,000/ for the year 19992000. Thus, total tuition income she claimed is Rs. 84,000/. She did not claim the tuition income for 20002001. IO not admitted the tuition income in section 294 Cr.P.c being not verified. Accused has not led any positive evidence to prove the tuition income, however relying only on the income tax records but without any positive evidence on tuition income, the income of Rs. 84,000/ claimed by the accused for his wife, as tuition income cannot be given for the purpose of present case as no credible evidence produced by the accused.
74. Though, the accused claimed the salary income and tuition income of his wife as the legal income of the wife however, on the analysis of the evidence the only salary income proved on record till the end of the check period ie, 25.08.2000 is 2,80,085/ (i.e. Rs. 1,70,085/ + Rs.1,10,000/). Income received as Gifts by wife and children from relatives in foreign currency and other occasions:
CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 42 to 84
75. As per the written submissions dated 06.07.2005 by the accused, gifts received by his wife and children in the form of dollars which on conversion amounted Rs. 3,53,274/ from her brother N.K. Tandon and also Rs. 9 lacs from her brother NK Tandon. At the outset, it is undisputed that these payments were received through cheques and travelled through bank accounts and also shown in the balance sheets. However, IO during admission / denial on 19.03.2004 denied genuinity of these payments. The IO (PW20) verified the fact that these transactions routed through bank accounts but this in itself does not prove the underlying purpose of these transactions. The letters dated 27.11.1991, 18.12.1991, 23.01.1992 and 26.07.1993 though suggests that NK Tandon claimed to be the brother of Mala Sehgal had given drafts of 8000 + 8400 US dollars in the name of Mala Sehga and Apeksha, 2500 +5000+5000 = 12,500 US dollar in the name of children and then 3200 US dollars in the name of Mala Sehgal and thereafter, 9 lacs in the name of Mala Sehgal in July 1993. The purpose shown as per letters for giving these drafts is for love and affection. Lacs of rupees were claimed to be given by the brother NK Tandon from 1991 to 1993 as an amount to Mala Sehgal out of love and affection, however there appears to be no money flown from NK Tandon to Mala Sehgal from 1993 onwards till end of the check period CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 43 to 84 ie, 25.08.2000. The accused led no defence evidence in the court why Mr. NK Tandon had given such a huge payments to his wife and children. However, as per written arguments of Ld. Counsel for accused submitted that Mr. NK Tandon was available for investigation in the year 2004 after filing of the chargesheet and this fact was communicated by his wife to the IO vide letter dated 20.01.2004 (D36, Ex.P68) and IO in cross examination stated that he did not found any need to examine him as he already verified these payments.
76. However, this statement of the IO do not absolve the accused to prove such a huge payments without leading defence evidence by examining NK Tandon or his wife Mala Sehgal. IO is not obliged to examine any witness at the request of the accused during trial of the case. If these payments as per the accused are duly reflected in the account statements and are bank transactions, then the accused must have examined this witness so that the prosecution could get the opportunity to cross examine as to unearth the underlying purpose of such a huge payments especially in view of the fact that these payments were given in the period 1991 to 1993 not thereafter.
77. Furthermore, the doubts arose because in every representation (Mala Sehgal claimed NK Tandon to be her brother and IO in his reply (Ex.PW20/DX2) stated that during investigation she CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 44 to 84 claimed that she is having only three sisters and not named his brother NK Tandon. The documents also suggests the name of the father of the wife of accused is Pran Nath , however the affidavit of NK Tandon shown the name of his father as P.N. Tandon. Therefore, the suspicion further enhanced why some cousin will give such huge amount to the wife of the accused and this suspicion is reinforced by the fact that wife of accused every where claimed NK Tandon as to be her brother not as cousin brother.
78. Furthermore, accused despite opportunity had not led any defence evidence to remove that suspicion. Merely on the basis of filing of income tax returns, this suspicion cannot be said to have been removed. Thus the income received from Sh NK Tandon as Rs. 3,53,000/ in foreign exchange and Rs. 9 lacs as cheques cannot be found to be the legal income and can be presumed as a back channel income. Thus, this income cannot be included as the legal income of his wife Mala Sehgal.
79. In summary of final arguments dated 21.11.2015, it is submitted that the wife of accused and children received a sum of Rs. 24, 67,689/ as a total receipts from gifts etc which were duly reflected in the ITR's of Mala Sehgal and children filed through Mala Sehgal. The gifts of Rs. 12,53,274/ claimed to be in the CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 45 to 84 name of Mala Sehgal, Rs. 5,74,000/ and Rs.6,39,815/ found to be claimed in case of minor school going daughters Apeksha Sehgal and Aditi Sehgal. These receipts in itself raises suspicion because there is nowhere reflected, whether at any point of time accused or his wife themselves have given any gifts to any relative in reciprocity. Furthermore, the total income of the accused for the entire salary period is found to be around 10 lacs and from his account nowhere it is reflected that he has ever given any gift to any relative, whereas the wife and children of the accused received such a huge receipts of gifts of more than Rs. 24 lacs from the relatives.
80. The gifts received by Apeksha Sehgal in assessment year 199192 through her maternal Uncle vide cheque no. 684301 dated 19.09.1990 for Rs. 1,76,000/ and thereafter, through DD no. FLG509546 dated 27.11.1991 for 2,16,600/ and thereafter, Apeksha Sehgal in assessment year 199495 through grandmother vide cheque of Rs. 31,000/, then Apeksha Sehgal in the AY 199596 received gifts from Maternal uncle for Rs. 51,000/, then the gifts received by Apeksha Sehgal in AY 20012002 through draft dated 19.07.2000 for Rs. One lac from her maternal grandfather and also a gift cheque of Rs. 5000/ in AY 199192 from her maternal grandfather, then a cheque of CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 46 to 84 Rs. 2,06,000/ in the AY 199293 dated 21.10.1999 in the name of Aditi Sehgal, then the drafts of Rs. 2,57,815/ in the name of Aditi Sehgal in the assessment year 199293. Thereafter, a sum of Rs. 20,000/ received as a gift from uncle/ chachaji by cheque dated 08.08.1991 in the AY 199293. Thereafter, a cheque dated 08.08.1994 for Rs.31,000/ in name of Aditi Sehgal in AY 199596. Thereafter, a DD of Rs. One lac dated 19.07.2000 in the name of Mala Sehgal in AY 20012002. These all receipts are found to be received from maternal uncle and other relatives including the father of the wife of the accused. The huge payments in foreign currency were received till 1993, thereafter the gifts of substantial amounts were also received in the name of children from various relatives. Though these gifts are transacted through bank accounts and duly reflected in balance sheets and ITR's, however no witness is examined by accused to prove why the relatives have given such a huge payments of gifts to children when there is nothing on record to suggest that accused person or his wife in reciprocity given gifts to them or to any other relative in the family. As observed in Ponnuswamy case (supra), u/s 114 Evidence Act, court may presume existence of any fact which it thinks likely to have happen having regard to natural course of event, human conduct and public and private business. The windfall of huge CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 47 to 84 gifts that too from the distant relatives appears unnatural course of event , thus natural presumption considering the common course of natural events and human conduct is that the money flows from accused to his wife and routed through the relatives in the shape of gifts. However, this a rebuttal presumption but the accused not rebutted the same by leading defence evidence, therefore hindered the revealing of truth by way of cross examination. The burden of proof over the accused in present scenario is evidenciary in nature not pursuasive and accused has to lead evidence to prove the same and mere plausible explanation is not enough but should be worthy of acceptance. (reference "C.S.D. Swamy Vs. State, AIR 1960 SC 7", State of Maharashtra VS. Wasudeo Ramchandra Kaildaiwar 1981 (3) SCC 199, K. Veeraswamy Vs. Union of India & Ors., 1991 (3) SCC 655, State of MP Vs. Awadh Kishore Gupta (2004) 1 SCC 691").
81. Therefore, the total receipts as claimed by accused for Mala Sehgal as well Apeksha Sehgal and Aditi Sehgal for Rs. 24,67,689/ cannot be considered as the legal income except the cheque of Rs.5000/ given by father of Mala Sehgal, and the benefit of the same cannot be given to the accused. This entire exercise appears to be to make black income into white income.
82. Other receipts in favour of Mala Sehgal from the relatives of CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 48 to 84 the accused. Letters dated 21.07.2003, 09.02.2004, 09.02.2004, 09.02.2004 and 09.02.2004 (Ex.PW20/DX81 to 85). These letters were written by Mala Sehgal, Krishna Sehgal, Minu Sehgal, (wife of accused's brother, Rajiv Sehgal), accused brother Rajiv Sehgal and Amar Nath to PW20 (IO Parveen Ahlawat) after filing of charge sheet. As per letter Ex.PW20/DX81 Mala Sehgal communicated that she received a security deposit of Rs. 1.62 lacs from A& Z Grindlays Bank, loan of Rs. 1.90 lacs from Meenu Sehgal Rs. 3 lacs from Tina Impex Pvt.Ltd. and Rs. 3 lacs from Krishna Sehgal and Rs. 1 lac from P.L. Sehgal till March 200001 before the check period. But this letter do not reflect for what purpose she has taken such a huge loan from his relatives including Meenu Sehgal (Sister in law (dever's wife)), Krishan Sehgal (mother in law) and P.L. Sehgal (father in law). Furthermore, this letter Ex.PW20/DX81 suggests that these loans were returned in the year 2002 after FIR of the present case. Thus, it is clear that these loan amounts were received prior to FIR and payments were made subsequent to the FIR. It is not clear why such a huge amount of loan were given. Accused neither opted to examine her wife nor his relatives who had given such loans. Mere transactions through the bank accounts do not validate the CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 49 to 84 transaction for the purpose of present case. On the other hand it appears that the records of Mala Sehgal were created for income tax purposes and it can be presumed in present circumstances that accused through his wife tried to show black money as a white money. The entire income tax records appears to be calculated device.
83. There are arguments again and again on behalf of the accused that no money is routed from accused to his wife. This arguments has no force because all the black money always routed in this manner. The circumstances of non routing of any amount of money from accused to wife when they are living together also appears unnatural. This also suggests that accused took all precautions since beginning that no money should connect him and his wife Mala Sehgal. Accused not led any defence evidence and appears to have avoided the cross examination because only from cross examination, the veracity of these transaction could be ascertained. Thus, in these circumstance no benefit of these huge gifts payments received by his wife could be given to the accused despite the transaction shown to be through bank account and depicted in ITR's.
Assets in the name of wife Mala Sehgal and Minor children CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 50 to 84 Apeksha and Aditi Sehgal.
84. It is admitted fact that Ms. Mala Sehgal purchased the ¼ share in the property E246 GK Part II on 13.08.93 from A.S. Mehal for Rs. 6.10 lacs, 360 sqft. of space in basement of M1 NDSE PartII on 27.07.94. And thereafter RBI bonds of Rs.75,000/ in the name of Apeksha Sehgal on 26.02.99 (Ex.PW11/D1), of Rs. 3.5 lacs in the name of Aditi Sehgal on 23.01.98 (PW11/D3), and Rs.5.75 lacs dtd 23.01.98 (Ex.PW11/D4), in the name of Apeksha. Therefore the assets, in the name of Mala Sehgal are the properties at GKII and basement at NDSE and furthermore the RBI relief bonds for a total sum of Rs. 10 lacs in the name of children represented through Mala Sehgal. No amount of money is claimed to be travelled from accused in purchase of these assets. Assets claimed to be purchased by Mala Sehgal from her own resources of income.
85. As already discussed above Mala Sehgal is found to have a very unusual career by earning in various private firms from the year 1989 to 94, and thereafter she has not earned any money from the salary, however from 1998 onwards shown to have earned salary and share income from Sampark Sales, a family partnership firm.
86. Till 1994 the legal income of Mala Sehgal as already calculated CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 51 to 84 in preceding para is around 1.7 lacs, whereas the property purchased by her through this income till 1994 is for Rs. 6.10 lacs plus for Rs. 3.96 lacs i.e around 10 lacs. In this period the foreign exchange gifts were found to be given by his cousin brother and also the gifts by other relatives which are considered out of the purview as being not an legal income. Therefore, the assets of Rs. 10 lacs till 1994 cannot be purchased out of legal income of Rs. 1. 7 lacs. Thus, the assets of Rs. 6.10 and Rs. 3.96 cannot be said to be purchased from the legal income and found to be result of being purchased from black income turned into white through the gifts of the relatives. Thus, on over all appreciation these assets cannot be termed to be purchased from the legal income of the wife, thus can be presumed to be purchased through black income converted into white income of the accused.
87. In this situation, if the property is not found to be purchased by the legal money then the benefits of rent etc. arose from that property cannot be termed as a legal income.
88. It is worth to be noticing that the NDSE basement property shown to be purchased in the year 1994 for a sum of Rs. 3.96 lacs only, when at that time the property is fetching a sum of Rs. 22,500/ per month as a rent, and further the wife of the accused also received security deposit of Rs. 1.35 lacs after CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 52 to 84 purchase plus remaining rent, in total received total of Rs. 1.62 lacs from the A&Z Grindlays bank. Though the court cannot go beyond the value as mentioned in the sale deed of the basement of NDSE property ie. 3.96 lacs, however, it appears unnatural that the property giving rent of Rs. 22,500/ per month alongwith the security deposit around 1.62 lacs could be purchased in 3.96 lacs.
89. Even otherwise the accused not able to prove that till 1994 Mala has sufficient money to purchase the basement floor for Rs. 3.96 lacs and the property at GKII for Rs. 6.10 lacs. Thus, the property is presumed to be purchased through illegal money of accused therefore, the rent recovered from the basement property cannot be given the legal colour. Therefore, the benefit of income received through rent as per prosecution case for Rs. 14.93,500/ cannot be given to the accused. This rent as per the evidence led, and as per the summary points in brief of the accused comes around 14,93,500/ +54,000/ +11,500/ i.e. 15,59,000/. The benefit of this rental income in present circumstance cannot be given to the accused.
90. Besides this income claimed by the accused is also from the interest from RBI relief bonds purchased in the name of minor children for a total of Rs. 10 lacs through his wife Mala Sehgal. As per summary of final arguments accused claimed an interest CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 53 to 84 on the RBI bonds of Aditi Sehgal for Rs. 87,500/ and Rs. 1,52,843.75 for Apeksha Sehgal. The total amount of RBI relief bonds are Rs. 10 lacs. The relief bonds were purchased in the year 1998 and 1999, and no money is claimed to be routed through the accused. And the entire money is shown to be from Mala Sehgal. The income of Mala Sehgal in 199899 found to from salary of Sampark Sales and share profit of Sampark Sale,. This is not enough to purchase RBI bonds of Rs. 10 lacs income of minor children namely Apeksha Sehgal and Aditi Sehgal. therefore, the interest income of Rs. 240,343.75/ claimed from RBI relief bonds cannot be given to the accused. The logic of this is simple when the principle amount is found to be illegal, then no benefit of interest amount on the illegal income could be given.
91. It is worth to be noticed here that accused Sanjeev Sehgal has purchased RBI bonds for a sum of Rs.2.75 lacs (PW11/D2) in his name alongwith his wife's name whereas the RBI bonds of Rs. 10 lacs (Ex.PW11/D1 to D3) were purchased in the name of children Apeksha Sehgal and Aditi Sehgal through his wife Mala Sehgal. The accused not contributed any money in purchase of those bonds. It appears that the accused is taking all precautions since beginning that no money could be shown to have been flown from his account to his wife and children's CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 54 to 84 accounts. It is unnatural conduct in present case that accused is not investing anything for wife and children, though they are living together and there is no dispute of any kind between them. This kind of practice by the accused is on the face of it shows that since beginning he is taking steps to legitimise all the money through income tax records.
92. The bank interest income for Mala Sehgal and children are claimed by the accused in summary of final arguments is Rs. 8,35,934/ on the basis of the various income and deposits. However, as already discussed the income of the wife do not appear to be at all sufficient to purchase such huge assets and investments, thus the benefit of total interest amount of Rs. 8,35,934/ cannot be given to the wife and children but the total interest on the hit and trial methods towards higher side for Rs. 2 lacs is given to the wife and children. Further, the accused is given the benefit of NSC's encashment of Rs. 27,001/ . Expenditure:
93. The expenditure of Rs.1,64,920/ towards school fees paid on behalf of Apeksha and Aditi to M/s Spring Dales is proved through PW12. The expenditure of Rs,31,858/ towards telephone charges in the name of Mala Sehgal proved through PW16. Premium paid on LIC Policy in the name of accused for Rs. 18,274/ proved through PW9. The expenditure on the CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 55 to 84 membership fee and annual subscription though claimed Rs.
36,955/, however proved through PW13 Rs. 35,955/. Expenditure of stamp duty paid by Mala Sehgal in purchase of share in Property at E246, GKII vide sale deed dated 13.08.93 proved through PW14 and sale deed an admitted document (Ex.P10) RS.48,800/. Expenditure on stamp duty paid by Mala sehgal for purchase of 360 sqft. Space in M1, NDSEII proved through PW6 Ramesh Chander (admitted document Ex.P11) Rs.31,680/.
94. Ld. Counsel for the accused vehemently opposed the non verifiable expenditure calculated at the rate of 1/3rd salary of the accused during the check period for Rs. 2,39,635/. Ld. Counsel for the accused stated that the IO or any member of the search team has nowhere explained the lifestyle of Sanjeev Sehgal. Furthermore, the accused used to stay in the joint family therefore the Ld. Counsel for accused submitted that there is no basis for claiming the non verifiable expenditure of Rs. 2,39,635/.
95. These 1/3rd non verifiable expenses are the standard deduction.
There is nothing suggested to the witnesses that these expenses in this manner cannot be deducted. Accused even not led any evidence in defence to disprove the same therefore, the plea of the accused that this amount cannot be deducted as expenses CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 56 to 84 cannot be accepted, thus prosecution able to prove the non verifiable expenditure of Rs. 2,39,365/.
96. The prosecution also alleged the expenses of Rs. 3,47,790/ on account of the approximate value of house hold articles found during the search conducted on 25.08.2000 on the ground floor of E246, GKII. PW19 Insp. S.C. Bhalla who conducted the raid stated that he alongwith PW2 Murgesan independent witness and other CBI officials conducted the raid at the house of the accused i.e. E246, GK II, which is consisted of three floors and on inquiry from the members of the house the ground floor is found to be in possession of the accused family and the first floor and second floor are in the possession of other family members of the accused. Nothing came in cross examination that accused with his family not residing at ground floor. The observation memo (Ex.PW2/A) consisted of 10 pages of the ground floor is made in presence of the independent witness PW2. This observation memo is duly signed by father P.L. Sehgal and wife Mala Sehgal of the accused. PW2 independent witness categorically stated that this observation memo is prepared in his presence. It is no where suggested to PW2 that these observation memo is not signed by accused father and wife, and that the articles mentioned in the said observation memo are not found at the spot. The accused CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 57 to 84 did not chose to examine his wife to rebut the claim that she has not signed the observation memo. This suggestion was also positively denied by PW19 SC Bhalla. There appears to be certain cuttings in the observation memos which PW2 could not explained but these are not material cuttings. Furthermore, nothing came in cross examination of PW19 over these cuttings. However, as observation memo (Ex.PW2/A) also includes the assets of pre check period for around Rs.80,000/ (Ex.PW20/DX79), a computer worth Rs. 52,000/ property of M/s Sampark Enterprises and air conditioner of Rs. 7000/ for the year 19.07.87. These amounts are liable to be deducted from total of Rs. 3,47,790/. Thus, the valuation of household articles at ground floor of E246, GKII, New Delhi is Rs. 3,47,790 Rs.80,000 Rs.52,000 - Rs.7000 = Rs.2,08,790/.
97. PW17 in his testimony stated that expenses on the approximate cost of construction relating to share of the wife of the accused is around 10.94 lacs. Ld. Counsel for the accused stated that this expenses is on the basis of the report Ex.PW17/A of PW17 Rakesh Dutt. But, this witness has not given any description in the valuation report as to how the cost of construction is made, whereas PW18 Anand Nawani had clarified that he got the building plan erected and the average cost of construction was Rs.325400 per sq. ft.
CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 58 to 84
98. PW17 Rakesh Dutt in his testimony stated that the share of the wife of the accused in the property is the front portion of the first floor and above, of which the valuation was conducted and this fact he reiterated in the cross examination. However, in its detailed report Ex.PW17/A, he has not given the details how he calculated the cost for the construction for Rs.10.94 lacs. The report is vague on this aspect. Thus, this report over the expenses calculated by PW17 cannot be relied upon, however accused himself admitted a letter dated 22.10.2003 written by Mala Sehgal to Praveen Ahlawat (Ex. P/34, D67) and alongwith this letter she enclosed a proforma and the valuation report of said property issued by Sh J.S. Chainey government approved valuer. As per this report, the cost of construction of additional area at first floor for around 1150 sq. ft @ 325 Sq.ft. is Rs. 3,73,750/ and the cost of balcony at first floor and the second floor (front area 75 +45=120 sq.ft.) is around 17,400/. Therefore, as per this report, the lumpsum expenses for construction incurred on the portion of the property owned by Mala Sehgal is taken around Rs. 3,80,000/.
99. NSC's (National Saving Certificates) of Rs.18,000/ in total (Ex.PW20/DX15 to Ex.PW20/DX19) are also found in favour of Mala Sehgal and on encashment she got a sum of Rs. CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 59 to 84 27,001/. This income also claimed by the accused in the written arguments. These are also considered in the assets as well as income of Mala Sehgal. The assets of having balance amount of Rs. 1,12,662/ in SB A/c no. 12374 in the name of Sanjeev Sehgal, balance in A/c no. 25464012 in the Joint name of Aditi Sehgal and Mala Sehgal with Grindlays Bank, NDSE PartII for Rs. 1,32,524/, balance in A/c no. 25464023 in the joint name of Apeksha Sehgal and Mala Sehgal with Grindlays Bank of Rs. 1,72,545/, balance in A/c no. 25459240 in the joint name of Mala Sehgal at Grindlays Bank of Rs. 4,85,650/, investment made in SBI mutual fund Magna monthly income scheme 1991 in the name of Apeksha Sehgal represented by Mala Sehgal for Rs. 30,000/, investment made in UTIMIP 97 in the name of Aditi Sehgal and Apeksha Sehgal for Rs. 40,000/ are proved and also not disputed by the accused.
100. The income added on account of interest received on investment in UTIMIP 97 in the name of Apeksha and Aditi for Rs. 1,33,000/ not disputed and dividend received on SBI mutual fund MMIS in the name of Apeksha Sehgal for a sum of Rs. 32,400/ also not disputed and stands proved.
101. From overall appreciation of evidence, income, expenditure and assets of the accused and his family were calculated as under:
CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 60 to 84 A. INCOME
(i) Total take home salary prior to the check period i.e., from Rs. 1,62,230,00 March 1981 to December 1989
(ii) Total take home Salary during check period i.e. from Rs.7,30,025.00 01.101.90 to 31.07.2000
(iii) Rental income received in the name of Smt. Mala Sehgal Not included by hiring out 360 Sq. feet of basement space of M1, NDSEII, New Delhi to Grindlays Bank from July 1994 to the end of check period. (Rs. 14,93,000/)
(iv) Total interest received on the bank accounts in the name of Rs. 1,14,410.00 accused & his wife A/c no 13274 (PNB)
(v) Interest received on the RBI relief bonds in the name of Rs. 68,750.00 (the the accused interest received on the RBI relief bonds of Apeksha and Aditi not included)
(vi) Interest received on investment in UTIMIP97 Scheme Rs.1,33,000.00 No. 70259 and 70260 in the name of Apeksha and Aditi Sehgal
(vii) Dividents received on SBI Mutual Fund MMIS, in the Rs.32,400.00 name of Apeksha Sehgal.
(viii) Survival benefit payments received on LIC Policy no. Rs. 9,000.00 05267716 in the name of Sanjeev Sehgal
(ix) Salary income of Mala Sehgal from Tinna Enterprises Rs. 1,70,085.00 and RP Tele circuits (as per written synopsis of accused dated 06.07.2005)
(x) Salary income of Mala Sehgal from Sampark Sales Rs. 1,10,000.00 Partnership firm (as per written synopsis of accused CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 61 to 84 dated 06.07.2005)
(xi) Profit share income of Mala Sehgal from Sampark Rs. 93,909.00 Sales Partnership firm (as per written synopsis of accused dated 06.07.2005)
(xii) Interest income claimed as Rs. 8,35,934/ for Mala |Rs, 2,00,000.00 Sehgal and minor children, however given benefit on hit and trial basis towards higher side
(xiii) NSC's encashment Rs.27,001.00
(xiv) Receipt of Rs. 5000/ and three cheques of Rs. 251/ Rs. 5753/ Total Rs. 18,56,563/ B. Expenditure:
(a) Non verifiable expenditure, calculated @ 1/3 rd of the total Rs. salary of the accused, during the check period 2,39,635.00
(b) Expenditure incurred by the accused, on account of school fees Rs.
paid on behalf of Apeksha and Aditi to M/s Springdales 1,64,920.00 School, Dhaula Kuan.
(c) The expenditure incurred on telephone No. 6453759 in the Rs. 31,858.00 name of Mrs. Mala Sehgal by way of bills paid.
(d) Premium paid on LIC policy no. 050267716 in the name of Sh. Rs.18,274.00 Sanjeev Sehgal
(e) The membership fee and annual subscriptions paid to M/s New Rs.35,955.00 Friends Club Ltd., by Mrs. Mala Sehgal, during the check period
(f) Stamp duty paid by Mrs. Mala Sehgal for purchasing share Rs.48,800.00 portion of E246, GKII vide regd., sale deed dated 13.08.93.
(g) Stamp duty paid by Mrs. Mala Sehgal for purchase of 360 Sq. Rs.31,680.00 feet space in M1, NDSEII vide regd., sale deed dated CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 62 to 84 27.07.94.
Total Rs.5,71,122.00 C. ASSETS ACQUIRED BY THE ACCUSED & FAMILY (i) The registered value of 1/4th share portion of property Rs.6,10,000.00
E246, GKII, purchased in the name of Mrs. Mala Sehgal on 13.08.93 from Sh. A.S. Mahal, which included front portion of the first floor with terrace, one bed room & bathroom.
(ii) The registered value of 360 Sq. ft. of space in the basement Rs.3,96,000.00 of M1, NDSEII, purchased in the name of Mrs. Mala Sehgal on 27.07.94 from M/s Aggarwal Developers Pvt. Ltd vide a registered sale deed.
(iii) The total face value of the RBI Relief Bounds Nos. Rs.12,75,000.00 DH0003068, DH003069, DH2095, & DH12944, purchased by Sanjeev Sehgal, in his own name and in the names of Mala Sehgal and Apeksha Sehgal, in the year 1998.
(iv) Balance amount in the SB A/c no. 13274 in the name of RS.1,12,662.00 Sh. Sanjeev Sehgal, with PNB, NDSEI, New Delhi, as on 25.08.2000
(v) Balance in A/c no. 25464012, in the joint name of Aditi Rs,1,32,524.00 Sehgal & Mala Sehgal, with Grindlays Bank, NDSEII, as on 25.08.2000
(vi) Balance in A/c no. 25464023, in the joint name of Apeksha Rs.1,72,545.00 Sehgal & Mala Sehgal, with Grindlays Bank, NDSEII, as on 25.08.2000
(vii) Balance in A/c no. 25459240, in the joint name of Mala Rs.4,85,650.00 Sehgal, with Grindlays Bank, NDSEII, as on 25.08.2000 CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 63 to 84
(viii) Investments made in SBI Mutual FundMagnum monthly Rs.30,000.00 Income Scheme91, in the name of Apeksha Sehgal represented by Mala Sehgal, vide folio Nos. 629607 dated 27.04.91 and 611237 dated 20.04.91
(ix) Investments made in UTIMIP97 Sheme in the name of Rs. 40,000.00 Aditi Shegal , Membership no. 70259 and Apeksha, No. 70260, both under the guardianship of Mala Sehgal. Total holding 4000 units @ Rs. 10/ pr unit.
(x) Approximately value of the household articles observed Rs.2,08,790.00 during the searches on 25.08.2000 on the ground floor of E246, GKII, found to be occupied by the accused Sanjeev Sehgal & family
(xi) The approximate cost of construction in E246, GKII as Rs.3,80,000.00 per the technical evaluation report, pertaining to 1/4th share of Mrs. Mala Sehgal.
(x) Investment made in National Saving certificates by Rs. 18,000.00
Mala Sehgal
Total Rs. 38,61,171.00
D.Calculation of DA:
1 Total income of the accused & his wife during the check Rs. 18,56,563.00 period 2 Total expenditure Rs.5,71,122.00 3 Likely savings (12) Rs.12,78,688.00 4 Likely savings at the beginning of check period (Total Rs.1,08,150.00 income at the beginning of check period minus non verifiable expenses @ 1/3rd of the income).
5 Total likely savings(3+4) Rs.13,86,838.00 6 Total assets during the check period Rs. 38,61,171.00 CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 64 to 84 7 Disproportionate assets (DA) (65) Rs.24,74,333.00 8 Percentage of DA to the total income 133.27%
102. Ld. Counsel for the accused submitted that the income of wife and children from the gifts acquired is a legal income. Ld. Counsel submits that the wife and children had acquired the gifts in their legal capacity from their relatives. Accused in property return filed (D11/Ex.P20) in office and noting dated 27.06.95 page 20/N to 21/N reflects that even the receipt of gifts stood intimated by the accused to his department and such intimation is accepted by his department thus gifts constitute "known sources of income" as contemplated in the explanation of section 13(1) (e) of PC Act.
103. For appreciating this contention, let me go through the judgment of apex court in case title State of MP Vs. Awadh Kishore Gupta, (2004) 1 SCC 691: Apex court in para 5 to 7 observed as under:
5. Section 13 deals with various situations when a public servant can be said to have committed criminal misconduct.
Clause
(e) of sub-section (1) of the Section is pressed into service against the accused. The same is applicable when the public servant 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 pecuniary resources or property disproportionate to his known CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 65 to 84 sources of income. Clause (e) of sub-section (1) of section 13 corresponds to clause (e) of sub-section (1) of section 5 of the Prevention of Corruption Act, 1947 (referred to as 'Old Act'). But there has been drastical amendments. Under the new clause, the earlier concept of "known sources of income" has undergone a radical change. As per the explanation appended, the prosecution is relieved of the burden of investigating into "source of income" of an accused to a large extent, as it is stated in the explanation that "known sources of income"
mean income received from any lawful source, the receipt of which has been intimated in accordance with the provisions of any law, rules orders for the time being applicable to a public servant. The expression "known sources of income" has reference to sources known to the prosecution after thorough investigation of the case. It is not, and cannot be contended that "known sources of income" means sources known to the accused. The prosecution cannot, in the very nature of things, be expected to know the affairs of an accused person. Those will be matters "specially within the knowledge" of the accused, within the meaning of Section 106 of the Indian Evidence Act, 1872 (in short the 'Evidence Act').
6.The phrase "known sources of income" in section 13(1)(e) {old section 5(1)(e)} has clearly the emphasis 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 elastic 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 having 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" is receipt in the hand of its recipient, every receipt would not partake into the character of income. Qua the public servant, whatever return he gets of his service, will be the primary item of his income. Other incomes which can conceivably are 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 from the "known sources of income" of a public servant.
CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 66 to 84
7. The legislature has advisedly used the expression "satisfactorily account". The emphasis must be on the word "satisfactorily" and the legislature has, thus, deliberately cast a burden on the accused not only to offer a plausible explanation as to how he came by his large wealth, but also to satisfy the Court that his explanation was worthy of acceptance.
104. As per this judgment the known sources of income means income received from any lawful source and the receipt of which has been intimated in accordance with the provisions of law, rules, orders for the time being applicable to the public servant. Furthermore, the income qua the public servant is the return which he gets from the service, and the other incomes which are regular receipts from his property or his investments. A receipt from windfall or gains of gift, crime or immoral secretions by persons prima facie would not be the receipt from the known sources of income of a public servant. It is also observed in this case that the expression "satisfactorily account", the emphasis on the word 'satisfactorily' therefore, the legislature deliberately cast a burden on the accused not only offer a plausible explanation as to how he came by his large wealth but also to satisfy the court that his explanation was worthy of acceptance.
105. Therefore, the mere intimation in the department is not enough. Before that, the accused has to prove that he has CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 67 to 84 acquired the income from the lawful source. And this burden is on the accused and for the discharge of the same the accused is not relieved by offering only a plausible explanation but also to satisfy the court that his explanation was worthy of acceptance. In present case as the accused not opted to lead any defence evidence by producing himself, his wife and the relative from whom they received huge gifts in foreign exchange as well as Indian currency. It is unnatural in the nature of things that such huge gifts would be given by the relatives out of love and affection, therefore the burden is on the accused to show the underlying purpose of the gifts. The underlying purpose behind gifts is in special knowledge of the accused or his family members, and this can only be surfaced by examining the witnesses in defence, so that in cross examination the prosecution could unearth the real purpose of giving of such a huge gifts. IO also in reply dated 23.07.05 (Ex.PW20/DX78) have come to the conclusion that as the income of the wife is found less in comparison to the assets and the purpose behind the gifts have not been verified and it is a matter of defence evidence.
106. In present case as accused not opted to lead any defence evidence in this regard, therefore mere intimation to the office CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 68 to 84 is not sufficient to infer that the huge gifts acquired is the legal income of he wife and the children.
107. Ld. Counsel for the accused also vehemently argued that all the gifts were also shown in the income tax records, therefore falls in the category of legal income. This contention of Ld. Defence Counsel cannot be accepted. Apex court in Vishvanath Chaturvedi Vs. Union of India Writ Petition (Civil No) 633/2005 in order dated 01.03.2007 held that the income tax department is only concerned with the source of income and whether the tax was paid or not. In State of Tamilnadu vs. N. Suresh Rajan & Ors.(Supra) apex court held that merely on the factum that property is in the name of income tax payee itself is not ground to hold that it actually belongs to an assesses. Therefore, this contention of the defence counsel that accused has shown the entire gifts transactions and immovable properties in the income tax return by itself is not sufficient particularly in view of the fact that the gifts on the face of it as already discussed appears unnatural and the accused not opted to lead defence evidence by subjecting himself or his wife or the relatives to cross examination to prove the same. Madhya Pradesh High court in case titled Permanand Kedarnath Jha (supra), also held that mere declaration of property in the income tax does not amount to showing that it was acquired CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 69 to 84 from the known sources of income.
108. Apex court in Awadh Kishore Gupta case (Supra) categorically held that burden of the accused to satisfactorily account the assets held by him not only by a plausible explanation but also to satisfy the court that this explanation of worthy of acceptance. This burden of proof is evidenciary in nature or say reverse burden, though in certain circumstances accused can prove the same without leading defence evidence but not in present type of case where the accused is claiming the income of his wife and children in lacs of rupees through gifts etc. from relatives. The purpose behind the gifts could only be surfaced by positive defence evidence in the court through cross examination as purpose is in special knowledge of accused, wife and relatives (reference also State of Maharashtra VS. Wasudeo Ramchandra Kaildaiwar 1981 (3) SCC 199, K. Veeraswamy Vs. Union of India & Ors., 1991 (3) SCC 655).
109. Ld. Counsel for the accused vehemently submitted that IO Praveen Ahlawat in his report dated 23.03.2005 (Ex.PW20/DX77) categorically stated on the directions of this court after investigation that Smt. Mala Sehgal acquired the properties out of her own savings and her own sources of CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 70 to 84 income. Moreover the assets acquired in the name of the children were made from their own bank accounts.
110. There is no dispute to the fact that the IO supported the defence in form however he had not supported the defence in substance and his fact is clear from his reply dated 23.07.2005 (Ex.PW20/DX78) to the written synopsis dated 06.07.2005 filed by the accused. This reply (Ex.PW20/DX78) filed by the IO is after his report (Ex.PW20/DX77). In this reply IO categorically stated that the assets acquired by the illegal income of the accused in the name of his wife. Further the purpose of the gifts not verified and it is the matter of defence evidence and the same should be considered at the time of defence. Burden to prove the underlying purpose of the huge gifts is on the accused and accused did not led any evidence to prove the same. Truth requires not mere form but also the substance and underlying purposes.
111. Ld. Counsel for the accused also submitted that none of the witnesses including the IO have alleged that accused was found with disproportionate assets in their deposition. Thus on this very ground the prosecution case should be thrown out. This submission has no force because PW20 exhibited the charge sheet (Ex.PW20/A) and in the charge sheet it is categorically CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 71 to 84 mentioned that accused could not satisfactorily explain his disproportionate asset which are in excess to his income. Furthermore, replies filed by the IO's as exhibited during his cross examination as already discussed and the case in its entirety suggests that the accused is being tried in present case for acquiring assets disproportionate to his income.
112. Ld. Defence counsel also raised the plea that the FIR registered in the present case is on the basis of written complaint lodged by PW19 Inspector S.C. Bhalla and the search was conducted at the house of the accused on 25.08.2000 by PW19 alongwith raiding party in pursuant to the search warrant endorsed to him by DSP M.S Singal (IO) of RC no. 41A/2000. However, neither the original complaint of SC Bhalla (PW19) nor the search warrants are found on record. Despite directions from the court these documents are not produced before the court. Ld. Counsel submits that the FIR in the present case is fabricated and the search also got vitiated.
113. In deposition PW19 categorically stated that he conducted the search of the house of the accused in pursuance of search warrant and also filed the complaint. However, admittedly these two documents were not placed on the record. Now the question arose whether by non filing these documents the present proceedings can be vitiated or not. And this is a matter CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 72 to 84 of total appreciation of evidence. The raid was conducted on 25.08.2000 in presence of independent witness PW2 and the observation memo was duly signed by the father and wife of the accused. In these circumstances the irregularity committed by the CBI by not producing the original complaint and the search warrant do not lead to vitiation of the present proceeding.
114. It has been held in catena of cases that illegal investigation do not perse results rejecting the case of prosecution (reference H.N. Rishbud Vs. State of Delhi AIR 1955 SC 196). In Leela Ram Vs. State of Haryana, AIR 1999 SC 3717 in reference to lapse in investigation, it was held " It is now a well settled principle that any irregularity or even an illegality during investigation ought not to be treated as a ground to reject the prosecution case and we need not dilate on the issue excepting referring a decision of this court [vide State of Rajasthan Vs. Kishore, AIR 1996 SC 3035]."
115. Reference can also be made to Kishore chand Vs. State of HP, 1990 Cr.LJ 2290 (SC), State of Rajasthan vs. Kishore, AIR 1996 SC 3035, Ram Bihari Yadav Vs. State of Bihar & Ors 1998 (4) SCC 517, Amar Singh Vs. Balwinder Singh & Ors. 2003 (2) SCC 518 and Ram Bali Vs. State of UP, AIR 2004 SC 2329.
116. In the present case, there is nothing to suggest that there is CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 73 to 84 any miscarriage of justice or the accused has been prejudiced in any manner. Hence, the case i.e. State Inspector of Police Vs. Surya Sankaran Karri, 2006VIIAD(SC) 278 as relied by accused is of no help to the accused in the present facts and circumstances.
117. Ld. Counsel for the accused submitted that income tax records cannot be held to be created because accused do not know in advance that he has to face a trial under PC Act, and in this regard Ld. Counsel for the accused relied upon the judgment of apex court in case titled "State of M.P Vs. Mohan Lal Soni 2000(6)SCC 338". There is no dispute to this proposition of the defence counsel, however the facts and circumstances as already discussed suggests that accused appears to be in practice of converting the black money into the white money for income tax purposes, therefore the case as relied by the accused is of no help in present facts and circumstances. In this background the case title "Ananda Bezbaruah Vs. Union of India 1994 CrlJ12 (Guwahati High Court)" is also no help to the accused.
118. Ld. Counsel for accused submitted that apex court in "DSP, Chennai Vs. K. Inbasagaran, 2006(1)SCC 420" held that accused on his part satisfactorily established that the money and assets belong to his wife which amassed from the business CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 74 to 84 run by her separately. Ld. Counsel also relied upon the judgment of apex court in case titled "Kedari Lal Vs. State of MP & Ors. Crl. Appeal no. No. 782 of 2011 dated 23.03.2015"
in which apex court held if the accounts in question were duly intimated and reflected in the income tax return and every single amount received by the appellant has been proved on record through testimonies of witnesses then no case. Ld. Counsel on the basis of these judgments submitted that present record categorically suggests that wife of the accused is independently earning and filing the income tax returns.
Furthermore, all the transactions are through bank accounts, therefore, the accused satisfactorily established that wife earned independently.
119. However, perusal of above cases as relied by the accused is of no help to the accused because in those cases the accused has examined the wife and other witnesses in defence whereas in present case, he opted not to do so. Furthermore, in "Kedari Lal case", in para 12 apex court found that in that case, receipts so projected were not bogus or was not a part of calculated device, however in present case as already discussed it appears that the entire money appears to be converted from black to white.
120. Ld. Counsel for the accused also relied upon the judgment of CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 75 to 84 Hon'ble Delhi High court in cases titled "K.Dhanalaxmi Vs. CBI, Crl. MC 5389/2014 dated 20.04.2015", wherein Hon'ble Delhi High court quashed the proceedings on the ground that CBI during investigation not able to point any material to connect the properties owned by Smt. M. Parvathamma with that of the petitioner. However, in present case as already discussed the accused tried to convert the black money into white through his wife and avoided to lead any defence evidence from which only truth could be unearthed by way of cross examination. In present facts and circumstances, this case is also of no help to the accused either.
121. Ld. counsel for the accused also relied upon judgment of apex court in case titled "Akhilesh Yadav Vs. Vishwanath Chaturvedi & Ors, 2013 (2) SCC 1 dated 13.12.2012" (different from the order as relied before). Ld. Defence counsel submitted in this case apex court held in para 35 that investigation against the wife of Sh Akhilesh Yadav cannot be launched due to her proximity with Akhilesh Yadav and Sh Mulayam Singh Yadav as she was not holding any public office or government post. This case is also of no help to the accused because in present case no proceedings were launched against his wife Mala Sehgal.
122. Ld. Counsel for the accused submitted that Hon'ble Delhi CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 76 to 84 High court in case titled "Gunjit Singh Vs. State, 1996 JCC 357", held that if the documents produced by the prosecution on being admitted by the accused becomes authentic and the contents thereof become the substantive evidence.
123. However in present case, it is clearly mentioned in chargesheet (Ex.PW20/A) that during investigation nothing concrete comes regarding the income of wife of the accused. However, after filing of chargesheet, an application dated 29.05.2003 (Ex.PW20/DX1) u/s 294 Cr.P.C filed by the accused for admission and denial of income tax record, the gifts documents etc pursuant to which the reply dated 08.09.2003 (Ex.PW20/DX2) was filed by the IO in which he categorically stated that during investigation photocopies of assessment order relating to assessment year 199596 and 19992000 of Mala Sehgal recovered but nothing came in investigation, over her income, and during PC remand of accused or examination of Mala Sehgal U/s 161 Cr.P.C the sources of income were not disclosed. This submission of the IO is also supported through the letters written by Mala Sehgal ie, letter dated 12.09.2003 (Ex.PW20/DX13), Ex.P33 by which she has supplied her income tax record, balance sheets,the funds where she was working and drawing salary etc after filing of chargesheet and the IO (PW20) during proceedings before the court had verified CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 77 to 84 the same, however in reply dated 23.07.2005 (Ex.PW20/DX78), he categorically stated that the purpose behind the gifts have not been verified and it is a matter of defence evidence. The replies filed by the IO (PW20) were duly exhibited in cross examination and there is nothing on record to suggest that IO has made any false assertions in his replies including reply dated 23.07.2005 (Ex.PW20/DX78). The revised DA was calculated through this reply. Thus from the entire evidence on record, it is clear that the prosecution only verified the transaction in form not in substance. Furthermore, IO in admission/denial denied the details of income tax records as well as balance sheet and other letters of gifts, and only verified the transactions during verification of documents filed u/s 294 Cr.P.C not the purpose behind the transaction. Mere admission of the accused of the documents which relates to its own family and relatives do not relieve him from leading defence evidence. In present facts and circumstances accused is not absolved from leading evidence in the garb of section 294 Cr.P.C, as the purpose of lakhs of gifts received is in the peculiar knowledge of accused, his family and relatives, and that could be surfaced only by way of positive evidence before the court. The burden on accused is evidenciary in nature not CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 78 to 84 persuasive as discussed before. Thus, in the present facts and circumstances, the case as relied upon by the accused is of no help to him.
124. Ld. Counsel during arguments also submitted that during investigation the income tax department had made endorsement on notice u/s 160 Cr.P.C issued by the CBI in which income tax department claimed to be giving the photocopy of income tax record of year 2001 of Mala Sehgal to the constable who had gone with the notice, however he refused to take the same. Therefore, investigation agency deliberately not included the said income tax record during investigation.
125. During present proceedings an application u/s 91 Cr.P.C (dated 25.05.2012) was filed by the accused in which the accused demanded the copy of notice u/s 160 Cr.P.C dated 06.02.2002 issued to ward no.23 of income tax department and the said notice in original produced by the IO before the court alongwith another letter written on behalf of the Superintendent of Police to Additional Commissioner, income tax for producing the copies of income tax return filed by Mala Sehgal since 1990. However, during cross examination, IO P. Balachandran (PW21) was not confronted with the said notice. No explanation sought from the IO regarding that endorsement. During investigation, IO recorded the statement of PW10 CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 79 to 84 Rajender Singh, Inspector from the Office of Income Tax who stated that income tax records of Mala Sehgal and Sanjeev Sehgal are not traceable due to rearrangement of area and produced the income tax record of P.L. Sehgal, Krishna Sehgal and Rajeev Sehgal. This fact is also averred by the accused in his application dated 11.11.2011 u/s 91 Cr.P.C and also corroborated from the cross examination of PW10 wherein he exhibited Ex.PW10/DY i.e, the income tax record of Rajeev Sehgal, P.L. Sehgal and Krishna Sehgal. In cross examination, nothing suggested to this witness that at that time the income tax records of Mala Sehgal were also traceable. Even otherwise, the various communications made by Mala Sehgal after filing of the chargesheet through letters as already discussed, clearly suggests that all the ITR's etc were provided by Mala Sehgal to the investigating agency after filing of the chargesheet. It is also not the case of the defence during cross examination that they have provided their income tax records and other gift documents to the IO prior to filing of the chargesheet. In these circumstances, this contention of the accused that CBI had not considered the income tax record of Mala Sehgal prior to filing of the chargesheet is devoid of merit.
126. On the other hand, it appears that accused played hide and CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 80 to 84 seek, and only after filing of chargesheet took all the steps of providing income tax record and other documents regarding his bank accounts etc for verification u/s 294 Cr.P.C and in this manner tried to evade the leading of defence evidence. Even otherwise, Apex court in "State of Maharashtra Vs. Ishwar Piraji Kalaptari & Ors, AIR 1996 SC 722", held that opportunity which is to be afforded to the delinquent officer u/s 5(1)(e) of satisfactorily explaining about his assets and resources is before the court when the trial commences and not at an earlier stage. Thus, the finding that the principle of natural justice had been violated as no opportunity was given before the registration of the case would clearly be unwarranted. Sanction:
127. Ld. Counsel for the accused vehemently argued that PW1 V.S. Sharma Additional Commissioner (Engineering) was not the competent authority to grant the sanction for prosecution against the present accused. ld. counsel submitted that as per Schedule under Regulation 7 of DMC Service (Control and Appeal Regulation) 1959, Additional Commissioner is not the competent authority to remove the Junior Engineer of the level of accused and competent authority is Commissioner. To substantiate this proposition, Ld. Counsel for the accused relied CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 81 to 84 upon : "AIR 1972 SC 2452 The Management of DTU Sh B.B.L. Hajelay & anr., 28(1985) DLT 176 M.C.D. Vs. Ravinder Kr. Gupta, AIR 2007 SC 1274 Prakash Singh Badal Vs. State of Punjab and, AD (Cr.)2012 (1) 564; G.S. Matharaoo Vs. CBI (Delhi High Court).
128. But in present case PW1 V.S. Sharma categorically deposed in his testimony that he was competent to accord sanction for prosecution of Junior Engineer of MCD and he was competent authority to appoint and remove the Junior Engineer. There is nothing suggested to this witness in cross examination that he was not competent to remove the accused. Furthermore, in statement u/s 313 Cr.P.C also, accused has not challenged the competency of PW1. Accused also did not lead any defence evidence to prove that PW1 was not competent to remove him, therefore in present facts and circumstances, the sanction order (Ex.PW1/1) cannot be faulted with and the sanction granted against the accused is found valid.
129. Ld. Counsel for the accused also raised the plea that sanction granted by PW1 in a mechanical manner without application of mind as while granting sanction he has not considered the personal file of the accused. This plea has no force because the competent authority is not required to go through the personal file of the accused while according sanction. The competent CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 82 to 84 has to satisfy itself from the records collected during investigation. Even otherwise, the personal file (Ex.PW8/DA, Ex.PW21/A, D12) do not suggest that accused has impeccable service record, on the other hand, it shows disciplinary proceedings against him during the course of service.
130. On overall appreciation of facts and circumstances, out of total income of the accused and his family, substantial part ie, more than 24 lacs is found to be received from relatives etc as gift out of love and affection without anything on record that accused or his family was also in habit of reciprocating the same. These transactions are against the natural course of event and human conduct, thus it can be presumed that these gifts are black income of the accused legitimized through the gifts of the relatives. However, this is rebutable presumption but accused did not lead any defence evidence to disprove the same and miserably failed to discharge the evidenciary burden on him in this regard.
131. In view of the above findings, in my opinion, prosecution has proved beyond reasonable doubt that accused was found in possession of disproportionate assets to the tune of Rs. 24,74,333/ which comes approximate 133.27% of the disproportionate assets against the total income of Rs. 18,56,563/. Accused failed to satisfactorily explain the CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 83 to 84 disproportionate assets possessed by him. It is proved beyond reasonable doubt that the accused is guilty of offence u/s 13(1)
(e) r/w section 13(2) of Prevention of Corruption Act, 1988 and therefore, convicted for the said offence.
132. Accused be heard separately on point of sentence. Announced in the open Court on this 13th January 2016. (AJAY KUMAR JAIN) Special Judge (PC Act):
CBI01 :PHC :New Delhi CC No. 43/10, Case ID No. 02403R00020032003, RC No. DAI2001 A0024, dated 13.01.2016, Page no. 84 to 84