DEPUTY SUPERINTENDENT Of POLICE VERSUS R. SOUNDIRARASU ETC

DEPUTY SUPERINTENDENT Of POLICE VERSUS R. SOUNDIRARASU ETC

Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले


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REPORTABLE
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NOS. 1452 – 1453 OF 2022
(Arising out of Special Leave Petition (Crl.) Nos. 3445-3446 of 2019)
STATE THROUGH ….APPELLANT(S)
DEPUTY SUPERINTENDENT Of POLICE
VERSUS
R. SOUNDIRARASU ETC. ....RESPONDENT(S)
J U D G M E N T
J.B. PARDIWALA, J.
1. Leave granted.
2. Since the issues raised in both the captioned appeals are the
same, those were heard analogously and are being disposed of by this
common judgment and order.
3. These appeals are at the instance of the State of Tamil Nadu
through the Deputy Superintendent of Police, Vigilance and
Anti-Corruption, Salem District, Tamil Nadu and are directed against
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the two judgments and orders passed by the High Court of Madras
dated 27.04.2017 allowing the criminal revision applications
preferred by the respondents herein (original accused persons)
discharging them from the prosecution under Section 13(2) read with
13(1)(e) of the Prevention of Corruption Act, 1988 (for short, “Act
1988”) read with Section 109 of the Indian Penal Code (for short, “the
IPC”).
FACTUAL MATRIX
4. The Respondents in these appeals are husband and wife. The
Respondent No.1 - R. Soundirarasu at the relevant point of time was
serving as a Motor Vehicle Inspector (Grade 1) at Namakkal during
the check period, i.e., from 01.01.2002 to 31.03.2004. The
Respondent No. 2, namely, Suguna is the wife of the Respondent
No. 1.
5. The Respondent No. 2 is a commerce graduate and claims to be
having a separate source of income. She was a partner in a
partnership firm running in the name of S.K. Mat Industries along
with one R. Kumar w.e.f. 23.10.1993. The partnership came to be
dissolved on 31.03.2003, and, thereafter she continued as a sole
proprietor.
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6. It is the case of the Respondent No. 2 that she has been paying
the income tax from 1990 onwards and her IT Returns are being
scrutinized by the appropriate authorities.
7. It appears from the materials on record that a First Information
Report (FIR) came to be registered against the Respondent No. 1
herein dated 19.09.2005 at the Police Station, Vigilance and
Anti-Corruption, District Salem for the offences under the Act 1988
as enumerated above.
8. For better and effective adjudication of the present appeals, we
deem it necessary to reproduce the entire FIR as under:
“Column No. 12 in FIR Cr. No.9/AC/2005/SL/SU
Tr. R. Sundararasu was working as Motor Vehicle
Inspector Grade-1 at the office of the Regional Transport
Officer, Namakkal, Rasipuram and Sankari from March
98 to May 2000 to July 2002 and September 2002 to
September2004 respectively and again in Namakkal from
27.09.2004. He is a Public Servant as defined u/s 2 (C)
of Prevention of Corruption Act, 1988.
The accused Tr. R. Sundararasu, Motor Vehicle
Inspector Grade-1 hailed from an ordinary agricultural
family. He is a second son to his parents. Tr. Ramasamy
and Tmt. Krishnammal. He has got diploma in Mechnaical
Engineering and got B.E., degree by attending evening
classes. He got married one Suguna D/o Tr. Duraisamy
of Kavai on 12.2.90. He has got one son by name
Sarankumar who is studying VIIth standard in Holy
Matriculation School, Salem.
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On receipt of credible information that the accused
has acquired and he is in possession of assets in the form
of house sites, lands, house building etc in his name and
in the name of his wife and father-in-law, worth more
than his known sources of income, a preliminary
verification made, during which the following information
has come to notice.
As on 1.1.2002, the accused is found to have been in
possession of assets in his name and in the name of his
wife Tmt. Suguna, gold jewels, Silver ornaments,
household articles etc. by way of gift and purchase etc.
all worth about Rs. 3,75,250.00.
As on 29.2.2004, the accused is found to have been
in possession of properties and pecuniary resources in the
name of his wife Smt. Suguna, his father-in-law
Thiru.Duraisamy and his minor son Sarankumar of a total
value of Rs. 18,41,680.00. These include, a part from the
properties and pecuniary resources in his possession as
on 1.1.2002. Additionally acquired properties and
pecuniary resources such as House Building and
construction of house building.
During the period from 1.1.2002 and 29.2.2004, the
accused is found to have acquired the following
properties:
(i) Constructed a terraced house worth
about Rs.7,99,500/- in the name of his
wife Tmt. Suguna at Door No.555,
situated in S.No.11/1266 of Ganapathy
Village, Ganapathypuram, Coimbatore
after demolishing the old terrace house.
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The Total value of the properties and pecuniary
resources acquired by the accused during the period from
1.1.2002 to 29.2.2004 has been tentatively estimated to
be Rs.14,66,430/-
Accused's wife Smt. Suguna is a house wife. She is
found to have had no sufficient sources of income of her
own to acquire the aforementioned assets. So also, Tr.
Duraisamy, the father-in-law of the accused appears to
have had no necessity for the purchase and transfer of
the property in the name of the grand son (son of the
accused). Thus, the accused appears to have acquired the
above properties in the name of aforesaid persons as his
benami (benamis).
The total income of the accused and his family
members and expenditure of the accused and his family
(ii) Purchased a terraced building worth
Rs.8,61,270 /- with a plinth area of 70
Sq. metre on the ground floor and 10 Sq.
Metre on the 1st floor in
Bodinaikanpatty village S.No.69/1-A1
in the name of his father-in-law
Tr.Duraisamy under Doc.No.499/2004
dt. 6.2.2004 of SRO, Sooramangalam
and the same was transferred in the
name of Sarankumar, the minor son of
the accused, by way of Settlement Deed
in Doc.No.645/2004, Dt. 16.02.2004 by
the said Tr.Duraisamy incurring a sum
of Rs.5,160/- towards stamp duty and
registration fees.
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during the above said period (i.e.1.1.2002 to 29.2.2004)
have been tentatively assessed as Rs.8,84,486 and
11,00, 198 respectively and hence there was no likely
savings for the above said period and on the contrary
there was an excess expenditure over the income of the
accused to the extent of Rs.2,15,712/-.
There are grounds to believe that the aforesaid
assets are for beyond and disproportionate to the known
sources of income of the accused for the above said period
to the extent of Rs.16,82,142 (Rs.14,66,430+2,15,712).
The above information discloses an offence of
criminal misconduct by public servant punishable u/ s
13(2) r /w 13(1)(e) of prevention of Corruption Act, 1988,
against the accused and requires a detailed investigation.
I am therefore, registering a case in
Cr.No.9/AC/2005/SL/SU against the accused for the
above said offence for the purpose of taking up
investigation.
(SdXXX)
(K.PERIYASAMY)
DSP, V&AC, Spl.Cell,
Salem.”
9. It appears that vide the letter dated 16.10.2007 the
investigating officer called for the explanation from the Respondent
No. 1 as regards the allegations levelled in the FIR.
10. The Respondent No. 1 vide his letter dated 1.11.2007 offered his
explanation stating that he does not possess or had acquired any
assets disproportionate to the known source of his income. The
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Respondent No. 1 also placed on record the income tax returns filed
by his wife from 1990 onwards and that of the partnership firm too
from 1993.
11. It appears that in the course of investigation the role of the
Respondent No. 2 as the wife of the Respondent No. 1 also surfaced
as an abettor.
12. Upon conclusion of the investigation, the Investigating Agency
filed charge-sheet in the Court of the Special Judge, Salem for the
offences enumerated above. The filing of the charge-sheet culminated
in the registration of the Special Criminal Case No. 36/2008 in the
Court of the Special Judge, Salem.
13. In such circumstances referred to above, the Respondents
preferred Crl. M.P. Nos. 87 and 86 of 2014 resply under Section 239
of the Code of Criminal Procedure (for short, ‘the CrPC’) seeking
discharge from the trial essentially on the ground of lack of any prima
facie case against them.
14. The Special Judge adjudicated both the aforesaid applications
filed by the respondents and thought fit to reject those by two
separate orders dated 29.03.2016. While rejecting the Crl. M.P. No.
86 of 2014 filed by the respondent No. 2 (wife of respondent No. 1),
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the Special Judge observed as under :-
“15. Yet another ground urged by the petitioner is
that the income derived by the petitioner being partner in
S.K. Mat Industries and by doing money lending
business was not given due credit by the Investigating
Officer and as such the decision arrived at by the
Investigating Officer that the petitioner has no
wherewithals to acquire the properties standing in her
name and described in Statement II and to treat the said
properties as the properties acquired by the 1st accused
in the name of the petitioner is totally wrong. The
Investigating Officer in his final report has categorically
mentioned that no documents were produced during
investigation, either by the petitioner or her husband, to
showcase the income derived by the petitioner by doing
money lending business. Even in the present application
there is no whisper in this regard by the petitioner. The
contentious issue as to whether the petitioner derived
income from S.K. Mat Industries and through money
lending business can be decided only during trial based
on the evidence placed before the court in this regard.
Hence this court decides that the above ground urged by
the petitioner is a pre-matured one and thus cannot be
entertained at the time of framing charges.
16. In the present case the total value of assets and
pecuniary resources held by the petitioner, her husband
and son at the end of the check-period has been
computed by the Investigating Officer at Rs.31,69,498/-
as set out in Statement II. During investigation the
petitioner and her husband have not produced any
documents except the Income-Tax returns of the
petitioner to trace the source of income of the petitioner
to acquire the properties that stood recorded in her name
during the check-period. Hence the Investigating Officer
has proceeded to treat the properties standing in the
name of the petitioner and her minor son as the
properties of the petitioner's husband, the lst accused,
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which cannot be found fault at this stage more so when
the petitioner's husband has not disclosed the
acquisition of properties by his wife, the petitioner
herein, to the concerned Department as required under
Tamil Nadu Government Servants Conduct Rules. Hence
this court decides that, at this stage, there is no
substance in the contention' of the petitioner that the
methodology adopted by the Investigating Officer in
computing the value of the assets of the petitioner's
husband is erroneous.
x x x x x
18. The materials produced by the Investigating Officer
along with the final report prima facie disclose the
existence of all the ingredients essential to constitute the
offence U / s 13 (2) r/w 13 (2) r/w 13 (1) (e) of the
Prevention of Corruption Act read with Sec : 109 of the
IPC alleged to have been committed by the petitioner.
Since the offence alleged against the petitioner and her
husband are grave in nature the petitioner cannot be let
scot free without facing trial and without affording an
opportunity to the prosecution to establish the case
during trial by adducing evidence.
19. Hence on a conspectus evaluation of all legal and
factual aspects involved in the application, this court
decides that there is no merit in the contention that the
charge levelled against the petitioner is groundless on
the face of materials available on record. Hence this
court decides that the petitioner is not entitled for an
order of discharge as prayed for.”
15. While rejecting the Crl. M.P. No. 87 of 2014 filed by the
Respondent No. 1 (husband), the Special Judge observed as under:-
“8. Now let us consider the grounds urged by the
petitioner in seriatum.
I. The Income-Tax returns submitted by the
petitioner’s wife, was not considered by the
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Investigating Officer in the proper perspective.
The learned counsel for the petitioner assiduously
argued that through the Income-Tax returns submitted
by the wife of the petitioner, who is arrayed as 2nd
accused in the main case, it established beyond doubt
that the petitioners wife had sufficient source to acquire
properties mentioned in Statement II but the
Investigating Officer in total disregard to the Income-Tax
returns has treated the properties standing in the name
of the petitioner’s wife as the properties of the petitioner
on the premise that the petitioner has purchased the
properties benami in the name of his wife and as such
the computation made by the Investigating Officer in
arriving at the total value of the assets acquired by the
petitioner during the check period at Rs. 28,23,492/- as
set out in Statement V is grossly erroneous. As already
pointed out the fact that the petitioner’s wife, the 2nd
accused is an Income-Tax assessee and that she had
submitted her Income-Tax returns to the concerned
Income-Tax authorities regularly is not seriously
disputed. The petitioner is making an adroit effort to
impress upon the court that particulars set out in the
Income-Tax returns unequivocally establish the financial
capabilities of the wife of the petitioner to purchase
properties and hence the properties standing in the name
of the wife of the petitioner has to be treated as selfacquired properties of the wife of the petitioner.
11.(II). Income derived by the petitioner’s wife through
money lending business not given due consideration.
According to the petitioner, his wife, the 2nd accused
by doing money lending business was deriving size able
income but the same was not considered by the
Investigating Officer and as such the conclusion arrived
at by the Investigating Officer that the 2nd accused is an
ostensible owner of the properties standing in her name
and that the petitioner is the true owner of the said
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properties is absolutely wrong. The Investigating Officer
has categorically mentioned that in respect of the so
called money lending business no documents were
produced before him either by the petitioner or his wife
during investigation. Even in the present application the
petitioner has not claimed that there are documents to
establish the money lending business carried out by his
wife and the income derived by her through the said
business. The contentious issue as to whether the
petitioner wife was deriving income by doing money
lending business can be decided only during trial based
on the evidence placed in this regard. Hence this court
decides that above contention raised by the petitioner is
pre-matured one and thus cannot be entertained at the
stage of framing charges. On a conspectus evaluation of
the legal and factual aspects involved in the case, this
court decides that the claim of the petitioner for an order
of discharge alleging that the Investigating Officer has
erred in treating the properties standing in the name of
the petitioner’s wife as the properties of the petitioner
ignoring the separate income of the petitioner’s wife
through money lending business is not sustainable
under law.
12. (III). The methodology adopted by the Investigating
Officer in arriving at the total value of assets standing in
the name of the petitioner at the end of the check-period
erroneous:-
According to the petitioner the income derived by the
petitioner’s wife other than from S.K. Mat Industries
during the relevant period of Rs. 5,90,342/- but the same
has not been considered by the Investigating Officer
even though the same has been set out in the IncomeTax returns submitted by the petitioner’s wife, the 2nd
accused Suguan. The petitioner further allege that the
properties of the petitioner’s wife and son more fully
described in Statement II ought to have been excluded
but strangely the Investigating Officer has included the
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same, which again clearly demonstrate that computation
has not been made in proper line. Based on the above
said contentions the petitioner challenging the very
methodology adopted by the Investigating Officer, seek
an order of discharge. As elaborately discussed in the
earlier part of this order, the question as to whether the
properties standing in the name of the petitioner’s wife
and son are in reality their self acquired properties or
whether those properties were in fact acquired by the
petitioner through his financial resources can be decided
only at the time of trial based on the evidence adduced
by both parties in this regard. Since the nature of
properties standing in the name of the petitioner’s wife
and son cannot be decided at this stage, at no stretch of
imagination it can be contended that the methodology
adopted by the Investigating Officer in arriving at the
total value of assets and financial resources standing in
the name of the petitioner at the end of the check period
is erroneous.
13.Hence considering the materials available on record
in the back drop of the principles of law propounded by
our Apex Court in the case of Suresh Rajan referred
supra, this court decides that the petitioner is not entitled
for an order of discharge alleging that the methodology
adopted by the Investigating Officer is erroneous.
14.In the present case the total value of the assets and
pecuniary resources of the petitioner and his family
members at the end of the check-period has been
computed by the Investigating Officer at Rs.31,69,498/-
as set out in Statement II. During investigation of the
case, the petitioner has not produced any documents
before the Investigating Officer except the Income-Tax
returns of his wife, the 2nd accused, to trace the source
of income of the petitioner's wife to acquire the properties
standing in her name. Hence the Investigating Officer
proceeded to treat the properties standing in the name of
the petitioner's wife and his son as the properties of the
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petitioner, which cannot be found fault at this stage more
so when the petitioner has not disclosed the acquisition
of properties by his wife to the concerned department as
required under the Tamil Nadu Government Servants
conduct rules. Hence this court, at this stage, decides
that there is no substance in the contention of the
petitioner that the methodology adopted by the
Investigating Officer in computing the value of the assets
of the petitioner is erroneous.
15. Conclusion :
The materials placed by the Investigating Officer
along with the Final Report disclose grave suspecion
against the petitioner of having committed the alleged
offence U / s 13 (1) (e) of the Prevention of Corruption Act.
The guilt or otherwise of the petitioner has to be decided
by court by affording an opportunity to the prosecution
to march in evidence in support of its case. The materials
placed by the Investigating Officer along with the final
report prima facie disclose the existence of all the
essential ingredients constituting the offence U/s 13 (2)
r/w 13 (1) (e) of the Prevention of Corruption Act 1988.
Hence this court decides that the petitioner is not entitled
for an order of discharge.
16. In the result the application is dismissed.”
16. Thus, while rejecting the discharge applications filed by the
respondents herein, the learned Special Judge recorded a categorical
finding that there was more than a prima facie case against the
accused persons to put them to trial for the alleged offence. The
learned Special Judge recorded a clear finding that the charges
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levelled against the accused persons cannot be said to be groundless
so as to discharge them from the prosecution in exercise of powers
under Section 239 of the CrPC.
17. The respondents, being dissatisfied with the orders passed by
the Special Court rejecting their discharge applications, went before
the High Court and challenged the orders by filing Criminal Revision
Application Nos. 702 and 703 of 2016 resply. Both the Revision
Applications came to be heard by the High Court analogously and
came to be allowed by the common impugned judgment and order
dated 27.04.2017. The respondents herein came to be discharged
from the prosecution. While allowing the Revision Applications, the
High Court held as under :
“41. Taking into consideration all the relevant facts
and circumstances, this Court is of the view that the
Investigating Officer had not considered the explanation
submitted by the first accused and also not taken into
account any assets of the petitioners/ Al and A2.
42. This Court has also perused the statements of
the listed witnesses along with the impugned orders. As
already discussed in the foregoing paragraphs and as
decided in State of Maharashtra Vs Wasudeo (AIR 1981
SC 1186:19813sec199) cited supra, the nature and the
extent of burden cast on the accused is well settled and
the accused is not bound to prove his innocence beyond
all reasonable doubt. All that he would do is to bring out
a preponderance of probability. In so far as this case is
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concerned, the petitioners have brought out a
preponderance of probability by way of establishing
their case. As enunciated in Explanation to clause (e) of
Sub Section (1) to Section 13, the petitioners have
intimated their income received from lawful source to the
income tax authorities concerned in accordance with the
provisions of the Income Tax Act, which is applicable for
the first accused being the public servant to intimate his
known source of income and therefore, this Court is of
the view that the prosecution has miserably failed to
make out a prima facie case against the petitioners/ Al
and A2.
43. It is the cardinal principle that the accused is
presumed to be innocent unless proved to be guilty by
the prosecution and the accused is entitled to the benefit
of every reasonable doubt. Thus, giving false information
or failing to prove his innocence is no ground to base
conviction of accused and on the contrary it offends the
very basic principle of criminal jurisprudence which lays
the burden on the prosecution to prove the offence
against the accused.
44. In criminal cases, the guilt should be proved
beyond any reasonable doubt that a reasonable man
with ordinary prudence can have. There should. be no
doubt whether the accused is guilty or not. If there is
slightest doubt, no matter how small it is, the benefit will
go to the accused. In Indian legal system the provision
regarding burden of proof and how it is to be discharged
are grandeurly laid down in Chapter VII of the Evidence
Act, 1872. The rule is that whoever alleges a fact must
prove it. In a criminal trail it is the prosecution who
alleges that the accused has committed the offence with
requisite mens rea and so the burden lies upon the
prosecution to prove the same.
45. As observed in the preceding paragraphs the
accused is not bound to prove his innocence beyond all
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reasonable doubt. All that he has to do is, to bring out a
preponderance of probability. The phrase
'preponderance of probability' appears to have been
taken from Charless R.Cooper V F.W.Slade, (1857-59) 6
HLC 746. The observations made therein make it clear
that what 'preponderance of probability' means is 'more
probable and rational view of the case', not necessarily
as certain as the pleadings should be.
46. Section 397(1) confers a sort of supervisory
power. The purpose is to rectify miscarriage of justice.
The main consideration was whether substantial justice
was done since this Section confers the revisional
jurisdiction upon both the Sessions Court as well as the
High Court (Criminal). Nobody can claim it as a matter of
right as it confers supervisory jurisdiction. When there is
a clear illegality in the order passed by the lower Court,
a revision could be entertained.
47. On coming to the provisions of Section 401 of the
Code, as it is understood, the object behind this Section
is to empower the High Court to exercise the powers of
an Appellate Court to prevent failure of justice in cases
where the Code does not provide for appeal.
48. The power, however, is to be exercised only in
exceptional cases where there has been a miscarriage of
justice owing to :
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(i) a defect in the procedure or
(ii) a manifest error on a point of law;
(iii) excess jurisdiction,
(iv) abuse of power, &
(v) where the decision upon which the trial Court relied
has since been reversed or overruled when the revision
petition was being heard.
49.As observed by the Supreme Court in State of M.P.
Vs. S.B.Johari, (AIR 2000 SC 665: (2000) 2 sec 57: 2000
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SCC (Crl) 311 : 2000 Crl.L.J.944), under Section 401 of
Criminal Procedure Code quashing of the charge by the
High Court would be justified if even on considering the
entire prosecution evidence, the offence is not made out.
50. Viewing it from any angle, this Court is of
considered opinion that the prosecution has not made
out any case as against the petitioners/ Al and A2 to
proceed with.
51.In the result, Criminal Revision Case Nos. 702 and
703 of 2016 are allowed and the impugned orders,
dated 29.03.2016 and made in Crl.M.P.Nos.87 and 86
of 2014 in Special CC.No.76 of 2014 on the file of the
learned Special Judge (for Corruption Cases), Salem are
set aside and the petitions in Crl.M.P.Nos.87 and 86 of
2014 in Special CC.No.76 of 2014 are allowed. The
petitioners/ Al and A2 are discharged from the clutches
of the charges.”
18. Thus, from the aforesaid, it appears that the High Court
thought fit to discharge both the accused essentially on the following
counts.
a) The Investigating Officer wrongly declined to consider the
explanation offered by the Respondent No. 1 as regards the
allegations and also failed to take into consideration the lawful
assets of the Respondents.
b) The accused persons had disclosed their income to the income
tax authorities in accordance with the provisions of the Income Tax
Act and, in such circumstances, no prima facie case could be said
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to have been made out against them.
c) The accused in a prosecution under the Act 1988, more
particularly for the offences punishable under section 13(1)(e) of
the Act, is obliged only to explain as regards the alleged assets
disproportionate to the known sources of his income on the
principle of preponderance of probability.
d) As no prima facie case could be said to have been made out
against the accused persons, they deserve to be discharged from
the prosecution in exercise of revisional powers meant for doing
substantial justice.
19. In view of the aforesaid, the State being aggrieved and
dissatisfied with the impugned orders passed by the High Court is
here before this Court with the present appeals.
SUBMISSIONS ON BEHALF OF THE APPELLANT
20. Mr. V. Krishnamurthy, the learned Additional Advocate General
appearing on behalf of the State vehemently submitted that the High
Court committed a serious error in discharging the accused persons
from the prosecution. He would submit that the whole approach of
the High Court, more particularly the finding that “when the
prosecuting agency has come forward with a specific occasion, that
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the petitioners have amassed wealth which is disproportionate to their
known source of income, it is incumbent on the part of the prosecution,
to prove the indictment with clinching and impeccable evidence beyond
all reasonable doubts, because the allegations made against the
petitioners would definitely affect their private rights and their selfrespect as well” is erroneous and unsustainable.
21. He would submit that the High Court has erroneously cast a
burden on the prosecution to prove the case against the accused
persons beyond all reasonable doubt even at the stage of framing
charge. The scope and ambit of inquiry before framing the charge or
at the stage of discharge has been well settled by this Court.
22. He would submit that the High Court grossly erred in taking
into consideration the documents produced by the accused persons
in their defence such as the Income Tax Assessments of A2 and other
records, to come to the conclusion that the properties disclosed
therein ought to be eschewed from consideration. The learned
counsel submitted that the practice of looking into the documents
produced by the accused at the stage of framing of charge has not
been approved by this Court in the case of State of Orissa v.
Debendra Nath Padhi, (2005) 1 SCC 568.
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23. He would submit that the High Court could be said to have
conducted a mini trial while considering the discharge applications
filed by the accused persons. In other words, at the stage of framing
of charge, roving and fishing inquiry is impermissible and that would
defect the object of the Code.
24. In the last, he submitted that the High Court overlooked the
dictum as laid by this Court in the State of Tamil Nadu by
Inspector of Police, Vigilance and Anti-Corruption vs. N. Suresh
Rajan and others, (2014) 11 SCC 709 @ 721 para 29, wherein this
Court held that:
“It is trite that at the stage of consideration of an
application for discharge, the court has to proceed with
an assumption that the materials brought on record by
the prosecution are true and evaluate the said materials
and documents with a view to find out whether the facts
emerging therefrom taken at their face value disclose the
existence of all the ingredients constituting the alleged
offence. At this stage, probative value of the materials
has to be gone into and the court is not expected to go
deep into the matter and hold that the materials would
not warrant a conviction. In our opinion, what needs to
be considered is whether there is a ground for presuming
that the offence has been committed and not whether a
ground for convicting the accused has been made out. To
put it differently, if the court thinks that the accused
might have committed the offence on the basis of the
materials on record on its probative value, it can frame
the charge; though for conviction, the court has to come
to the conclusion that the accused has committed the
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offence. The law does not permit a mini trial at this
stage.”
25. In such circumstances referred to above, the learned counsel
appearing for the State prayed that there being merit in his two
appeals, those may be allowed and the impugned orders passed by
the High Court may be set aside.
SUBMISSIONS ON BEHALF OF THE ACCUSED
26. Dr. K. Radhakrishnan, the learned senior counsel appearing for
the accused persons, on the other hand, vehemently opposed both
the appeals submitting that no error, not to speak of any error of law,
could be said to have been committed by the High Court in passing
the impugned orders discharging the accused persons from the
prosecution.
27. The learned senior counsel would submit that without
considering the explanation furnished by the respondent No. 1 and
without calling for any explanation from his wife (second accused),
the chargesheet for the offences punishable under Sections 13(2) r/w
13(1)(e) of the Act 1988 and Section 109 of the IPC could not have
been filed. The learned counsel, relying on the decision of this Court
22
in the case of N. Suresh Rajan (supra), submitted as a proposition
of law that any property in the name of an income tax assessee, by
itself, cannot be a ground to assume that such property belongs to
the assessee.
28. He would submit that this Court in N. Suresh Rajan (supra)
was dealing with a factual situation wherein the parents of the
accused to whom the property belonged were not having any
independent source of income unlike in the facts of the present case
where the wife of the respondent is a commerce graduate and an
entrepreneur. She has her own independent source of income and
had purchased the properties out of her own income and that one of
those has been gifted by her father. She has been an income tax
assessee from the year 1990 and has been regularly filing her income
tax returns.
29. He would submit that the Investigating Officer failed to consider
the explanation furnished by the Respondent No. 1. Relying on the
decision of this Court in the case of State of Maharashtra vs.
Wasudeo Ramchandra Kaidalwar, (1981) 3 SCC 199, the learned
counsel submitted that the nature and extent of burden cast on the
accused is not to prove his innocence beyond reasonable doubt. All
23
that the accused is obliged in law is to explain on preponderance of
probability. In so far as the present case is concerned, the
respondents have brought out a preponderance of probability by way
of establishing their case.
30. The learned counsel in his written submissions has stated as
under:-
i. “In determining the assets of the respondent, the assets
standing in the name of his wife and their son must be
eschewed.
ii. Income of Tmt. Suguna, wife of the respondent R.
Soundirarasu could not be clubbed along with the
income of her husband when she is particularly having
independent source of income and pays income tax.
iii. Further, the investigating Officer has called for the
explanation from the respondent R. Soundirarasu, which
was not considered by the IO.
iv. However, the IO has not called for the explanation from
Tmt. Suguna. This approach of the IO is contrary to the
law laid down by this Hon’ble Court. This Hon’ble Court
in the case of Devine Retreat Centra Vs. State of Kerala
(2008) 3SCC 542, has held that no judicial order can
ever be passed by any court without providing a
reasonable opportunity of being heard to the person
likely to be affected by such order and particularly when
such order results drastic consequences of affecting
one’s own reputation.
v. Respondent-R. Soundirarasu in his explanation had
explained that his wife Tmt. Suguna has independent
source of income. She is a commerce graduate and was
a partner in a S.K. Matt Industries along with one R.
Kumar with effect from 23.10.1993. The partnership
was dissolved on 31.3.2003 and thereafter she
continued as the sole proprietor. She had been paying
24
income tax from 1990 onwards and her IT returns were
scrutinized by the appropriate authorities. She had been
regularly filed her income tax returns even beyond the
end of the check period.
vi. It is respectfully submitted that the Investigating Officer
while collecting necessary details from both the income
tax authority as well as the respondent R. Soundirarasu,
had failed to consider them in proper perspective which
do establish that his wife Tmt. Suguna had acquired
properties from her own income. But the investigating
officer has erroneously stated in the final report that she
had no source of income and that her father also did not
possess any means to acquire property.
15. It is submitted that Statement No. 1 appended to the
letter dated 16.10.2007 and the Charge Sheet is the
assets and pecuniary resources that stood to the credit
of respondent and his family members. The check
period, as per the prosecution has been determined from
1.1.2002 to 31.3.2004. In statement No. 1, 14 items have
been shown. In so far as Statement I is concerned,
properties mentioned at item Nos, 01,02,08,10,12 and
14 are exclusively the investments of his wife out of her
own resources.
16. It is submitted that in so far as Statement II is
concerned.
i. Item 1, the house was constructed at the cost of Rs.
4,15,344/- by respondent’s wife Tmt. S. Suguna from
her independent resources derived from S.K. Mat
Industries and other income and LIC Finance Housing
Loan.
ii. Item No. 2 was purchased by respondent’s wife out of
her independent income derived from S.K. Mat
Industries.
iii. Item no. 12, the Land measuring 0.67.½ cents comprised
in Survey No. 12/1Q situated at M. Chettipatti, Omalur
Taluk, Salem District was inherited by respondent’s
25
mother Krishnammal and subsequently settled this
property in favour of her three sons and thereby he had
received 1/3rd share.
iv. Item No. 13 was purchased by respondent’s father-inlaw Thiru. T. Duraisamy with his own resources and
later gifted by way of dhana settlement to his son Thiru.
S.S.Saran Kumar on 16.02.2004. This property should
be taken into account as a gift and the value thereof
should not have been included in the Statement.
v. Item No. 14, was inherited by respondent’s wife Tmt.
S.Suguna by virtue of Dhana settlement.
vi. Item No. 15 was purchased by respondent’s mother-inlaw Tmt. D. Shantha out of her own funds in the name
of his son and that neither he nor his wife had invested
any money in this transaction.
vii. Item Nos. 17, 18, were purchased by respondent’s wife
Tmt. S. Suguna out of her own resources.
viii. Items 19, 21 are related to respondent’s wife Tmt. S.
Suguna and the same cannot be attributed to the
respondent.
17. It is submitted that items 2, 3, 4, 5 of Schedule III
pertains to respondent’s wife Tmt. S. Suguna and the
same cannot be attributed to the respondent.
18. It is submitted that in respect of Statement IV,
i. Item No. 2, the expenditure towards repayment of LIC
housing loan to the extent of Rs. 1,19,934.30 cannot be
shown towards respondent’s expenditure as the loan
was availed and repaid by his wife Tmt. S. Suguna out
of her own resources.
ii. Similarly, the expenditure being Rs. 1,80,000/- shown
under item No. 3 should not have been shown in
respondent’s account, since the loan was obtained by
his wife independently and repaid so far with interest by
her, out of her own resources.
iii. Item No. 5, Telephone charges of Rs. 26,854/- were paid
by respondent’s wife out of her own resources.
26
iv. Item No. 10, the house tax was paid by respondent’s
wife out of her own resources.
v. Item No. 09, the transaction pertains to respondent’s
wife. Therefore, the loss should not have been shown in
respondent’s account.
vi. Item No. 11 is subscription towards Sri Ram Chits was
made by respondent’s wife out of her own resources.
vii. Item No. 12 the house tax for the house at Ganapathy is
paid by respondent’s wife out of her own resources.
viii. Item No. 14, the income tax paid by his respondent’s wife
out of her own resources has been shown in his account.
19. It is submitted that the calculation made by the
petitioner is incorrect. It is submitted that the correct
computation as has been explained by the respondent in
his explanation is as follows,
i. The value of assets that stood to respondent’s credit as
well as to the credit of his family members at the
beginning of the check period is Rs. 1,31,254/-.
ii. The value of the assets that stood to respondent’s credit
as well as to the credit of his family members at the end
of the check period is Rs. 1,37,430/-
iii. Therefore, the value of assets acquired during the check
period is Rs. 6,176/-.
iv. Income derived by him and his family members during
the check period is Rs. 3,11,547/-.
v. Expenditure during the check period is Rs. 1,91,910/-.
vi. Thus, the savings during the check period is Rs.
1,19,636.80
Therefore, it is submitted that the assets acquired by the
respondent (R. Soundirarasu) are not disproportionate to
his known source of income.
20. It is submitted that in his explanation respondent (R.
Soundirarasu), has referred to the provisions of the Tamil
Nadu Government Servant Conduct Rules 1973 as
amended up to September 2006, Rules 7 (1) (a), which
27
reads as follows:
(1)(a) No Government servant, shall except after notice to
the prescribed authority, acquire or dispose of any
immovable property by lease, mortgage, purchase, sale,
gift, exchange or otherwise either in his own name or in
the name of any member of his family.
Such a notice will be necessary even where any
immovable property is acquired by any member of the
family of the Government servant out of the resources of
the Government servant:
Provided that the previous sanction of the prescribed
authority shall not be necessary for the acquisition of
immovable property in respect of house-site assigned by
the Government in favour of the Government servant.
Explanation-A Government servant is not required to give
notice to the prescribed authority or seek prior
permission from the prescribed authority for acquisition
or disposal of immovable properties by the members of
his family under clause (a), if the immovable property in
question is not acquired from the resources of the
Government servant concerned.
The IO ought to have considered this provision before
taking the properties and other resources into account.
21. It is respectfully submitted that the High Court has
decided the matter by following the principles of law laid
down by this Hon’ble Court. The High Court has only
looked at the materials relied upon in the chargesheet to
ascertain whether a prima facie case is made out or not.
It is submitted that the High Court has rightly arrived at
the conclusion that the prosecution has not examined the
materials and the explanation afforded by the
respondent. After examining the facts emerging from of
the materials brought on record by the prosecution, the
28
High Court has concluded that prima facie the materials
on record does not disclose the existence of all the
ingredients constituting the offences alleged against the
respondents. The High Court has rightly concluded that
the evidences tagged along with the final report are also
not in consonance with the accusation made in the final
report. The High Court has rendered the judgment
discharging the accused to avert miscarriage of justice
and to erase the prejudice caused to the accused at the
instance of the investigating officer by not examining the
explanation rendered by the first accused in proper
perspective and without calling for the explanation from
the second accused. Prejudice is also caused by the
finding of the Special judge to the effect that there are no
materials/ evidence to prove that the second accused
has separate and independent source of income.”
 (Emphasis supplied)
In such circumstances referred to above, the learned counsel
prayed that there being no merit in the two appeals filed by the State,
those may be dismissed.
31. If we have to give a fair idea as regards the case put up by the
Prosecution against the accused persons, we may do so as under:-
(a) There are 14 items shown in the Statement No. 1, i.e. Assets
and pecuniary sources that stood to the credit of the accused
and his family members at the beginning of the check period
i.e., 01.01.2002 such as lands, house sites, shares, jewels and
other movables valued at Rs.3,46,006-00.
29
(b) There are 21 items shown in the Statement No. II i.e., assets
and pecuniary source that stood to the credit of the accused
and his family members at the end of the check period as on
31.03.2004, valued at Rs. 31,69,498-00.
(c) There are 6 items shown in the Statement No. III as income
derived by the accused and his family members during the
check period i.e., 01-01-2002 to 31-03-2004, calculated at Rs.
9,97,888-00.
(d) There are 15 items shown in the Statement No. IV i.e.,
expenditure incurred by the accused and his family members
during the check period from 01-01-2002 to 31-03-2004 as
family consumption expenditure, education, electricity charges,
housing loan, LIC premiums, telephone charges etc. is
calculated at Rs. 6,16,376-50.
(e) The value of assets acquired by the accused and his family
members at the end of the check period i.e., 31-03-2004 as
shown in Statement No. V is at Rs. 28,23,492-00 (i.e. Rs.
31,69,498 (-) Rs. 3,46,006-00).
(f) The likely savings of the accused and his family members
30
during the check period as shown in Statement No. VI is arrived
at Rs. 3,81,512-00 (i.e.,) Rs. 9,97,888-00 (-) Rs. 6,16,376-50).
(g) The value of disproportionate assets acquired by the accused
and his family members as shown in the Statement No. VII is
calculated at Rs. 24,41,980-00.
(h) The percentage of disproportionate assets acquired by the
accused and his family members to the known sources of their
income is calculated at 244.71% (Rs.24,41,980-00 divided by
Rs.9,97,888-00 multiplied by 100).
Thus, in view of the aforesaid, the case of the prosecution is that
the accused No. 1 (public servant) was found to be in possession of
assets disproportionate to the known sources of his income to the
extent to Rs. 24,41,980/- as on 31.03.2004.
ANALYSIS
32. Having heard the learned counsel appearing for the parties and
having gone through the materials on record, the only question that
falls for our consideration is whether the High Court committed any
error in discharging both the accused from the charges levelled
against them?
31
33. We have no hesitation in observing that the impugned orders
passed by the High Court are utterly incomprehensible. We shall
explain in details why we say so.
PREVENTION OF CORRUPTION ACT, 1988
34. Section 13(1)(e) of the Act 1988 including explanation thereto
reads as under :-
“13. Criminal misconduct by a public servant.
(1) A public servant is said to commit the offence of
criminal misconduct,-
(e) if he or any person on his behalf, is in possession or
has, at any time during the period of his office, been in
possession for which the public servant cannot
satisfactorily account, of pecuniary resources or property
disproportionate to his known sources of income.
Explanation.- For the purposes of this section, “known
sources of income” means income received from any
lawful source and such receipt has been intimated in
accordance with the provisions of any law, rules or
orders for the time being applicable to a public servant.”
35. The explanation to Section 13(1)(e) defines the expression
“known sources of income” and states that this expression means the
income received from any lawful source and also requires that the
receipt should have been intimated by the public servant in
accordance with any provisions of law, rules or orders for the time
being applicable to a public servant. This explanation was not there
32
in the Prevention of Corruption Act, 1947 (for short, “Act 1947”).
Noticing this fact in Jagan M. Seshadri v. State of Tamil Nadu,
(2002) 9 SCC 639, this Court has observed as under:-
"7. A bare reading of Section 30(2) of the 1988 Act shows
that any act done or any action taken or purported to
have been done or taken under or in pursuance of the
repealed Act, shall, insofar as it is not inconsistent with
the provisions of this Act, be deemed to have been done
or taken under or in pursuance of the corresponding
provisions of the Act. It does not substitute Section 13 in
place of Section 5 of the 1947 Act. Section 30(2) is
applicable "without prejudice to the application
of Section 6 of the General Clauses Act, 1897". In our
opinion, the application of Section 13 of the 1988 Act to
the fact situation of the present case would
offend Section 6 of the General Clauses Act, which, inter
alia provides that repeal shall not (i) affect the previous
operation of any enactment so repealed or anything duly
done or suffered thereunder, or (ii) affect any
investigation, legal proceedings or remedy in respect of
any such rights, privilege, obligation, penalty, forfeiture
or punishment. Section 13, both in the matter of
punishment as also by the addition of the Explanation
to Section 13(1)(e) is materially different from Section
5 of the 1947 Act. The presumption permitted to be
raised under the Explanation to Section 13(1)(e) was not
available to be raised under Section 5(1)(e) of the 1947
Act. This difference can have a material bearing on the
case."
36. The explanation to Section 13(1)(e) of the Act 1988 has the effect
of defining the expression “known sources of income” used in Section
13(1)(e) of the Act 1988. The explanation to Section 13(1)(e) of the Act
33
1988 consists of two parts. The first part states that the known
sources of income means the income received from any lawful source
and the second part states that such receipt should have been
intimated by the public servant in accordance with the provisions of
law, rules and orders for the time being applicable to a public servant.
37. Referring to the first part of the expression "known sources of
income" in N. Ramakrishnaiah v. State of A.P., 2009 Crl.L.J.
1767, this Court observed as under:
"15. The emphasis of the phrase "known sources of
income" in Section 13(1)(e) (old Section 5(1)(e)) is clearly
on the word "income". It would be primary to observe that
qua the public servant, the income would be what is
attached to his office or post, commonly known as
remuneration or salary. The term "income" by itself, is
classic and has a wide connotation. Whatever comes in
or is received is income. But, however, wide the import
and connotation of the term "income", it is incapable of
being understood as meaning receipt having no nexus to
one's labour, or expertise, or property, or investment, and
being further a source which may or may not yield a
regular revenue. These essential characteristics are vital
in understanding the term "Income". Therefore, it can be
said that, though "income" in receipt in the hand of its
recipient, every receipt would not partake into the
character of income. For the public servant, whatever
return he gets of his service, will be the primary item of
his income. Other income which can conceivably be
income qua the public servant will be in the regular
receipt from (a) his property, or (b) his investment. A
receipt from windfall, or gains of graft crime or immoral
34
secretions by persons prima facie would not be receipt
for the "known source of income" of a public servant.”
38. The above brings us to the second part of the explanation,
defining the expression “such receipt should have been intimated by
the public Servant” i.e. intimation by the public servant in
accordance with any provisions of law, rules or orders applicable to
a public servant.
39. The language of the substantive provisions of Section 5(3) of the
Act 1947 before its amendment, Section 5 (1)(e) of the Act 1947 and
13(1)(e) of the Act 1988 continues to be the same though Section 5(3)
before it came to be amended was held to be a procedural Section in
the case of Sajjan Singh v. State of Punjab, AIR 1964 SC 464.
Section 5(3) of the Act 1947 before it came to be amended w.e.f. 18th
December, 1964 was interpreted in the case of C.D.S. Swami v.
State, AIR 1960 SC 7, and it was observed:-
“5. Reference was also made to cases in which courts
had held that if plausible explanation had been offered
by an accused person for being in possession of property
which was the subject-matter of the charge, the court
could exonerate the accused from criminal responsibility
for possessing incriminating property. In our opinion,
those cases have no bearing upon the charge against the
appellant in this case, because the section requires the
accused person to "satisfactorily account" for the
possession of pecuniary resources or property
35
disproportionate to his known sources of income.
Ordinarily, an accused person is entitled to acquittal if
he can account for honest possession of property which
has been proved to have been recently stolen (see
illustration (a) to Section 114 of the Indian Evidence Act,
1872). The rule of law is that if there is a prima facie
explanation of the accused that he came by the stolen
goods in an honest way, the inference of guilty
knowledge is displaced. This is based upon the wellestablished principle that if there is a doubt in the mind
of the court as to a necessary ingredient of an offence,
the benefit of that doubt must go to the accused. But the
legislature has advisedly used the expression
"satisfactorily account". The emphasis must be on the
word "satisfactorily", and the legislature has, thus,
deliberately cast a burden on the accused not only to
offer a plausible explanation as to how he came by his
large wealth, but also to satisfy the court that his
explanation was worthy of acceptance.
6. Another argument bearing on the same aspect of the
case, is that the prosecution has not led evidence to
show as to what are the known sources of the
appellant’s income. In this connection, our attention was
invited to the evidence of the investigating officers, and
with reference to that evidence, it was contended that
those officers have not said, in terms, as to what were
the known sources of income of the accused, or that the
salary was the only source of his income. Now, the
expression "known sources of income" must have
reference to sources known to the prosecution on a
thorough investigation of the case. It was not, and it
could not be, contended that "known sources of income"
means sources known to the accused. The prosecution
cannot, in the very nature of things, be expected to know
the affairs of an accused person. Those will be matters
"specially within the knowledge" of the accused, within
the meaning of Section 106 of the Evidence Act. The
prosecution can only lead evidence, as it has done in the
36
instant case, to show that the accused was known to
earn his living by service under the Government during
the material period. The prosecution would not be
justified in concluding that travelling allowance was also
a source of income when such allowance is ordinarily
meant to compensate an officer concerned for his out-ofpocket expenses incidental to journeys performed by him
for his official tours. That could not possibly be alleged
to be a very substantial source of income. The source of
income of a particular individual will depend upon his
position in life with particular reference to his occupation
or avocation in life. In the case of a government servant,
the prosecution would, naturally, infer that his known
source of income would be the salary earned by him
during his active service. His pension or his provident
fund would come into calculation only after his
retirement, unless he had a justification for borrowing
from his provident fund. We are not, therefore, impressed
by the argument that the prosecution has failed to lead
proper evidence as to the appellant’s known sources of
income. It may be that the accused may have made
statements to the investigating officers as to his alleged
sources of income, but the same, strictly, would not be
evidence in the case, and if the prosecution has failed to
disclose all the sources of income of an accused person,
it is always open to him to prove those other sources of
income which have not been taken into account or
brought into evidence by the prosecution.”
(Emphasis supplied)
40. Even after Section 5(3) was deleted and Section 5(1)(e) was
enacted, this Court in the case of Wasudeo Ram Chandra
Kaidalwar (supra) has observed that the expression "known
sources of income" occurring in Section 5(1)(e) has a definite legal
connotation which in the context must mean the sources known to
37
the prosecution and not sources relied upon and known to the
accused. Section 5(1)(e), it was observed by this Court, casts a
burden on the accused for it uses the words "for which the public
servant cannot satisfactorily account". The onus is on the accused to
account for and satisfactorily explain the assets. Accordingly, in
Wasudeo Ram Chandra Kaidalwar (supra) it was observed:-
"11. The provisions of Section 5(3) have been subject of
judicial interpretation. First the expression "known
sources of income" in the context of Section 5(3) meant
"sources known to the prosecution". The other principle
is equally well- settled. The onus placed on the accused
under Section 5(3) was, however, not to prove his
innocence beyond reasonable doubt, but only to
establish a preponderance of probability. These are the
well-settled principles: see C.S.D. Swamy v.
State; Sajjan Singh v. State of Punjab and V.D. Jhingan
v. State of U.P. The legislature thought it fit to dispense
with the rule of evidence under Section 5(3) and make
the possession of disproportionate assets by a public
servant as one of the species of the offence of criminal
misconduct by inserting Section 5(1)(e) due to
widespread corruption in public services.
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
incomes" means "sources known to the prosecution". So
also, the same meaning must be given to the words "for
which the public servant cannot satisfactorily account"
occurring in Section 5(1)(e). No doubt, Section
4(1) provides for presumption of guilt in cases falling
38
under Section 5(1)(a) and (b), but there was, in our
opinion, no need to mention Section 5(1)(e) 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 cannot 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 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 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
39
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 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 Prosecution. 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,
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:
"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 the burden of proof is
clearly used in the secondary sense namely, the duty of
introducing evidence. The nature and extent of the
40
burden cast on the accused is well settled. The accused
is not bound to prove his innocence beyond all the
reasonable doubt. All that he need to do is to bring out
a preponderance of probability.”
41. While the expression "known sources of income" refers to the
sources known to the prosecution, the expression "for which the
public servant cannot satisfactorily account" refers to the onus or
burden on the accused to satisfactorily explain and account for the
assets found to be possessed by the public servant. This burden is
on the accused as the said facts are within his special
knowledge. Section 106 of the Evidence act applies. The explanation
to Section 13(1)(e) is a procedural Section which seeks to define the
expression "known sources of income" as sources known to the
prosecution and not to the accused. The explanation applies and
relates to the mode and manner of investigation to be conducted by
the prosecution, it does away with the requirement and necessity of
the prosecution to have an open, wide and rowing investigation and
enquire into the alleged sources of income which the accused may
have. It curtails the need and necessity of the prosecution to go into
the alleged sources of income which a public servant may or possibly
have but are not legal or have not been declared. The undeclared
41
alleged sources are by their very nature are expected to be known to
the accused only and are within his special knowledge. The effect of
the explanation is to clarify and reinforce the existing position and
understanding of the expression "known sources of income" i.e. the
expression refers to sources known to the prosecution and not
sources known to the accused. The second part of the explanation
does away with the need and requirement for the prosecution to
conduct an open ended or rowing enquiry or investigation to find out
all alleged/claimed known sources of income of an accused who is
investigated under the PC Act, 1988. The prosecution can rely upon
the information furnished by the accused to the authorities under
law, rules and orders for the time being applicable to a public servant.
No further investigation is required by the prosecution to find out the
known sources of income of the accused public servant. As noticed
above, the first part of the explanation refers to income received from
legal/lawful sources. This first part of the expression states the
obvious as is clear from the judgment of this Court in N.
Ramakrishnaiah (supra). (Emphasis supplied)
42. Thus, it is evident from the aforesaid that the expression
“known source of income” is not synonymous with the words “for
42
which the public servant cannot satisfactorily account.” The two
expressions connote and have different meaning, scope and
requirements.
43. In the case of Central Bureau of Investigation (CBI) and Anr.
v. Thommandru Hannah Vijayalakshmi @ T.H. Vijayalakshmi
and Anr., reported in 2021 SCC OnLine SC 923, this Court, after an
exhaustive review of its various other decisions, more particularly the
decision in the case of K. Veeraswami v. Union of India, (1991) 3
SCC 655, held that since the accused public servant does not have a
right to be afforded a chance to explain the alleged Disproportionate
Assets to the investigating officer before the filing of a chargesheet, a
similar right cannot be granted to the accused before the filing of an
FIR by making a preliminary inquiry mandatory.
44. The above decision of this Court in the case of Thommandru
Hannah Vijayalakshmi @ T.H. Vijayalakshmi (supra) is a direct
answer to the contention raised on behalf of the accused persons that
the investigating officer wrongly declined to consider the explanation
offered by the public servant in regard to the allegations and also
failed to take into consideration the assets lawfully acquired by his
wife.
43
45. In K. Veeraswami (supra), this Court held thus:-
“75…since the legality of the charge-sheet has been
impeached, we will deal with that contention also.
Counsel laid great emphasis on the expression ―for
which he cannot satisfactorily account ― used in clause
(e) of Section 5(1) of the Act. He argued that that term
means that the public servant is entitled to an
opportunity before the Investigating Officer to explain the
alleged disproportionality between assets and the
known sources of income. The Investigating Officer is
required to consider his explanation and the chargesheet filed by him must contain such averment. The
failure to mention that requirement would vitiate the
charge-sheet and renders it invalid. This submission, if
we may say so, completely overlooks the powers of the
Investigating Officer. The Investigating Officer is only
required to collect material to find out whether the
offence alleged appears to have been committed. In the
course of the investigation, he may examine the accused.
He may seek his clarification and if necessary, he may
cross check with him about his known sources of income
and assets possessed by him. Indeed, fair investigation
requires as rightly stated by Mr. A.D. Giri, learned
Solicitor General, that the accused should not be kept in
darkness. He should be taken into confidence if he is
willing to cooperate. But to state that after collection of
all material the Investigating Officer must give an
opportunity to the accused and call upon him to account
for the excess of the assets over the known sources of
income and then decide whether the accounting is
satisfactory or not, would be elevating the Investigating
Officer to the position of an enquiry officer or a judge. The
Investigating Officer is not holding an enquiry against
the conduct of the public servant or determining the
disputed issues regarding the disproportionality
between the assets and the income of the accused. He
44
just collects material from all sides and prepares a report
which he files in the court as charge-sheet.”
 (Emphasis supplied)
46. The second contention canvassed on behalf of the accused
persons that every bit of information in regard to the assets had been
intimated to the Income Tax Authorities and the documents in regard
to the same should be sufficient to exonerate the accused persons
from the charges is without any merit. In other words, the contention
that the High Court rightly took into consideration the aforesaid for
the purpose of discharging the accused persons from the prosecution
is without any merit and erroneous more particularly in view of the
decision of this Court in the case of Thommandru Hannah
Vijayalakshmi @ T.H. Vijayalakshmi (supra). This Court has
observed in paras 58, 60 & 61 resply as under:-
“58. On the other hand, it has been argued on behalf of
the appellant that the documents relied upon by the
respondents are not unimpeachable and have to be
proved at the stage of trial. Hence, it was urged that the
arguments made on the basis of these documents should
not be accepted by this Court. The appellant has relied
upon the judgment of a two Judge Bench of this Court in
J. Jayalalitha (supra), where it has been held that
documents such as Income Tax Returns cannot be relied
upon as conclusive proof to show that the income is from
a lawful source under the PC Act. Justice P C Ghose held
thus:
45
“191. Though considerable exchanges had been made in
course of the arguments, centering around Section 43 of
the Evidence Act, 1872, we are of the comprehension
that those need not be expatiated in details. Suffice it to
state that even assuming that the income tax returns, the
proceedings in connection therewith and the decisions
rendered therein are relevant and admissible in
evidence as well, nothing as such, turns thereon
definitively as those do not furnish any guarantee or
authentication of the lawfulness of the source(s) of
income, the pith of the charge levelled against the
respondents. It is the plea of the defence that the income
tax returns and orders, while proved by the accused
persons had not been objected to by the prosecution and
further it (prosecution) as well had called in evidence the
income tax returns/orders and thus, it cannot object to
the admissibility of the records produced by the defence.
To reiterate, even if such returns and orders are
admissible, the probative value would depend on the
nature of the information furnished, the findings
recorded in the orders and having a bearing on the
charge levelled. In any view of the matter, however, such
returns and orders would not ipso facto either
conclusively prove or disprove the charge and can at best
be pieces of evidence which have to be evaluated along
with the other materials on record. Noticeably, none of
the respondents has been examined on oath in the case
in hand. Further, the income tax returns relied upon by
the defence as well as the orders passed in the
proceedings pertaining thereto have been filed/passed
after the chargesheet had been submitted. Significantly,
there is a charge of conspiracy and abetment against the
accused persons. In the overall perspective therefore
neither the income tax returns nor the orders passed in
the proceedings relatable thereto, either definitively
attest the lawfulness of the sources of income of the
accused persons or are of any avail to them to
satisfactorily account the disproportionateness of their
pecuniary resources and properties as mandated by
46
Section 13(1)(e) of the Act. In Vishwanath Chaturvedi (3)
v. Union of India [Vishwanath Chaturvedi (3) v. Union of
India, (2007) 4 SCC 380 : (2007) 2 SCC (Cri) 302] , a writ
petition was filed under Article 32 of the Constitution of
India seeking an appropriate writ for directing the Union
of India to take appropriate action to prosecute R-2 to R5 under the 1988 Act for having amassed assets
disproportionate to the known sources of income by
misusing their power and authority. The respondents
were the then sitting Chief Minister of U.P. and his
relatives. Having noticed that the basic issue was with
regard to alleged investments and sources of such
investments, Respondents 2 to 5 were ordered by this
Court to file copies of income tax and wealth tax returns
of the relevant assessment years which was done. It
was pointed out on behalf of the petitioner that the net
assets of the family though were Rs 9,22,72,000, as per
the calculation made by the official valuer, the then value
of the net assets came to be Rs 24 crores. It was pleaded
on behalf of the respondents that income tax returns had
already been filed and the matters were pending before
the authorities concerned and all the payments were
made by cheques, and thus the allegation levelled
against them were baseless. It was observed that the
minuteness of the details furnished by the parties and
the income tax returns and assessment orders, sale
deeds, etc. were necessary to be carefully looked into
and analyzed only by an independent agency with the
assistance of chartered accountants and other
accredited engineers and valuers of the property. It was
observed that the Income Tax Department was
concerned only with the source of income and whether
the tax was paid or not and, therefore, only an
independent agency or CBI could, on court direction,
determine the question of disproportionate assets. CBI
was thus directed to conduct a preliminary enquiry into
the assets of all the respondents and to take further
action in the matter after scrutinizing as to whether a
case was made out or not. This decision is to emphasize
47
that submission of income tax returns and the
assessments orders passed thereon, would not
constitute a foolproof defence against a charge of
acquisition of assets disproportionate to the known
lawful sources of income as contemplated under the PC
Act and that further scrutiny/analysis thereof is
imperative to determine as to whether the offence as
contemplated by the PC Act is made out or not.
x x x x x
60. At the very outset, we must categorically hold that
the documents which have been relied upon by the
respondents cannot form the basis of quashing the FIR.
The value and weight to be ascribed to the documents is
a matter of trial. Both the parties have cited previous
decisions of two Judge Benches of this Court in order to
support their submissions. There is no clash between the
decisions in Kedari Lal (supra) and J. Jayalalitha (supra)
for two reasons: (i) the judgment in J. Jayalalitha (supra)
notes that a document like the Income Tax Return, by
itself, would not be definitive evidence in providing if
the ―source of one‘s income was lawful since the Income
Tax Department is not responsible for investigating that,
while the facts in the judgment in Kedari Lal (supra) were
such that the ―source of the income was not in question
at all and hence, the Income Tax Returns were relied
upon conclusively; and (ii) in any case, the decision in
Kedari Lal (supra) was delivered while considering a
criminal appeal challenging a conviction under the PC
Act, while the present matter is at the stage of quashing
of an FIR.
61. In the present case, the appellant is challenging the
very ―source of the respondents‘ income and the
questioning the assets acquired by them based on such
income. Hence, at the stage of quashing of an FIR where
the Court only has to ascertain whether the FIR prima
facie makes out the commission of a cognizable offence,
48
reliance on the documents produced by the respondents
to quash the FIR would be contrary to fundamental
principles of law. The High Court has gone far beyond
the ambit of its jurisdiction by virtually conducting a trial
in an effort to absolve the respondents.”
(Emphasis supplied)
47. Now, the reason why we say that the impugned orders passed
by the High Court are utterly incomprehensible is because the High
Court has not been able to comprehend the true scope and ambit of
Section 239 of the CrPC. The High Court has also not been able to
comprehend in what set of circumstances the revisional powers
under Section 397 read with Section 401 of the CrPC are to be
exercised.
48. We have gathered an impression that the High Court seems to
be labouring under a serious mis-conception of law as is evident from
the two impugned orders and such erroneous mis-conceptions need
to be eradicated.
49. The learned counsel appearing for the State rightly submitted
that at the stage of consideration of discharge under Section 239 of
the CrPC only a prima facie case is to be seen and the Special Court
having recorded a satisfaction with regard to the existence of a prima
facie case there cannot be said to be any material error or illegality
49
in the orders assailed before the High Court.
50. The procedure for trial of warrant cases by Magistrate is
provided for under Chapter XIX of the CrPC and Sections 239 and
240 resply relate to discharge and framing of charge.
51. The primary consideration at the stage of framing of charge is
the test of existence of a prima facie case, and at this stage, the
probative value of materials on record is not to be gone into.
52. The provisions which deal with the question of framing of charge
or discharge, relatable to: (i) a sessions trial or, (ii) a trial of warrant
case, or (iii) a summons case, are contained in three pairs of Sections
under the CrPC. These are Sections 227 and 228 resply in so far as,
the sessions trial is concerned; Sections 239 and 240 resply relatable
to the trial of warrant cases; and Sections 245(1) and 245(2) resply
in respect of summons case. The relevant provisions read as follows:-
“Section 227. Discharge - If, upon consideration of the
record of the case and the documents submitted
therewith, and after hearing the submissions of the
accused and the prosecution in this behalf, the Judge
considers that there is not sufficient ground for proceeding
against the accused, he shall discharge the accused and
record his reasons for so doing.
Section 228. Framing of charge.—(1) If, after such
consideration and hearing as aforesaid, the Judge is of
50
opinion that there is ground for presuming that the
accused has committed an offence which—
(a) is not exclusively triable by the Court of Session,
he may, frame a charge against the accused and,
by order, transfer the case for trial to the Chief
Judicial Magistrate, or any other Judicial
Magistrate of the first class and direct the accused
to appear before the Chief Judicial Magistrate, or,
as the case may be, the Judicial Magistrate of the
first class, on such date as he deems fit, and
thereupon such Magistrate shall try the offence in
accordance with the procedure for the trial of
warrant-cases instituted on a police report;
(b) is exclusively triable by the Court, he shall frame
in writing a charge against the accused.
(2) Where the Judge frames any charge under clause
(b) of subsection (1), the charge shall be read and
explained to the accused, and the accused shall be
asked whether he pleads guilty of the offence
charged or claims to be tried.
Section 239. When accused shall be discharged.—If,
upon considering the police report and the documents
sent with it under Section 173 and making such
examination, if any, of the accused as the Magistrate
thinks necessary and after giving the prosecution and the
accused an opportunity of being heard, the Magistrate
considers the charge against the accused to be
groundless, he shall discharge the accused, and record
his reasons for so doing.
Section 240. Framing of charge.—(1) If, upon such
consideration, examination, if any, and hearing, the
Magistrate is of opinion that there is ground for presuming
that the accused has committed an offence triable under
this Chapter, which such Magistrate is competent to try
51
and which, in his opinion, could be adequately punished
by him, he shall frame in writing a charge against the
accused.
(2) The charge shall then be read and explained to the
accused, and he shall be asked whether he pleads guilty
of the offence charged or claims to be tried.
Section 245. When accused shall be discharged.—(1)
If, upon taking all the evidence referred to in Section 244,
the Magistrate considers, for reasons to be recorded, that
no case against the accused has been made out which, if
unrebutted, would warrant his conviction, the Magistrate
shall discharge him.
(2) Nothing in this section shall be deemed to prevent a
Magistrate from discharging the accused at any previous
stage of the case if, for reasons to be recorded by such
Magistrate, he considers the charge to be groundless.”
53. The aforestated Sections indicate that the CrPC contemplates
discharge of the accused by the Court of Sessions under Section 227
in a case triable by it, cases instituted upon a police report are
covered by Section 239 and cases instituted otherwise than on a
police report are dealt with in Section 245. The three Sections contain
somewhat different provisions in regard to discharge of the accused.
As per Section 227, the trial judge is required to discharge the
accused if “the Judge considers that there is not sufficient ground
for proceeding against the accused”. The obligation to discharge the
accused under Section 239 arises when “the Magistrate considers the
52
charge against the accused to be groundless”. The power to discharge
under Section 245(1) is exercisable when “the Magistrate considers,
for reasons to be recorded, that no case against the accused has been
made out which, if unrebutted would warrant his conviction”.
Sections 227 and 239 resply provide for discharge being made before
the recording of evidence and the consideration as to whether the
charge has to be framed or not is required to be made on the basis of
the record of the case, including the documents and oral hearing of
the accused and the prosecution or the police report, the documents
sent along with it and examination of the accused and after affording
an opportunity to the parties to be heard. On the other hand, the
stage for discharge under Section 245 is reached only after the
evidence referred to in Section 244 has been taken.
54. Despite the slight variation in the provisions with regard to
discharge under the three pairs of Sections referred to above, the
settled legal position is that the stage of framing of charge under
either of these three situations, is a preliminary one and the test of
“prima facie” case has to be applied — if the trial court is satisfied
that a prima facie case is made out, charge has to be framed.
53
55. The nature of evaluation to be made by the court at the stage of
framing of charge came up for consideration of this Court in Onkar
Nath Mishra and others v. State (NCT of Delhi) and another,
(2008) 2 SCC 561, and referring to its earlier decisions in the State
of Maharashtra v. Som Nath Thapa, (1996) 4 SCC 659, and the
State of M.P. v. Mohanlal Soni, (2000) 6 SCC 338, it was held that
at that stage, the Court has to form a presumptive opinion as to the
existence of the factual ingredients constituting the offence alleged
and it is not expected to go deep into the probative value of the
materials on record. The relevant observations made in the judgment
are as follows:-
"11. It is trite that at the stage of framing of charge the
court is required to evaluate the material and documents
on record with a view to finding out if the facts emerging
therefrom, taken at their face value, disclosed the
existence of all the ingredients constituting the alleged
offence. At that stage, the court is not expected to go deep
into the probative value of the material on record. What
needs to be considered is whether there is a ground for
presuming that the offence has been committed and not a
ground for convicting the accused has been made out. At
that stage, even strong suspicion founded on material
which leads the court to form a presumptive opinion as to
the existence of the factual ingredients constituting the
offence alleged would justify the framing of charge
against the accused in respect of the commission of that
offence.”
54
56. Then again in the case of Som Nath Thapa (supra), a threeJudge Bench of this Court, after noting the three pairs of Sections
i.e. (i) Sections 227 and 228 resply in so far as the sessions trial is
concerned; (ii) Sections 239 and 240 resply relatable to the trial of
warrant cases; and (iii) Sections 245(1) and (2) qua the trial of
summons cases, which dealt with the question of framing of charge
or discharge, stated thus: (SCC p. 671, para 32).
"32...if on the basis of materials on record, a court could
come to the conclusion that commission of the offence is a
probable consequence, a case for framing of charge exists.
To put it differently, if the court were to think that the
accused might have committed the offence it can frame
the charge, though for conviction the conclusion is
required to be that the accused has committed the offence.
It is apparent that at the stage of framing of a charge,
probative value of the materials on record cannot be gone
into; the materials brought on record by the prosecution
has to be accepted as true at that stage."
57. In a later decision in Mohanlal Soni (supra), this Court,
referring to several of its previous decisions, held that: (SCC p. 342,
para 7)
"7. The crystallised judicial view is that at the stage of
framing charge, the court has to prima facie consider
whether there is sufficient ground for proceeding against
the accused. The court is not required to appreciate
evidence to conclude whether the materials produced are
sufficient or not for convicting the accused.”
55
58. Reiterating a similar view in Sheoraj Singh Ahlawat and
others v. State of Uttar Pradesh and another, (2013) 11 SCC 476,
it was observed by this Court that while framing charges the court is
required to evaluate the materials and documents on record to decide
whether the facts emerging therefrom taken at their face value would
disclose existence of ingredients constituting the alleged offence. At
this stage, the court is not required to go deep into the probative
value of the materials on record. It needs to evaluate whether there
is a ground for presuming that the accused had committed the
offence and it is not required to evaluate sufficiency of evidence to
convict the accused. It was held that the Court at this stage cannot
speculate into the truthfulness or falsity of the allegations and
contradictions & inconsistencies in the statement of witnesses
cannot be looked into at the stage of discharge.
59. In the context of trial of a warrant case, instituted on a police
report, the provisions for discharge are to be governed as per the
terms of Section 239 which provide that a direction for discharge can
be made only for reasons to be recorded by the court where it
considers the charge against the accused to be groundless. It would,
therefore, follow that as per the provisions under Section 239 what
56
needs to be considered is whether there is a ground for presuming
that the offence has been committed and not that a ground for
convicting the accused has been made out. At that stage, even strong
suspicion founded on material which leads the Court to form a
presumptive opinion as to the existence of the factual ingredients
constituting the offences alleged would justify the framing of charge
against the accused in respect of that offence, and it is only in a case
where the Magistrate considers the charge to be groundless, he is to
discharge the accused after recording his reasons for doing so.
60. Section 239 envisages a careful and objective consideration of
the question whether the charge against the accused is groundless
or whether there is ground for presuming that he has committed an
offence. What Section 239 prescribes is not, therefore, an empty or
routine formality. It is a valuable provision to the advantage of the
accused, and its breach is not permissible under the law. But if the
Judge, upon considering the record, including the examination, if
any, and the hearing, is of the opinion that there is "ground for
presuming" that the accused has committed the offence triable under
the chapter, he is required by Section 240 to frame in writing a
charge against the accused. The order for the framing of the charge
57
is also not an empty or routine formality. It is of a far-reaching
nature, and it amounts to a decision that the accused is not entitled
to discharge under Section 239, that there is, on the other hand,
ground for presuming that he has committed an offence triable under
Chapter XIX and that he should be called upon to plead guilty to it
and be convicted and sentenced on that plea, or face the trial. (See :
V.C. Shukla v. State through CBI, AIR 1980 SC 962).
61. Section 239 of the CrPC lays down that if the Magistrate
considers the charge against the accused to be groundless, he shall
discharge the accused. The word 'groundless', in our opinion, means
that there must be no ground for presuming that the accused has
committed the offence. The word 'groundless' used in Section 239 of
the CrPC means that the materials placed before the Court do not
make out or are not sufficient to make out a prima facie case against
the accused.
62. The learned author Shri Sarkar in his Criminal P.C., 5th
Edition, on page 427, has opined as:-
"The provision is the same as in S. 227, the only difference
being that the Magistrate may examine the accused, if
necessary, of also S. 245. The Magistrate shall discharge the
accused recording reasons, if after (i) considering the police
58
report and documents mentioned in S. 173; (ii) examining the
accused, if necessary and (iii) hearing the arguments of both
sides he thinks the charge against him to be groundless, i.e.,
either there is no legal evidence or that the facts do not make
out any offence at all."
63. In short, it means that if no prima facie case regarding the
commission of any offence is made out, it would amount to a charge
being groundless.
64. In Century Spinning and Manufacturing Co. Ltd. v. State
of Maharashtra, AIR 1972 SC 545, this Court has stated about the
ambit of Section 251(A)(2) of the CrPC 1898, which is in pari materia
with the wordings used in Section 239 of the CrPC as follows:-
"It cannot be said that the Court at the stage of framing the
charge has not to apply its judicial mind for considering
whether or not there is a ground for presuming the
commission of the offence by the accused. The order framing
the charges does substantially affect the person's liberty and
it cannot be said that the Court must automatically frame the
charge merely because the prosecuting authorities by relying
on the documents referred to in S. 173 consider it proper to
institute the case. The responsibility of framing the charges
is that of the Court and it has to judicially consider the
question of doing so. Without fully adverting to the material
on the record it must not blindly adopt the decision of the
prosecution."
In para 15, this Court has stated as:-
"Under sub-sec. (2), if upon consideration of all the
documents referred to in S. 173, Criminal P.C. and
examining the accused, if considered necessary by the
59
Magistrate and also after hearing both sides, the
Magistrate considers the charge to be groundless, he must
discharge the accused. This sub-section has to be read
along with sub- sec. (3), according to which, if after hearing
the arguments and hearing the accused, the Magistrate
thinks that there is ground for presuming that the accused
has committed an offence triable under Chap. XXI of the
Code within the Magistrate's competence and for which he
can punish adequately, he has to frame in writing a charge
against the accused. Reading the two sub-sections
together, it clearly means that if there is no ground for
presuming that the accused has committed an offence, the
charges must be considered to be groundless, which is the
same thing as saying that there is no ground for framing
the charges." (Emphasis supplied)
65. Thus the word 'groundless', as interpreted by this Court, means
that there is no ground for presuming that the accused has
committed an offence.
66. This Court has again dealt with this aspect of the matter in
Superintendent and Remembrancer of Legal Affairs, West
Bengal v. Anil Kumar Bhunja, AIR 1980 SC 52. This Court has
stated in the said case as:-
"At this stage, even a very strong suspicion found upon
materials before the Magistrate, which leads him to form
a presumptive opinion as to the existence of the factual
ingredients constituting the offence alleged, may justify
the framing of charges against the accused in respect of
the commission of that offence."
60
67. The suspicion referred to by this Court must be founded upon
the materials placed before the Magistrate which leads him to form a
presumptive opinion as to the existence of the factual ingredients
constituting the offence alleged. Therefore, the words "a very strong
suspicion" used by this Court must not be a strong suspicion of a
vacillating mind of a Judge. That suspicion must be founded upon
the materials placed before the Magistrate which leads him to form a
presumptive opinion about the existence of the factual ingredients
constituting the offence alleged.
68. Section 239 has to be read along with Section 240 of the CrPC.
If the Magistrate finds that there is prima facie evidence or the
material against the accused in support of the charge (allegations),
he may frame charge in accordance with Section 240 of the CrPC.
But if he finds that the charge (the allegations or imputations) made
against the accused does not make out a prima facie case and does
not furnish basis for framing charge, it will be a case of charge being
groundless, so he has no option but to discharge the accused. Where
the Magistrate finds that taking cognizance of the offence itself was
61
contrary to any provision of law, like Section 468 of the CrPC, the
complaint being barred by limitation, so he cannot frame the charge,
he has to discharge the accused. Indeed, in a case where the
Magistrate takes cognizance of an offence without taking note of
Section 468 of the CrPC, the most appropriate stage at which the
accused can plead for his discharge is the stage of framing the
charge. He need not wait till completion of trial. The Magistrate will
be committing no illegality in considering that question and
discharging the accused at the stage of framing charge if the facts so
justify.
69. The real test for determining whether the charge should be
considered groundless under Section 239 of the CrPC is that whether
the materials are such that even if unrebutted make out no case
whatsoever, the accused should be discharged under Section 239 of
the CrPC. The trial court will have to consider, whether the materials
relied upon by the prosecution against the applicant herein for the
purpose of framing of the charge, if unrebutted, make out any case
at all.
62
70. The provisions of discharge under Section 239 of the CrPC fell
for consideration of this Court in K. Ramakrishna and others v.
State of Bihar and another, (2000) 8 SCC 547, and it was held that
the questions regarding the sufficiency or reliability of the evidence
to proceed further are not required to be considered by the trial court
under Section 239 and the High Court under Section 482. It was
observed as follows:-
“4. The trial court under Section 239 and the High Court
under Section 482 of the Code of Criminal Procedure is not
called upon to embark upon an inquiry as to whether
evidence in question is reliable or not or evidence relied
upon is sufficient to proceed further or not. However, if
upon the admitted facts and the documents relied upon
by the complainant or the prosecution and without
weighing or sifting of evidence, no case is made out, the
criminal proceedings instituted against the accused are
required to be dropped or quashed. As observed by this
Court in Rajesh Bajaj v. State NCT of Delhi, [1999 (3) SCC
259] the High Court or the Magistrate are also not
supposed to adopt a strict hypertechnical approach to
sieve the complaint through a colander of finest gauzes
for testing the ingredients of offence with which the
accused is charge. Such an endeavour may be justified
during trial but not during the initial stage.”
63
71. In the case of State by Karnataka Lokayukta, Police
Station, Bengaluru v. M.R. Hiremath, (2019) 7 SCC 515, this Court
observed and held in paragraph 25 as under:-
“25. The High Court ought to have been cognizant of the fact
that the trial court was dealing with an application for
discharge under the provisions of Section 239 CrPC. The
parameters which govern the exercise of this jurisdiction have
found expression in several decisions of this Court. It is a
settled principle of law that at the stage of considering an
application for discharge the court must proceed on the
assumption that the material which has been brought on the
record by the prosecution is true and evaluate the material in
order to determine whether the facts emerging from the
material, taken on its face value, disclose the existence of the
ingredients necessary to constitute the offence. In State of T.N.
v. N. Suresh Rajan [State of T.N. v. N. Suresh Rajan, (2014) 11
SCC 709, adverting to the earlier decisions on the subject, this
Court held: (SCC pp. 721-22, para 29)
“29. … At this stage, probative value of the materials
has tobe gone into and the court is not expected to go
deep into the matter and hold that the materials would
not warrant a conviction. In our opinion, what needs to
be considered is whether there is a ground for
presuming that the offence has been committed and not
whether a ground for convicting the accused has been
made out. To put it differently, if the court thinks that
the accused might have committed the offence on the
basis of the materials on record on its probative value,
it can frame the charge; though for conviction, the court
has to come to the conclusion that the accused has
committed the law does not permit a mini trial at this
stage.””
64
72. The ambit and scope of exercise of power under Sections 239
and 240 of the CrPC, are therefore fairly well settled. The obligation
to discharge the accused under Section 239 arises when the
Magistrate considers the charge against the accused to be
"groundless". The Section mandates that the Magistrate shall
discharge the accused recording reasons, if after (i) considering the
police report and the documents sent with it under Section 173, (ii)
examining the accused, if necessary, and (iii) giving the prosecution
and the accused an opportunity of being heard, he considers the
charge against the accused to be groundless, i.e., either there is no
legal evidence or that the facts are such that no offence is made out
at all. No detailed evaluation of the materials or meticulous
consideration of the possible defences need be undertaken at this
stage nor any exercise of weighing materials in golden scales is to be
undertaken at this stage - the only consideration at the stage of
Section 239/240 is as to whether the allegation/charge is
groundless.
73. This would not be the stage for weighing the pros and cons of
all the implications of the materials, nor for sifting the materials
placed by the prosecution- the exercise at this stage is to be confined
65
to considering the police report and the documents to decide whether
the allegations against the accused can be said to be “groundless”.
74. The word "ground" according to the Black's Law Dictionary
connotes foundation or basis, and in the context of prosecution in a
criminal case, it would be held to mean the basis for charging the
accused or foundation for the admissibility of evidence. Seen in the
context, the word "groundless" would connote no basis or foundation
in evidence. The test which may, therefore, be applied for determining
whether the charge should be considered groundless is that where
the materials are such that even if unrebutted, would make out no
case whatsoever.
SPOPE OF EXCERICSE OF REVISIONAL POWER AT THE STAGE
OF CHARGE
75. In Munna Devi v. State of Rajasthan & Anr., (2001) 9 SCC
631, this Court held as under:-
"3.....The revision power under the Code of Criminal
Procedure cannot be exercised in a routine and casual
manner. While exercising such powers the High Court has no
authority to appreciate the evidence in the manner as the trial
and the appellate courts are required to do. Revisional
powers could be exercised only when it is shown that there
is a legal bar against the continuance of the criminal
proceedings or the framing of charge or the facts as stated in
the first information report even if they are taken at the face
66
value and accepted in their entirety do not constitute the
offence for which the accused has been charged."
76. Thus, the revisional power cannot be exercised in a casual or
mechanical manner. It can only be exercised to correct manifest error
of law or procedure which would occasion injustice, if it is not
corrected. The revisional power cannot be equated with appellate
power. A revisional court cannot undertake meticulous examination
of the material on record as it is undertaken by the trial court or the
appellate court. This power can only be exercised if there is any legal
bar to the continuance of the proceedings or if the facts as stated in
the charge-sheet are taken to be true on their face value and accepted
in their entirety do not constitute the offence for which the accused
has been charged. It is conferred to check grave error of law or
procedure.
77. This Court in Asian Resurfacing of Road Agency Pvt. Ltd. v.
Central Bureau of Investigation, (2018) 16 SCC 299, has held that
interference in the order framing charges or refusing to discharge is
called for in the rarest of rare case only to correct the patent error of
jurisdiction.
67
78. The High Court has acted completely beyond the settled
parameters, as discussed above, which govern the power to discharge
the accused from the prosecution. The High Court could be said to
have donned the role of a chartered accountant. This is exactly what
this Court observed in the case of Thommandru Hannah
Vijayalakshmi @ T.H. Vijayalakshmi (supra). The High Court has
completely ignored that it was not at the stage of trial or considering
an appeal against a verdict in a trial. The High Court has enquired
into the materials produced by the accused persons, compared with
the information complied by the investigation agency and
pronounced a verdict saying that the explanation offered by the
accused persons deserves to be accepted applying the doctrine of
preponderance of probability. This entire exercise has been justified
on account of the investigating officer not taking into the explanation
offered by the public servant and also not taking into consideration
the lawful acquired assets of the wife of the public servant i.e. the
Respondent No. 2 herein.
79. By accepting the entire evidence put forward by the accused
persons applying the doctrine of preponderance of probability, the
case put up by the prosecution cannot be termed as “groundless”. As
68
observed by this Court in C.D.S. Swami (supra) that the accused
might have made statements before the investigating officer as to his
alleged sources of income, but the same, strictly, would not be
evidence in the case.
80. Section 13(1)(e) of the Act 1988 makes a departure from the
principle of criminal jurisprudence that the burden will always lie on
the prosecution to prove the ingredients of the offences charged and
never shifts on the accused to disprove the charge framed against
him. The legal effect of Section 13(1)(e) is that it is for the prosecution
to establish that the accused was in possession of properties
disproportionate to his known sources of income but the term
“known sources of income” would mean the sources known to the
prosecution and not the sources known to the accused and within
the knowledge of the accused. It is for the accused to account
satisfactorily for the money/assets in his hands. The onus in this
regard is on the accused to give satisfactory explanation. The accused
cannot make an attempt to discharge this onus upon him at the stage
of Section 239 of the CrPC. At the stage of Section 239 of the CrPC,
the Court has to only look into the prima facie case and decide
whether the case put up by the prosecution is groundless.
69
81. In the overall view of the matter, we are convinced that the
impugned orders passed by the High Court are not sustainable in
law and deserve to be set aside. The circumstances emerging from
the record of the case, prima facie, indicate the involvement of the
accused persons in the alleged offence. Having regard to the
materials on record, it cannot be said that the charge against the
accused persons is groundless. There are triable issues in the matter.
If there are triable issues, the Court is not expected to go into the
veracity of the rival versions.
82. In the result, both the appeals succeed and are hereby allowed.
The impugned orders passed by the High Court discharging the
accused persons from the prosecution are hereby set aside. The
Special Court shall now proceed to frame charge against the accused
persons in accordance with law and put them to trial.
83. It is clarified that the observations made by this Court in this
judgment shall not be construed as final expressions of the innocence
or guilt of the accused persons. The guilt or innocence of the accused
persons shall be determined by the trial court on the basis of the
evidence that may be led by both the prosecution and the defence.
We have confined our adjudication only to consider the legality and
70
validity of the impugned orders passed by the High Court discharging
the accused persons.
84. Pending application, if any, also stands disposed of.
…………………………………….J.
(DINESH MAHESHWARI]
…………………………………….J.
(J.B. PARDIWALA)
NEW DELHI;
SEPTEMBER 5, 2022

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