Ashok Tshering Bhutia vs State Of Sikkim

Ashok Tshering Bhutia ...Appellant

Versus

State of Sikkim ...Respondent

J U D G M E N T

Dr. B.S. CHAUHAN, J.

1. This appeal has been preferred against the judgment and order

dated 11.12.2002 passed by the High Court of Sikkim at Gangtok in

Criminal Appeal No. 4 of 2002, upholding the judgment and order

dated 30.5.2002, passed by the Special Judge, Prevention of

Corruption Act, Gangtok in Criminal Case No. 4 of 1997, convicting

the appellant for the offences punishable under Section 13(2) read

with Section 13(1)(e) of the Prevention of Corruption Act, 1988

(hereinafter called as PC Act 1988) and awarding him the sentence of

3 years RI and a fine of Rs.10,000/-, in default thereof, to undergo a

further RI for six months.

2. Facts and circumstances giving rise to appeal are as under:

(A) The appellant joined the Special Branch of Police in the State

of Sikkim as a Constable in 1972. He was accorded promotion to the

rank of Head Constable in 1976, and was subsequently promoted on

an ad hoc basis to the post of Inspector in 1987. His services were

attached to the Hon'ble Chief Minister of Sikkim in 1987. The

appellant was repatriated to his parent department, i.e. the Reserve

Line, in 1994.

(B) An FIR dated 5.1.1996 was registered against the appellant by

the DSP, CBI (ACB) under Section 13(2) r/w Section 13(1)(e) of the

PC Act 1988, alleging that the appellant was in possession of

disproportionate assets to the tune of Rs.6,46,805/- and had

accumulated the same between 1987 to 1995.

(C) The appellant received the office memorandum dated 5th/31st

August, 1996 from the Superintendent of Police, Police Headquarters,

Gangtok, directing him to give a consolidated statement of the

2

immovable properties inherited and/or owned or acquired by him in

his name or in the name of any member of his family during the

period from 1987 to 1995, as per the requirements of statutory

provisions in the Sikkim Government Servants Conduct Rules, 1981

(hereinafter called Rules 1981).

(D) The appellant submitted the required information vide

document Ext. D-4 on 10.9.1996 giving full details of the properties

acquired and possessed by him. The Director General of Police,

Sikkim granted sanction on 5.4.1997, under the provisions of Section

19(1)(c) of the PC Act 1988 to prosecute the appellant under Section

13(2) r/w Section 13(1)(e) of the PC Act 1988.

(E) The charge sheet was submitted against the appellant on

23.4.1997, alleging that he was found in possession of the assets dis-

proportionate to his known sources of income, to the tune of

Rs.18,25,098.69, which had been acquired by him, abusing his official

post during the period from 1.4.1987 to 10.1.1996.

(F) The learned Special Judge vide order dated 18.6.1998 came to

the conclusion that there was a prima facie case against the appellant

to try him for the aforesaid charges.

3 (G) Being aggrieved, the appellant approached the High Court by

filing the Revision Petition No.4 of 1998 challenging the aforesaid

order. The High Court disposed of the said petition vide order dated

26.8.1998 holding that it would be the duty of the Investigating

Officer to establish its authority at the time of commencement of the

trial.

(H) During the course of trial, the prosecution examined 26

witnesses and the statement of the appellant was recorded under

Section 313 of the Code of Criminal Procedure, 1973 (hereinafter

called Cr.P.C.) on 29.11.2001. Subsequent thereto, in support of his

case the appellant also examined 4 witnesses. The Special Judge held

the appellant guilty of the aforesaid charges vide judgment and order

dated 30.5.2002 and awarded the punishment mentioned hereinabove.

(I) Being aggrieved, the appellant approached the High Court by

filing Criminal Appeal No.4 of 2002. During the hearing of the

appeal, an argument was advanced before the High Court that a large

number of documents, particularly the Exhibits P/16, P/17, P/23, P/33,

P/34, P/35(I), P/35(II), P/35(III), P/62 and P/63, though relied by the

Special Judge during the trial, had not been proved in evidence.

4 Therefore, the judgment of the Special Court suffered from

fundamental procedural errors and stood vitiated. The High Court

instead of deciding the appeal taking into account the aforesaid

argument, remitted the matter to the Trial Court vide order dated 27th

September, 2002, giving an opportunity to the prosecution to prove

those documents and it directed the Trial Court to send the file back to

the High Court after completing that formality.

(J) The Special Judge considered the matter in the light of the

directions issued by the High Court and on an application submitted

by the Special Public Prosecutor on 7.10.2002, issued summons to 12

witnesses i.e. Shri Kishore Kumar Mukhiya (PW.3), Shri P.S. Rasaily

(PW.4), Shri Chandra Prakash Raya (PW.6), Shri B.K Gurung

(PW.8), Shri B.K. Mukhiya (PW.9), Shri Kamal Tewari (PW.10), Shri

R.K. Gupta (PW.11), Shri K. Somarajan (PW.12), Shri D.P. Deokotta

(PW.15), Shri C.K. Das (PW.16), Shri Shri B.K. Trihatri (PW.23) and

Shri Pallav Kenowar (PW.24) to appear before it to prove the

aforesaid documents, and dates were fixed for that purpose from

25.10.2002 to 30.10.2002.

5 (K) In spite of all this, the prosecution failed to prove the said

documents as the original records of the aforesaid documents, which

related to the bills of telephone and electricity expenditure

aggregating to Rs.1,04,364/-. Shri R.K. Gupta, Sr. Accounts Officer

(PW.11) appeared before the Special Court and admitted that the

original S.R.C. could not be produced in the court as the same was not

traceable in respect of the telephone bill. Same remained the position

in respect of the electricity charges as Shri D.P. Deokota, Executive

Engineer, Power Department (PW.15), admitted that the original

demand register could not be brought as the same was not traceable.

With the aforesaid remarks, the Special Judge referred the matter back

to the High Court and the High Court heard the arguments and

dismissed the appeal vide impugned judgment and order. Hence, this

appeal.

3. Shri V.A. Bobde, learned senior counsel appearing for the

appellant, has raised a large number of issues contending inter-alia

that the FIR could not have been lodged without the written

order/direction of the Superintendent of Police. The FIR had been

lodged in flagrant violation of statutory requirements. The question of

putting the criminal law into motion could not arise. Executive action

6

has not only been taken irresponsibly, it tantamounts to abuse of

power. The courts below not only ought to have disapproved of it but

should have refused to act upon it. The police authorities cannot be

permitted to take advantage of an abuse of power. Sanction could not

have been accorded without considering the contents of Ex.D-4; no

preliminary enquiry had been conducted against the appellant, as

required by various judicial pronouncements of this Court. The

documents very heavily relied upon by the prosecution had never been

proved in spite of remand of the case for that purpose. Remand even

for limited purpose to prove the documents was impermissible as it is

tantamount to giving an opportunity to the prosecution to fill up any

lacunae in its case. The procedural error committed by the prosecution

is not curable. Therefore, the entire prosecution proceedings stood

vitiated. More so, the evidence adduced by the appellant in defence

regarding the income from his rented premises had been discarded on

flimsy grounds e.g. that the tenants had not shown their income and

expenditure while filling up the income tax returns, nor had the

tenants produced the rent receipts or on the basis that there was some

discrepancy between the income derived from the tenants and the

amounts shown from other sources while submitting the Ext. D-4.

7 Shri Bobde has further submitted that the Explanation added to

Section 13(1)(e) of PC Act 1988 did not exist in the Prevention of

Corruption Act, 1947 (hereinafter called Act 1947). It provides that

"known sources of income" means income received from any lawful

source and such receipts had been submitted by the appellant in Ext.

D-4. No such requirement was there under Section 5(1)(e) of the Act,

1947 and, therefore, the start of check period from 1.4.1987 and

computation of income was not based on any income derived from

other lawful sources. The addition of the Explanation to Section

13(1)(e) led to a material change in the statutory requirement. The

courts below failed to appreciate the submission that the PC Act 1988

was made applicable in the State of Sikkim on 12.9.1988, though in

other States it had come into force earlier. The prosecution failed to

make any segregation between the periods covered by the two Acts, as

regards income, expenditure, savings, assets with the result that

prosecution had not proved any of the said documents from

12.9.1988. Thus, the entire proceedings had been conducted in gross

violation of the rights of the appellant under Article 21 of the

Constitution of India. In view of the above, the appeal deserves to be

8

allowed and judgments and orders of the courts below are liable to be

set aside.

4. On the contrary, Shri P.P. Malhotra, Additional Solicitor

General and Shri A. Mariarputham, learned senior counsel appearing

for the respondents, have vehemently opposed the appeal pointing out

that the document Ext.D-4 was not submitted in compliance of the

statutory requirement of Section 19 of Rules 1981. The fact that

documents particularly the telephone and electricity bills were not

proved even after remand itself does not affect the merits of the case,

as the same cannot be a ground for disbelieving the said documents.

The said bills had been prepared on the basis of the registers, though

registers could not be traced and the bills could not be proved.

Addition of Explanation to Section 13(1)(e) of the PC Act 1988

does not make any difference whatsoever in view of the fact that once

the prosecution successfully establishes the possession of dis-

proportionate assets the burden shifts to the accused to prove his

innocence. Mere acquisition of property does not itself constitute an

offence under the P.C. Act, 1988, rather it is failure to satisfactorily

account for such possession of property that makes the possession

9

thereof objectionable as offending the law. The issue of segregation

of income and expenditure etc. for the periods covered by the two

Acts is not required to be considered as PC Act 1947 as well as PC

Act 1988 provided for the possession of assets at any time during the

period of his office. Defence evidence has rightly been discarded by

the courts below being not reliable. Any error, omission or irregularity

in the sanction does not vitiate the trial unless a failure of justice has

been occasioned thereby. Thus, the appeal is devoid of any merit and

is liable to the dismissed.

5. We have considered the rival submissions made by learned

counsel for the parties and perused the record.

6. This Court in P. Sirajuddin etc. v. The State of Madras etc.,

AIR 1971 SC 520; and State of Haryana & Ors. v. Ch. Bhajan Lal

& Ors., AIR 1992 SC 604 has categorically held that before a public

servant is charged with an act of dishonesty which amounts to serious

mis-demeanor and an FIR is lodged against him, there must be some

suitable preliminary enquiry into the allegations by a responsible

officer. Such a course has not been adopted by the prosecution though

10

the law declared by this Court is binding on everyone in view of the

provisions of Article 14 of the Constitution, which would by all means

override the statutory provisions of the Cr.P.C. and such an

irregularity is not curable nor does it fall within the ambit of Section

465 Cr.P.C. However, as the issue is being raised first time before

this Court, it is not worth further consideration. More so, the aforesaid

observations do not lay down law of universal application.

7. Much has been argued on the issue that investigation has been

conducted without a proper order in writing, by an officer not

authorised otherwise and sanction has been granted under Section 19

of the PC Act 1988 vide order dated 5.4.1997, without taking into

account the assets and income shown in Ext. D-4, though the said

assets represented known sources of income within the meaning of

Section 13(1)(e) and the Explanation attached thereto. It has further

been submitted that an invalid sanction cannot be the foundation for

the prosecution and thus, the entire investigation and trial stood

vitiated as the investigation without proper authorisation and invalid

sanction goes to the root of the jurisdiction of the court and so the

conviction cannot stand.

11 8. The issues raised hereinabove are no more res integra. The

matter of investigation by an officer not authorised by law has been

considered by this Court time and again and it has consistently been

held that a defect or irregularity in investigation however serious, has

no direct bearing on the competence or procedure relating to

cognizance or trial and, therefore, where the cognizance of the case

has in fact been taken and the case has proceeded to termination, the

invalidity of the precedent investigation does not vitiate the result,

unless a miscarriage of justice has been caused thereby. The defect or

irregularity in investigation has no bearing on the competence of the

Court or procedure relating to cognizance or trial. (Vide H.N.

Rishbud & Anr. v. State of Delhi, AIR 1955 SC 196; Munnalal v.

State of U.P., AIR 1964 SC 28, Khandu Sonu Dhobi & Anr. v. The

State of Maharashtra, AIR 1972 SC 958; State of M.P. v. Bhooraji

& Ors., AIR 2001 SC 3372; State of M.P. v. Ramesh Chand

Sharma, (2005) 12 SCC 628; and State of M.P. v. Virender Kumar

Tripathi, (2009) 15 SCC 533).

9. In Kalpnath Rai v. State (Through CBI), AIR 1998 SC 201, a

case under the provisions of Section 20 of Terrorist and Disruptive

12

Activities (Prevention) Act, 1987, this Court considered the issue as to

whether an oral direction to an officer to conduct investigation could

meet the requirement of law. After considering the statutory

provisions, the Court came to the conclusion that as oral approval

was obtained from the competent officer concerned, it was sufficient

to legalise the further action.

10. In State Inspector of Police, Vishakhapatnam v. Surya

Sankaram Karri, (2006) 7 SCC 172, a two-Judge Bench of this

Court had taken a contrary view without taking note of the earlier

two-Judge Bench judgment in Kalpnath Rai (supra) and held as

under:

"When a statutory functionary passes an

order, that too authorizing a person to carry out a

public function like investigation into an offence,

an order in writing was required to be passed. A

statutory functionary must act in a manner laid

down in the statute. Issuance of an oral direction

is not contemplated under the Act. Such a concept

is unknown in administrative law. The statutory

functionaries are enjoyed with a duty to pass

written orders. However, the Court taking note of

subsequent proceedings recorded its conclusions

as under:

`It is true that only on the basis of illegal

investigation a proceeding may not be quashed

unless miscarriage of justice is shown, but in this

13

case as we have noticed hereinbefore, the

respondent had suffered miscarriage of justice as

the investigation made by PW 41 was not fair'."

11. In the instant case, the officer has mentioned in the FIR itself

that he had orally been directed by the Superintendent of Police to

investigate the case. It is evident from the above that the judgments in

Kalpnath Rai (supra) and Surya Sankaram Karri (supra) have

been decided by two Judge Benches of this Court and in the latter

judgment, the earlier judgment of this Court in Kalpnath Rai (supra)

has not been taken note of. Technically speaking it can be held to be

per incuriam. There is nothing on record to show that the officer's

statement is not factually correct. We have no occasion to decide as

which of the earlier judgments is binding. It is evident that there was

a direction by the Superintendent of Police to the officer concerned to

investigate the case. Thus, in the facts and circumstances of the case,

the issue as to whether the oral order could meet the requirement of

law remains merely a technical issue. Further, as there is nothing on

record to show that the investigation had been conducted unfairly, we

are not inclined to examine the issue further.

14 12. Same remained the position regarding sanction. In the absence

of anything to show that any defect or irregularity therein caused a

failure of justice, the plea is without substance. A failure of justice is

relatable to error, omission or irregularity in the sanction. Therefore, a

mere error, omission or irregularity in sanction is not considered to be

fatal unless it has resulted in a failure of justice or has been

occasioned thereby. Section 19 (1) of the PC Act 1988 is a matter of

procedure and does not go to the root of the jurisdiction and once the

cognizance has been taken by the Court under Cr.P.C., it cannot be

said that an invalid police report is the foundation of jurisdiction of

the court to take cognizance. (Vide Kalpnath Rai (supra); State of

Orissa v. Mrutunjaya Panda, AIR 1998 SC 715; State by Police

Inspector v. Sri T. Venkatesh Murthy, (2004) 7 SCC 763;

Shankerbhai Laljibhai Rot v. State of Gujarat, (2004) 13 SCC

487; Parkash Singh Badal & Anr. v. State of Punjab & Ors., AIR

2007 SC 1274; and M.C. Mehta v. Union of India & Ors. (Taj

Corridor Scam), AIR 2007 SC 1087).

13. In State of Haryana & Ors. v. Ch. Bhajan Lal & Ors., AIR

1992 SC 604, this Court dealing with the same provisions held that a

15

conjoint reading of the main provision, Section 5-A(1) (new Section

17) and the two provisos thereto, shows that the investigation by the

designated police officer was the rule and the investigation by an

officer of a lower rank was an exception. It has been ruled by the

Court in several decisions that Section 6-A (new Section 23) of the

Act was mandatory and not directory and the investigation conducted

in violation thereof bears the stamp of illegality, but that illegality

committed in the course of an investigation, does not affect the

competence and the jurisdiction of the Court for trial and where the

cognizance of the case has in fact been taken and the case has

proceeded to termination, the validity of the proceedings is not

vitiated unless a miscarriage of justice has been caused as a result of

the illegality in the investigation.

In the facts and circumstances of the case, we are also not

willing to examine the correctness of submissions made by Mr. Bobde

in respect of segregation of period covered by two Acts and as to

whether ratio of the judgment of this Court in State of Maharashtra

v. Krishnarao Dudhappa Shinde, (2009) 4 SCC 219, runs counter to

the ratio in State of Maharashtra v. Kaliar Koil Subramaniam

Ramaswamy, AIR 1977 SC 2091, wherein the earlier judgment in

16 Sajjan Singh v. State of Punjab, AIR 1964 SC 464, had been

explained.

14. In view of the above, the facts and circumstances of the instant

case require an examination of the case on merits.

Additional Evidence:

15. Additional evidence at appellate stage is permissible, in case of

a failure of justice. However, such power must be exercised sparingly

and only in exceptional suitable cases where the court is satisfied that

directing additional evidence would serve the interests of justice. It

would depend upon the facts and circumstances of an individual case

as to whether such permission should be granted having due regard to

the concepts of fair play, justice and the well-being of society. Such

an application for taking additional evidence must be decided

objectively, just to cure the irregularity. The primary object of the

provisions of Section 391 Cr.P.C. is the prevention of a guilty man's

escape through some careless or ignorant action on part of the

prosecution before the court or for vindication of an innocent person

wrongfully accused, where the court omitted to record the

circumstances essential to elucidation of truth. Generally, it should be

17

invoked when formal proof for the prosecution is necessary. (Vide

Rajeswar Prasad Misra v. The State of West Bengal & Anr., AIR

1965 SC 1887; Ratilal Bhanji Mithani v. The State of

Maharashtra & Ors., AIR 1971 SC 1630; Rambhau & Anr. v.

State of Maharashtra, AIR 2001 SC 2120; Anil Sharma & Ors. v.

State of Jharkhand, AIR 2004 SC 2294; Zahira Habibulla H.

Sheikh & Anr. v. State of Gujarat & Ors., (2004) 4 SCC 158; and

Sidhartha Vashisht @ Manu Sharma v. State (NCT of Delhi), AIR

2010 SC 2352).

16. This Court in State of Gujarat v. Mohanlal Jitamalji Porwal

& Anr., AIR 1987 SC 1321, dealing with the issue held as under:

"...To deny the opportunity to remove the formal

defect was to abort a case against an alleged

economic offender. Ends of justice are not

satisfied only when the accused in a criminal case

is acquitted. The community acting through the

State and the Public Prosecutor is also entitled to

justice. The cause of the community deserves equal

treatment at the hands of the court in the

discharge of its judicial functions. The community

or the State is not a persona-non-grata whose

cause may be treated with disdain. The entire

community is aggrieved if the economic offenders

who ruin the economy of the State are not brought

to book. A murder may be committed in the heat of

moment upon passions being aroused. An

18

economic offence is committed with cool

calculation and deliberate design with an eye on

personal profit regardless of the consequence to

the community. A disregard for the interest of the

community can be manifested only at the cost of

forfeiting the trust and faith of the community in

the system to administer justice in an even-handed

manner without fear of criticism from the quarters

which view white collar crimes with a permissive

eye unmindful of the damage done to the national

economy and national interest....."

17. In Rambhau (supra), a larger Bench of this Court held as

under:

"Incidentally, Section 391 forms an exception to

the general rule that an Appeal must be decided on

the evidence which was before the Trial Court and

the powers being an exception shall always have

to be exercised with caution and circumspection

so as to meet the ends of justice. Be it noted

further that the doctrine of finality of judicial

proceedings does not stand annulled or affected in

any way by reason of exercise of power under

Section 391 since the same avoids a de novo trial.

It is not to fill up the lacuna but to subserve the

ends of justice. Needless to record that on an

analysis of the Civil Procedure Code, Section 391

is thus akin to Order 41, Rule 27 of the C.P.

Code." (Emphasis added)

18. In view of the above, the law on the point can be summarised to

the effect that additional evidence can be taken at the appellate stage

in exceptional circumstances, to remove an irregularity, where the

19

circumstances so warrant in public interest. Generally, such power is

exercised to have formal proof of the documents etc. just to meet the

ends of justice. However, the provisions of Section 391 Cr.P.C.

cannot be pressed into service in order to fill up lacunae in the

prosecution's case.

19. In Santa Singh v. State of Punjab, AIR 1956 SC 526; Tori

Singh & Anr. v. State of Uttar Pradesh, AIR 1962 SC 399; and

State of Rajasthan v. Bhawani & Anr., AIR 2003 SC 4230, this

Court placed reliance upon its earlier judgment and came to the

conclusion that any information or statement made before the

investigating officer under Section 161 Cr.P.C. requires corroboration

by sufficient evidence. In the absence of any corroboration thereof, it

would merely be a case where some witnesses had stated a particular

fact before the investigating officer and the same remained

inadmissible in law, in view of the provisions of Section 162 Cr.P.C.

20. In the instant case, the electricity and telephone bills have not

been proved at the time of trial. The High Court while hearing the

appeal remitted the matter back to the Trial Court to allow the

20

prosecution to prove the said documents and in spite of giving full

opportunity to the prosecution witnesses, the said bills were not

proved. Though it may be permissible in law as referred to

hereinabove to get the formal approval of the documents by adducing

additional evidence, but it cannot be held even by any stretch of

imagination that in absence of proving the said documents the same

can be relied upon. Therefore, the judgments of the courts below

suffered from a fundamental procedural error and the amount shown

in the said bills to the tune of Rs.1,04,364/- cannot be taken into

account.

21. For the sake of argument, even if it is assumed that the form

required to be filled up under Rule 19 of the Rules 1981 was

mandatory and the appellant failed to fill up the same, for the reason

that the form had never been prescribed under the Rules 1981, and he

ought to have declared the same on plain papers, as he did on

instructions of the superior authority after lodging of the FIR against

him, the document Ext.D-4 could not be rejected merely on the

ground that it had been submitted after the lodging of the FIR. Not

filling up the form under the mandatory requirement of Rule 19 of

21

Rules 1981 may render the appellant liable for disciplinary

proceedings under service jurisprudence, but that itself cannot be a

ground for rejection of the said documents in toto without examining

the contents thereof. In this regard, we are of the considered view that

the courts below have committed a grave error and the contents

thereof should have been examined.

22. In Bharat Sanchar Nigam Limited & Anr. v. BPL Mobile

Cellular Limited & Ors., (2008) 13 SCC 597, this Court held that

"prescribed" means that prescribed in accordance with law and not

otherwise.

Thus, in view of the above, furnishing information about assets

and income etc. on a plain paper was not required as the Government

failed to prescribe the said form.

23. It has been urged by the respondents that the contents of Ext.D-

4 were rightly rejected as evidence by the High Court for two reasons;

(i) Ext.D-4 is not in compliance with the Rules 1981; and (ii) the

statements of the defence witnesses corroborating the contents of

Ext.D-4 must be discarded because they did not account for rent paid

22

in their IT returns or show any receipts or any documents to support

their statements.

24. The relevant portion of Rule 19(i)(a) of the Rules 1981 reads as

under:

"19(i) a government servant shall, on his first

appointment to any service or post and thereafter

at the close of every financial year, submit to the

government return of his assets and liabilities in

such form as may be prescribed by the

Government giving full particulars....."

(Emphasis added)

25. The contention of the respondents regarding non compliance of

the Rules 1981 adversely affecting the evidentiary value of Ext.D-4

must be rejected for at least two reasons;

(i) The Rules 1981 are not rules of evidence. The

admissibility and probative value of evidence is

determined under the provisions of the Indian

Evidence Act, 1872. These rules are merely

service rules by which government servants in

Sikkim are expected to abide. Consequently, the

respondent has not been able to provide any cogent

reason why the contents of Ext.D-4 should be

disregarded; and

23

(ii) Rule 19(i)(a) of the Rules 1981 does undoubtedly

require government servants to on first

appointment to any service or post and thereafter at

the close of every financial year submit to the

government the return of their assets and liabilities.

However, it is to be noted that the said rule

envisages that public servants will submit such

returns in a prescribed form. Despite being

repeatedly questioned by this Court, the

respondents were unable to produce such form.

Thus, it cannot be said that the appellant did not

comply with the said rule as in the absence of such

a form it was impossible for him to have done so

(through no fault of his own). In any event, failing

to submit such returns even if there had been no

such a form, would make the appellant liable to

face the disciplinary proceedings under the service

rules applicable at the relevant time. The

provisions of the Rules 1981 cannot by any stretch

of imagination be said to have the effect of

rendering evidence inadmissible in criminal

proceedings under the PC Act 1988.

Thus, in such a fact situation, the appellant could not be

fastened with criminal liability for want of compliance of the said

requirement of the Rules.

24 26. Learned senior counsel appearing for the respondent has placed

a great deal of emphasis on the argument that Mohanlal Goyal,

D.W.1, Nagaram Agrawal, D.W.2, Thakur Bansari, D.W.3 and Dil

Hassasan Ansari, D.W.4, did not show that they had taken the shops

from the appellant on rent as they did not disclose the said fact in their

respective income tax returns nor did they produce sales tax returns or

rent receipts. There can be no doubt that the fact that DWs 1-4 did not

show the transactions in their IT returns reduces their credibility in the

eyes of the Court, but that does not have any impact on the contents of

Ext. D-4 itself.

27. Thus, it becomes clear that the High Court erred in not placing

reliance on the evidence contained in Ext. D-4. Taking into

consideration the contents of Ext. D-4, it becomes clear that the

alleged unexplained income of the Appellant is only Rs. 2,71,613.64.

This unexplained income is significantly lower than what had been

alleged by the prosecution. It must also be borne in mind that check

period had been very long and consequently, it is easily possible that a

small over-estimation of the Respondent's expenditure would have

been multiplied and could easily explain the said amount. Thus, the

25

submission made on behalf of the appellant that there has been an

over-estimation of his expenses, further telephone bills and electricity

bills aggregating to Rs.1,04,364.00 have not been proved before the

Trial Court and even after remand by the High Court when witnesses

were recalled, if accepted would mean that the alleged unexplained

income is further reduced to Rs.1,67,249.64.

28. No doubt the prosecution has to establish that the pecuniary

assets acquired by the public servant are disproportionately larger than

his known sources of income and then it is for the public servant to

account for such excess. The offence becomes complete on the failure

of the public servant to account or explain such excess.

29. The High Court has found that the appellant was in possession

of assets amounting to Rs.18,25,098.69 for which he could not

account. In coming to this conclusion, the High Court made the

following calculations:

Known income of appellant and Rs.14,54,629.81

his wife during the check period

Expenditure of the appellant and Rs.12, 75,928.05

26

his wife during the check period

Actual assets in possession of the Rs.20,38,715.45

appellant and his wife at the end of

the check period

Likely savings of appellant and his Rs.14,54,629.81(-)

wife at the end of the check period Rs.12, 75,928.05

= Rs. 1,78,701.76

Known assets of the appellant and Rs.34,915.00

his wife at the beginning of the

check period

Unexplained income of the Rs.20,38,715.45 (-)

appellant and his wife at the end of Rs.34,915 (-) Rs.

the check period 1,78,701.76

= Rs.18,25,098.69

30. The High Court has held that the appellant has amassed assets

disproportionate to his known sources of income. However,

throughout the investigation, trial and appeal, the income contained in

Ex.D-4 has been totally ignored in computing the income from known

sources as being Rs.14,54,629.81. B.K. Roka, PW.19, the

Superintendent of Police has admitted that even before sanction was

granted on 5.4.1997, the accused had complied with Rule 19 and that

Ex.D-4, subject to mathematical accuracy, for the years 1987-1994

would aggregate to Rs.15,88,400/- according to the break-up of each

financial year. Similarly, Chand Prakash Raya, P.W.6 stated that

through Ex.D-4 the accused had complied with Rule 19. Therefore,

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this figure should have been added to income from known sources

which would have then amounted to Rs.30,43,029.81. Even if the

expenditure is taken to be Rs.12,75,928.05, the likely savings amount

is Rs.17,67,101.76 and not Rs.1,78,701.76. Thus, the gap between the

assets worth Rs.20,38,715.45 and the savings of Rs.17,67,10176

would be Rs.2,71,613.69 instead of Rs.18,25,098.69. Thus, the table

above should have read as follows:

Known income of appellant and Rs.14,54,629.81 (+)

his wife during the check period Rs.15,88,400.00

(+) income explained and =Rs.30,43,029.81

accounted for in Ext. D-4

Expenditure of the appellant and Rs.12, 75,928.05

his wife during the check period

Actual assets in possession of the Rs.20,38,715.45

appellant and his wife at the end

of the check period

Likely savings of appellant and Rs.14,54,629.81(-)

his wife at the end of the check Rs.12, 75,928.05 (+)

period Rs.15,88,400.00

= Rs.17,67,101.76

Known assets of the appellant and Rs.34,915.00

his wife at the beginning of the

check period

Unexplained income of the Rs.20,38,715.45 (-) Rs.

appellant and his wife at the end 1,78,701.76

of the check period (-)Rs.15,88,400.00 =

Rs.2,71,613.69

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Thus, it is evident from the above table that only a sum of Rs.

2.71 lacs (approx.) remains unexplained.

31. In State of Maharashtra v. Pollonji Darabshaw Daruwalla,

AIR 1988 SC 88, this Court held as under:

"....on a consideration of the matter it cannot be

said that there is no disproportion or even a

sizeable disproportion.....There are also other

possible errors in the calculations in regard to point

(c). The finding becomes inescapable that the assets

were in excess of the known sources of income. But

on the question whether the extent of the

disproportion is such as to justify a conviction for

criminal misconduct...., a somewhat liberal view

requires to be taken of what proportion of assets in

excess of the known sources of income constitutes

"disproportion" for purposes of Section 5(1)(e) of

the Act." (Emphasis added)

32. In view of the above, at the most a sum of Rs. 2,71,613.69

remained unexplained. The appellant entered into in service in 1972

and there is no break up so far as assets and expenditures etc. are

concerned in the charge sheet though the check period covered both

the Acts i.e. P.C. Acts, 1947 or 1988. Even if the said amount is

spread over the period from 1987 to 1996, the alleged unexplained

29

income remains merely a marginal/paltry sum which any government

employee can save every year.

33. In view of the above, we are of the considered opinion that

judgments and orders of the courts below cannot be sustained in the

eyes of law and they are liable to be set aside. The appeal is allowed.

The judgments and orders of the courts below dated 11.12.2002

passed by the High Court of Sikkim at Gangtok in Criminal Appeal

No. 4 of 2002 and judgment and order dated 30.5.2002 passed by the

Special Judge, Prevention of Corruption Act, Gangtok in Criminal

Case No. 4 of 1997 are hereby set aside.

..................................J.

(P. SATHASIVAM)

...................................J.

New Delhi, (Dr. B.S. CHAUHAN)

February 25, 2011

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