Karnataka High Court
Mr Y Gangi Reddy vs Karnataka Lokayukth A Police on 7 November, 2022
Author: Mohammad Nawaz
Bench: Mohammad Nawaz
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IN THE HIGH COURT OF KARNATAKA
AT BENGALURU
DATED THIS THE 07TH DAY OF NOVEMBER 2022
BEFORE
THE HON'BLE MR. JUSTICE MOHAMMAD NAWAZ
CRIMINAL APPEAL No.825/2020
BETWEEN
MR. Y. GANGI REDDY
S/O LATE Y. NARASIMHA REDDY,
AGE: 56 YEARS OCC: POLICE INSPECTOR
KARNATAKA COSTAL SECURITY P.S.
UDUPI-576 101.
RESIDENT OF ROOM NO.205,
2ND FLOOR, DIVYASHREE APARTMENT,
OPP: TO BALIGA STORE,
BIJAI, KAPIKADU ROAD,
MANGALORE-574 173. ...APPELLANT
(BY SRI. PARAMESHWAR N. HEGDE, ADVOCATE)
AND
KARNATAKA LOKAYUKTHA POLICE
MANGALORE DIVISION
REP. BY SPL. PUBLIC PROSEUTOR
M.S.BUILDING, BANGALORE-01. ...RESPONDENT
(BY SRI. B. S. PRASAD, ADVOCATE)
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THIS CRIMINAL APPEAL IS FILED UNDER SECTION 374
(2) OF CR.P.C. PRAYING TO CALL FOR THE RECORDS, SET-
ASIDE THE JUDGMENT AND CONVICTION DATED 27.08.2020
PASSED BY THE LEARNED 3RD ADDITIONAL DISTRICT AND
SESSIONS JUDGE AND SPECIAL COURT, DAKSHINA KANNADA,
MANGALORE IN SPL.Case.NO.19/2013 AND CONSEQUENTLY
ACQUIT THE ACCUSED/APPELLANT OF THE CHARGES UNDER
SECTION 13 (1) (E) READ WITH SECTION 13 (2) OF
PREVENTION OF CORRUPTION ACT.
THIS APPEAL HAVING BEEN HEARD AND RESERVED FOR
JUDGMENT AND COMING ON FOR PRONOUNCEMENT FOR
JUDGMENT, THIS DAY, THE COURT DELIVERED THE
FOLLOWING.
JUDGMENT
This appeal is preferred by the accused assailing the judgment and order dated 27.08.2020 passed by the III Additional District and Sessions Judge and Special Court for Trial of cases relating to prevention of corruption Act, D.K. Mangalore in Special Case No.19/2013, wherein the accused has been convicted and sentenced for the offence punishable under Sections 13 (i) (e) read with Section 13 (2) of Prevention of Corruption of Act, 1988 (for short 'P.C. Act').
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02. Heard the learned counsel for appellant and the learned Special Prosecutor appearing for respondent.
03. The case of the prosecution in brief is that the accused was appointed as a sub-inspector of police in the police department on 12.10.1993 and worked at various places in various capacity. While working as Circle Inspector of Police, Belthangady, D.K. District, on 11.08.2009, PW.2 - Srinivasprasad visited the police station to lodge a complaint regarding theft of his vehicle. The accused demanded bribe of Rs.30,000/- to do an official favour. Therefore, PW.2 approached PW.10 - police inspector Lokayukta, D.K. Mangalure on 13.08.2009, with a recorded conversation regarding the alleged demand made by the accused. PW.10 in turn asked PW.2 to record the conversation once again and handed-over a voice recorder. Accordingly, on 14.08.2009, PW.2 went to the office of the accused with the voice recorder to record the conversation. Finding the voice recorder with PW.2, the accused snatched and destroyed it. PW.2 gave a written 4 complaint to PW.10 on 26.08.2009 and based on the said information a case was registered against the accused in Crime No.7/2009 for the offence under Sections 7, 13 (1)
(d), 13 (1) (e) read with 13 (2) of P.C. Act and Section 201 of IPC and investigation was taken up.
04. PW.10 - Police Inspector after obtaining the search warrant from the Court searched the office and residential premises of the accused and seized the documents reported in P.F.Nos.10/2009 and 11/2009. Since, the voice recorder was not traced a 'C' report came to be filed to the Court on 01.02.2011 in Crime No.7/2009. The said report was accepted by the jurisdictional court.
05. The Deputy Superintendent of Police gave a requisition to Superintendent of Police (S.P.) for permission to register and investigate the case against accused for having amassed wealth disproportionate to his known source of income, on the ground that during the search conducted in Crime No.7/2009 such disproportionate wealth accumulated by the accused was 5 revealed. Accordingly, the S.P. accorded permission under Section 17 of the P.C. Act. A case was registered by PW.1 in Crime No.4/2010 against the accused on 20.03.2010 for the offence punishable under Section 13 (1) (e) read with Section 13 (2) of P.C. Act. He collected certain documents and recorded the statements of various witnesses. Thereafter, the investigation was taken up by PW.22, Dy.S.P. Lokayukta, who submitted the final report to the jurisdictional court.
06. The Investigating Officer fixed the check period from 12.09.1993 to 27.08.2010. According to the report, the following are the assets, expenditures and income of the accused and his family members during the check period:-
i. Assets of the accused Rs.24,54,071=37.
ii. Expenditure Rs.17,80,333=51.
iii. Assets and expenditure Rs.42,36,404=88.
iv. Income Rs.27,64,787=45.
v. Disproportionate Assets Rs.14,71,617=43.
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07. Charges were framed against the accused for the offence punishable under Section 13 (1) (e) read with 13 (2) of P.C. Act, for which the accused pleaded not guilty and claimed to be tried.
08. In order to establish the charges leveled against the accused, the prosecution got examined 22 witnesses and got marked Exs.P.1 to 86. The defence got marked Exs.D.1 to 21.
09. The learned Trial Court found the accused guilty for the charged offence and sentenced him to undergo S.I. for 04 years and to pay fine of Rs.5,00,000/-
and in default of payment of fine, to further undergo S.I. for one year.
10. The Trial Court reassessed the claim of the prosecution and the defence and came to the following conclusion regarding the assets, expenditure and income of the accused.
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i. Assets of the accused Rs.20,50,822/-
during check period
ii. Expenditure Rs.17,53,533/-
iii. Known source of income Rs.27,64,787/-
iv. Disproportionate Assets Rs.10,39,568/-
Further, from the explanation offered by the
accused, the Trial Court found that, he has received additional income of Rs.16,932/- from his two months salary which was not included, as admitted by PW.22 in his cross-examination and thus held that the accused possessed disproportionate assets of Rs.10,22,630/- and therefore, the prosecution has established that the accused was in possession or as at any time during the period of his office in possession, for which he cannot satisfactorily account, pecuniary resources or property disproportionate to his known source of income.
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11. The learned counsel for the appellant has firstly contended that the investigation conducted by the police inspector was without jurisdiction and the materials collected during the said investigation in crime No.7/2009 has therefore, no legal sanctity in the eye of law and it is per se illegal.
12. The defence disputed, out of 34 heads of assets, the value mentioned in the assets at Sl.No.7, 9, 11, 25, 27, 28 and 31 to 34. It is contended that the reasoning of the trial court rejecting the claim of the appellant was not proper and it is against the evidence on record. The learned counsel has taken through the evidence of the prosecution witnesses and contended that their evidence is not sufficient to come to a conclusion that the accused has acquired disproportionate assets to the known source of his income. In reference to the agricultural income, it is contended that the accused has declared his agricultural and horticultural income from his joint family properties and enclosed the documents, but 9 the Investigating Officer who has collected the details of income from the jurisdictional agricultural officer has not placed the same before the Court and the said information has been concealed. He therefore contended that the income declared by the accused from his agricultural sources was erroneously rejected by the Trial Court.
13. The learned counsel has contended that all the documents which are part of the charge sheet ought to have been taken into consideration by the Trial Court, as the outcome of investigation is on the basis of the materials collected in the course of investigation. He contends that, when the I.O. has admitted he has received Ex.D.14 to Ex.D.16 along with the Annual Property Returns, the Trial Court was not justified in ignoring the same, which has prejudiced the defence of the accused.
14. It is further contended that the assessment made by the Trial Court with regard to the electronic items, furnitures etc., in the rented apartment of the accused as well as the assessment made with regard to 10 the gold ornaments are untenable and the reasoning of the Trial Court is vague and contrary to the evidence adduced in the case.
15. The learned counsel for the appellant has also contended that the burden of proof in disproportionate assets cases is always on the prosecution and the burden resting on the accused is not so onerous as that of prosecution and in the case on hand the prosecution has failed to establish the charges leveled against the accused beyond reasonable doubt.
16. In support of the various contentions raised, the learned counsel for the appellant has relied on the following decisions :-
a. (2006) 7 SCC 172 State Inspector of Police, Vishakhapatnam vs. Surya Sankaram Karri.
b. (2000) 8 SCC 590 Roy V.D. vs. State of Keralala, c. W.P.No.33661/2017 M. Srinivas vs. State of Karnataka, 11 d. 1999 Crl.L.J. 1026 GVS Lingam vs. State of A.P. e. (1981) 3 SCC 199 State of Maharastra vs. Wasdeo f. (2017) 14 SCC 442 Vasanth Rao Guhe vs. State of M.P. g. (2003) 8 SCC 752, RVE Venkatachala vs. Arulmigu h. (1992) 4 SCC 45, M. Krishna Reddy vs. State by Dy.S.P. i. (1997) 6 SCC 185 Kaptansingh and others vs. State of M.P. and another.
17. Per contra, the learned Special Prosecutor appearing for the respondent argued in support of the impugned judgment contending that the ITR or APR are self-declared statements which have to be proved independently by adducing evidence and the defence has failed to prove the agricultural income, as the burden shifts on the accused to prove the same when he has claimed that the properties are his ancestral properties. He contends that, trial court has rightly discarded the agricultural income and rental income, as it is the 12 discretion of the Court either to accept or not to accept the material collected during the investigation. He contends that the photo copies of the Annual Property Returns, cannot be accepted and the trial Court has rightly refused to place reliance on the same. He contends that the Trial Court has taken into consideration each and every aspect of the case and rightly held that the accused has failed to prove the agricultural income and rental income and rightly discarded the income from sale of gold ornaments etc.,
18. The learned counsel for the respondent has further argued that a separate case in Crime No.4/2010 was registered and the documents were collected legally and therefore even if those documents are collected in connection with Crime No.7/2009 that would not make the documents inadmissible in evidence. He contends that the prosecution has discharged its initial burden to show that the accused was in possession of property disproportionate to his known source of income and therefore, the burden 13 shifts on the accused to prove otherwise, which he has failed to discharge. He contends that there is no illegality committed by the Trial Court and seeks to dismiss the appeal.
19. The learned counsel for the respondent has placed reliance on the following decisions in support of his arguments:-
a. (2001) 6 SCC 674 K. Ponnuswamy vs. State of T.N., by Inspector of Police Directorate of Vigilance and Anti Corruption South Range, Trichy, b. (2004) 1 SCC 691 State of M.P. vs. Awadh Kishore Gupta and others.
c. (2014) 11 SCC 709 State of Tamil Nadu by Inspector of Police Vigilance and Anti-Corruption vs. N. Suresh Rajan and others.
20. According to prosecution the accused had an income of Rs.27,64,787=45/- from all sources and his total asset was Rs.24,46,071=37/- and expenditures was Rs.17,80,331=51/- and therefore, he was having pecuniary resources or property worth of 14 Rs.14,71,617=43/-, disproportionate to his known source of income. The Trial Court has come to the conclusion that the accused is having an income of Rs.27,64,787/- and additional income of Rs.16,932/- which was two months salary not included by the Investigating Officer. Further, an asset of Rs.20,50,822/- as against Rs.24,46,071=37/- and expenditure of Rs.17,53,533/- as against Rs.17,80,333=51/- and therefore, came to the conclusion that the accused was having disproportionate assets to the tune of Rs.10,22,630/-.
21. Out of the items mentioned at Sl.No.1 to 34 at paragraph No.46 of the judgment, under the heads of assets, the accused disputed the value in respect of the assets mentioned in Sl.No.7, 9, 11 to 25, 27, 28, 31 to 34 and did not dispute the remaining items. While discussing the evidence of the prosecution and the documents adduced in the case, the Trial Court came to the conclusion that the prosecution has proved that the accused is having possession of the assets during the check period shown in 15 items Nos.1 to 6, 8 to 10, 26, 29 and 30. The total value of these assets are valued at Rs.15,78,484/-. Further held, the accused was in possession of assets shown in item Nos.28 and 31 to 34. The value of the same was assessed at Rs.5,24,820/-, out of which 10% was deducted and the net value was taken as Rs.4,72,338/-. The possession of remaining items shown at Sl.No.7, 11 to 25 and 27 are held to be not proved by the prosecution. While giving 10% deduction in respect of assets shown at Sl.No.28 and 31 to 34, namely the electronic items, furnitures and household articles found at Vijaya Sequiera apartment, Sarees and Dress materials, it was opined that the investigating officer might have shown inflated price of these items and at the same time observed that the accused has also not adduced the evidence of any expert to show that the valuation made by PW.1 was not correct.
22. It is contended by the learned counsel for appellant that the appreciation of evidence by the Trial Court in rejecting appellant's claim in respect of item No.9 16 and 28 is not proper and the same is contrary to the evidence and material on record. It is also contended that the Trial Court has committed a grave error in not giving 10% deduction in item No.9 and also taking the value of item No.28 as assets of the accused.
23. Item No.9 is the gold ornaments found during the raid at Vijaya Sequiera Apartment, the value of which has been estimated at Rs.1,51,800/-. As per prosecution 138 grams of gold were found in the said apartment, where the accused was residing as tenant. Those items were seized under a mahazar at Ex.P.14. The learned counsel for the appellant has contended that the said mahazar was drawn in reference to Crime No.7/2009, wherein a 'C' report was filed and not in Crime No.4/2010 and therefore, the contents of the said mahazar which is not the subject matter of disproportionate assets case, could not have been taken into consideration by the Trial Court. He has further contended that the gold ornaments were not weighed after separating the non-gold articles in 17 the ornaments and there is no material to show that those ornaments were purchased immediately prior to the date of raid.
24. The Trial Court has opined that the accused has not disputed the possession of gold ornaments in Ex.P.14, but disputed the value of gold ornaments. The contention that the Investigating Officer has inflated the value of the gold ornaments was rejected and believing the evidence of the expert examined as PW.19, the value of gold ornaments was assessed at Rs.1,51,800/-.
25. As per PW.19, the Lokayutka police showed him the gold, silver ornaments and stones and after examining the same he gave the approximate value. He has admitted that he has signed Ex.P.14 mahazar. In the cross-examination he has admitted that the Mangalya Chain was weighing 35 grams including the Karimani and without removing the said Mangalya Chain which was worn by the wife of the accused, he has given an approximate rate of the same. It is also admitted by him that he has 18 mentioned the weight of the gold ornaments at Sl.No.371 including the stones and he has mentioned the approximate weight of the gold at Sl.No.372, worn by the wife of accused. There is nothing mentioned in the mahazar to suggest that the gold ornaments were weighed after separating the non-gold articles. The panch witness namely PW.3 who has signed Ex.P.14, during his cross- examination has admitted that while weighing the gold ornaments the stones were not separated. The check period is from 12.10.1993 to 27.08.2010. It is not shown that the gold ornaments were purchased immediately prior to the raid. It appears more reasonable to presume that the said gold ornaments were acquired over a period of time. Hence, the Trial Court was not proper in not giving 10% deduction on the value of the gold fixed by the Investigating Officer, which comes to Rs.15,180/-.
26. Insofar as the articles mentioned in item No.28 of the list of assets, the cost of electronic items, found at the apartment in which the accused was staying has been 19 valued at Rs.1,79,284/- and the value of furniture as per Sl.No.31 is taken as Rs.52,850/-. The details of these articles are mentioned in Ex.P.14.
27. The Trial Court has held that the above articles found in the apartment which are seized under Ex.P.14 is not disputed by the accused. Hence, based on the evidence of the landlady of the apartment, examined as PW.17, has come to the conclusion that the items shown at Sl.No.28 and 31 did not belong to PW.17, but it belonged to the accused and therefore, they are the assets of the accused. To arrive at the said conclusion the Trial Court was of the view that there should have been a written agreement between the accused and PW.17 and in the absence of the same and in the absence of any defence evidence, the contention of the accused cannot be accepted.
28. Admittedly, the accused was staying as a tenant in one Sequiera apartment belonging to PW.17. She has admitted that the accused has taken the said 20 apartment on a monthly rent of Rs.2,000/-. In the cross- examination she has categorically stated that she has rented out the fully furnished house to the accused with two air conditioners, wardrobes, cot, dining table, sofa-set etc., She has stated that Sl.No.1, 2, 3, 50, 51, 64 and 65 mentioned in Ex.P.14 belong to her. In the cross- examination conducted by the Special Prosecutor, it is not elicited from her that those articles belong to the accused. On the other hand, she has stated that even while she was enquired by the Lokayukta police, she has stated that those articles belong to her, but she did not give it in writing. She has denied that she is deposing falsely. She has stated that she did not execute any agreement, because those items would remain in the said apartment.
29. In the cross-examination of PW.17 conducted by the prosecution, nothing worthy has been elicited to disprove the admission made by her. The prosecution has to establish that the items mentioned above, which was found in the apartment belonging to PW.17, in which the 21 accused was staying as a tenant, exclusively belong to the accused. The evidence of the prosecution witness namely PW.17 who is examined in this behalf does not throw any light in support of the prosecution case. The Trial Court was therefore not justified in placing the burden on the accused to prove that those items did not belong to him. Another aspect is that the learned Trial Judge at Para No.67 of the judgment has observed that PW.17 has reiterated the statement made in Ex.P.47 and she has again admitted that there were no furnitures or electronic items, let out to the accused, thereby totally ignoring her evidence given in the cross-examination conducted by the defence. The total value of items at Sl.Nos.1 to 3, 50, 51, 64 and 65 in Ex.P.14 comes to Rs.76,000/-. Therefore, the said amount should be deducted from the assets of the accused.
30. As per the report filed by the Investigating Officer, the accused had an expenditure of Rs.17,80,333=51/-. The expenditure component of the 22 accused consisted of 36 items. Before the Trial Court, the accused admitted the expenditures shown in items No.2 to 20, 22 to 28, 31 and 33 to 36, total value of which comes to Rs.13,89,864/-. The Trial Court after discussion about the disputed expenditure, held that the prosecution has not proved the expenses shown in item No.21 to the extent of Rs.18,000/-, part of expenses shown in item No.29, 30 and 32 to the extent of Rs.8,800/-, which totally comes to Rs.26,800/-. Hence, the total expenditure of the accused during check period was taken as Rs.17,53,533/-. The learned counsel for the appellant has not seriously disputed the finding recorded by the Trial Court, regarding the expenditures incurred by the accused during the check period.
31. Insofar as the income of the accused is concerned, the learned counsel for the appellant has vehemently contended that during the course of investigation, the accused has submitted his explanation about his income under schedule Nos.1 to 16 through his 23 department and schedule Nos.17 to 23 directly to the Investigating Officer. He has contended that the accused has declared his agricultural and horticultural income received from his joint family properties to an extent of 43 acres, situated at Dabaravari Palli, ODC Mandal, Andra Pradesh. He contends that even though the Investigating Officer has collected the documents in this regard, he has withheld those documents. He therefore, contends that the investigation is not fair and intentionally such information was concealed. He has further contended that PW.22 has admitted that the documents marked as Exs.D.3 to 13 were received during investigation and therefore, the rejection of the claim of the defence with regard to the agricultural income was not proper.
32. The income of the accused during the check period assessed by the Investigating Officer is Rs.27,64,787=45/-, which is as under :-
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1. Salary from 37,609-00 12.10.1993 till 8/1994
2. Salary from 09/1994 48,144-00 till 12/1995
3. Salary from 01/1996 3,20,143-00 till 04/2001
4. Salary 22.05.2001 1,53,240-00 till 05.08.2003
5. Salary 01.08.2003 5,369-00 till 29.08.2003
6. Salary 9/2003 21,476-00 till 12.2003
7. Salary 01/2004 83,685-00 till 01.2005
8. Salary 02.2005 till 06.2006 and 9/2006 5,82,567-00 till 8/2009
9. Agricultural income 00-00
10. Rental income 00-00
11. Sale proceed of 8 acres land at 2,00,000-00 Ananthapura Andra Pradesh to PW.20
12. Sale proceed from gold to Ganesh Reddy 00-00 on 21.05.2009 for Rs.3,60,000 and to R.N.Gopal on 17.07.2009 Rs.3,90,000/-.
13. Housing loan obtained by accused from 10,00,000-00 Union Bank of India
14. Personal loan obtained by accused from 1,00,000-00 SBI
15. Term advance received from GPF 95,000-00 10/2001 Rs.20,000/-
01/2003 Rs.25,000/-
03/2004 Rs.50,000/-
Totally Rs.95,000/-
16. Interest from SBI Bank account 2,828-45
17. Matured amount of NSS 14,726-00
18. Matured amount of LIC 80,000-00
19. Matured amount of LIC 10,000-00
28.10.2001 Rs.5,000/-
28.10.2006 Rs.5,000/-
20. Matured amount of LIC 10,000-00
28.03.2003 Rs.5,000/-
28.03.2008 Rs.5,000/-
Total Rs.27,64,787=45/-
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33. According to prosecution the accused has not received any agricultural income and rental income during the check period and therefore, such income was shown as NIL in item Nos.9 and 10. Further, the income by sale of gold is also shown as NIL in item No.12. According to accused he has agricultural income and rental income and therefore, disputed the claim of the prosecution with regard to item Nos.9 and 10. He has also claimed that he received an income of Rs.7,50,000/- by selling the gold mentioned at item No.12. Insofar as other items are concerned, it is not seriously disputed.
34. The Trial Court has accepted that the accused was having an income of Rs.27,64,787=45/- during the check period, as calculated by the Investigating Officer. As already mentioned the accused has disputed the components under the heads of income namely the agricultural income, rental income and income from sale of gold ornaments. While discussing the agricultural income claimed by the accused, the Trial Court has observed that 26 the I.O. has disbelieved the asset of land measuring 43 acres and income shown in Ex.D.3 to 13 on the ground that such income was not shown by the accused while submitting his income tax returns. Further, that the land shown was not only standing in the name of accused, but also in the name of his family members. The Trial Court has observed that the accused was appointed on 12.10.1993, but he has not produced the annual assets and liability statement for the year 1993-94 and 1994-95.
Further, that Ex.D.3 to 7 are the photo copies of the annual assets and liability statement filed by the accused and Ex.D.8 to 13 are the photo copies of annual assets and liability statement submitted by the accused to the competent authority. Holding that marking of those documents without any objections from the prosecution is not authentication or proof of contents and raising a doubt about submission of those documents, the Trial Court has held that the accused has failed to prove, he has submitted the statements at Ex.D.3 to 13 and thus rejected the claim of the accused regarding the agricultural income. It is also 27 observed that the accused has not produced the original or certified copies of record of rights of the lands and houses owned by him and therefore, the photo copies of the records of land produced with Ex.P.23 and 24 was not accepted. The Trial Court has also found fault with the accused for not entering into the witness box to depose about the agricultural income from the land inherited by him.
35. Before proceeding further, it is relevant to see what the Hon'ble Supreme Court has held with regard to the nature and extent of the 'burden of proof', while dealing with a case of disproportionate assets. In The State of Maharashtra vs. Wasudeo Ramachandra Kaidalwar (Supra), it is held that the initial burden to substantiate the charge is on the prosecution and once that burden is discharged, onus shifts on accused to account for, by preponderance of probabilities, the possession of disproportionate assets. Para No.12 and 13 which may be relevant are extracted hereunder:- 28
"12. The terms and expressions appearing in Section 5(1)(e) of the Act are the same as those used in the old Section 5(3). Although the two provisions operate in two different fields, the meaning to be assigned to them must be the same. The expression "known sources of income" means "sources known to the prosecution". So also, the same meaning must be given to the words "for which the public servant is unable to satisfactorily account" occurring in Section 5(1)(e). No doubt, Section 4(1) provides for presumption of guilt in cases falling under Section 5(1)(a) and (b), but there was, in our opinion, no need to mention Section 5(1)(a) therein. For, the reason is obvious. The provision contained in Section 5(1)(e) of the Act is a self-contained provision. The first part of the Section casts a burden on the prosecution and the second on the accused. When Section 5(1)(e) uses the words "for which the public servant is unable to satisfactorily account", it is implied that the burden is on such public servant to account for the sources for the acquisition of disproportionate assets. The High Court, therefore, was in error in holding that a public 29 servant charged for having disproportionate assets in his possession for which he cannot satisfactorily account, cannot be convicted of an offence under Section 5(2) read with Section 5(1)(e) of the Act unless the prosecution disproves all possible sources of income.
13. That takes us to the difficult question as to the nature and extent of the burden of proof under Section 5 (1) (e) of the Act. The expression 'burden of proof' has two distinct meanings (1) the legal burden, i.e. the burden of establishing the guilt, and (2) the evidential burden, i.e. the burden of leading evidence. In a criminal trial, the burden of proving everything essential to establish the charge against the accused lies upon the prosecution, and that burden never shifts. Notwithstanding the general rule that the burden of proof lies exclusively upon the prosecution, in the case of certain offences, the burden of proving a particular fact in issue may be laid by law upon the accused. The burden resting on the accused in such cases is, however, not so onerous as that which lies on the prosecution 30 and is discharged by proof of a balance of probabilities. The ingredients of the offence of criminal misconduct under Section 5(2) read with Section 5(1)(e) are the possession of pecuniary resources or property disproportionate to the known sources of income for which the public servant cannot satisfactorily account. To substantiate the charge, the prosecution must prove the following facts before it can bring a case under Section 5(1)(e), namely, (1) it must establish that the accused is a public servant, (2) the nature and extent of the pecuniary resources or property which were found in his possession, (3) it must be proved as to what were his known sources of income i.e. known to the prosecution, and (4) it must prove quite objectively, that such resources or property found in possession of the accused were disproportionate to his known sources of income. Once these four ingredients are established, the offence of criminal misconduct under Section 5(1)(e) is complete, unless the accused is able to account for such resources or property. The burden then shifts to the accused to satisfactorily account for his 31 possession of disproportionate assets. The extent and nature of burden of proof resting upon the public servant to be found in possession of disproportionate assets under Section 5(1)(e) cannot be higher than the test laid by the Court in Jhingan case, i.e. to establish his case by a preponderance of probability. That test was laid down by the court following the dictum of Viscount Sankey, L.C. in Woolmington v. Director of Public Prosecutions. The High Court has placed an impossible burden on the prosecution to disprove all possible sources of income which were within the special knowledge of the accused. As laid down in Swamy case (supra), the prosecution cannot, in the very nature of things, be expected to know the affairs of a public servant found in possession of resources or property disproportionate to his known sources of income i.e. his salary. Those will be matters specially within the knowledge of the public servant within the meaning of Section 106 of the Evidence Act, 1872. Section 106 reads:32
"When any fact is especially within the knowledge of any person, the burden of proving that fact is upon him."
In this connection, the phrase 'burden of proof' is clearly used in the secondary sense. Namely, the duty of introducing evidence. The nature and extent of the burden cast on the accused is well settled. The accused is not bound to prove his innocence beyond all reasonable doubt. All that he need to do is to bring out a preponderance of probability."
36. In Vasant Rao Guhe vs. State of Madhya Pradesh (Supra) it is held that a person cannot be subjected to criminal prosecution either for a charge which is amorphous and transitory and on evidence that is conjectural or hypothetical. Para Nos.20 and 21 of the said judgment are extracted hereunder:-
"20. As ordained by the above statutory text, a public servant charged of criminal misconduct thereunder has to be proved by the prosecution to be in possession of pecuniary resources or property disproportionate to his known sources of income, at any time during 33 the period of his office. Such possession of pecuniary resources or property disproportionate to his known sources of income may be of his or anyone on his behalf as the case may be. Further, he would be held to be guilty of such offence of criminal misconduct, if he cannot satisfactorily account such disproportionate pecuniary resources or property. The Explanation to Section 13(1)(e) elucidates the words "known sources of income" to mean income received from any lawful source and that such receipt has been intimated in accordance with the provisions of law, rules, orders for the time being applicable to a public servant.
21. From the design and purport of clause (e) of sub-section (1) to Section 13, it is apparent that the primary burden to bring home the charge of criminal misconduct thereunder would be indubitably on the prosecution to establish beyond reasonable doubt that the public servant either himself or through anyone else had at any time during the period of his office been in possession of pecuniary resources or property disproportionate to his known sources of income and it is only on the 34 discharge of such burden by the prosecution, if he fails to satisfactorily account for the same, he would be in law held guilty of such offence. In other words, in case the prosecution fails to prove that the public servant either by himself or through anyone else had at any time during the period of his office been in possession of pecuniary resources or property disproportionate to his known sources of income, he would not be required in law to offer any explanation to satisfactorily account therefore. A public servant facing such charge, cannot be comprehended to furnish any explanation in absence of the proof of the allegation of being in possession by himself or through someone else, pecuniary resources or property disproportionate to his known sources of income. As has been held by this Court amongst others in State of Maharashtra Vs. Dnyaneshwar Laxman Rao Wankhede, even in a case when the burden is on the accused, the prosecution must first prove the foundational facts. Incidentally, this decision was rendered in a case involving a charge under Sections 7, 13 and 20 of the Act."35
37. From the above, the initial burden to substantiate the charge leveled against the accused is always on the prosecution in a case of this nature as it is in any criminal trial. The burden of proving the essential ingredients to establish the charge always lies upon the prosecution and the burden resting on the accused is not so onerous as that which lies on the prosecution and the said burden can be discharged by preponderance of probabilities and he need not prove his innocence beyond all reasonable doubt. Further, he would held to be guilty, if he cannot satisfactorily account for such disproportionate pecuniary resources or property, if the same is established by the prosecution beyond all reasonable doubt.
38. In the course of investigation, the accused was called upon to give the particulars of his income. The accused submitted his explanation under schedule Nos.1 to 16 through his department and schedule No.17 to 23 to the I.O. Ex.P.23 and 24 contains schedule Nos.1 to 16 collected by the I.O. which was submitted by the accused to his department. He has declared his agricultural and 36 horticultural income through his joint family properties. The revenue documents and the documents regarding the agricultural activities have been obtained by the I.O. from the Tahasildar. PW.1 in his chief examination has deposed that he addressed a letter to his superior officer seeking the details of movable and immovable properties of the accused and received a report from the Agricultural Officer, Ananthpura District. Further, he has also admitted that he visited the land concerned to the accused at Khadri Taluka in Andhra Pradesh and collected revenue documents from the Tahasildar. The Investigating Officer - PW.22 in his cross-examination has admitted that his predecessor has investigated the agricultural income of the accused, however, in the charge sheet he did not mention about the agricultural income of the accused. He has further admitted that the details regarding the agricultural income was collected by the Investigating Officer from the concerned department and since those documents were not handed over to him, he did not submit the same to the Court while filing charge-sheet.
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39. The Investigating Officer during the investigation has secured the assets and liability statement filed by the accused to his department disclosing his assets, expenditure and income, including the annual agricultural income. The defence while conducting cross- examination of PW.22 confronted those documents to him. He has admitted that the assets and liability statement of the accused from the year 1995 to 2000 and 2004 to 2009 were secured from the department. PW.22 has admitted that those documents were received during the investigation under covering letters, marked as Ex.D.14 to
16.
40. The I.O. has not shown the agricultural income of the land measuring 43 acres as shown in Ex.D.3 to 13, which amounts to Rs.45,00,000/- from 1995 to 2000 and 2004 to 2009, on the ground that such income was not shown by the accused while submitting his income tax returns and also on the ground that the land is standing not only in the name of accused, but also in the name of 38 his family members. The learned Trial Judge, has rejected Ex.D.3 to 13 on the ground that they are the photo copies of annual assets, observing that the accused has not obtained the certified copies of Ex.D.3 to 13 from the competent authority to tender such documents in evidence and he has not taken any steps to call the original assets and liability statement from his employer during the trial and also that there is no seal and signature of the authority who received the document. Hence, it is held that manipulation of copies cannot be ruled out. The said findings recorded by the Trial Court are not proper. PW.22 has admitted that in the course of investigation through covering letters at Ex.D.14 to 16, the documents at Ex.D.3 to 13 were received by him from the concerned department. As per explanation to Section 13 (e) of P.C. Act, 1988, 'known source of income' means income received from any lawful sources. Further, a public servant is required to submit his assets and liability statement namely Annual Property Returns (APR) and such returns were submitted from the year 1995 - 96. In the case on 39 hand Ex.D.3 to 13 documents were confronted to the I.O. and marked without objection. The said documents were obtained by the I.O. along with the original covering letters and when the defence confronted the said documents to the I.O., the prosecution has not raised any objection. Therefore, finding fault with the accused at a later stage that originals are not produced by him has certainly prejudiced him, since if the said objection was raised at an earlier stage, the defence would have taken steps to tender the certified copies from the competent authority.
41. It is relevant to refer to Para No.20 of the judgment of the Apex Court in the case of R.V.E. Venkatachala Gounder vs. Arulmigu Viswesaraswami and V.P. Temple and Another (Supra).
"20. The learned counsel for the defendant- respondent has relied on The Roman Catholic Mission Vs. The State of Madras & Anr. AIR 1966 SC 1457 in support of his submission that a document not admissible in evidence, though brought on record, has to be excluded from 40 consideration. We do not have any dispute with the proposition of law so laid down in the above said case. However, the present one is a case which calls for the correct position of law being made precise. Ordinarily an objection to the admissibility of evidence should be taken when it is tendered and not subsequently. The objections as to admissibility of documents in evidence may be classified into two classes:- (i) an objection that the document which is sought to be proved is itself inadmissible in evidence; and (ii) where the objection does not dispute the admissibility of the document in evidence but is directed towards the mode of proof alleging the same to be irregular or insufficient. In the first case, merely because a document has been marked as 'an exhibit', an objection as to its admissibility is not excluded and is available to be raised even at a later stage or even in appeal or revision. In the latter case, the objection should be taken before the evidence is tendered and once the document has been admitted in evidence and marked as an exhibit, the objection that it should not have been admitted in evidence or that the mode adopted for proving the document is irregular cannot be 41 allowed to be raised at any stage subsequent to the marking of the document as an exhibit. The later proposition is a rule of fair play. The crucial test is whether an objection, if taken at the appropriate point of time, would have enabled the party tendering the evidence to cure the defect and resort to such mode of proof as would be regular. The omission to object becomes fatal because by his failure the party entitled to object allows the party tendering the evidence to act on an assumption that the opposite party is not serious about the mode of proof. On the other hand, a prompt objection does not prejudice the party tendering the evidence, for two reasons: firstly, it enables the Court to apply its mind and pronounce its decision on the question of admissibility then and there; and secondly, in the event of finding of the Court on the mode of proof sought to be adopted going against the party tendering the evidence, the opportunity of seeking indulgence of the Court for permitting a regular mode or method of proof and thereby removing the objection raised by the opposite party, is available to the party leading the evidence. Such practice and procedure is fair to both the 42 parties. Out of the two types of objections, referred to hereinabove, in the later case, failure to raise a prompt and timely objection amounts to waiver of the necessity for insisting on formal proof of a document, the document itself which is sought to be proved being admissible in evidence. In the first case, acquiescence would be no bar to raising the objection in a superior Court."
42. The Trial Court has refused to accept Ex.D.3 to 9, wherein it is shown that the accused, his father and brothers were jointly holding 43 acres of land and two houses, on the ground that the disclosure was not made in the statement for the year 1993-94 and also on the grounds that the certified copies of record of right are not produced. It is relevant to see that the disproportionate case is registered in the year 2009/10. The accused has shown the asset in the statement for year 1996-97. These documents could not have been manipulated and concocted anticipating the prosecution of the accused in 2009-10. The Trial Court was not proper in refusing to 43 accept Exs.P.23 and 24, marked through PW.1, which shows that he sought for an information which was submitted by the accused. The Trial Court has observed that it is hard to believe that the accused inherited the properties before joining to service and also found fault with the accused for not entering into witness box and not examining others.
43. PW.22 has admitted that Ex.D.3 to 13 were sent to the office of Lokayukta by the concerned department and Ex.D.14 and 16 are the letters received by them. He has admitted that those documents were not furnished to the Court along with the final report. He has further stated that the accused has mentioned about the income, he was receiving from 43 acres of his ancestral property situated in Ananthapur and the same was investigated by his predecessor, but he did not mention in the final report. PW.22 has also stated that the Investigating Officer while conducting investigation had received the information from the Horticultural department about the agricultural income 44 of the accused, however, he did not submit those documents to the Court along with the charge sheet. He has further admitted he has not taken into consideration the agricultural income of Rs.45,00,000/- while filing the charge sheet. Hence, The Trial Court was not proper in rejecting the claim of the accused with regard to the agricultural income completely. The agricultural income shown in Ex.D.3 to 13 is a sum of Rs.45,00,000/-. It cannot be said that the accused did not have income from agricultural activities during the check period.
44. The learned counsel for the appellant has relied on a decision of the Hon'ble Supreme Court in the case of Kaptansingh and others (Supra), to contend that the learned Trial Judge was not proper in ignoring the documents marked by the defence through the Investigating Officer. He contends that the Trial Court has based the conviction only on the basis of the investigation papers without properly appreciating the documents relied upon by the defence.
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45. In the aforementioned judgment, the Hon'ble Apex Court has referred to the judgment in the case of Vijendr vs. State of Delhi reported in (1997) 6 SCC 171, wherein it is held as under:-
"The reliance of the trial judge on the result of investigation to base his findings is again patently wrong. If the observation of the trial Judge in this regard is taken to its logical conclusion it would mean that a finding of guilt can be recorded against an accused without a trial, relying solely upon the police report submitted under Section 173 Cr.P.C. which is the outcome of an investigation. The result of investigation under Chapter XII of the Criminal Procedure Code is a conclusion that an Investigating Officer draws on the basis of materials collected during investigation and such conclusion can only form the basis of a competent court to take cognizance thereupon under Section 190 (1)(b) CrPC and to proceed with the case for trial, where the materials collected during investigation are to be translated into legal evidence. The trial court is then required to base its conclusion solely on 46 the evidence adduced during the trial; and it cannot rely on the investigation or the result thereof. Since this is an elementary principle of criminal law, we need not dilate on his point any further."
46. The Trial Court has taken the income from sale of gold ornaments as NIL. The accused claimed an income of Rs.3,60,000/- from the sale of gold weighing 300 grams to one Ganesh Reddy (PW.15). Similarly, an income of Rs.3,90,000/- from sale of gold to one Gopal Reddy (CW.45). It is contended that the prosecution has not deliberately marked the sale receipts and letter collected from PW.15 as exhibits, hence, in the cross-examination of I.O. those documents were marked as Ex.D.1 and 18. Further, it is contended that Gopal Reddy was deliberately not examined and therefore, the defence got marked Ex.D.19. The learned counsel has contended that those documents clearly show that the accused by selling the gold to the said two persons had an income of Rs.7,50,000/-.
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47. The Trial Court has taken note of the fact that the gold articles worth Rs.3,60,000/- sold to Ganesh Reddy, as per Ex.D.1 is prepared on a plain paper and raised a suspicion over the execution of the said document, prior to registration of Crime No.7/2009. Similarly, Ex.D.19 said to have been executed at the time of sale of gold to Gopal Reddy is also on a plain paper. The Trial Court was right in observing that if the alleged 600 grams of gold shown in Ex.D.1 and 19 are included in the asset component, such gold has to be included in the gold component as well. Therefore, the price of gold shown in Ex.D.1 and Ex.D.19 was rightly not considered as the income of the accused.
48. Insofar as the rental income of Rs.1,20,000/- claimed by the accused is concerned, the Trial court has found that the rental agreements were written on a stamp paper, purchased after registration of the case in Crime.No.7/2009 and therefore, rejected the claim of the accused, who relied on a lease-agreement dated 48 05.01.2009 said to be executed by him, observing that the parties have kept quiet from 05.01.2009 till 18.09.2009 and the deed came into existence only after registration of the case. Hence, rejection of Ex.D.13 insofar as the rental agreement is concerned is justified.
49. The learned counsel for respondent has relied on the judgment of the Hon'ble Apex Court in the case of K.Ponnuswamy (supra). In the said case, it is held that, "when appellant only a lecturer his income was meager, but during the period he held the office of Minister, though in his own name there were no pecuniary resources of assets disproportionate to his known source of income, but assets standing in his wife and daughter, who had no source of income of their own, were substantial, as they could not explain their source of income." The facts of the said case is not applicable to the case on hand.
50. The learned counsel for the respondent has relied on a decision in State of Tamil Nadu vs. N. Suresh Rajan (Supra), to contend that the 'property in 49 the name of income tax assessee itself cannot be a ground to hold that it actually belongs to such an assessee.' There is no dispute with the regard to the said proposition. In the said case the accused was seeking an order of discharge on the ground that he is an income tax assessee and the said contention was negated as it was alleged by the prosecution that there is no separate income to amass the properties.
51. In State of M.P. vs. Awadh Kishor Gupta and others (supra), relied upon by the learned counsel for the respondent, the Hon'ble Apex Court refused to quash the proceedings, observing that, at that juncture the Court cannot appreciate the evidence, but can evaluate material and documents on records to the extent of its prima-facie satisfaction about the existence of sufficient ground for proceedings against the accused.
52. After evaluating and re-appreciating the evidence and material on record this Court finds that the 50 Trial Court was not justified in rejecting the agricultural income of the accused in toto. Further, as already noted supra the Court below was not justified in not giving 10% deduction in respect of item No.9 under the heads of assets, which comes to Rs.15,180/- and also taking the value of item No.28 under the same head as the assets of the accused, which is Rs.76,00,000/-. The Trial Court has arrived at a conclusion that the accused has amassed disproportionate assets to the tune of Rs.10,22,630/- during the check period 12.09.1993 to 27.08.2010. Not considering the agricultural income claimed by the accused has resulted in miscarriage of justice. Even if 1/4 of the agricultural income is taken into consideration then it cannot be said that the accused was having pecuniary resources or property disproportionate to the known source his income. The accused has been able to satisfactorily account for the possession of resources by preponderance of probability.
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53. It is also contended by the learned counsel for the appellant that in the case on hand initially Crime No.7/2009 was registered and investigation in the said case was conducted by the police inspector and the material collected during the course of said investigation is relied upon by the prosecution in Crime No.4/2010 registered against the appellant under Section 13 (1) (e) read with Section 13 (2) of P.C. Act. He has contended that no separate search or mahazars were conducted in Crime No.4/2010 and therefore the investigation will not have legal sanctity in the eye of law.
54. Admittedly, Crime No.7/2009 was registered against the appellant on a complaint lodged by one Srinivas Prasad - PW.2 on an allegation that the appellant demanded a sum of Rs.30,000/- from him and later destroyed the voice recorder etc., The said case ended in filing of a 'C' report. Interestingly, the said case was registered under Section 13 (1) (e) read with Section 13 (2) of P.C. Act read with Section 201 of IPC. The FIR was 52 registered by the police inspector - PW.10 on 26.08.2009. PW.10 has deposed in his evidence that on 27.08.2009 he visited the office of the accused and conducted a search and seized certain documents under a mahazar marked as per Ex.P.17 and then submitted the documents before CW.1/PW.1. He has admitted that he has completed the investigation in Crime No.7/2009. He has admitted that he has no authority to conduct the investigation for the offence punishable under Section 13 (1) (e) of the P.C. Act. Though, he has stated that till Crime No.4/2010 was registered, he has not made any investigation regarding the disproportionate assets of the accused, however, he has stated that in Ex.P.8 seeking search warrant submitted to the Court, he has mentioned that he has taken up investigation in respect of disproportionate assets. Admittedly, Crime No.4/2010 was registered on 23.10.2010 by PW.1.
55. PW.3 is the panch witness to the mahazars - Exs.P.14 and 17, which are conducted after registration of 53 Crime No.7/2009. It can be gathered from his evidence that he went along with the Lokayutka Police to the house of the accused, wherein Ex.P.14 Mahazar was drawn and then they went to the office of the accused, wherein Ex.P.17 was drawn.
56. PW.22 is the Investigating Officer who filed the charge sheet. He has deposed that Crime No.7/2009 was registered by the Police Inspector against the accused for amassing disproportionate assets and admitted that the police inspector has no power to investigate the said case. He has stated that the said police inspector was not authorized and there was no permission granted to him to conduct investigation. Further, after registration of Crime No.4/2010 there was no raid conducted in the house of the accused and no documents were collected.
57. From the evidence of PW.22 it is abundantly clear that after registration of Crime No.4/2010 no documents were collected from the house of the accused 54 and the documents collected in Crime No.7/2009 was adopted in Crime No.4/2010.
58. It is held in the case State Inspector of Police, Vishakhapatnam vs. Surya Shankaram Karri reported in (2006) 7 SCC 172, that the non-obstante clause occurring in Section 17 of the P.C. Act, 1988, makes investigation only by a police officer of the rank specified therein and the investigation cannot be carried out without authorization by a police officer not below the rank of Superintendent of Police.
59. In the case on hand, Crime No.7/2009 was registered by PW.10, Police Inspector. In the course of investigation of the said case Ex.P.14 and 17 were prepared. PW.22 has categorically admitted that the said officer has no authority to conduct investigation in disproportionate asset cases. He has also admitted that after registration of Crime No.4/2010 the house of the accused was not raided and no documents are collected from the accused.
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60. It is relevant to refer to Para No.13 of the above judgment of the Hon'ble Apex Court :-
"13. Provisions of the 1988 Act, no doubt, like the 1947 Act seek to protect public servant from a vexatious prosecution. Section 17 provides for investigation by a person authorised in this behalf. The said provision contains a non-obstante clause. It makes investigation only by police officers of the ranks specified therein to be imperative in character. The second proviso appended to Section 17 of the Act provides that an offence referred to in clause (3) of sub-section (1) of Section 13, shall not be investigated without the order of a police officer not below the rank of a Superintendent of Police. Authorisation by a Superintendent of Police in favour of an officer so as to enable him to carry out investigation in terms of Section 17 of the Act is a statutory one. The power to grant such sanction has been conferred upon the authorities not below the rank of a Superintendent of Police. The proviso uses a negative expression. It also uses the 56 expression "shall" Ex facie it is mandatory in character. When the authority of a person to carry out investigation is questioned on the ground that he did not fulfill the statutory requirements laid down therefore in terms of the second proviso, the burden, undoubtedly, was on the prosecution to prove the same. It has not been disputed before us that the investigating officer, PW.41, did not produce any record to show that he had been so authorized. Shri. K. Biswal, the Investigating Officer, while examining himself as PW.41, admitted that he had not filed any authorisation letter stating;
"I have received the specific authorisation from SP, CBI, to register a case but I have not filed the said authorisation letter:"
61. The learned counsel for the appellant has relied on the judgment of the Hon'ble Apex Court in Roy V.D. (Supra), wherein it is held that Where criminal proceedings are initiated based on illicit material collected on search and arrest which are per se illegal, vitiate not only a conviction and sentence based on such material, but also the trial itself."
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62. From the above discussion and for the foregoing reasons, this Court is of the considered view that the conviction and sentence passed by the Trial Court against the accused for the offence punishable under Sections 13 (1) (e) read with Section 13 (2) of the P.C. Act, 1988 is not sustainable in law. Hence, the following;
ORDER I. Appeal is allowed.
II. The judgment and order dated 27.08.2020 passed by the Court of III Additional District and Sessions Judge and Special Court for trial of cases relating to Prevention of Corruption Act, D.K. Mangaluru in Spl. Case No.19/2013, is hereby set-aside.
III. Appellant - accused is acquitted of the charges leveled against him under Section 13 (1) (e) read with Section 13 (2) of Prevention of Corruption Act. IV. The bail bond executed by the appellant is cancelled.
Sd/-
JUDGE KJJ